Rise of the Super Rich & Fall of the World’s Poor

Michael Bloomberg, the three-term Mayor of New York city and a billionaire philanthropist, was once quoted as saying that by the time he dies, he would have given away all his wealth to charity – so that his cheque to the funeral undertaker will bounce for lack of funds in his bank account.

Sounds altruistic – even as the number of billionaires keep rising while the poorest of the world’s poor keep multiplying.

The latest brief by Oxfam International, titled “Profiting from Pain” and released May 23, shows that 573 people became new billionaires during the two-and-a half-year Covid 19 pandemic —while the world’s poverty stricken continued to increase.

“We expect this year that 263 million more people will crash into extreme poverty, at a rate of a million people every 33 hours,” Oxfam said.

Billionaires’ wealth has risen more in the first 24 months of COVID-19 than in 23 years combined. The total wealth of the world’s billionaires is now equivalent to 13.9 percent of global GDP. This is a three-fold increase (up from 4.4 percent) in 2000, according to the study.

Asked about the philanthropic gestures, Gabriela Bucher, Executive Director of Oxfam International, told IPS wealthy individuals who use their money to help others should be congratulated.

“But charitable giving is no substitute for wealthy people and companies paying their fair share of tax or ensuring their workers are paid a decent wage. And it does not justify them using their power and connections to lobby for unfair advantages over others,” she declared.

Oxfam’s new research also reveals that corporations in the energy, food and pharmaceutical sectors —where monopolies are especially common— are posting record-high profits, even as wages have barely budged and workers struggle with decades-high prices amid COVID-19.

The fortunes of food and energy billionaires have risen by $453 billion in the last two years, equivalent to $1 billion every two days, says Oxfam.

Five of the largest energy companies (BP, Shell, Total Energies, Exxon and Chevron) are together making $2,600 profit every second, and there are now 62 new food billionaires.

Currently, the world’s total population is around 7.8 billion, and according to the UN, more than 736 million people live below the international poverty line.

A World Bank report last year said extreme poverty is set to rise, for the first time in more than two decades, and the impact of the spreading virus is expected to push up to 115 million more people into poverty, while the pandemic is compounding the forces of conflict and climate change, that has already been slowing poverty reduction.

By 2021, as many as 150 million more people could be living in extreme poverty.

Yasmeen Hassan, Global Executive Director at Equality Now, told IPS Oxfam’s report demonstrates systemic failings in the discriminatory nature of countries’ economies and underscores the urgent need for financial systems to be restructured so that they benefit the 99%, not the 1%.

“As with any crisis, Equality Now foresaw that gender would influence how individuals and communities experienced the pandemic, but even we were shocked at how exceptionally and intensely pre-existing inequalities and sex-based discrimination has been exacerbated”, she said.

While billionaires — the vast majority of whom are men — continue to amass vast sums of wealth, women around the world remain trapped in poverty. Wealthy elites are profiting off women’s labor, much of which is underappreciated, underpaid, and uncompensated, she pointed out.

“Economic hardship and inadequate policy responses to the pandemic have eroded many of the hard-won gains that have been achieved over recent years for women and girls. From increases in child marriage, sexual exploitation and human trafficking, to landlords demanding sex from female tenants who have lost their job, and domestic workers trapped inside with abusive employers, women and girls around the world have borne the brunt of the pandemic,” Hassan declared.

The Oxfam study has been released to coincide with the World Economic Forum’s (WEF) annual meeting—which includes the presence of the rich and the superrich—taking place in Davos-Klosters, Switzerland from 22-26 May. The meeting, whose theme is ‘Working Together, Restoring Trust’, will be the first global in-person leadership event since the outbreak of the COVID-19 pandemic in early 2020

“Billionaires are arriving in Davos to celebrate an incredible surge in their fortunes. The pandemic, and now the steep increases in food and energy prices have, simply put, been a bonanza for them. Meanwhile, decades of progress on extreme poverty are now in reverse and millions of people are facing impossible rises in the cost of simply staying alive,” said Oxfam’s Bucher.

She said billionaires’ fortunes have not increased because they are now smarter or working harder. But it is really the workers who are working harder, for less pay and in worse conditions.

The super-rich, she argued, have rigged the system with impunity for decades and they are now reaping the benefits. They have seized a shocking amount of the world’s wealth as a result of privatization and monopolies, gutting regulation and workers’ rights while stashing their cash in tax havens — all with the complicity of governments.”

“Meanwhile, millions of others are skipping meals, turning off the heating, falling behind on bills and wondering what they can possibly do next to survive. Across East Africa, one person is likely dying every minute from hunger. This grotesque inequality is breaking the bonds that hold us together as humanity. It is divisive, corrosive and dangerous. This is inequality that literally kills.”

Elaborating further, Hassan of Equality Now said women are more likely to be informally employed, low-wage earners, and this disadvantaged position has resulted in higher rates of women losing their jobs, particularly in sectors that were not prioritized in government relief packages.

“Women are also more likely to be primary caretaker and many have had to absorb increases in unpaid duties while schools and nurseries shut down. As a consequence, some women have been forced out of jobs as they found it impossible to juggle full-time work while also providing full-time childcare. This loss of income has been especially catastrophic for women in poverty and has made them more vulnerable to a range of human rights violations.”

She said world leaders must stop pursuing policy agendas that benefit the rich and hurt the poor.

“Instead, we urgently need a committed and coordinated response from governments and policymakers to reduce inequality and poverty, and address discrimination that is holding women and girls back while allowing the super-rich to get richer still,” she added.

The Oxfam study also says the pandemic has created 40 new pharma billionaires.

Pharmaceutical corporations like Moderna and Pfizer are making $1,000 profit every second just from their monopoly control of the COVID-19 vaccine, despite its development having been supported by billions of dollars in public investments.

“They are charging governments up to 24 times more than the potential cost of generic production. 87 percent of people in low-income countries have still not been fully vaccinated.”

“The extremely rich and powerful are profiting from pain and suffering. This is unconscionable. Some have grown rich by denying billions of people access to vaccines, others by exploiting rising food and energy prices. They are paying out massive bonuses and dividends while paying as little tax as possible. This rising wealth and rising poverty are two sides of the same coin, proof that our economic system is functioning exactly how the rich and powerful designed it to do,” said Bucher.

Oxfam recommends that governments urgently:

–·Introduce one-off solidarity taxes on billionaires’ pandemic windfalls to fund support for people facing rising food and energy costs and a fair and sustainable recovery from COVID-19. Argentina adopted a one-off special levy dubbed the ‘millionaire’s tax’ and is now considering introducing a windfall tax on energy profits as well as a tax on undeclared assets held overseas to repay IMF debt. The super-rich have stashed nearly $8 trillion in tax havens.

  • — End crisis profiteering by introducing a temporary excess profit tax of 90 percent to capture the windfall profits of big corporations across all industries. Oxfam estimated that such a tax on just 32 super-profitable multinational companies could have generated $104 billion in revenue in 2020.

— Introduce permanent wealth taxes to rein in extreme wealth and monopoly power, as well as the outsized carbon emissions of the super-rich. An annual wealth tax on millionaires starting at just 2 percent, and 5 percent on billionaires, could generate $2.52 trillion a year —enough to lift 2.3 billion people out of poverty, make enough vaccines for the world, and deliver universal healthcare and social protection for everyone living in low- and lower middle-income countries.

Indian Rupee Falls To The Lowest

The Indian rupee extended its losses and touched an all-time low of 77.42 against the US dollar in early trade on Monday, May 10th.

The Indian currency is weighed by the strength of the American currency in the overseas market and continued foreign fund outflows. Further, rupee slipped on surge in crude oil prices

Foreign institutional investors were net sellers in the capital market on Friday, as they offloaded shares worth Rs 5,517.08 crore, as per stock exchange data. They have been selling equities constantly in the recent months.

Rupee has been under-pressure after global central banks started normalising policy and last week RBI too started raising key interest rates.

On Friday, the rupee had slumped 55 paise to close at 76.90 against the US dollar.

“Local units are also hit by haven dollar flows, higher global rates due to rising inflation and risk-off sentiments. Weakness in Chinese yuan, which fell to its weakest level since November 2020, also weighing on regional currencies,” said Dilip Parmar, Retail Research Analyst at HDFC Securities.

So far this year, foreign institutions have withdrawn a total of nearly $19 billion from domestic equities and debt markets, Parmar said.

Parmar sees near term depreciation in rupee could continue for a few more days with lower side limited in the range of 77.70 to 78. In the event of unwinding, the rupee could see levels of 77 to 76.70.

According to Sugandha Sachdeva, VP-Commodity and Currency Research at Religare Broking, the Indian rupee has plummeted to record lows amid the deteriorating risk sentiments and the unrelenting spree of overseas outflows from the domestic equities.

Besides, an unabated rise in the dollar index towards a two-decade high, soaring US treasury yields and crude prices, all of them have worked their way to push the domestic currency on a downward trajectory, Sachdeva told IANS.

“Markets are concerned about the spiralling inflation and prospects of an aggressive tightening path that continues to threaten the growth outlook, leading to safe-haven flows in the greenback.”

Also, hardening crude oil prices as the EU is moving ahead to impose an embargo on Russian oil are roiling the sentiments, leading to worries about the widening current account deficit and exacerbating the pressure on the domestic currency.

Going ahead, as the Indian rupee has breached the previous all-time lows of the 77.14-mark, it seems poised to witness further depreciation towards the 78-mark in the near term.

Sachdeva, however, anticipates that RBI will intervene around the 78-mark to curb excessive depreciation in the Indian currency.

According to experts, this depreciation is caused by the strength of the American currency in the overseas market and continuous foreign fund outflows from the Indian market. Some also attribute the fall of the rupee to rising crude oil prices globally due to the Russia-Ukraine crisis and the COVID induced lockdown in Shanghai.

India’s Pharma Exports Rise 103% In 8 Years

India’s pharma exports have witnessed a growth of 103 per cent since 2013-14 from Rs 90,415 crore to Rs 1,83,422 crore in 2021-22. The exports achieved in 2021-22 is the Pharma Sector’s best export performance ever and is a remarkable growth with exports growing by almost USD 10 billion in eight years, said Ministry of Commerce & Industry in a statement on Sunday.

Highlighting the achievement in a tweet, the Union Minister of Commerce and Industry Piyush Goyal said: “India’s booming drugs & pharmaceuticals exports more than double in 2021-22 compared to 2013-14. Under the active leadership of PM @NarendraModi ji, India is serving as ‘Pharmacy of the World”.

The pharma exports in 2021-22 sustained a positive growth despite the global trade disruptions and drop in demand for COVID related medicines. The trade balance continues to be in India’s favour, with a surplus of USD 15175.81 Million, said the ministry.

India ranks third worldwide for production by volume and 14th by value. Indian pharma companies have made global mark with 60 per cent of the world’s vaccines and 20 per cent of generic medicines coming from India.

The share of pharmaceutical and drugs in India’s global exports is 5.92 per cent. The formulations and biologicals continue to account for a major share of 73.31 per cent in total exports, followed by Bulk drugs and drug intermediates with exports of USD 4437.64 million. India’s top five pharma export destinations are the US, UK, South Africa, Russia and Nigeria. (IANS)

US Economy Shrinks By 1.4% In 2022 Amid Omicron Surge

The US economy shrank at an annual rate of 1.4 per cent in the first quarter as effects of the Omicron surge start to show up, the US Commerce Department reported.

The latest data marks the economy’s first contraction since the Covid-19 pandemic impacted the country in early 2020, Xinhua news agency reported.

“In the first quarter, an increase in Covid-19 cases related to the Omicron variant resulted in continued restrictions and disruptions in the operations of establishments in some parts of the country,” the department’s Bureau of Economic Analysis (BEA) said in an “advance” estimate.

The BEA noted that government assistance payments in the form of forgivable loans to businesses, grants to state and local governments, and social benefits to households “all decreased as provisions of several federal programs expired or tapered off”.

The decrease in real gross domestic product reflected declines in private inventory investment, exports, federal government spending, and state and local government spending, while imports — a subtraction in the calculation of GDP, increased, the report showed.

Personal consumption expenditures, non-residential fixed investment and residential fixed investment increased, it added.

The US economy contracted in the first quarter as inflation remained elevated at levels not seen in four decades.

The March consumer price index surged 8.5 per cent from a year earlier, the largest 12-month increase since the period ending December 1981, according to data from the Labour Department. That compared with a 7.9 per cent year-on-year gain in February.

Since the March policy meeting, a flurry of comments from US Federal Reserve officials indicated that the urgency for rate hikes is growing, and the central bank is prepared to take more aggressive actions going forward.

Diane Swonk, Chief Economist at major accounting firm Grant Thornton, noted in a recent analysis that as the Fed moves forward with more aggressive rate hikes to combat surging inflation, “what was the strongest and fastest recovery on record may soon be among the shortest.”

Even Fed Chairman Jerome Powell, who argued that soft, or at least softish landings have been relatively common in the US monetary history, noted that no one expects that bringing about a soft landing will be straightforward or easy in the current context. “It’s going to be very challenging,” Powell said.

Former US Treasury Secretary, Lawrence Summers also pointed out that in the past decades, when inflation was above 4 per cent and unemployment was below 4 per cent, the US economy usually fell into recession within two years, which means the Fed’s task would be very difficult.

“A growth recession is likely; unemployment will rise,” Swonk said, adding, “Those waiting for a recession to hire workers may find themselves without the jobs they had hoped to fill.”

Toyota To Invest $ 624 Million In India

Toyota Group plans to invest 48 billion Indian rupees ($624 million) to make electric vehicle components in India, as the Japanese carmaker works toward carbon neutrality by 2050.

Toyota Kirloskar Motor and Toyota Kirloskar Auto Parts signed a memorandum of understanding with the southern state of Karnataka to invest 41 billion Indian rupees, the group said in a statement Saturday. The rest will come from Toyota Industries Engine India.

Toyota is aligning its own green targets with India’s ambitions of becoming a manufacturing hub though the switch to clean transport in the South Asian nation is slower than other countries such as China and the U.S. Expensive price tags, lack of options in electric models and insufficient charging stations have led to sluggish adoption of battery vehicles in India.

“From a direct employment point of view, we are looking at around 3,500 new jobs,” Toyota Kirloskar executive vice president Vikram Gulati told the Press Trust of India in an interview. “As the supply chain system builds, we expect much more to come in later.”

He added that the company would be moving toward a new area of technology — electrified powertrain parts — with production set to start in the “very near-term.”

Indian automakers could generate $20 billion in revenue from electric vehicles between now and fiscal year 2026, according to forecast by Crisil. By 2040, 53% of new automobile sales in India will be electric, compared with 77% in China, according to BloombergNEF.

Gautam Adani Is World’s 5th Richest Person

Gautam Adani, the Indian infrastructure mogul, became the richest Asian billionaire in history earlier this month–and he’s kept on climbing, reported Forbes magazine.

“Adani has now passed Warren Buffett to become the 5th richest person in the world,” said Forbes, estimating that the 59-year-old Adani has a net worth of $123.7 billion, as of Friday’s market close, edging out the $121.7 billion fortune of Buffett, who is 91.

Worth $8.9 billion just two years ago, Adani’s fortune spiked to an estimated $50.5 billion in March 2021 because of his skyrocketing share prices–then nearly doubled by March 2022, to an estimated $90 billion, as Adani Group stocks rose even further, according to Forbes.

“Adani’s estimated $123.7 billion net worth makes him the richest person in India, $19 billion wealthier than the country’s number 2, Mukesh Ambani (who’s worth an estimated $104.7 billion). He surpasses Buffett as shares of the famed investor’s Berkshire Hathaway dropped by 2% on Friday amid a broad drop in the U.S. stock market,” said Forbes.

There are now only four people on the planet richer than Adani, according to Forbes’ real-time billionaire tracker: Microsoft cofounder Bill Gates (worth an estimated $130.2 billion), French luxury goods king Bernard Arnault ($167.9 billion), Amazon founder Jeff Bezos ($170.2 billion) and Tesla and SpaceX chief Elon Musk ($269.7 billion), according to Forbes.

World today has 2,668 billionaires, including 236 newcomers—far fewer than last year’s 493

Forbes’ 36th annual World’s Billionaires List, released earlier this month, reveals 2,668 billionaires, including 236 newcomers—far fewer than last year’s 493.

Elon Musk tops the World’s Billionaires ranking for the first time ever, with an estimated net worth of $219 billion. Altogether the total net worth of the world’s billionaires is $12.7 trillion, down from last year’s $13.1 trillion.

Following last year’s record-breaking number of billionaires, the past 12 months have proven to be more volatile. The number of billionaires fell to 2,668, down from 2,755 last year. A total of 329 people dropped off the list this year—the most in a single year since the 2009 financial crisis.

“The tumultuous stock market contributed to sharp declines in the fortunes of many of the world’s richest,” said Kerry A. Dolan, Assistant Managing Editor of Wealth, Forbes. “Still, more than 1,000 billionaires got wealthier over the past year. The top 20 richest alone are worth a combined $2 trillion, up from $1.8 trillion in 2021.”

Key facts for the 2022 World’s Billionaires list:

  • Top Five: Tesla’s Elon Musk tops the list, unseating Amazon founder Jeff Bezos, who drops to the No. 2 spot after spending the past four years as the richest person in the world. Bernard Arnault of LVMH remains at No. 3, followed by Bill Gates at No. 4. Rounding out the top five is Warren Buffett, who rejoins the top five after falling to No. 6 last year.
  • Newcomers: Among the list of notable newcomers are Lord of the Rings director Peter Jackson(No.1929); OpenSea founders Devin Finzer and Alex Atallah (Nos. 1397); social media and e-commerce tycoon Miranda Qu (No. 1645) and pop star and cosmetics mogul Rihanna (No. 1729).
  • Self-Made: Of the total 2,668 people on the 2022 ranking, 1,891 are self-made billionaires, who founded or cofounded a company or established their own fortune (as opposed to inheriting it).
  • Women: There are 327 women billionaires, including 16 who share a fortune with a spouse, child or sibling, down from 328 in 2021.
  • Globally: Regionally, Asia-Pacific boasts the most billionaires, with 1,088, followed by the United States, with 735, and Europe, with 592.
  • Drop-offs: The war in Ukraine, a Chinese tech crackdown and slipping stock prices pushed 329 people off the World’s Billionaires list this year, including 169 one-hit wonders who were part of last year’s record 493 newcomers.

To view the full list, visit www.forbes.com/billionaires.

The 2022 Billionaires issue features five consecutive covers, including:

  • Igor Bukhman: When Vladimir Putin invaded Ukraine, Igor Bukhman, the Russia-born billionaire founder of gaming company Playrix, found himself with thousands of employees divided by the frontlines. His internal battlefield offers lessons for us all.
  • Ken Griffin: War in Europe. The China-Russia alliance. De-dollarization. Ken Griffin, Wall Street’s billionaire kingpin, is making the best out of the worst of times.
  • Tope Awotona: Awotona built Calendly out of frustration. Now the scheduling app is worth $3 billion—and the subject of a heated Twitter spat among Silicon Valley elite.
  • Ryan Breslow: Bolt cofounder Ryan Breslow has boosted the value of his fintech to the moon by promising an Amazon-style checkout to millions of online retailers. Now the new billionaire is making a lot of noise—and some powerful enemies—challenging the tech industry’s culture and ethics.
  • Falguni Nayar: A decade ago, when she was 49, Nayar left behind her investment banking career to launch beauty-and-fashion retailer Nykaa. She took it public in November and is now India’s richest self-made woman. Nykaa, which means “one in the spotlight,” currently sells more than 4,000 brands online and in its 102 stores.

The Forbes World’s Billionaires list is a snapshot of wealth using stock prices and currency exchange rates from March 11, 2022.

US Home Prices Rose By 20% In One Year

Prices rose 19.8% year-over-year in February, an even higher rate than the 19.2% growth seen in January, according to the S&P CoreLogic Case-Shiller US National Home Price Index.

Phoenix, Tampa and Miami reported the highest year-over-year gains among the 20 US cities tracked by the index. Phoenix led the way for the 33rd consecutive month with home prices rising 32.9% from the year before. It was followed by Tampa and Miami, which saw 32.6% and 29.7% gains, respectively.

All 20 cities reported price increases in the year ending February 2022. In January, 16 cities saw year-over-year growth. Prices were strongest in the South and Southeast, but every region continued to show big gains.

“US home prices continued to advance at a very rapid pace in February,” said Craig J. Lazzara, managing director at S&P Dow Jones Indices. “That level of price growth suggests broad strength in the housing market, which is exactly what we continue to observe.”

Although Lazarra noted that rising inflation, further interest rate hikes by the Federal Reserve and rising mortgage rates may soon take the momentum out of the housing market.

The imbalance between strong demand from prospective buyers and insufficient supply of available homes has also been pushing home prices higher, said George Ratiu, manager of economic research for Realtor.com

“Today’s S&P Case-Shiller Index highlights a housing market experiencing a renewed sense of urgency in February, as buyers worked through a small number of homes for sale in an effort to get ahead of surging mortgage rates,” he said.

While inventory has increased a bit since February, according to the National Association of Realtors, there are several other changes that have taken place since then, too.

Real estate markets have seen supply-chain disruptions from the war in Ukraine. Mortgage rates have also been rising fast, climbing above 5% for the first time since 2010. In addition, a strong labor market is driving wages and inflation higher, he said.

“For buyers, the jumps in prices and mortgage rates translated into sticker shock,” said Ratiu.

For a median-priced home financed with a 30-year loan, the monthly payment is $550 higher than a year ago, he said.

But with more inventory expected to come onto the market this spring and rising mortgage rates, housing analysts are expecting to see a cool-off in demand.

“Many buyers are deciding to take a step back and re-evaluate their budgets and timelines,” said Ratiu.

Bitcoin Miners Seek Ways To Dump Fossil Fuels

For the past year a company that “mines” cryptocurrency had what seemed the ideal location for its thousands of power-thirsty computers working around the clock to verify bitcoin transactions: the grounds of a coal-fired power plant in rural Montana.

But with the cryptocurrency industry under increasing pressure to rein in the environmental impact of its massive electricity consumption, Marathon Digital Holdings made the decision to pack up its computers, called miners, and relocate them to a wind farm in Texas.

“For us, it just came down to the fact that we don’t want to be operating on fossil fuels,” said company CEO Fred Thiel.

In the world of bitcoin mining, access to cheap and reliable electricity is everything. But many economists and environmentalists have warned that as the still widely misunderstood digital currency grows in price — and with it popularity — the process of mining that is central to its existence and value is becoming increasingly energy intensive and potentially unsustainable.

The Hardin Generating Station, a coal-fired power plant that is also home to the cryptocurrency “mining” operation Big Horn Data Hub, is seen on April 20, 2022, in Hardin, Mont. Energy from burning coal is used to power thousands of computers that are kept on site to produce the digital currency known as bitcoins. (AP Photo/Matthew Brown)

Bitcoin was was created in 2009 as a new way of paying for things that would not be subject to central banks or government oversight. While it has yet to widely catch on as a method of payment, it has seen its popularity as a speculative investment surge despite volatility that can cause its price to swing wildly. In March 2020, one bitcoin was worth just over $5,000. That surged to a record of more than $67,000 in November 2021 before falling to just over $35,000 in January.

Central to bitcoin’s technology is the process through which transactions are verified and then recorded on what’s known as the blockchain. Computers connected to the bitcoin network race to solve complex mathematical calculations that verify the transactions, with the winner earning newly minted bitcoins as a reward. Currently, when a machine solves the puzzle, its owner is rewarded with 6.25 bitcoins — worth about $260,000 total. The system is calibrated to release 6.25 bitcoins every 10 minutes.

When bitcoin was first invented it was possible to solve the puzzles using a regular home computer, but the technology was designed so problems become harder to solve as more miners work on them. Those mining today use specialized machines that have no monitors and look more like a high-tech fan than a traditional computer. The amount of energy used by computers to solve the puzzles grows as more computers join the effort and puzzles are made more difficult.

Marathon Digital, for example, currently has about 37,000 miners, but hopes to have 199,000 online by early next year, the company said.

Determining how much energy the industry uses is difficult because not all mining companies report their use and some operations are mobile, moving storage containers full of miners around the country chasing low-cost power.

The Cambridge Bitcoin Electricity Consumption Index estimates bitcoin mining used about 109 terrawatt hours of electricity over the past year — close to the amount used in Virginia in 2020, according to the U.S. Energy Information Center. The current usage rate would work out to 143 TWh over a full year, or about the amount used by Ohio or New York state in 2020.

Cambridge’s estimate does not include energy used to mine other cryptocurrencies.

A key moment in the debate over bitcoin’s energy use came last spring, when just weeks after Tesla Motors said it was buying $1.5 billion in bitcoin and would also accept the digital currency as payment for electric vehicles, CEO Elon Musk joined critics in calling out the industry’s energy use and said the company would no longer be taking it as payment.

Some want the government to step in with regulation. In New York, Gov. Kathy Hochul is being pressured to declare a moratorium on the so-called proof-of-work mining method — the one bitcoin uses — and to deny an air quality permit for a project at a retrofitted coal-fired power plant that runs on natural gas.

A New York State judge recently ruled the project would not impact the air or water of nearby Seneca Lake. “Repowering or expanding coal and gas plants to make fake money in the middle of a climate crisis is literally insane,” Yvonne Taylor, vice president of Seneca Lake Guardians, said in a statement.

Anne Hedges with the Montana Environmental Information Center said that before Marathon Digital showed up, environmental groups had expected the coal-fired power plant in Hardin, Montana, to close.

“It was a death watch,” Hedges said. “We were getting their quarterly reports. We were looking at how much they were operating. We were seeing it continue to decline year after year — and last year that totally changed. It would have gone out of existence but for bitcoin.”

The cryptocurrency industry “needs to find a way to reduce its energy demand,” and needs to be regulated, Hedges said. “That’s all there is to it. This is unsustainable.”

Some say the solution is to switch from proof-of-work verification to proof-of-stake verification, which is already used by some cryptocurrencies. With proof of stake, verification of digital currency transfers is assigned to computers, rather than having them compete. People or groups that stake more of their cryptocurrency are more likely to get the work — and the reward.

While the method uses far less electricity, some critics argue proof-of-stake blockchains are less secure. Some companies in the industry acknowledge there is a problem and are committing to achieving net-zero emissions — adding no greenhouse gases to the atmosphere — from the electricity they use by 2030 by signing onto a Crypto Climate Accord, modeled after the Paris Climate Agreement.

“All crypto communities should work together, with urgency, to ensure crypto does not further exacerbate global warming, but instead becomes a net positive contributor to the vital transition to a low carbon global economy,” the accord states.

Marathon Digital is one of several companies pinning its hopes on tapping into excess renewable energy from solar and wind farms in Texas. Earlier this month the companies Blockstream Mining and Block, formerly Square, announced they were breaking ground in Texas on a small, off-the-grid mining facility using Tesla solar panels and batteries.

“This is a step to proving our thesis that bitcoin mining can fund zero-emission power infrastructure,” said Adam Back, CEO and co-founder of Blockstream.

Companies argue that cryptocurrency mining can provide an economic incentive to build more renewable energy projects and help stabilize power grids. Miners give renewable energy generators a guaranteed customer, making it easier for the projects to get financing and generate power at their full capacity.

The mining companies are able to contract for lower-priced energy because “all the energy they use can be shut off and given back to the grid at a moment’s notice,” said Thiel.

In Pennsylvania, Stronghold Digital is cleaning up hundreds of years of coal waste by burning it to create what the state classifies as renewable energy that can be sent to the grid or used in bitcoin mining, depending on power demands.

Pennsylvania’s Department of Environmental Protection is a partner in the work, which uses relatively new technology to burn the waste coal more efficiently and with fewer emissions. Left alone, piles of waste coal can catch fire and burn for years, releasing greenhouse gases. When wet, the waste coal leaches acid into area waterways.

After using the coal waste to generate electricity, what’s left is “toxicity-free fly ash,” which is registered by the state as a clean fertilizer, Stronghold Digital spokesperson Naomi Harrington said.

As Marathon Digital gradually moves its 30,000 miners out of Montana, it’s leaving behind tens of millions of dollars in mining infrastructure behind.

Just because Marathon doesn’t want to use coal-fired power anymore doesn’t mean there won’t be another bitcoin miner to take its place. Thiel said he assumes the power plant owners will find a company to do just that. “No reason not to,” he said.

Time For A Higher Poverty Line In India

The time has come for India to raise its poverty line from the existing extreme poverty line of $1.90 per person per day to the lower-middle income (LMI) poverty line of $3.20, a level some 68 percent higher. This may seem odd to aspire to in what is not even the first post-pandemic year, but that is the main message coming out of our recent IMF working paper “Pandemic, Poverty and Inequality: Evidence from India.”

No one should be surprised at this need for a higher poverty line. Per capita GDP growth in India averaged 3.5 percent per annum for twenty years from 1983 to 2003. In 2004, the official poverty line was raised by 18 percent, when the head count ratio (HCR) was 27.5 percent. Rapid growth (5.3 percent per annum) and an improved method of measurement of consumption (the modified mixed recall period (MMRP) rather than the Uniform Recall Period (URP)), resulted in the HCR reaching the low teens in 2011-12.

The poverty line should have been raised then, as Bhalla (2010) argued. Most countries change from the concept of absolute poverty to relative poverty as they get richer, and India should too. Relative poverty—subject to minor debate—is mostly chosen to mean an HCR level of around a quarter or a third of the population. Hence, the$1.90 poverty line was already too low in 2011-12 and is extremely low today.

The HCR of the $1.90 poverty line (Figure 1) has shown a steep decline since 2004—from approximately a third of the population in 2004 to less than 1.5 percent in 2019. These numbers are lower than those shown in the World Bank’s Povcal database, the most commonly used source, because Povcal does not correct for the misleading uniform recall period used or for the provision of food subsidies.

Figure 1. The poverty rate in India steeply declined starting in 2004

Source: NSS 2011-12 MMRP data; Private Final Consumption Expenditure (PFCE)  growth rates for estimates of monthly per capita consumption; authors’ calculations.

By our estimates, in the pre-pandemic year 2019, extreme poverty was already below 1 percent and despite the significant economic recession in India in 2020, we believe that the impact on poverty was small. This is because we estimate poverty (HCR) after incorporating the benefits of in-kind food (wheat and rice) subsidies for approximately 800 million individuals (75 percent of rural and 50 percent of urban residents). This food subsidy was not small and rose to close to 14 percent of the poverty line for the average subsidy recipient (Figure 2) in 2020. This was enough to contain any rise in poverty even in the pandemic year 2020.

Figure 2. Food subsidies contained any increases in poverty

Source: NSS 2011-12 MMRP data; Private Final Consumption Expenditure (PFCE)  growth rates for estimates of monthly per capita consumption; Indian poverty line very close to PPP $1.9 per capita per month; authors’ calculations.

A notable feature of the pandemic response was the provision of a free extra 5 kilograms of wheat or rice per person per month via the Pradhan Mantri Garib Kalyan Yojana (PMGKY) program plus 1 kg of pulses. This was in addition to the existing food transfers of 5 kg per capita per month of wheat or rice at subsidized prices. Total subsidized food grain in 2020 therefore amounted to 10 kg, which is the average per capita level of food (wheat and rice) consumption by Indian citizens for the last three decades.

The additional food subsidy was a pandemic-centric response. We would conjecture that a cross-country comparative study could show that this policy response was possibly the most effective in the world. Hence, the Indian experience can provide lessons for individual countries, and multilateral agencies concerned with effective redistribution of income.

Poverty measurement) in India was in 2011-12. The following survey conducted in 2017-18 generated results that have not been officially released, on the grounds that the data were not of acceptable quality. Our paper has an extensive discussion on the validity of the evidence regarding this controversial decision where we conclude that the data is indeed unreliable and of extremely questionable quality and hence should not be released. A very recent World Bank April 2022 study by Edochie et. al. suggests support for our conclusion and inference.

Our paper presents a consistent time series of poverty and (real) inequality in India for each of the years 2004-2020. Our estimate of real inequality (Figure 3) shows that consumption inequality has also declined, and in 2020 is very close to the lowest historical level of 0.28. Poverty and inequality trends can be emotive, controversial, and confusing. Consumption inequality is lower than income inequality, which itself is lower than wealth inequality. And each can show different trends. The levels and trends are different, and intermingled use should carry a warning about this when discussing “inequality.”

Our results are different than most of the commentary and analysis of poverty in India. All the estimates are made in the absence of an official survey post-2011-12. A large part of the explanation for the difference in results is because of differences in definition. Our paper makes a strong case for the acceptance of the official consumption definition (accepted by most countries and also recommended by the World Bank); it should be measured according to the classification of consumption according to the nature of the good or service consumed. This is the MMRP method for obtaining consumption expenditures.

The Indian government has officially adopted this method, and the above mentioned “ill-fated” 2017-18 survey was the first time when the National Statistical Organization exclusively measured consumption (and poverty) according to the MMRP definition.

However, many studies continue to rely on the now obsolete uniform reference period (URP or 30-day recall for all items) method. For example, a very recent World Bank study estimated the HCR to be around 10 percent in 2019; it uses the outdated (URP) definition of consumption and does not adjust for food subsidies. Incidentally, both in 2009-10 and 2011-12, the URP and MMRP poverty estimates diverged by approximately 10 percentage points, as did their respective estimates of mean consumption.

Thus, given the approximate magnitude of definition differences observed both in 2009-10 and 2011-12 and making the necessary adjustment for food subsidies, the World Bank poverty estimate for 2019 is likely to be very close to our estimate.

Inclusive growth is a very relevant policy goal for all economies. With the pandemic ebbing and the IMF’s expected growth for India rebounding very strongly for three successive years from 2021-23, Indian policymakers will soon be confronted with a policy choice—how long should they keep the extra PMGKY subsidy? This query is part of a huge success story of poverty decline. Additionally, another query pertains to whether policies should move toward targeted cash transfers instead of subsidized food grains.

In the past, the key argument in support of a policy shift to cash transfers was to reduce leakages, but our results indicate that leakages have substantially been reduced over the last decade even in the in-kind food transfer scheme. In fact, the recent food transfer program was a very successful intervention, especially during the pandemic when supply chains were breaking down and there was heightened uncertainty. Under normal circumstances, cash transfers are likely to be more efficient, and they retain broadly the same allocative outcomes as food transfers. The debate therefore now should be on the efficiency trade-offs associated with use of either in-kind or cash transfers as the key instrument of poverty alleviation.

These debates are significant given the improvement in targeting of transfers and are consistent with the objective of building a modern social security architecture in developing countries.

Accumulating all the evidence, the strong conclusion from our work is that Indian policy has effectively delivered both growth and inclusion, and in a fundamental sense has faithfully followed the Rawlsian maximin principle—maximizing the welfare of the poorest.

Biden Admn. To Decide On Student Loans In Months

White House press secretary Jen Psaki said last week that President Biden’s use of executive action to cancel some federal student loan debt is “still on the table” and that a “decision” could be made in the coming months.

Psaki made the comments during an appearance on “Pod Save America” after being pressed about past comments by White House chief of staff Ron Klain. “Yes, still on the table, still on the table,” Psaki could be heard saying to apparent cheers from the audience attending the live podcast, which was released by the platform on Friday. She then pointed to the Aug. 31 deadline for when the freeze on student loan debt payments and interest accrual is set to lapse, saying: “We have to then decide whether it’s extended.”

“Nobody’s had to pay a dollar, a cent, anything in student loans since Joe Biden has been president,” Psaki said. “And if that can help people ease the burden of costs in other parts of their lives, that’s an important thing to consider. That’s a big part of the consideration.”

Between now and the end of August, Psaki said the moratorium is “either going to be extended or we’re going to make a decision, as Ron referenced, about canceling student debt.”

White House press secretary Jen Psaki on Friday said President Biden’s use of executive action to cancel some federal student loan debt is “still on the table” and that a “decision” could be made in the coming months.

Between now and the end of August, Psaki said the current moratorium on student loan payments is “either going to be extended or we’re going to make a decision, as [White House chief of staff Ron Klain] referenced, about canceling student debt.”

Biden last extended the pause earlier this month amid mounting pressure from advocates, borrowers and members of his own party to provide further relief.

Biden during his campaign called for federal student loan debt cancellation, and supported forgiveness of at least $10,000 per borrower. However, some top Democrats have pushed for him to go beyond that, canceling up to $50,000 per borrower or wiping out federal student loan debt entirely.

The White House called on Congress to send legislation canceling debt to Biden’s desk, but Democrats are not optimistic about their chances of doing so in the 50-50 Senate given staunch GOP opposition. Sixty votes would be needed to overcome procedural hurdles.

The background: The current pause on federal student loan payments was first implemented under the Trump administration at the outset of the coronavirus pandemic. It has since been extended six times.

Biden last extended the pause earlier this month amid mounting pressure from advocates, borrowers and members of his own party to provide further relief.

World Bank Cuts India, South Asia Growth Forecast On Ukraine Crisis

Indian Prime Minister Narendra Modi speaks during the inauguration of the Samsung Electronics smartphone manufacturing facility in Noida, India, July 9, 2018. REUTERS/Adnan Abidi

NEW DELHI – The World Bank cut its economic growth forecast for India and the whole South Asian region on Wednesday, citing worsening supply bottlenecks and rising inflation risks caused by the Ukraine crisis.

The international lender lowered its growth estimate for India, the region’s largest economy, to 8% from 8.7% for the current fiscal year to March, 2023 and cut by a full percentage point the growth outlook for South Asia, excluding Afghanistan, to 6.6%.

In India, household consumption will be constrained by the incomplete recovery of the labour market from the pandemic and inflationary pressures, the bank said.

“High oil and food prices caused by the war in Ukraine will have a strong negative impact on peoples’ real incomes,” Hartwig Schafer, World Bank Vice President for South Asia, said in a statement.

The World Bank raised its growth forecast for Pakistan, the region’s second-largest economy, for the current year ending in June, to 4.3% from 3.4% and kept next year’s growth outlook unchanged at 4%.

The region’s dependence on energy imports meant high crude prices forced its economies to pivot their monetary policies to focus on inflation rather than reviving economic growth after nearly two years of pandemic restrictions.

The World Bank slashed this year’s growth forecast for Maldives to 7.6% from 11%, citing its large imports of fossil fuels and a slump in tourism arrivals from Russia and Ukraine.

It raised crisis-hit Sri Lanka’s 2022 growth forecast to 2.4% from 2.1% but warned the island’s outlook was highly uncertain due to fiscal and external imbalances.

Sri Lanka’s central bank said on Tuesday it had become “challenging and impossible” to repay external debt, as it tries to use its dwindling foreign exchange reserves to import essentials like fuel.

Recession Fears Rise As Fed Fights Inflation

As Americans feel the squeeze of rising inflation, fears are growing that a recession is around the corner.  The U.S. economy is running hot as a record stretch of job growth, steady consumer demand and intense demand for labor has helped fuel the highest inflation rate in 40 years.

While the economy has recovered far quicker than many economists expected, the speed of the rebound is putting pressure on the Federal Reserve to take more significant action to help slow price growth.

Wendy Edelberg, director of The Hamilton Project and a senior economic studies fellow at the left-leaning Brookings Institution, said the economy has been “revving” given the amount of fiscal stimulus that has been poured into the system to keep it afloat during the coronavirus pandemic.

But in order to combat the skyrocketing inflation, Edelberg and other economists say a slowdown is vital.

“So, now the question is, how smoothly does that slowdown happen?” Edelberg said. “And slowdowns can be painful. So, there’s absolutely a risk of a recession.”

The Fed’s primary tool for keeping prices stable and the job market strong is adjusting the federal funds rate. When the Fed raises or cuts its baseline interest rate range, borrowing costs for home loans, credit cards and other lending products typically move in the same direction.

When interest rates rise, consumer and business spending tends to decrease as the costs of borrowing money increase. Higher interest rates also incentivize saving, which means less immediate spending in the economy.

After slashing rates to near-zero levels amid the onset of the pandemic, the Fed in March launched a series of interest rate hikes meant to bring down soaring inflation.

The Fed hopes higher borrowing costs will slow down the economy enough to curb price growth without halting the recovery.

“Our goal is to restore price stability while fostering another long expansion and sustaining a strong labor market,” Fed Chair Jerome Powell said last month, adding the bank is aiming for the economy to achieve a “soft landing, with inflation coming down and unemployment holding steady.”

Powell, other Fed officials and some economists believe the U.S. economy is strong enough to withstand rising interest rates without falling into recession or losing jobs. The U.S. gained nearly 1.7 million jobs over the first three months of the year, consumer spending has remained strong and there are roughly two open jobs for every unemployed jobseeker.

Those confident in the Fed’s handle on inflation believe the bank can stanch inflation while only reducing job openings and the intense need for workers, rather than slowing the economy into layoffs.

Even so, the Fed is facing serious turbulence as it attempts to steer the recovery to a sustainable pace.  The war in Ukraine, the sanctions imposed on Russia and Moscow’s response has fueled rapid price increases for oil, gasoline, food, key minerals and other essential consumer goods already hit by inflation. COVID-19 shutdowns in China have also jammed up supply chains, which were already overwhelmed by consumer demand.

Dana M. Peterson, chief economist at The Conference Board, said Fed rate hikes could help reduce consumer demand for goods and services, pent-up savings, rising wages and housing market heat, but can’t do anything about supply chain dysfunction, COVID-19 shutdowns and the war.

“The supply side drivers of inflation, which includes the supply chain disruptions and also higher global commodity prices, the Fed can do very little about. Nonetheless, the Fed is going to be raising interest rates,” Peterson said during a Thursday briefing with reporters.

“I don’t know how confident the Fed is about anything, but certainly I think they’ve abandoned expectations that there’s going to be kind of a natural solution to inflation.”

Economists warn more must be done to tighten monetary policy to cool the economy, which could still mean pain in the months ahead for more Americans’ finances.

“As you slow the economy down, inflation will fall,” Ray Fair, an economics professor at Yale University, said, adding that’s how the Fed can help lower inflation. “But the cost of that, of course, is slower output growth and higher unemployment.”

And Fair, director emeritus at the National Bureau of Economic Research (NBER), said his own research suggests the Fed has “got to do quite a bit” of intervention to slow the economy.

“They’ve got to raise the interest rate, for example, more than just two percentage points, if they expect to get much lowering of inflation,” Fair said. The Fed funds rate is currently at a range of 0.25 to 0.5 percent and bank officials expect to raise it to roughly 2 percent by the end of the year.

Some economists fear inflation may be rising too quickly for the Fed to curb without raising rates so high, it halts economic growth.

In March, consumer prices shot up 1.2 percent, according to data released by the Labor Department this week. The data also found those prices had risen to 8.5 percent in the past year alone, marking the highest yearly increase in roughly four decades.

Americans saw prices go up in a variety of areas, ranging from food to gasoline and transportation, as the Ukraine-Russian war helped exacerbate the nation’s ongoing inflation problem.

Fair, whose bureau is often looked to for measuring recessions, said the NBER’s defines such an event as roughly, but not completely, “two successive quarters of negative real growth in GDP.”

Recent weeks have seen reports of institutions like Bank of America warning of recession shocks. A recent survey by The Wall Street Journal found more economists are also changing their tune on chances of a recession, finding forecasters “on average put the probability of the economy being in recession sometime in the next 12 months at 28 percent,” compared to 18 percent in January.

In an interview, Desmond Lachman, a senior fellow for the right-leaning American Enterprise Institute, said he feels a recession is likely.

“In order for [the Fed] to get the inflation out of the system, they’re going to have to tighten policy and that’s going to produce a recession,” Lachman said.

But others believe the Fed may have to contend that higher inflation could be around for a little while longer, as the central bank proceeds in slowing down the economy.

“They’re also going to have to recognize that they may not get back to a 3 percent or 2 percent (annual inflation) target anytime soon,” Peterson said, arguing such an attempt “would essentially drive the US economy into recession.”

Mortgage Rates Hit 5 Percent, Ushering In New Economic Uncertainty

Mortgage rates swelled above 5 percent for the first time in more than a decade — an unexpectedly rapid ascent that has begun to temper the U.S. housing boom and could usher new uncertainty into an economy dogged by soaring inflation.

The 30-year fixed-rate mortgage, the most popular home loan product, hit the threshold just five weeks after surpassing 4 percent, according to Freddie Mac data released Thursday. The average has not been this high since February 2011.

The run-up comes as the Federal Reserve has launched a major initiative to rein in the highest inflation in 40 years. Fed officials are betting that higher interest rates will slash inflation and recalibrate the job market. But their plan also rests on the assumption that higher rates will cool demand for housing, especially while homes themselves are in such short supply.

Low rates fueled the revival of the U.S. housing market after the Great Recession and have helped drive home prices to record levels. But after two years of hovering at historical lows, rates have been on a tear: In January, the 30-year fixed average was 3.22 percent. It was 3.04 percent a year ago. And while mortgage rates had been expected to rise, they’ve done so more quickly than many economists predicted.

“I’m not surprised that rates have hit 5 percent, but I am surprised that everyone else is surprised,” Curtis Wood, founder and chief executive of Bee, a mobile mortgage app, said via email. “If you look at historical action by the Fed in a high-rate environment and compare that to what the Fed is doing today, the Fed is underreacting to the reality of inflation in the economy.

“I’m surprised that rates aren’t at 6 percent right now,” he added, “and wouldn’t be shocked if they’re at 7 percent by end of year.”

Consumers have been absorbing higher prices in nearly every facet of their lives, with essentials such as food and gasoline spiking 8.8 percent and 48 percent, respectively, compared with last year. But higher mortgage rates can significantly limit what they can buy, or price them out altogether.

Several months ago, a home buyer would be looking to pay $1,347 a month on a $300,000 loan at 3.5 percent interest. But if the buyer had waited until this week, the same loan at 5 percent would tack on $263, bringing the monthly payment to $1,610.

The Federal Reserve’s efforts to tame inflation are driving the rise in rates. Although the Fed does not set mortgage rates, it does influence them. The central bank took its first steps toward bringing down inflation in March when it raised its benchmark rate for the first time since 2018. In addition to the federal funds rate hike, the Fed is soon to begin the process of reducing its balance sheet.

The Federal Reserve holds about $2.74 trillion in mortgage-backed securities. It indicated it will reveal its plans for reducing its holdings at its May meeting. The more aggressively the Fed sells those bonds, the faster mortgage rates are likely to rise.

The cost of housing doesn’t only weigh on buyers and sellers. It also has proved to be a major complication for the economic recovery, and potentially jeopardizes policymakers’ ability to rein in soaring inflation.

Inflation is rising at the fastest pace in 40 years, with prices climbing 8.5 percent in March compared with the year before. Shelter is a major part — roughly one third — of the basket of goods and services used to calculate inflation, or what’s known as the consumer price index. That means that if housing costs don’t meaningfully turn around soon, it will be that much harder for overall inflation to simmer down to more normal levels.

Shelter costs also stand apart from other categories, such as gas, food or plane tickets, that may be more susceptible to forces like the ongoing coronavirus pandemic, supply chain disruptions or a war. (Courtesy: https://www.msn.com/en-us/money/realestate/mortgage-rates-hit-5-percent-ushering-in-new-economic-uncertainty/ar-AAWe1XQ)

Inflation Has Risen Around The World, But The U.S. Has Seen One Of The Biggest Increases

Americans who have been to the grocery store lately or started their holiday shopping may have noticed that consumer prices have spiked. The annual rate of inflation in the United States hit 6.2% in October 2021, the highest in more than three decades, as measured by the Consumer Price Index (CPI). Other inflation metrics also have shown significant increases in recent months, though not to the same extent as the CPI.

Understanding why the rate of inflation has risen so quickly could help clarify how long the surge might last – and what, if anything, policymakers should do about it. The recent acceleration in the rate of inflation appears to be fundamentally different from other inflationary periods that were more closely tied to the regular business cycle. Explanations for the current phenomenon proffered to date include continuing disruptions in global supply chains amid the coronavirus pandemic; turmoil in the labor markets; the fact that today’s prices are being measured against prices during last year’s COVID-19-induced shutdowns; and strong consumer demand after local economies were reopened.

How we did this

At least one thing is clear: A resurgent inflation rate is by no means solely a U.S. concern. A Pew Research Center analysis of data from 46 nations finds that the third-quarter 2021 inflation rate was higher in most of them (39) than in the pre-pandemic third quarter of 2019. In 16 of these countries, including the U.S., the inflation rate was more than 2 percentage points higher last quarter than in the same period of 2019. (For this analysis, we used data from the Organization for Economic Cooperation and Development, a group of mostly highly developed, democratic countries. The data covers the 38 OECD member nations, plus eight other economically significant countries.)

At 5.3%, the U.S. had the eighth-highest annual inflation rate in the third quarter of 2021 among the 46 countries examined, narrowly edging out Poland. The increase in the U.S. inflation rate – 3.58 percentage points between the third quarter of 2019 and the third quarter of 2021 – was the third highest in the study group, behind only Brazil and Turkey, both of which have substantially higher inflation rates in general than the U.S. does.

Regardless of the absolute level of inflation in each country, many show variations on the same pattern: relatively low inflation before the COVID-19 pandemic struck in the first quarter of 2020; flat or falling inflation for the rest of that year and into 2021, as many governments sharply curtailed most economic activity; and rising inflation in the second and third quarters of this year, as the world struggled to get back to something approaching normal.

For most countries in this analysis, 2021 has marked a sharp break from what had been an unusually long period of low-to-moderate inflation. In fact, during the decade leading up to the pandemic, 34 of the 46 countries in the analysis averaged changes in inflation rates of 2.6% or lower. In 27 of these countries, inflation rates averaged less than 2%. The biggest exception was Argentina, whose economy has been plagued by high inflation and other ills for decades. The OECD has no data on Argentine inflation rates before 2018, but in the 2018-19 period it averaged 44.4%.

At the other end of the spectrum is Japan, which has struggled against persistently low inflation and periodic deflation, or falling prices, for more than two decades, mostly without success. In the first quarter of 2020, Japan’s inflation rate was running at an anemic 0.7%. It slid into deflationary territory in the last quarter of 2020 and has remained there since: Consumer prices in the third quarter of this year were 0.2% below their level in the third quarter of 2020.

A few other countries have departed from the general dip-and-surge pattern. In Iceland and Russia, for instance, inflation has risen steadily throughout the pandemic, not just in more recent months.

In Indonesia, inflation fell early on and has remained at low levels. In Mexico, the inflation rate fell slightly during the 2020 lockdown period but returned quickly, hitting 5.8% in the third quarter of 2021, the highest level since the fourth quarter of 2017. And in Saudi Arabia, the pattern was reversed: The inflation rate surged during the height of the pandemic but fell sharply in the most recent quarter, to just 0.4%.

Sundar Pichai Announces $9.5 Bn For New Offices, Data Centres In US

Alphabet and Google CEO Sundar Pichai on Wednesday announced to invest approximately $9.5 billion for new offices and data centres in the US this year, creating 12,000 new full-time jobs and thousands more among local suppliers, partners and communities.

Pichai said that Google helped provide $617 billion in economic activity for millions of American businesses, nonprofits, creators, developers and publishers last year.

“In addition, the Android app economy helped create nearly two million jobs last year, and YouTube’s creative ecosystem supported 394,000 jobs in 2020,” he informed.

In the past five years, Google has invested more than $37 billion in its offices and data centres in 26 US states, creating over 40,000 full-time jobs.

“That’s in addition to the more than $40 billion in research and development the company invested in 2020 and 2021,” said the company.

Pichai said that while it might seem counterintuitive to step up investment in physical offices even as the world embraces more flexibility in how we work.

“Yet we believe it’s more important than ever to invest in our campuses and that doing so will make for better products, a greater quality of life for our employees, and stronger communities,” the Google CEO noted.

At the same time, the investments in data centres “will continue to power the digital tools and services that help people and businesses thrive”.

“As we work towards running our offices and data centres on carbon-free energy 24/7 by 2030, we’re aiming to set new standards for green building design”.

In California, Google will continue to invest in offices and support affordable housing initiatives in the Bay Area as part of its $1 billion housing commitment. (IANS)

China Debt Traps in the New Cold War

As China increases lending to other developing countries, ‘debt trap’ charges are growing quickly. As it greatly augments financing for development while other sources continue to decline, condemnation of China’s loans is being weaponized in the new Cold War.

Debt-trap diplomacy?
The catchy term ‘debt-trap diplomacy’ was coined by Indian geo-strategist Brahma Chellaney in 2017. According to him, China lends to extract economic or political concessions when a debtor country is unable to meet payment obligations. Thus, it overwhelms poor countries with loans, to eventually make them subservient.

Unsurprisingly, his catchphrase has been popularized to demonize China. Harvard’s Belfer Center has obligingly elaborated on the rising Asian power’s nefarious geostrategic interests. Meanwhile, as with so much else, the Biden administration continues related Trump policies.

But even Western researchers generally wary of China dispute the new narrative. A London Chatham House study concluded it is simply wrong – flawed, with scant supporting evidence.

Studying China’s loan arrangements for 13,427 projects in 165 countries over 18 years, AidData – at the US-based Global Research Institute – could not find a single instance of China seizing a foreign asset following loan default.

China has been the ‘new kid on the block’ of development financing for more than a decade. Its growing loans have helped fill the yawning gap left by the decline and increasing private business orientation of financing by the global North.

Instead of tied aid pushing exports, as before, it now shamelessly promotes foreign direct investment from donor nations. Unless disbursed via multilateral institutions, China’s increased lending to support businesses abroad has not really helped developing countries cope with renewed ‘tied’ concessional aid.

Grand ‘debt trap diplomacy’ narratives make for great propaganda, but obscure debt flows’ actual impacts. Most Chinese lending is for infrastructure and productive investment projects, not donor-determined ‘policy loans’. Some countries ‘over-borrow’, but most do not. Deals can turn sour, but most apparently don’t.

While leaving less room for discretionary abuse in implementation, project lending typically puts borrowers at a disadvantage. This is largely due to the terms of sought-after foreign investment and financing, regardless of source. Hence, the outcomes of most such borrowing – not just from China – vary.

Sri Lanka
Sri Lanka’s Hambantota Port is the most frequently mentioned China debt trap case. The typical media account presumes it lent money to build the port expecting Sri Lanka to get into debt distress. China then supposedly seized it – in exchange for providing debt relief – enabling use by its navy.

But independent studies have debunked this version. Last year, The Atlantic insisted, ‘The Chinese “Debt Trap” Is a Myth’. The subtitle elaborated, “The narrative wrongfully portrays both Beijing and the developing countries it deals with”.

It elaborated: “Our research shows that Chinese banks are willing to restructure the terms of existing loans and have never actually seized an asset from any country, much less the port of Hambantota”.

The project was initiated by then President Mahindra Rajapaksa – not China or its bankers. Feasibility studies by the Canadian International Development Agency and the Danish engineering firm Rambol found it viable. The Chinese Harbour Group construction firm only got involved after the US and India both refused Sri Lankan loan requests.

Sri Lanka’s later debt crisis has been due to its structural economic weaknesses and foreign debt composition. The Chatham House report blamed it on excessive borrowing from Western-dominated capital markets – not Chinese banks.

Even the influential US Foreign Policy journal does not blame Sri Lanka’s undoubted economic difficulties on Chinese debt traps. Instead, “Sri Lanka has not successfully or responsibly updated its debt management strategies to reflect the loss of development aid that it had become accustomed to for decades”.

As the US Fed tapered ‘quantitative easing’, borrowing costs – due to Sri Lanka’s persistent balance of payment problems – rose, forcing it to seek International Monetary Fund help. Some argue borrowing even more from China is the best option available to the island republic.

To set the record straight, there was no debt-for-asset swap after Sri Lanka could no longer service its foreign debt. Instead, a Chinese state-owned enterprise leased the port for US$1.1 billion. Sri Lanka has thus boosted its foreign reserves and paid down its debt to other – mainly Western – creditors.

Also, Chinese navy vessels cannot use the port – home to Sri Lanka’s own southern naval command. “In short, the Hambantota Port case shows little evidence of Chinese strategy, but lots of evidence for poor governance on the recipient side”.

Malaysia
China has also been accused by the media of seeking influence over the Straits of Malacca, through which some 80% of its oil imports pass. Debt-trap proponents claim Beijing therefore inflated lending for Malaysia’s controversial East Coast Rail Link (ECRL).

The Chatham House report notes, “The real issue here is not one of geopolitics, but rather – as in Sri Lanka – the recipient government’s efforts to harness Chinese investment and development financing to advance domestic political agendas, reflecting both need and greed”.

ECRL was initiated by convicted former Malaysian prime minister Najib Razak. Ostensibly to develop the less developed East Coast of Peninsular Malaysia as part of China’s Belt and Road Initiative, it rejected other less costly, but much needed options.

Borrowings are far more than needed – probably for nefarious purposes. Loan terms were structured to delay repayment – to Najib’s political advantage by ‘passing the buck’ to later generations. But such abuse is by the borrower – not the lender – unless Chinese official connivance is involved.

Non-alignment for our times
There is undoubtedly much room for improving development finance, especially to achieve more sustainable development. Instead of mainly lending to the US, as before, China’s growing role can still be improved. To begin, all involved should respect the United Nations’ principles on responsible sovereign lending and borrowing.

After more than half a century of Western donors’ largely betrayed promises, China’s development finance has significantly improved ‘South-South cooperation’. Meanwhile, sustainable development finance needs – compounded by global warming, the pandemic and Ukraine war – have increased.

After decades of the West denying China commensurate voice in decision making, even under rules it made, its role on the world stage has grown. But instead of working together for the benefit of all, rich countries seem intent on demonizing it. Unsurprisingly, most developing country governments seem undeterred.

As the new Cold War and the scope of economic sanctions spread, collateral damage is undermining development finance and developing countries. To cope with the new situation, developing countries need to consider building a new non-aligned movement for our dark times.

Gautam Adani Now 6th Richest Person In World $20.6 Billion Richer Than Mukesh Ambani Of Reliance

Gautam Adani, founder and chairman of the Adani group, a conglomerate with businesses in sectors such as energy, ports, mining, edible oil and so on, with a net worth of $118 billion is now the world’s sixth-richest person, driven by a meteoric rise in the value of Adani group’s listed stocks. The 59-year-old mogul has overtaken Google’s famed founders Larry Page and Sergey Brin, according to the Bloomberg Billionaires Index.

It is important to note here in this context that Adani’s net worth soared by $8.57 billion, or about Rs 65,091 crore, due to a rise in the share prices of Adani Green Energy, Adani Enterprises, Adani Gas and Adani Transmission on Monday. While India’s benchmark indices ended the day in the red on Monday, shares of Adani Group surged up to 16 per cent.

Adani Green Energy breaks into list of top 10 most valued firms on BSE, replaces Bharti Airtel

With an almost $41.6 billion jump in his personal fortune, Gautam Adani is the world’s biggest wealth-gainer this year. Meanwhile, Reliance Industries (RIL)— India’s most valuable company—chairman Mukesh Ambani’s total wealth now stands at $97.4 billion, and he is now the 11th richest in the world, as per the latest Bloomberg billionaire ranking. So far this year, his personal wealth has increased by $7.45 billion. If we go by the Bloomberg wealth index, Adani is $20.6 billion ahead of Ambani at present, and it could be tough for the RIL boss to catch up very quickly.

The moot question is: What’s made Adani so rich, so fast? The tycoon is pushing into clean energy, airports and power plants. The mega stock market gainer that catapulted Adani to the top position is Adani Green Energy. Shares of the company soared 16.25 per cent to settle at Rs 2,701.55 apiece on BSE on Monday. It entered the list of top-10 valued companies as its market valuation zoomed over Rs 4.22 lakh crore.

For the last 14 years, Ambani has been the leader of India’s wealthiest list. The oil-to-telecom conglomerate boss was briefly dethroned by pharmaceutical tycoon Dilip Sangavi a few years ago but grabbed the top position.

Last week, Adani had reached a net worth of $100 billion as he became the new member of the centibillionaires club. Worth mentioning here is that Amazon founder Jeff Bezos (currently have a net worth of $176 billion) was the first to hit the $100 billion milestone in 2017 since Microsoft. co-founder Bill Gates back in 1999 for a brief period.

Tesla chief executive Musk, now the world’s richest person with a fortune of $249 billion, joined the elite club in 2020.

Meanwhile, in the last 10 years, while Ambani’s wealth has grown 400 per cent, Adani has seen a 1,830 per cent jump, as per the 2022 M3M Hurun Global Rich List.

India’s Apex Court Upholds BJP Govt’s Foreign Contribution Regulation Act

The Supreme Court on Friday, April 8th affirmed the validity of the Foreign Contribution (Regulation) Amendment (FCRA) Act, 2020, which imposes new conditions on the receipt and use of funds by NGOs.

A bench headed by Justice A.M. Khanwilkar upheld the 2020 amendments made to the FCRA Act, 2010. The detailed judgment in the case will be uploaded on the top court website later in the day.

The Centre had told the Supreme Court that there exists no fundamental right to receive unbridled foreign contributions without any regulation, while defending the amendments made in 2020 to the Foreign Contribution (Regulation) Act.

The MHA emphasized that FCRA aim was to ensure foreign contribution does not adversely impinge upon the functioning of parliamentary institutions, political associations, and academic, and other voluntary organisations as well as individuals in India.

The petitioners had challenged the amendments, which included newly added sections 12 and 17, which state that the foreign contributions must be deposited in the FCRA account created in the specified branch of the scheduled bank, which was later notified as State Bank of India, New Delhi branch.

The petitioners claimed the amendments were arbitrary and stringent, which made the functioning of NGOs extremely difficult.

The Ministry of Home Affairs (MHA) in a 355-page affidavit filed in the Supreme Court, said Parliament has enacted the Foreign Contribution (Regulation) Act, laying down a clear legislative policy of strict controls over foreign contributions for certain activities in the country.

The MHA said the “legislation has also prohibited acceptance and utilisation of foreign contribution or foreign hospitality for any activities detrimental to the national interest and for matters connected therewith or incidental thereto”. The affidavit was settled by Solicitor General of India Tushar Mehta, who was assisted by advocate Kanu Agrawal.

Petitioners in the matter were — Noel Harper and Nigel Mills of Share and Care Foundation in Andhra Pradesh and Joseph Lizy and Annamma Joachim of National Workers Welfare Trust in Telangana.

British Chancellor Rishi Sunak Seeks Inquiry Into Wife Akshata Murty’s Tax Leak

Rishi Sunak of the United Kingdom, an embattled British Conservative party Chancellor of the exchequer, has defended his Indian wife Akshata Murthy, daughter of Narayana Murthy, one of the founders of software giant Infosys, against charges of avoiding paying taxes in Britain.

Sunak, who is of East African-Indian origin, told media that reports about her non-domicile status are ‘unpleasant smears’. A non-dom in the United Kingdom does not have to pay tax on her overseas income. The BBC estimated “she would have avoided 2.1 million pounds a year in UK tax”.

This, while not unlawful, is embarrassing for Sunak, under whom comes Her Majesty’s Revenue and Customs (HMRC). “To smear my wife to get at me is awful,” Sunak insisted.

Murthy is said to own a 0.9 per cent stake in Infosys, which has been calculated as being worth 500 million pounds. Annual dividends from this holding is estimated to be 11.6 million pounds. On Thursday, it emerged she pays just 30,000 pounds a year in the UK on the British income.

Rishi Sunak is now demanding a Whitehall inquiry to find out who leaked details about his wife Akshata Murty’s tax arrangements. Murty has said she will pay UK taxes on her overseas income, following a row over her non-domicile status, the BBC reported.

Downing Street has rejected newspaper reports that its staff leaked damaging stories about Sunak to the media. It has been a bruising week for the Chancellor, and now he has asked senior civil servants for a full investigation to establish who divulged his wife’s tax status.

His allies say very few people had access to the personal information, which Sunak declared to Whitehall officials when he became a minister in 2018, the BBC reported.

Some Conservative MPs say he was naive to think the details would remain private, and that he should have predicted that the tax arrangements would be criticised as inappropriate, despite being legal. Sunak’s team has dismissed suggestions of a rift with Downing Street and say the prime minister has been “incredibly supportive”.

The opposition Labor party said it would be “breath-taking hypocrisy” if the Chancellor’s wife had reduced her tax bill as he raised taxes for millions of workers — referring to the rise in National Insurance contributions imposed in last month’s budget by Sunak.

Opposition Labor Party MP Louise Haigh said: “I think the question many people will be asking is whether it was ethical and whether it was right that the Chancellor of the Exchequer, whilst piling on 15 separate tax rises to the British public, was benefiting from a tax scheme that allowed his household to pay significantly less to the tune of potentially tens of millions of pounds.”

The Chancellor’s brand, vigorously promoted since he came to office, has been damaged, with some members of the ruling Conservative Party questioning his judgement. Opposition MPs have said Sunak’s family is benefiting at a time when he is putting up taxes for millions of others, the BBC reported.

However, a section of British newspapers has claimed that Prime Minister Boris Johnson’s office is leaking damaging material about Sunak to media. 10 Downing Street described the allegations as “categorically untrue” and “baseless”.

On Thursday, the pro-Johnson Daily Mail ran a headline, which read: “Collapsed fitness chain backed by Rishi Sunak’s non-dom wife was paid up to 650,000 pounds in furlough cash – while her billionaire father’s IT firm claimed Covid handout for hundreds of UK staff”.

Earlier, the attack against Sunak ranged from he being the richest member of Parliament with a net worth of 200 million pounds, to Infosys operating in Russia, which western corporate houses are restrained from doing after the West’s sanctions against the Russian Federation following its invasion of Ukraine.

While Sunak may have built a slight fortune as an investment banker, his background is upper middle class, his father being a general practitioner and mother an owner of a chemist’s shop.

The allegation about Infosys was ridiculous as an Indian company is under no obligation to copy its western counterparts, since the government of India maintains normal economic ties with Moscow.

From December 2021 until before the Russia-Ukraine conflict — when Johnson’s continuity as head of government looked untenable, because of a series of scandals associated with him — it was widely being speculated in British print media as well as in Conservative circles that Sunak was a front-runner to succeed Johnson.

It was also pointed out at that point that while other cabinet colleagues were strenuously defending Johnson against the barrage of demands for him to step down, Sunak was lukewarm in doing so, which was interpreted as ‘ambition’.

Sunak became popular when the British government was significantly generous in protecting the livelihoods during the Covid-19 crisis. But having borrowed money to extend such assistance, it was inevitable that he would have to raise taxes to repay the debt. However, given the cost of living crisis that had descended on Britons because of inflation, the Chancellor’s recent budget has been condemned as uncaring.

In Britain, a budget is identified in particular with the Chancellor, although the intelligentsia is aware its contents have the prior approval of the Prime Minister. With Johnson not saying much to protect Sunak against the onslaught unleashed against him on his proposals or lack of them, an impression has grown that the latter is being thrown under a bus.

Rising Oil Prices To Keep Indian Rupee On A Slippery Slope

High crude oil prices combined with fears of rising inflation are expected to keep the Indian rupee under pressure, next week. Lately, the Brent crude oil price has remained elevated due to the Russian-Ukrainian war. The price has hovered in the range of $100-$110 in the last few weeks.

“Rupee has been under pressure due to rising US bond yields, inflation and high crude oil prices,” said Sajal Gupta Head Fx & Rates Edelweiss.

“These circumstances are going to be tough for the Indian rupee to appreciate. Expect rupee to trade between 75.50 and 76.25 in the next week.” Last week, the rupee closed at 75.90 to a greenback.

“Next week is a relatively shorter week but market participants will be keeping an eye on the inflation and industrial production number to gauge a view for the currency,” said Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services.

“Expectation is that inflation could remain elevated following the recent rise in energy and food prices. On the other hand, industrial production could grow at a slower pace in January and could further weigh on the currency.”

The Central Statistics Office (CSO) is slated to release the macro-economic data points of Index of Industrial Production (IIP), Consumer Price Index (CPI) on March 12.

On the other hand, expectations of India Inc’s healthy Q4FY22 results season should attract fresh equity focused foreign funds which might cub any sharp weakness in the Indian rupee versus the US dollar.

“Dollar index have surged past week and it is now trading near crucial psychological mark of 100,” said Devarsh Vakil, Deputy Head of Retail Research, HDFC Securities.

“Rupee is likely to consolidate next week on back of improving sentiments for equity markets. In near term, spot USD INR expected to trade in the range of 76.20 to 75.70. with bias towards appreciation.”

$40 Billion Borrowed By US Consumers in February Alone

Americans got into a lot more debt in February this year as rampant inflation kept up the pressure, the Federal Reserve’s consumer credit report showed last week. Debt levels jumped by nearly $42 billion to a total of almost $4.5 trillion. That’s an annual increase of 11.3%, seasonally adjusted, far outperforming economists’ expectations and setting a new high. In January, total credit had grown only 2.4%.

The Fed’s historical consumer credit data goes back to the early 1940s. Revolving credit, which includes credit cards, jumped by 20.7% to about $1.1 trillion. The category increased by only 4% in the prior month.

Nonrevolving credit, such as student or car loans, grew by 8.4% to $3.4 trillion, also outpacing a smaller January gain.

Americans have been challenged with a rapid pace of price increases everywhere, from the grocery store to the gas station. Year-over-year inflation has increased at a pace not seen in 40 years.

Consumer spending has kept up the pace so far, but it is not immediately clear whether that’s because people are paying more for the same items that got more expensive or are actually buying more goods and services.

In late February, Russia’s invasion of Ukraine jolted global energy markets and boosted the price of gasoline. With prices at the pump rising higher in March, credit card spending is unlikely to have gone down after the February jump.

Biden’s Order To Release Oil From Strategic Petroleum Reserve To Reduce Gas Prices ‘Fairly Significantly’

US President Joe Biden announced last week that his administration will release 1 million barrels of oil per day for the next six months from its strategic reserve in an effort a bid to control energy prices that have spiked after the United States and allies imposed steep sanctions on Russia over its invasion of Ukraine. The releasing of over 180 million barrels from the US Strategic Petroleum Reserve is the “largest” release from national reserve in the country’s history, Biden said in a speech from the Eisenhower Executive Office Building on Thursday.

The president said it was not known how much gasoline prices could decline as a result of his move, but he suggested it might be “anything from 10 cents to 35 cents a gallon.” Gas is averaging about $4.23 a gallon, compared with $2.87 a year ago, according to AAA.

“As Russian oil comes off the global market, supply of oil drops and prices are rising,” he said, acknowledging the US energy embargo on Russia would “come with a cost”.

“The bottom line is if we want lower gas prices we need to have more oil supply right now,” Biden said. “This is a moment of consequence and peril for the world, and pain at the pump for American families.”

The president also wants Congress to impose financial penalties on oil and gas companies that lease public lands but are not producing. He said he will invoke the Defense Production Act to encourage the mining of critical minerals for batteries in electric vehicles, part of a broader push to shift toward cleaner energy sources and reduce the use of fossil fuels. The actions show that oil remains a vulnerability for the U.S. Higher prices have hurt Biden’s approval domestically and added billions of oil-export dollars to the Russian government as it wages war on Ukraine.

Tapping the stockpile would create pressures that could reduce oil prices, though Biden has twice ordered releases from the reserves without causing a meaningful shift in oil markets. Biden said Thursday he expects gasoline prices could drop “fairly significantly.”

Part of Biden’s concern is that high prices have not so far coaxed a meaningful jump in oil production. The planned release is a way to increase supplies as a bridge until oil companies ramp up their own production, with administration officials estimating that domestic production will grow by 1 million barrels daily this year and an additional 700,000 barrels daily in 2023.

The markets reacted quickly with crude oil prices dropping about 6% in Thursday trading to roughly $101 a barrel. Still, oil is up from roughly $60 a year ago, with supplies failing to keep up with demand as the world economy has begun to rebound from the coronavirus pandemic. That inflationary problem was compounded by Russian President Vladimir Putin’s invasion of Ukraine, which created new uncertainties about oil and natural gas supplies and led to retaliatory sanctions from the U.S. and its allies.

Stewart Glickman, an oil analyst for CFRA Research, said the release would bring short-term relief on prices and would be akin to “taking some Advil for a headache.” But markets would ultimately look to see whether, after the releases stop, the underlying problems that led to Biden’s decisions remain.

“The root cause of the headache is probably still going to be there after the medicine wears off,” Glickman said. Biden has been in talks with allies and partners to join in additional releases of oil, such that the world market will get more than the 180 million barrels total being pledged by the U.S.

Americans on average use about 21 million barrels of oil daily, with about 40% of that devoted to gasoline, according to the U.S. Energy Information Administration. That total accounts for about one-fifth of total global consumption of oil.

Domestic oil production is equal to more than half of U.S. usage, but high prices have not led companies to return to their pre-pandemic levels of output. The U.S. is producing on average 11.7 million barrels daily, down from 13 million barrels in early 2020.

“Look, the action I’m calling for will make a real difference over time. But the truth is it takes months, not days, for companies to increase production,” he said on Thursday. In his address, Biden also highlighted the importance of US energy independence and called for a transition to clean energy.

“Ultimately, we and the whole world need to reduce our dependence on fossil fuels altogether. We need to choose long-term security over energy and climate vulnerability,” he said. Biden, who faces with mounting pressure to address a surging inflation ahead of the midterm elections, blamed the Covid-19 pandemic and Russia’s military action for rising gas prices.

Republican lawmakers have said the problem results from the administration being hostile to oil permits and the construction of new pipelines such as the Keystone XL. Democrats say the country needs to move to renewable energy such as wind and solar that could reduce the dependence on fossil fuels and Putin’s leverage.

Sen. Steve Daines, R-Mont., blasted Biden’s action to tap the reserve without first taking steps to increase American energy production, calling it “a Band-Aid on a bullet wound.″ Daines called Biden’s actions “desperate moves″ that avoid what he called the real solution: ”investing in American energy production,″ and getting “oil and gas leases going again.”

The administration says increasing oil output is a gradual process and the release would provide time to ramp up production. It also wants to incentivize greater production by putting fees on unused leases on government lands, something that would require congressional approval.

Oil producers have been more focused on meeting the needs of investors than consumers, according to a survey released last week by the Dallas Federal Reserve.

About 59% of the executives surveyed said investor pressure to preserve “capital discipline” amid high prices was the reason they weren’t pumping more, while fewer than 10% blamed government regulation.

In his remarks last week, Biden tried to shame oil companies that he said are focused on profits instead of putting out more barrels, saying that adding to the oil supply was a patriotic obligation.

“This is not the time to sit on record profits: It’s time to step up for the good of your country,” the president said.

The steady release from the reserves would be a meaningful sum and come near to closing the domestic production gap relative to February 2020, before the coronavirus caused a steep decline in oil output.

Still, the politics of oil are complicated with industry advocates and environmentalists both criticizing the planned release. Groups such as the American Petroleum Institute want to make drilling easier, while environmental organizations say energy companies should be forced to pay a special tax on windfall profits instead.

The administration in November announced the release of 50 million barrels from the strategic reserve in coordination with other countries. And after the Russia-Ukraine war began, the U.S. and 30 other countries agreed to an additional release of 60 million barrels from reserves, with half of the total coming from the U.S.

According to the Department of Energy, which manages it, more than 568 million barrels of oil were held in the reserve as of March 25. After the release, the government would begin to replenish the reserve once prices have sufficiently fallen.

Among 108,000 New Immigrants To Canada, Indians Top The List

Canada, which plans to admit a record 432,000 new immigrants in 2022, is on target to hit this mark as the country welcomed 108,000 newcomers in the first three months of the year.

“Canada is proud to be a destination of choice for so many people around the world, and we will continue to work hard to provide the best experience possible for them,” said Sean Fraser, Minister of Immigration, Refugees and Citizenship, releasing the figures for the first quarter on Thursday.

Though there is no country-wise break-up of the numbers, Indians are the top immigrant group to take up residence in Canada this year.

In 2021, nearly 100,000 Indians became permanent residents of Canada as the country admitted a record 405,000 new immigrants in its history.

During 2021-2022, over 210,000 permanent residents also acquired Canadian citizenship.

As per figures released by Immigration, Refugees and Citizenship Canada (IRCC), it also issued 450,000 study permit applications.

As per figures released by Immigration, Refugees and Citizenship Canada (IRCC), it also issued 450,000 study permit applications. As of December 31, 2021, of the approximately 622,000 foreign students in Canada, Indians number as high as 217,410.

The Indian Parliament was informed that as of March 20, this year, a total of 1,33,135 Indian students have already gone abroad for higher studies. There are over 622,000 foreign students in Canada, with Indians numbering 217,410 as of December 31, 2021.

Canada is steadily becoming a popular destination among Indians looking to migrate abroad, for studying or work. According to a study by the National Foundation for American Policy (NFAP), the number of Indians who became permanent residents of Canada increased by 115% in the last four to five years.

In fact, NFAP data shows that America is no longer the dream destination for most Indians, Canada is taking its place. The number of Indian students doing post-graduation in science and engineering studies at US universities declined by nearly 40% between the 2016-17 and 2019-20 academic years, while it increased by nearly 182% in Canada between 2016 and 2019.

In Canada, it is easier for international students to obtain temporary visas and permanent residence after graduating than it is in the United States. Canada’s post-graduation work permit (PGWP) is commonly seen as the first major step towards obtaining permanent resident status.

Open Work Permit is another immigration pathway that lets one go to Canada without a Labour Market Impact Assessment (LMIA) or an offer letter from an employer who has paid the compliance fee. The permit allows one to work for any organisation in Canada as long as it has not been marked ineligible by the government.

Canada’s acute labour shortage became a serious concern during the pandemic after which it announced major plans to overcome the problem by setting a target of admitting more than 1.3 million immigrants over three years.

“Common Prosperity” By President XI A Defining Theme Of Chinese Politics

Introduced by Chinese President Xi Jinping at the beginning of 2021, “common prosperity” has become a defining theme of Chinese politics today, serving to set critical priorities for Beijing across economic, environmental, and social policy, at both the national and local levels. Focused largely on alleviating systemic inequalities, the common prosperity campaign has been described as a transformational new path for China’s development. Despite the central importance of common prosperity to the direction of Chinese policymaking, clarity on the concept remains limited outside of China.

What exactly does common prosperity mean in practice, and what are the intentions and motivations of the political campaign being waged in its name? Where is the campaign headed, and will it be able to accomplish its goals? And, in particular, what will common prosperity mean for international non-profits and philanthropic organizations working in or with China on those areas central to the campaign?

China’s Common Prosperity Program: Causes, Challenges, and Implications,” a new paper by Asia Society Policy Institute (ASPI) Senior Fellow Guoguang Wu, examines these questions in detail. The paper finds that common prosperity is derived from a complex number of motivations, including reducing pressing inequalities, but also key political goals of interest to the Chinese party-state.

Global Jobs Attract Indian Students To Foreign Varsities

Foreign universities, technical institutes and B-schools not only provide world class education to students, but also prepare them for high-paying global jobs which the Indian youth see as an easy way to fast-tract their career growth.

While countries like Russia, China and Australia are a popular choice for technical courses among the Indian students, a large number of them have also turned to universities in the US, the UK and Canada for programmes that will fetch them work permit for global technical jobs.

According to Canada’s Immigration Refugee and Citizenship data, the number of Indian students studying in the country has increased by a whopping 350 per cent between the 2015-16 and 2019-20 academic years.

As per data by the UK’s Higher Education Statistics Agency (HESA), the number of Indian students enrolling to universities every year has increased by 220 per cent. However, the percentage of Indian students in the US has declined by 9 per cent between 2015-16 and 2019-20.

Canada’s Post-Graduation Work Permit Program (PGWPP), America’s Optional Training Program (OPT) and Britain’s New Graduate Pathway (GR) offer opportunities for good placements after postgraduation which are a major attraction among Indian students to advance their career.

Notably, Indian applicants have an excellent track record in approval rates for work permits abroad. In Canada, there has been an approval rate of over 95 per cent for the PGWPP in the past five years.

International education expert Karunn Kandoi told IANS that the US, the UK and Canada are the most popular destinations for Indian students for studying Science, Technology, Engineering and Mathematics (STEM) or business management programmes.

“While 44 per cent of Indian students in the UK and 37 per cent in Canada have opted for business studies, the US is the first choice to study STEM courses. In 2020-21, 78 per cent of Indians studied STEM programmes in the US. It was the third highest rate among the top 25 countries to study,” he said.

According to a former professor of Delhi University, D. Sharma, universities in the US, Canada and Australia are not only providing modern education and global culture to its students but also excellent employment opportunities.

He also pointed out: “India has been leading the way in global talent development over the past 10 years and the trend of studying abroad remains more relevant than ever in the past two years, despite the constraints caused by the pandemic.”

An Indian student from a reputed B-school in Canada, Bhaskar Sharma, said: “Getting a permanent residency here is also a big goal for many Indian students after admission to an international university. Students sometimes also find it easier to achieve their goals abroad on the basis of their merit, especially when there is a need for special kind of technical knowledge in one field.

“For example, Canada’s health sciences and skilled trades are facing a significant labour shortage, while in the UK, the information and communications sector has the highest vacancy rate at 5.5 per cent.”

Indian students are also now turning to foreign countries to study medicine. However recently, due to the Russia-Ukraine war, around 18,000 students had to return to the country before the completion of their course.

Pawan Chaudhary, President of India’s Medical Technology Association, said: “Due to the Russia-Ukraine war, Indian students will find options to complete MBBS in any other countries such as Bangladesh, Nepal, Spain, Germany, Kyrgyzstan and the UK, where the cost of the course is low.”

The Impact Of Economic War On Putin Led Russia How Sanctions On Russia Will Upend The Global Order

The Russian-Ukrainian war of 2022 is not just a major geopolitical event but also a geoeconomic turning point. Western sanctions are the toughest measures ever imposed against a state of Russia’s size and power.

In the space of less than three weeks, the United States and its allies have cut major Russian banks off from the global financial system; blocked the export of high-tech components in unison with Asian allies; seized the overseas assets of hundreds of wealthy oligarchs; revoked trade treaties with Moscow; banned Russian airlines from North Atlantic airspace: restricted Russian oil sales to the United States and United Kingdom; blocked all foreign investment in the Russian economy from their jurisdiction; and frozen $403 billion out of the $630 billion in foreign assets of the Central Bank of Russia.

The overall effect has been unprecedented, and a few weeks ago would have seemed unimaginable even to most experts: in all but its most vital products, the world’s eleventh-largest economy has now been decoupled from twenty-first-century globalization.

How will these historic measures play out? Economic sanctions rarely succeed at achieving their goals. Western policymakers frequently assume that failures stem from weaknesses in sanctions design.

Indeed, sanctions can be plagued by loopholes, lack of political will to implement them, or insufficient diplomatic agreement concerning enforcement. The implicit assumption is that stronger sanctions stand a better chance of succeeding.

Yet the Western economic containment of Russia is different. This is an unprecedented campaign to isolate a G-20 economy with a large hydrocarbon sector, a sophisticated military-industrial complex, and a diversified basket of commodity exports. As a result, Western sanctions face a different kind of problem.

The sanctions, in this case, could fail not because of their weakness but because of their great and unpredictable strength. Having grown accustomed to using sanctions against smaller countries at low cost, Western policymakers have only limited experience and understanding of the effects of truly severe measures against a major, globally connected economy. Existing fragilities in the world’s economic and financial structure mean that such sanctions have the potential to cause grave political and material fallout.

THE REAL SHOCK AND AWE

Just how severe the current sanctions against Russia are can be seen from their effects across the world. The immediate shock to the Russian economy is the most obvious. Economists expect Russian GDP to contract by at least 9–15 percent this year, but the damage could well become much more severe.

The ruble has fallen more than a third since the beginning of January. An exodus of skilled Russian professionals is underway, while the capacity to import consumer goods and valuable technology has fallen drastically. As Russian political scientist Ilya Matveev has put it, “30 years of economic development thrown into the bin.”

The ramifications of the Western sanctions go far beyond these effects on Russia itself. There are at least four different kinds of broader effects: spillover effects into adjacent countries and markets; multiplier effects through private-sector divestment; escalation effects in the form of Russian responses; and systemic effects on the global economy.

Spillover effects have already caused turmoil in international commodities markets. A generalized panic erupted among traders after the second Western sanctions package—including the SWIFT cutoff and the freezing of central bank reserves—was announced on February 26.

Prices of crude oil, natural gas, wheat, copper, nickel, aluminum, fertilizers, and gold have soared. Because the war has closed Ukrainian ports and international firms are shunning Russian commodity exports, a grain and metals shortage now looms over the global economy.

Although oil prices have since dropped in anticipation of additional output from Gulf producers, the price shock to energy and commodities across the board will push global inflation higher. African and Asian countries reliant on food and energy imports are already experiencing difficulties.

Economists expect Russian GDP to contract by at least 9 to 15 percent this year.

Central Asia’s economies are also caught up in the sanctions shock. These former Soviet states are strongly connected to the Russian economy through trade and outward labor migration. The collapse of the ruble has caused serious financial distress in the region.

Kazakhstan has imposed exchange controls after the tenge, its currency, fell by 20 percent in the wake of the Western sanctions against Moscow; Tajikistan’s somoni has undergone a similarly steep depreciation. Russia’s impending impoverishment will force millions of Central Asian migrant workers to seek employment elsewhere and dry up the flow of remittances to their home countries.

The impact of the sanctions goes beyond decisions taken by G-7 and EU governments. The official sanctions packages have had a catalyzing effect on international businesses operating in Russia. Virtually overnight, Russia’s impending isolation has set in motion a massive corporate flight.

In what amounts to a vast private sector boycott, hundreds of major Western firms in the technology, oil and gas, aerospace, car, manufacturing, consumer goods, food and beverage, accounting and financial, and transport industries are pulling out of the country.

It is noteworthy that these departures are in many cases not required by sanctions. Instead, they are driven by moral condemnation, reputational concerns, and outright panic. As a result, the business retreat is deepening the economic shock to Russia by multiplying the negative economic effects of official state sanctions.

The Russian government has responded to the sanctions in several ways. It has undertaken emergency stabilization policies to protect foreign exchange earnings and shore up the ruble. Foreign portfolio capital is being locked into the country.

While the stock market has remained closed, the assets of many Western firms that have departed may soon face confiscation. The Ministry of Economic Development has prepared a law that grants the Russian state six months to take over businesses in case of an “ungrounded” liquidation or bankruptcy.

The potential nationalization of Western capital is not the only escalatory effect of the sanctions. On March 9, Putin signed an order restricting Russian commodity exports. Although the full array of items to be withheld under the ban is not yet clear, the threat of its use will continue to hang over international trade.

Russian restrictions on fertilizer exports imposed in early February have already put pressure on global food production. Russia could retaliate by restricting exports of important minerals such as nickel, palladium, and industrial sapphires. These are crucial inputs for the production of electrical batteries, catalytic converters, phones, ball bearings, light tubes, and microchips.

In the globalized assemblage system, even small changes in materials prices can massively raise the production costs faced by final users downstream in the production chain. A Russian embargo or large export reduction of palladium, nickel, or sapphires would hit car and semiconductor manufacturers, a $3.4 trillion global industry.

If the economic war between the West and Russia continues further into 2022 at this intensity, it is very possible that the world will slide into a sanctions-induced recession.

MANAGING THE FALLOUT

The combination of spillover effects, negative multiplier effects, and escalation effects means that the sanctions against Russia will have an effect on the world economy like few previous sanctions regimes in history. Why was this great upheaval not anticipated?

One reason is that over the last few decades, U.S. policymakers have usually deployed sanctions against economies that were sufficiently modest in size for any significant adverse effects to be contained. The degree of integration into the world economy of North Korea, Syria, Venezuela, Myanmar, and Belarus was relatively modest and one-dimensional. Only the rollout of U.S. sanctions against Iran required special care to avoid upsetting the oil market.

In general, however, the assumption held that sanctions use was economically almost costless to the United States. This has meant that the macroeconomic and macrofinancial consequences of global sanctions are insufficiently understood.

To better grasp the choices to be made in the current economic sanctions against Russia, it is instructive to examine sanctions use in the 1930s, when democracies similarly attempted to use them to stop the aggression of large-sized autocratic economies such as Fascist Italy, imperial Japan, and Nazi Germany.

The crucial backdrop to these efforts was the Great Depression, which had weakened economies and inflamed nationalism around the world. When Italian dictator Benito Mussolini invaded Ethiopia in October 1935, the League of Nations implemented an international sanctions regime enforced by 52 countries. It was an impressive united response, similar to that on display in reaction to Russia’s invasion of Ukraine.

But the league sanctions came with real tradeoffs. Economic containment of Fascist Italy limited democracies’ ability to use sanctions against an aggressor who was more threatening still: Adolf Hitler.

As a major engine of export demand for smaller European economies, Germany was too large an economy to be isolated without severe commercial loss to the whole of Europe. Amid the fragile recovery from the Depression, simultaneously placing sanctions on both Italy and Germany—then the fourth- and seventh-largest economies in the world—was too costly for most democracies.

Hitler exploited this fear of overstretch and the international focus on Ethiopia by moving German troops into the demilitarized Rhineland in March 1936, advancing further toward war. German officials were aware of their commercial power, which they used to maneuver central European and Balkan economies into their political orbit.

The result was the creation of a continental, river-based bloc of vassal economies whose trade with Germany was harder for Western states to block with sanctions or a naval blockade.

The sanctions dilemmas of the 1930s show that aggressors should be confronted when they disrupt the international order. But it equally drives home the fact that the viability of sanctions, and the chances of their success, are always dependent on the global economic situation.

In unstable commercial and financial conditions, it will be necessary to prioritize among competing objectives and prepare thoroughly for unintended effects of all kinds. Using sanctions against very large economies will simply not be possible without compensatory policies that support the sanctioners’ economies and the rest of the world.

More intensive sanctions will inflict further damage to the world economy.

The Biden administration is aware of this problem, but its actions so far are inadequate to the scale of the problem. Washington has attempted to reduce strains in the oil market by a partial reconciliation with Iran and Venezuela.

Countering the spillover effects of sanctions against one leading petrostate may now require lifting sanctions on two smaller petrostates. But this oil diplomacy is insufficient to meet the challenge posed by the Russia sanctions, the effects of which are aggravating preexisting economic woes.

Supply chain issues and pandemic-era bottlenecks in global transport and production networks predated the war in Ukraine. The unprecedented use of sanctions in these already troubled conditions has made an already difficult situation worse.

The problem of managing the fallout of economic war is greater still in Europe. This is not only because the European Union has much stronger trade and energy links with Russia. It is also the result of the political economy of the eurozone as it has taken shape over the last two decades: with the exception of France, most of its economies follow a heavily trade-reliant, export-focused growth strategy.

This economic model requires foreign demand for exports while repressing wages and domestic demand. It is a structure that is very ill suited to the prolonged imposition of trade-reducing sanctions. Increasing EU-wide renewable energy investment and expanding public control in the energy sector, as French President Emmanuel Macron has announced, is one way to absorb this shock.

But there is also a need for income-boosting measures for consumer goods and price-dampening interventions in producer goods markets, from strategic reserve management to the excess profits taxes that are being rolled out in Spain and Italy.

Then there are the consequences of sanctions cause for the world economy at large, especially in the “global South.” Addressing these problems will pose a major macroeconomic challenge. It is therefore imperative for the G-7, the European Union, and the United States’ Asian partners to launch bold and coordinated action to stabilize global markets.

This can be done through targeted investment to clear up supply bottlenecks, generous international grants and loans to developing countries struggling to secure adequate food and energy supplies, and large-scale government funding for renewable energy capacity.

It will also have to involve subsidies, and perhaps even rationing and price controls, to protect the poorest from the destructive effects of surging food, energy, and commodity prices.

Such state intervention is the price to be paid for engaging in economic war. Inflicting material damage at the scale levelled against Russia simply cannot be pursued without an international policymaking shift that extends economic support to those affected by sanctions. Unless the material well-being of households is protected, political support for sanctions will crumble over time.

THE NEW INTERVENTIONISTS

Western policymakers thus face a serious decision. They must decide whether to uphold sanctions against Russia at their current strength or to impose further economic punishment on Putin. If the goal of the sanctions is to exert maximum pressure on Russia with minimal disruption to their own economies—and thus a manageable risk of domestic political backlash—then current levels of pressure may be the most that is politically feasible now.

At the moment, simply maintaining existing sanctions will require active compensatory policies. For Europe especially, neither laissez-faire economic policies nor fiscal fragmentation will be sustainable if the economic war persists. But if the West decides to step up the economic pressure on Russia further still, far-reaching economic interventions will become an absolute necessity.

More intensive sanctions will inflict further damage, not just to the sanctioners themselves but to the world economy at large. No matter how strong and justified the West’s resolve to stop Putin’s aggression is, policymakers must accept the material reality that an all-out economic offensive will introduce considerable new strains into the world economy.

An intensification of sanctions will cause a cascade of material shocks that will demand far-reaching stabilization efforts.And even with such rescue measures, the economic damage may well be serious, and the risks of strategic escalation willremain high.

For all these reasons, it remains vital to pursue diplomatic and economic paths that can end the conflict. Whatever the results of the war, the economic offensive against Russia has already exposed one important new reality: the era of costless, risk-free, and predictable sanctions is well and truly over.

Elon Musk Could Become World’s First Trillionaire In 2024

Tesla and SpaceX CEO Elon Musk could become the first person to ever accumulate a $1 trillion net worth, and it could happen as soon as 2024, says a new report.

Musk is currently said to be the richest person in the world, overtaking former Amazon CEO Jeff Bezos last year to claim the title, reports Teslarati.

While Musk has stated many times that material possessions are not a concern of his, eventually selling nearly all of his personal properties as proof, a new study from Tipalti Approve suggests he could become the first person to ever accumulate a $1 trillion net worth.

Musk’s net worth, according to Forbes’ Real Time Billionaires list, sits at over $260 billion, nearly $70 billion more than Bezos’ current estimation of about $190 billion.

His wealth skyrocketed over the past few years thanks to his majority ownership of Tesla, which increased in value substantially since 2020. SpaceX also has helped Musk’s net worth skyrocket and could catalyze even more growth in the next two years.

“Since 2017, Musk’s fortune has shown an annual average increase of 129 per cent, which could potentially see him enter the trillion-dollar club in just two short years, achieving a net worth of $1.38 trillion by 2024 at age 52,” Tipalti Approve, who conducted the study, said in their report.

“SpaceX generates massive incomes by charging governmental and commercial clients to send various things into space, including satellites, ISS supplies, and people,” it added.

Other billionaires are also expected to hit the trillion-dollar range, but not before Musk, the report said.

Zhang Yiming, TikTok’s founder, is projected to reach a $1 trillion net worth by 2026 at 42 years old, making him the youngest trillionaire. Bezos may not hit the threshold until 2030. Bezos broke ground in the net worth realm by reaching $100 billion before any other entrepreneur in the world.

Ukraine Incursion, World Stagflation

Finger pointing in the blame game over Russia’s Ukraine incursion obscures the damage it is doing on many fronts. Meanwhile, billions struggle to cope with worsening living standards, exacerbated by the pandemic and more.

Losing sight in the fog of war

US Secretary of State Anthony Blinken insists, “the Russian people will suffer the consequences of their leaders’ choices”. Western leaders and media seem to believe their unprecedentedcrushing sanctions” will have a “chilling effect” on Russia.

With sanctions intended to strangle Russia’s economy, the US and its allies somehow hope to increase domestic pressure on Russian President Vladimir Putin to retreat from Ukraine. The West wants to choke Russia by cutting its revenue streams, e.g., from oil and gas sales to Europe.

Already, the rouble has been hammered by preventing Russia’s central bank from accessing its US$643bn in foreign currency reserves, and barring Russian banks from using the US-run global payments transfer system, SWIFT.

Withdrawal of major Western transnational companies – such as Shell, McDonald’s and Apple – will undoubtedly hurt many Russians – not only oligarchs, their ostensible target.

Thus, Blinken’s claim that “The economic costs that we’ve been forced to impose on Russia are not aimed at you [ordinary Russians]” may well ring hollow to them. They will get little comfort from knowing, “They are aimed at compelling your government to stop its actions, to stop its aggression”.

As The New York Times notes, “sanctions have a poor record of persuading governments to change their behavior”. US sanctions against Cuba over six decades have undoubtedly hurt its economy and people.

But – as in Iran, North Korea, Syria and Venezuela – it has failed to achieve its supposed objectives. Clearly, “If the goal of sanctions is to compel Mr. Putin to halt his war, then the end point seems far-off.”

Russia, major commodity exporter

Undoubtedly, Russia no longer has the industrial and technological edges it once had. Following Yeltsin era reforms in the early 1990s, its economy shrank by half – lowering Russian life expectancy more than anywhere else in the last six millennia!

Russia has become a major primary commodity producer – not unlike many developing countries and the former settler colonies of North America and Australasia. It is now a major exporter of crude oil and natural gas.

It is also the largest exporter of palladium and wheat, and among the world’s biggest suppliers of fertilizers using potash and nitrogen. On 4 March, Moscow suspended fertilizer exports, citing “sabotage” by “foreign logistics companies”.

Farmers and consumers will suffer as yields drop by up to half. Sudden massive supply disruptions will thus have serious ramifications for the world economy – now more interdependent than ever, due to earlier globalization.

Sanctions’ inflation boomerang

International Monetary Fund Managing Director Kristalina Georgieva has ominously warned of the Ukraine crisis’ economic fallouts. She cautions wide-ranging sanctions on Russia will worsen inflation and further slow growth.

No country is immune, including those imposing sanctions. But the worst hit are poor countries, particularly in Africa, already struggling with rising fuel and food prices.

For Georgieva, more inflation – due to Russian sanctions – is the greatest threat to the world economy. “The surging prices for energy and other commodities – corn, metals, inputs for fertilizers, semiconductors – coming on top of already high inflation” are of grave concern to the world.

Russia and Ukraine export more than a quarter of the world’s wheat while Ukraine is also a major corn exporter. Supply chain shocks and disruptions could add between 0.2% to 0.4% to ‘headline inflation’ – which includes both food and fuel prices – in developed economies over the coming months.

US petrol prices jumped to a 17-year high in the first week of March. The costs of other necessities, especially food, are rising as well. US Treasury Secretary Janet Yellen has acknowledged that the sanctions are worsening US inflation.

The European Union (EU) gets 40% of its natural gas from Russia. Finding alternative supplies will be neither easy nor cheap. The EU is Russia’s largest trading partner, accounting for 37% of global trade in 2020. Thus, sanctions may well hurt Europe more than Russia – like cutting one’s nose to spite one’s face.

The European Central Bank now expects stagflation – economic stagnation with inflation, and presumably, rising unemployment. It has already slashed its growth forecast for 2022 from 4.2% to 3.7%. Inflation is expected to hit a record 5.1% – way above its previous 3.2% forecast!

Developing countries worse victims
Global food prices are already at record highs, with the Food Price Index (FPI) of the Food and Agricultural Organization up more than 40% over the past two years.

The FPI hit an all-time high in February – largely due to bad weather and rising energy and fertilizer costs. By February 2022, the Agricultural Commodity Price Index was 35% higher, while maize and wheat prices were 26% and 23% more than in January 2021.

Besides shortages and rising production costs – due to surging fuel and fertilizer prices – speculation may also push food prices up – as in 2007-2008.

Signs of such speculation are already visible. Chicago Board of Trade wheat future prices rose 40% in early March – its largest weekly increase since 1959!

Rising food prices impact people in low- and middle-income countries more as they spend much larger shares of their incomes on food than in high-income countries. The main food insecurity measure has doubled in the past two years, with 45 million people close to starvation, even before the Ukraine crisis.

Countries in Africa and Asia rely much more on Russian and Ukrainian grain. The World Bank has warned, “There will be important ramifications for the Middle East, for Africa, North Africa and sub-Saharan Africa, in particular”, where many were already food insecure before the incursion.

The Ukraine crisis will be devastating for countries struggling to cope with the pandemic. Unable to access enough vaccines or mount adequate responses, they already lag behind rich countries. The latest food and fuel price hikes will also worsen balance-of-payments problems and domestic inflationary pressures.

No to war!

The African proverb, “When two elephants fight, all grass gets trampled”, sums up the world situation well. The US and its allies seem intent to ‘strangle Russia’ at all costs, regardless of the massive collateral damage to others.

This international crisis comes after multilateralism has been undermined for decades. Hopes for reduced international hostilities, after President Biden’s election, have evaporated as US foreign policy double standards become more apparent.

Russia has little support for its aggressive violation of international law and norms. Despite decades of deliberate NATO provocations, even after the Soviet Union ended, Putin has lost international sympathy with his aggression in Ukraine.

But there is no widespread support for NATO or the West. Following the vaccine apartheid and climate finance fiascos, the poorer, ‘darker nations’ have become more cynical of Western hypocrisy as its racism becomes more brazen.

59 Percent Of Indian Billionaires Are Self-Made

Fifty-nine percent of Indian billionaires are self-made, according to a new report.

“We are happy to be associated with Hurun India for the launch of the M3M Hurun Global Rich List 2022, curated with an in-depth market research which demonstrates that Indian businesses are one of the fastest value creators,” said Pankaj Bansal, Director, M3M India, on the M3M Hurun Global Rich List 2022.

Over the last few years, wealth creation by India Inc. has catapulted the economic growth in the country.

Interestingly, 59 per cent of the country’s billionaires are self-made, thus indicating that the new-generation entrepreneurs are financially-wise, asset-rich and investment-vibrant. Also, gender inclusivity and equality has been a noticeable theme with women outranking men across industries, said Bansal.

“Having said this, it is also true that the rich have invested in philanthropy and have played a significant role in the social and economic growth in India, particularly focusing on nutrition, education and women empowerment,” he said.

As Andrew Carnegie, one of the greatest philanthropists, said, “Ninety per cent of all millionaires become so through owning real-estate.”

“The real estate sector is ranked third amongst major sector in India and is also the second largest in terms of employment generation, and it particularly delivers in short-term and long-term employment creation. This sector is also looking forward to contribute 13 per cent in India’s GDP by 2025 and reach a market size of $1 trillion by 2030.

“No wonder, it contributed 8.1 per cent to the overall list of billionaires and possesses a concentration of 275 billionaires, which I am certain will see a significant jump in the next 5 years owing to unmet housing demands generated by urbanisation and modernisation of towns,” Bansal said.

“We are hopeful that the year 2022 will ignite the economic buoyancy in the country and will enable us to match steps with our global counterparts. Particularly, when India is gaining momentum in startups and unicorns, and has become 3rd largest ecosystem in the world, only after US and China,” he added.

Inflation, War Push Stress To Alarming Levels At Two-Year COVID-19 Anniversary

Newswise — Two years after the World Health Organization declared COVID-19 a global pandemic, inflation, money issues and the war in Ukraine have pushed U.S. stress to alarming levels, according to polls conducted for the American Psychological Association.

A late-breaking poll, fielded March 1–3 by The Harris Poll on behalf of APA, revealed striking findings, with more adults rating inflation and issues related to the invasion of Ukraine as stressors than any other issue asked about in the 15-year history of the Stress in AmericaTM poll. This comes on top of money stress at the highest recorded level since 2015, according to a broader Stress in America poll fielded last month.

Top sources of stress were the rise in prices of everyday items due to inflation (e.g., gas prices, energy bills, grocery costs, etc.) (cited by 87%), followed by supply chain issues (81%), global uncertainty (81%), Russia’s invasion of Ukraine (80%) and potential retaliation from Russia (e.g., in the form of cyberattacks or nuclear threats) (80%).

These stressors are coming at a time when the nation is still struggling to deal with the prolonged pandemic and its effects on our daily lives, with close to two-thirds of adults (63%) saying their life has been forever changed by the COVID-19 pandemic. While a majority (51%) reported this change as neither positive nor negative — simply different — the long-lasting implications of the pandemic are clear. The survey also revealed continued hardships for vulnerable populations, concerns for children’s development among parents and entrenched, unhealthy coping habits.

“The number of people who say they’re significantly stressed about these most recent events is stunning relative to what we’ve seen since we began the survey in 2007,” said Arthur C. Evans Jr., PhD, APA’s chief executive officer. “Americans have been doing their best to persevere over these past two tumultuous years, but these data suggest that we’re now reaching unprecedented levels of stress that will challenge our ability to cope.”

A year ago, APA’s first pandemic anniversary survey found COVID-19-related stress was associated with unhealthy weight changes and increased drinking. The most recent survey confirmed that these unhealthy behaviors have persisted, suggesting that coping mechanisms have become entrenched — and that mental and physical health may be on a continuing decline for many as a result. Close to half of adults (47%) said they have been less active than they wanted to be since the pandemic started, and close to three in five (58%) reported experiencing undesired weight changes.

Among those who gained more weight than they wanted, the average amount of weight gained was 26 pounds, with a median of 15 pounds. On the other hand, the average amount of weight lost among those who lost more than they wanted to was 27 pounds, with a median of 15 pounds. More than one in five Americans (23%) said they have been drinking more alcohol during the COVID-19 pandemic, with those who have been drinking more consuming an average of 10 drinks per week (and a median of six drinks per week) compared with an average of two drinks (and a median of one drink) per week among those who did not report drinking more.

Adults also reported separation and conflict as causes for straining and/or ending of relationships. Half of adults (51%, particularly essential workers at 61%) said they have loved ones they have not been able to see in person in the past two years as a result of the COVID-19 pandemic. Strikingly, more than half of all U.S. adults (58%) reported experiencing a relationship strain or end as a result of conflicts related to the COVID-19 pandemic, including canceling events or gatherings due to COVID-19 concerns (29%); difference of opinion over some aspect of vaccines (25%); different views of the pandemic overall (25%); and difference of opinion over mask-wearing (24%).

Strained social relationships and reduced social support during the pandemic make coping with stress more difficult. In fact, more than half of respondents (56%) said that they could have used more emotional support than they received since the pandemic started. “We know from decades of research that healthy and supportive relationships are key to promoting resilience and building people’s mental wellness,” said Evans. “Particularly during periods of prolonged stress, it’s important that we facilitate opportunities for social connection and support.”

The majority of parents reported concerns regarding child(ren)’s development, including social life or development (73%), academic development (71%) and emotional health or development (71%). More than two-thirds of parents reported concern about the pandemic’s impact on their child’s cognitive development (68%) and their physical health/development (68%).

“Living through historic threats like these often has a lasting, traumatic impact on generations,” said Evans. “As a society, it’s important that we ensure access to evidence-based treatments and that we provide help to everyone who needs it. This means not only connecting those in distress with effective and efficient clinical care, but also mitigating risk for those more likely to experience challenges and engaging in prevention for those who are relatively healthy.”

More information on the findings and how to handle stress and trauma related to Ukraine is available at www.stressinamerica.org. APA psychologists are available for media interviews to discuss these findings and provide science-based recommendations on how to address this mental health crisis.

METHODOLOGY

The 2022 Pandemic Anniversary Survey was conducted online within the United States by The Harris Poll on behalf of the American Psychological Association between Feb. 7–14, 2022, among 3,012 adults age 18+ who reside in the U.S. Interviews were conducted in English and Spanish. Data were weighted to reflect proportions in the population based on the 2021 Current Population Survey (CPS) by the U.S. Census Bureau.

Weighting variables included age by gender, race/ethnicity, education, region, household income, and time spent online. Latino adults were also weighted for acculturation, taking into account respondents’ household language as well as their ability to read and speak in English and Spanish. Country of origin (U.S./non-U.S.) was also included for Latino and Asian subgroups.

Weighting variables for Gen Z adults (ages 18 to 25) included education, age by gender, race/ethnicity, region, household income, and size of household, based on the 2021 CPS. Propensity score weighting was used to adjust for respondents’ propensity to be online. Respondents for this survey were selected from among those who have agreed to participate in Harris’ surveys. The sampling precision of Harris online polls is measured by using a Bayesian credible interval. For this study, the sample data is accurate to within + 2.9 percentage points using a 95% confidence level.

This credible interval will be wider among subsets of the surveyed population of interest. All sample surveys and polls, whether or not they use probability sampling, are subject to other multiple sources of error, which are most often not possible to quantify or estimate, including but not limited to coverage error, error associated with nonresponse, error associated with question wording and response options, and post-survey weighting and adjustments.

The March late-breaking survey was conducted online within the United States between March 1–3, 2022, among 2,051 adults (age 18 and over) by The Harris Poll on behalf of the American Psychological Association via its Harris On Demand omnibus product. Data were weighted where necessary by age, gender, race/ethnicity, region, education, marital status, household size, household income, and propensity to be online, to bring them in line with their actual proportions in the population. The sampling precision of Harris online polls is measured by using a Bayesian credible interval. For this study, the sample data is accurate to within + 2.8 percentage points using a 95% confidence level.

US Economy Adds 678,000 Jobs In February, Unemployment Dips To 3.8%

The U.S. added 678,000 jobs and the unemployment rate dropped to 3.8 percent in February, according to data released Friday by the Labor Department.

Unprecedented demand for workers and resilient consumer spending helped power another strong month of job growth in February. Economists expected the U.S. to add roughly 400,000 jobs last month, far less than the actual haul in the February jobs report, and push the jobless rate to 3.9 percent.

“If we see more numbers like this moving forward, we can be optimistic about this year. Employment is growing at a strong rate and joblessness is getting closer and closer to pre-pandemic levels,” said Nick Bunker, economic research director at Indeed.

“In these uncertain times, we cannot take anything for granted. But if the recovery can keep up its current tempo, several key indicators of labor market health will hit pre-pandemic levels this summer,” he said.

The Bureau of Labor Statistics (BLS) said the U.S. saw “widespread” job growth in February led by a surge in service sector hiring — a promising sign for industries still recovering from the onset of the pandemic.

Leisure and hospitality employment rose by 179,000 jobs in February, led by a gain of 124,000 jobs in restaurants and bars. Professional and business services added 95,000 jobs, the health care sector added 64,000 jobs and construction employment rose by 60,000 after staying flat in January.

Transportation and warehousing employment rose by 48,000 in February, and retail trade employment rose by 37,000.

The BLS also revised the December and January job gains up by a combined 92,000 jobs.

While the labor force participation rate stayed flat, the February jobs report showed other signals of labor shortages easing and more Americans returning to the workforce.

Average hourly earnings rose 5.1 percent over the past 12 months, down from 5.7 percent in January. Wages have risen sharply as employers struggled to fill a record number of job openings from a smaller pool of workers than before the pandemic.

The number of Americans who said they could not look for a job because of the pandemic — who are not counted as unemployed — fell from 1.8 million in January to 1.2 million last month. The number of people who lost hours at work because of a pandemic-related shutdown also sunk from 6 million in January to 4.2 million in February.

“With the Omicron wave receding rapidly, the labor market has unlocked faster jobs growth. Additionally, employer demand for workers exceeds labor supply significantly, which is likely to keep jobs growth healthy even if demand slows amid disruptions from the war in Ukraine and rising interest rates in coming months,” said Daniel Zhao, senior economist at Glassdoor.

While the U.S. labor market held strong in February, economists are concerned about the potential fallout of the war in Ukraine and the sanctions imposed on Russia in response. A surge in oil prices, steep drop in economic activity or retaliation from Russia could dent the U.S. economy and risk stoking inflation even higher after hitting the highest annual rate in 40 years.

The jobs report will keep the Federal Reserve on track to raise interest rates in March to help cool inflation and tame what Fed Chairman Jerome Powell on Thursday called an “overheated” labor market. Even so, Powell said the deep uncertainty driven by the war could still force the Fed to adjust the pace of future rate hikes.

“The war in Ukraine reemphasizes the risk of inflation in the economic recovery, especially as price increases are concentrated in areas that the Federal Reserve may not have much control over,” Zhao wrote.

“Ultimately, however, today’s jobs report helps build confidence in the resilience of the recovery and its ability to continue driving jobs growth despite unanticipated headwinds.”

U.S. National Debt Skyrockets Past $30 TRILLION

The U.S. national debt has surpassed $30 trillion, the highest it’s ever been, as borrowing surged during the COVID-19 pandemic, according to data published by the Treasury Department on Tuesday.

National debt skyrocketed pandemic, but the nation reached the milestone much earlier than projected as a result of the trillions in federal spending being used to combat the pandemic, the New York Times reported.

‘Hitting the $30 trillion mark is clearly an important milestone in our dangerous fiscal trajectory,’ Michael Peterson, head of the Peter G. Peterson Foundation, told the Times.

‘For many years before Covid, America had an unsustainable structural fiscal path because the programs we’ve designed are not sufficiently funded by the revenue we take in,’ he added.

In January 2020, the Congressional Budget Office projected that the national debt would reach $30 trillion by the end of 2025. But it was reached much sooner due to the pandemic.

The $5 trillion used to combat the pandemic, which was used to fund jobless benefits, financial support for small businesses and stimulus payments, was financed with borrowed money, the Times reported.

The federal government now owes almost $8 trillion to foreign investors, led by Japan and China, which must be repaid with interest, according to CNN.

‘That means American taxpayers will be paying for the retirement of the people in China and Japan, who are our creditors,’ David Kelly, chief global strategist at JPMorgan Asset Management, explained to CNN Business.

The national debt has been skyrocketing since the Great Recession when the debt was $9.2 trillion in December 2007,  according to Treasury data.

But by the time, former President Donald Trump took office, the national debt stood at nearly $20 trillion, CNN reported.

‘Covid exacerbated the problem. We had an emergency situation that required trillions in spending,’ said Michael Peterson, CEO of the Peterson Foundation. ‘But the structural problems we face fiscally existed long before the pandemic.

The U.S. Is Considering A Radical Rethinking Of The Dollar For Today’s Digital World

Since its establishment as the country’s national currency, the dollar has undergone many updates and changes, but nothing compares to the proposal being debated today.

The U.S. is gingerly considering whether to adopt a digital version of its currency, one better suited for today’s increasingly cashless world, ushering in what could be one of the dollar’s most fundamental transformations.

In that scenario, the U.S. would not only mint the coins and print paper bills but also issue digital cash, or a central bank digital currency (CBDC), that would be stored in apps or “digital wallets” on our smartphones.

We could then use them to pay for things, just like we do with Venmo or Apple Pay, and no physical money would change hands.

It’s a vision of a cashless future that other countries are already embracing. China, for example, has unveiled the digital yuan on a trial basis. India this week said it would create a digital rupee.

Now the U.S. is weighing whether it wants to get into the game.

Last month, the Federal Reserve released a much-anticipated paper, laying out the advantages and disadvantages of a digital currency.

The Fed says it’s a first step, meant to kick-start an important conversation among policymakers and to gather feedback from average people to some of the country’s largest financial institutions.

So, how would it actually work?

Policymakers stress these are early days yet, and there is a lot that needs to be hammered out. All in all, the transactions conducted with digital dollars probably wouldn’t seem too different from existing private alternatives that allow us to pay for things by bringing our smartphones next to digital readers.

China, for example, allows digital yuan payments in the cities in which the country is piloting its digital currency, allowing citizens to make payments via an app set up by the government.

Reducing or eliminating fees is one clear benefit.

When you make a contactless payment today, it may seem immediate, but according to Chris Giancarlo, the former chairman of the Commodity Futures Trading Commission, a lot happens behind the scenes.

“My mobile device tells his mobile device to inform a whole series of banks, to confirm who I am, how much money is in my bank, that there is enough money to move from my bank to his bank,” he says.

And at each step of the way, there are transaction fees. In 2020, they added up to more than $110 billion, which was generally shouldered by businesses.

With a digital dollar, you could in theory eliminate those middlemen. If you wanted to buy a sandwich, for instance, you could transfer money from a digital wallet directly to a cashier.

It wouldn’t necessarily entirely eliminate nongovernment players. In China, for example, users who want to use the digital yuan can go to banks to add money to their digital wallets.

But just having digital dollars in circulation could put pressure on credit card companies and payment processors to lower fees to be competitive. That is, if enough people start using the Fed-run version.

In China, adoption of the e-renminbi has been slow given that private providers such as WeChat or Alipay are already pretty popular and entrenched.

Another argument for creating a digital dollar is to open up digital transactions to Americans who don’t have bank accounts. According to the Fed, more than 5% of U.S. households are “unbanked.”

Providing them with a digital wallet would allow people to participate in our increasingly cashless financial system.

It would also make it easier for the federal government to distribute benefits.. For example, having a digital dollar in place during the pandemic could have allowed the government to transfer relief payments directly into digital wallets.

What are the challenges?

Without question, one of the biggest issues is privacy. Because the Fed would implement and oversee the project, the central bank could accrue a vast amount of data, potentially giving it a lot more visibility into everyone’s financial life.

That could be useful to regulators who want to combat money laundering, for example, but it would also raise serious privacy concerns.

That makes it critical to sort out how much information the Fed would have, according to Raghuram Rajan, a professor of finance at The University of Chicago Booth School of Business and a former governor of the Reserve Bank of India.

“There will be legitimate questions about how much the government knows about each individual, and also, how much it can act to restrain activities by individuals,” he says.

Cybersecurity is another critical issue, especially given the uptick in hacks and heists at cryptocurrency exchanges.

To implement a digital dollar, the U.S. government would need to modernize the country’s financial infrastructure to stave off attacks.

A digital version of the Chinese yuan is displayed during a trade fair in Beijing in September. China is among a handful of countries that are experimenting with national digital currencies.

So what’s next?

Fed Chair Jerome Powell and his colleagues are moving ahead cautiously and methodically.

The Fed is in the process of soliciting feedback from the public after releasing its paper last month. And last week, the Federal Reserve Bank of Boston released preliminary results of its ongoing research into the technological challenges associated with implementing a digital currency in the U.S.

It would take five to 10 years to introduce a digital currency in the U.S., several experts say, but they argue policymakers can’t sit idly by.

There is concern that by moving slowly, the U.S. is letting other countries shape standards for national digital currencies, and the popularity of the dollar could be diminished.

After all, for decades, it has been the world’s primary reserve currency, meaning many countries hold their reserves in U.S. dollars.

But Powell has made it clear he’s in no hurry. Last year, a reporter asked the central banker whether he was worried the U.S. was falling behind countries like China.

“I think it’s more important to do this right than to do it fast,” he replied.

Oil Prices Hit $90 A Barrel For The First Time Since 2014

US oil prices jumped above $90 a barrel last week for the first time in more than seven years. The latest rally comes just a day after OPEC and its allies declined to aggressively ramp up production to cool off red-hot energy prices.

Crude jumped 2.2% to $90.15 a barrel in afternoon trading. That marks the first time US oil prices surpassed the $90 threshold on an intraday basis since October 2014.

Oil has surged by 37% since closing at a recent low of $65.57 a barrel on December 1 amid Omicron fears and the fallout from the US-led intervention into energy markets.

Last week, Brent crude, the world benchmark, closed above $90 a barrel for the first time since October 2014.

OPEC+, led by Saudi Arabia and Russia, announced Wednesday it will stick to its previously telegraphed plan to increase production by 400,000 barrels per day. That’s despite the fact that some on Wall Street suggested OPEC+ could boost production more substantially to meet demand.

“OPEC+ opted to hold its shortest meeting on record and rubber-stamped the 400 kb/d monthly increase, sticking with a hands-off the wheel management approach despite global inflationary fears,” RBC Capital Markets strategists wrote in a note to clients Thursday.

Indian Union Budget Reveals Importance Of Cryptocurrency

At last, it is a piece of surprising news that Digital currency is also being introduced in the Indian fiduciary system as part of yet another dream project of Digital India. The Finance Minister Nirmala Sitaraman and the  Governor of the Central Bank of India had elaborated on this. We have heard earlier that the Indian Government was also making a move to ban foreign digital currencies in the country. The Central Bank is in the process of making an official announcement soon on its development model of digital currency (CBDC). Nirmala Sitharaman has said that the Indian Digital Rupee will be launched using blockchain technology in the financial year 2022-23.

Anyway, the Supreme Court made a favorable ruling in favor of lifting the Reserve Bank’s ban on crypto use. This ruling created a new wave among Indian investors and led to a rapid rise in retail. At the same time, investors are optimistic about the central bank and the emergence of digital currencies.

Union Finance Minister Nirmala Sitharaman had announced in her budget speech that the distribution of digital currency would begin. But there are widespread doubts about what a digital rupee is. The announcement comes at a time when the central Government is considering a strong policy to curb the misuse of cryptocurrencies. At the Republican Economic Summit in November 2021, Rajeev Chandrasekhar, Electronics & IT, hinted at the introduction of an official digital currency.

 What is Digital Rupee?

The digital currency of the Reserve Bank of India will be based on blockchain technology, the technology behind Bitcoin, and other popular cryptocurrencies. According to the Finance Minister, this will pave a more efficient and cost-effective currency management system. However, the future of Bitcoin and other cryptocurrencies is unclear.

The RBI has already been keenly watching the performance of major economies worldwide and their respective central banks for CBDC schemes. As a result, the central bank has almost decided on the issue of official digital currency. While the Reserve Bank mentions the need for central banking digital currency (CBDC), it also makes it clear that the government is concerned about the risks surrounding other cryptocurrencies. Why has the government not yet officially banned such currencies? Why did the Supreme Court overturn the ban on banks operating cryptocurrencies? The questions are numerous.

As economists fear that cryptocurrency is one of the most widely used dangerous currencies globally, without any government control. It can also be described as a private currency and minting huge profits sometimes. All of these operate with the support of some unknown sovereign guarantees. No country provides any security. For example, a Rs.500 Indian currency note!. The Reserve Bank Governor guarantees on  500 currency note. Even if it is paper, the RBI pays for it. But governments do not ensure the value of digital currencies like Bitcoin.

However, we know that the value of crypto like Bitcoin is supported by complex programming. No one or any government can change it individually, and it involves multiple checks at multiple computer servers worldwide, related to its value. Therefore, the easiest way to understand digital currency  is to use a digital currency that can only be transferred from one person to another via the Internet on platforms like Coinbase.

However, the RBI is not the first financial institution in the world to make such a drastic move. Reports indicate that India is far behind its technological  derivatives  in terms of crypto controls. We were hearing that China has been working on this for so many  years;  supported by the Chinese Central Bank and government approval. The Chinese widely use digital currency for e-commerce portals, offline shops, and other outlets through smartphones.

However, there is a difference between CBDC and cryptocurrency as the latter has some basic features. Those features cannot be copied to digital currencies. Cryptocurrencies, by nature, operate on the basic principle of anonymity. The exciting part is that the details of the seller and the buyer cannot be tracked. But beware,  in the case of a digital currency released by the central bank will have a whole tracking system, just like a standard currency. This is the kind of digital currency used in China. This ensures that transactions will take place under the supervision of the government. Go ahead Digital India!

The Evolution Of Global Poverty, 1990-2030

The last 30 years have seen dramatic reductions in global poverty, spurred by strong catch-up growth in developing countries, especially in Asia. By 2015, some 729 million people, 10% of the population, lived under the $1.90 a day poverty line, greatly exceeding the Millennium Development Goal target of halving poverty. From 2012 to 2013, at the peak of global poverty reduction, the global poverty headcount fell by 130 million poor people.

This success story was dominated by China and India. In December 2020, China declared it had eliminated extreme poverty completely. India represents a more recent success story. Strong economic growth drove poverty rates down to 77 million, or 6% of the population, in 2019. India will, however, experience a short-term spike in poverty due to COVID-19, before resuming a strong downward path. By 2030, India is likely to essentially eliminate extreme poverty, with less than 5 million people living below the $1.90 line. By 2030, the only Asian countries that are unlikely to meet the goal of ending extreme poverty are Afghanistan, Papua New Guinea, and North Korea.

In other parts of the world, poverty trends are disappointing. In Latin America, poverty fell rapidly at the beginning of this century but has been rising since 2015, with no substantial reductions forecast by the end of this decade. In Africa, poverty has been rising steadily, thanks to rapid population growth and stagnant economic growth. Exacerbated by a pandemic-induced rise in poverty of 11%, African poverty shows little signs of decline through 2030.

These trends point to the emergence of a very different poverty landscape. Whereas in 1990, poverty was concentrated in low-income, Asian countries, today’s (and tomorrow’s) poverty is largely found in sub-Saharan Africa and fragile and conflict-affected states. By 2030, sub-Saharan African countries will account for 9 of the top 10 countries by poverty headcount. Sixty percent of the global poor will live in fragile and conflict-affected states. Many of the top poverty destinations in the next decade will fall into both of these categories: Nigeria, Democratic Republic of the Congo, Mozambique and Somalia. Global efforts to achieve the SDGs by 2030, including eliminating extreme poverty, will be complicated by the concentration of poverty in these fragile and hard-to-reach contexts.

By 2030, poverty will be associated not just with countries, but with specific places within countries. Middle-income countries will be home to almost half of the global poor, a dramatic shift from just 40 years earlier. Nigeria is now the global face of poverty, overtaking India as the top poverty destination in 2019. (While India temporarily regained its title due to COVID-19, which pushed many vulnerable Indians back below the poverty line, Nigeria will reclaim the top spot by 2022.) In 2015, Nigeria was home to 80 million poor people, or 11% of global poverty; by 2030, this number could grow to 18%, or 107 million.

Poverty numbers and trends have traditionally been reported on a country-by-country basis. However, today we see that low-income countries have significant corridors of prosperity, while middle-income countries can have large pockets of poverty. With advances in geospatial and sub-national data, there is a growing push to move from country-wide metrics to sub-national data, in order to better identify and target these poverty “hotspots.”

As Inflation Soars, A Look At What’s Inside The Consumer Price Index

After many years of historically low inflation, consumer prices in the United States continued their steep ascent last month. The Consumer Price Index, the most widely followed inflation gauge, increased 7.0% from December 2020 to December 2021 – its highest rate in nearly 40 years.

The CPI – or, to give it its full name, the Consumer Price Index for All Urban Consumers (CPI-U) – isn’t the government’s only measure of inflation. For that matter, it isn’t even the only version of the CPI. Pew Research Center analyses typically use the CPI’s Retroactive Series, especially when adjusting prices or dollar values over several years or decades, because that series adjusts the CPI for previous years to reflect current methodology. There’s also the Chained CPI, which is meant to reflect how consumers alter their buying patterns in response to changes in relative prices – for example, buying more chicken when beef becomes more expensive. The Chained CPI often (but not always) comes in a bit below the “regular” CPI-U: It rose 6.9% between December 2020 and December 2021.

But the CPI-U is the most widely cited inflation metric, so it’s worth popping the hood and looking inside to see how it works.

The Bureau of Labor Statistics (BLS), which is responsible for the CPI, starts by collecting price data for hundreds of discrete goods and services – the so-called “market basket” – from around 8,000 housing units and 23,000 retailers, service providers and online outlets in 75 urban areas around the country. Data on rents is gathered from some 50,000 landlords and tenants. The items sampled, and their weights in the overall index, are determined by the Consumer Expenditure Survey, which is carried out for BLS by the Census Bureau.

The BLS reports index weights for dozens of categories, subcategories and specific items in the CPI’s basket of goods and services. The biggest category by far is shelter, which accounts for nearly a third of the index. The single weightiest item, at about 22.3%, is “owner’s equivalent rent of primary residence” – essentially how much homeowners would have to pay if they were renting their homes. (The idea is to separate out shelter, the service provided by a house, from whatever value the house might have as an investment.)

While shelter costs carry the most weight in the CPI, they’ve not risen nearly as much as the index as a whole. In December, owner’s equivalent rent was up 3.8% compared with December 2020, and regular rent of primary residence was just 3.3% higher. The one big exception among shelter costs was lodging away from home, a category that mostly tracks hotel and motel room rates, where prices were 27.6% higher than a year earlier. However, that subcategory accounts for less than 1% (0.849%, to be precise) of the CPI.

The next-biggest category, food, accounts for just under 14% of the index. Groceries, or “food at home,” makes up a bit more than half of that category. Grocery prices were 6.5% higher than a year ago, which will come as no surprise to anyone who’s been to a supermarket lately. Meats, especially beef and pork, led the way, with prices for beef roasts and steaks more than 20% higher than a year ago, bacon up 18.6% and chicken parts up 11.5%. (On the other hand, prices for hot dogs and cheese both are down 0.6%.)

Eating out has gotten more expensive too. Prices for full-service meals and snacks consumed away from home were up 6.6% from December 2020, and limited-service meals and snacks were up 8%. School breakfasts and lunches were down by nearly two-thirds, perhaps because the U.S. Department of Agriculture has authorized free meals for all children in public schools this academic year.

Besides at the supermarket, consumers also feel the effects of inflation acutely at the fuel pump. Gasoline accounts for just 4% of the overall CPI, but prices for it have risen more than any other good or service in the CPI basket over the past year. Regular unleaded gasoline, for instance, is up 50.8% since December 2020. It should be noted that gas prices fell sharply in 2020, as demand plunged because much of the U.S. economy was shut down. As the economy reopened and demand came back, so did gas prices, though they’ve since risen 20% or more above pre-pandemic levels.

Energy goods and services, a category of which gasoline is a major component, accounts for roughly 7.5% of the overall CPI. Prices for fuels used for home heating and cooking also are sharply higher than a year ago: Fuel oil is up 41%, propane, kerosene and firewood are up 33.8%, and piped natural gas is up 24.1%.

Aside from motor fuels, the vehicles that burn them also loom relatively large in the CPI. New vehicles account for nearly 3.9% of the index; prices for new cars rose 12% from December 2020 to December 2021, and new trucks prices almost as much (11.6%). But the real movement was for used vehicles: Prices for used cars and trucks, which make up about 3.4% of the index, have soared 37.3% over the past 12 months. Why? The pandemic has disrupted and depressed production of new vehicles, while low interest rates have increased demand for cars and trucks. Buyers who couldn’t find the new vehicles they wanted have moved over to the used lot, increasing demand at the same time as the flow of pre-owned cars and trucks dwindled.

India’s Economy To Grow At 8.0-8.5% In 2022-23

The Economic Survey 2021-22 has projected the economy to grow at 8.0-8.5 per cent in 2022-23, thereby moderating the growth forecast from 9.2 per cent expansion for 2021-22 outlined by the National Statistical Office (NSO) in its first advance estimates of Gross Domestic Product (GDP).

Last year’s Survey had projected real GDP to record a 11 per cent growth in 2021-22, post a 7.3 per cent contraction in 2020-21. While this year’s growth comes on a low base year economic output, the expansion next year has to be seen from the recovery levels in economic output.

The Survey flags inflation as a concern while assessing the macroeconomic stability indicators and suggests that the Indian economy is “well- placed” to take on the challenges of 2022-23.

India’s Finance Minister Nirmala Sitharaman on January 31st tabled the Economic Survey 2021-22 in the Lok Sabha, the Lower House of India’s Parliament.

“Growth in 2022-23 will be supported by widespread vaccine coverage, gains from supply-side reforms and easing of regulations, robust export growth, and availability of fiscal space to ramp up capital spending. The year ahead is also well poised for a pick-up in private sector investment with the financial system in a good position to provide support to the revival of the economy,” it said.

The growth projection for the next year based on “the assumption that there will be no further debilitating pandemic related economic disruption, monsoon will be normal, withdrawal of global liquidity by major central banks will be broadly orderly and oil prices will be in the range of $70-$75/bbl,” the Survey said.

The Survey projection is comparable with the World Bank’s and Asian Development Bank’s latest forecasts of real GDP growth of 8.7 per cent and 7.5 per cent respectively for 2022-23. As per the IMF’s latest World Economic Outlook (WEO) growth projections released on 25th January, 2022, India’s real GDP is projected to grow at 9 per cent in both 2021-22 and 2022-23 and at 7.1 per cent in 2023-24. It stressed the need to watch up for imported inflation. India’s Consumer Price Index inflation stood at 5.6 per cent in December 2021 but wholesale price inflation, however, has been running in double-digits. “Although this is partly due to base effects that will even out, India does need to be wary of imported inflation, especially from elevated global energy prices,” it said.

Last year’s Economic Survey had pitched for an expansionary fiscal policy in 2021-22 to boost growth and advised the government towards significant privatisation of state-owned companies. A privatisation push and review of the banking sector asset quality was recommended in last year’s survey.

Setting the tone for the Union Budget 2022-23, to be presented on Tuesday, the Economic Survey 2021-22 tabled in the Parliament on Monday stressed on the need for the government to provide a buffer against stresses such as the uncertainty in the global environment, the cycle of liquidity withdrawal by major central banks, etc.

India’s economic growth in 2022-23 could spring a surprise: ASSOCHAM

Despite the Covid-19 pandemic, India’s economic growth in the upcoming financial year, i.e., 2022-23, can be surprising on the higher side, ASSOCHAM Secretary General said on Monday.

“While the 8-8.5 per cent GDP projections for FY23 are on the back of a high base of 9.2 per cent in the current financial year, ASSOCHAM is of the view that India’s economic growth can surprise us on the higher side.

“Even as the pandemic is still raging in most parts of the world, its latest variant is less damaging. Besides, with 75 per cent of eligible Indians fully vaccinated and the booster dose being rolled out, India would be far better prepared to take on the challenges,” ASSOCHAM Secretary General Deepak Sood said.

ASSOCHAM said it shares the prognosis of the Economic Survey that the Indian economy is well placed to take on the challenges of 2022-23, riding on the back of continuous reforms in supply side and safety nets to the vulnerable sections of the society.

Sood further said that the advance estimates suggest manufacturing to be growing by 12.5 per cent in the current fiscal while services would expand by 8.5 per cent.

“Traditionally, services grow at a faster face. Clearly, the Covid impact on contact intensive industries is reflecting even as manufacturing has been aided by supply side reforms. Once the impact of PLI scheme kicks in, we expect the manufacturing to be leading the growth for the foreseeable future,” Sood said, adding that robust performance in exports has also helped the manufacturing.

He further said that the Economic Survey is right in its assessment about the investment scenario, saying: “The private investment recovery is still at a nascent stage, though there are increased activities in the brownfield projects. Heavy lifting would still be needed by the government with capital expenditure, and we expect that in the Budget.”

The Survey has pointed out that the government has the fiscal capacity to maintain the support, and ramp up capital expenditure when required, ASSOCHAM said in a statement.

“Schemes like credit guarantee with 100 per cent guarantee for additional funding of Rs 4.5 lakh crore to MSMEs have provided critical relief to the sectors severely hit by the pandemic. More such measures are expected in the Budget,” it said.

“The Survey has re-emphasised the government’s asset monetisation and disinvestment agenda, which spells out bare minimum presence of government ownership even in the strategic sectors. Successful completion of Air India disinvestment should infuse confidence for the roadmap,” it added.

Gold Demand Globally Rose 10% In 2021

Global demand for gold increased 10 per cent in the calendar year 2021, led by improved economic growth and investors’ sentiment during the October-December quarter, the Word Gold Council said on Friday.

Gold demand jumped almost 50 per cent in the period, thereby hitting a 10-quarter high.

The total demand for the yellow metal was at 4,021 tonnes, excluding the “over the counter” figures.

“Demand for gold in the consumer-driven jewellery and technology sectors recovered throughout the year in line with economic growth and sentiment, while central bank buying also far outpaced that of 2020. Investment demand was mixed in an environment of opposing forces: high inflation competed with rising yields for investors’ attention,” the council added.

Jeweler fabrication staged a strong recovery in 2021 and it grew 67 per cent to 2,221 tonnes in 2021.

“This was in good part linked to Q4 demand, which – at 713 tonnes – saw the strongest quarterly jeweler consumption since Q2 2013,” the council said.

Global holdings of gold ETFs fell by 173 tonnes in 2021 in sharp contrast to 2020’s record 874 tones rise.

Bar and coin investment jumped 31 per cent to an eight-year high of 1,180 tones.

“Central banks accumulated 463 tonnes of gold in 2021, 82 per cent higher than the 2020 total and lifting global reserves to a near 30-year high. The pace of buying slowed in the second half, with a 22 per cent Y-o-Y decline in Q4.”

Further, gold used in technology rose nine per cent in 2021, to reach a three-year high of 330 tonnes. (IANS)

Number Of Indian Billionaires Grows To 142 In 2021 From 102

The number of Indian billionaires grew from 102 to 142, while 84 per cent of households in the country suffered a decline in their income in 2021, which was also a year marked by tremendous loss of life and livelihoods, according to non profit Oxfam India’s latest report published on Monday.

The report ‘Inequality Kills’ comes ahead of the World Economic Forum’s Davos Agenda.

It indicates that the collective wealth of India’s 100 richest people hit a record high of Rs 57.3 lakh crore in 2021.

In India, during the pandemic (since March 2020, through to November 30th, 2021) the wealth of billionaires increased from Rs 23.14 lakh crore to Rs 53.16 lakh crore.

More than 4.6 crore Indians, meanwhile, are estimated to have fallen into extreme poverty in 2020 (nearly half of the global new poor according to the United Nations).

The stark wealth inequality in India is a result of an economic system rigged in favour of the super-rich over the poor and marginalised, the report said

It advocates a one per cent surcharge on the richest 10 per cent of the Indian population to fund inequality combating measures such as higher investments in school education, universal healthcare, and social security benefits like maternity leaves, paid leaves and pension for all Indians.

“The ‘Inequality Kills’ briefing shows how deeply unequal our economic system is and how it fuels not only inequality but poverty as well. We urge the Government of India to commit to an economic system which creates a more equal and sustainable nation,” Amitabh Behar, CEO, Oxfam India said in a statement.

Further, Behar said that Oxfam’s global briefing points to the stark reality of inequality contributing to the death of at least 21,000 people each day, or one person every four seconds.

Moreover, the pandemic set gender parity back from 99 years to now 135 years. Women collectively lost Rs 59.11 lakh crore in earnings in 2020, with 1.3 crore fewer women in work now than in 2019, the report showed.

“It has never been so important to start righting the wrongs of this obscene inequality by targeting extreme wealth through taxation and getting that money back into the real economy to save lives,” Behar said.

“India can show the world that democratic systems are capable of wealth redistribution and inclusive growth where no one is left behind. India’s fight against inequality and poverty must be supported by the billionaires who made record profits in the country during the pandemic,” he suggested. (IANS)

Income Of Poorest Fifth India Plunged 53% In 5 Years; Those At Top Surged

In a trend unprecedented since economic liberalisation, the annual income of the poorest 20% of Indian households, constantly rising since 1995, plunged 53% in the pandemic year 2020-21 from their levels in 2015-16. In the same five-year period, the richest 20% saw their annual household income grow 39% reflecting the sharp contrast Covid’s economic impact has had on the bottom of the pyramid and the top.

This stark K-shaped recovery emerges in the latest round of ICE360 Survey 2021, conducted by People’s Research on India’s Consumer Economy (PRICE), a Mumbai- based think-tank.

The survey, between April and October 2021, covered 200,000 households in the first round and 42,000 households in the second round. It was spread over 120 towns and 800 villages across 100 districts.

While the pandemic brought economic activity to a standstill for at least two quarters in 2020-21 and resulted in a 7.3% contraction in GDP in 2020-21, the survey shows that the pandemic hit the urban poor most and eroded their household income.

Splitting the population across five categories based on income, the survey shows that while the poorest 20% (first quintile) witnessed the biggest erosion of 53%, the second lowest quintile (lower middle category), too, witnessed a decline in their household income of 32% in the same period. While the quantum of erosion reduced to 9% for those in the middle income category, the top two quintiles — upper middle (20%) and richest (20%)— saw their household income rise by 7% and 39% respectively.

The survey shows that the richest 20% of households have, on average, added more income per household and more pooled income as a group in the past five years than in any five-year period earlier since liberalisation. Exactly the opposite has happened for the poorest 20% of households — on average, they have never actually seen a decrease in household income since 1995. Yet, in 2021, in a huge knockout punch caused by Covid, they earned half as much as they did in 2016.

How disruptive this distress has been for those at the bottom of the pyramid is reinforced by the fact that in the previous 11-year period between 2005 and 2016, while the household income of the richest 20% grew by 34%, the poorest 20% saw their household income surge by 183% at an average annual growth rate of 9.9%.

Coming in the run-up to the Budget, the task for the Government is cut out.

“As the Finance Minister is finalising her budget proposals for 2022-23 to give shape to the roadmap for economic revival of the country,” said Rajesh Shukla, MD and CEO, PRICE, “we need a K-shaped policy too that addresses the two ends of the spectrum and a lot more thinking on how to build the bridge between the two.”

Opinion |P Chidambaram writes: No political price yet

This couldn’t be more timely. Said PRICE founder and one of the authors of the survey Rama Bijapurkar. “Or else, we are back to a tale of two Indias, a narrative we thought we were rapidly getting rid of. The good news is that we have built a far more efficient welfare state for the disbursal of benefit be it DBT or vaccination for all.”

The survey showed that while the richest 20% accounted for 50.2% of the total household income in 1995, their share has jumped to 56.3% in 2021. On the other hand, the share of the poorest 20% dropped from 5.9% to 3.3% in the same period.

As for India Inc, it has been in a better position to weather the disruption. The pandemic accelerated further formalisation of the economy with large companies benefitting at the cost of smaller ones. The survey also shows that while job losses were quite evident among Small and Medium Enterprises in the casual labour segment, large companies did not witness much of that.

Even among the poorest 20 per cent, those in urban areas got more impacted than their rural counterparts as the first wave of Covid and the lockdown led to stringent curbs on economic activity in urban areas. This resulted in job losses and loss of income for the casual labour, petty traders household workers.

Data shows that there has been a rise in the share of poor in cities. While 90 per cent of the poorest 20 per cent in 2016, lived in rural India, that number had dropped to 70 per cent in 2021. On the other hand the share of poorest 20 per cent in urban areas has gone up from around 10 per cent to 30 per cent now.

“The data reflects that the casual labour, petty trader, household workers among others in Tier 1 and Tier 2 cities got hit most by the pandemic. During the survey we also noticed that while in rural areas people in lower middle income category (Q2) have moved to middle income category (Q3), in the urban areas the shift has been downwards from Q3 to Q2. In fact, the rise in poverty level of urban poor has pulled down the household income of the entire category down,” said Shukla.

“The elephant in the room is investment,” said Bijapurkar. “Inspiring confidence through long-term policy stability and improving ease of doing business should make the tide rise again and sweep small business and individuals up along with it. Most big companies are doing well and don’t need more help but we need to work the economy for the bottom half.”

US Consumer Prices Rise At Fastest Rate In Nearly 40 Years

Prices in the US are rising at their fastest rate in almost 40 years, with inflation up 7% year-on-year in December. Strong demand and scarce supply for key items such as cars are driving the increases, which are putting pressure on policymakers to act.

The US central bank is expected to raise interest rates this year. The rise in borrowing costs is aimed at reducing demand by making purchases such as cars more expensive.

December’s increase marked the third month in a row that the US annual inflation rate has hovered above 6% – well north of policymakers’ 2% target. The last time the pace of inflation exceeded that level was 1982.

Housing costs were up 4.1% year-on-year, while the cost of groceries rose 6.5% – compared to a 1.5% annual average over the last 10 years.

Wednesday’s report from the Labor Department showed signs that some of the pressures may be easing. The cost of energy dropped 0.4% from November to December – its first decline since April. But over 12 months energy costs are up by nearly 30% and have returned to their upward trend in recent days.

“Overall, this is every bit as bad as we expected,” Paul Ashworth, chief economist at Capital Economics, said of the December inflation report.

Reacting to the latest report, President Joe Biden said that it “demonstrates that we are making progress in slowing the rate of price increases”.

He added that there is “more work to do” in the US and noted that “inflation is a global challenge, appearing in virtually every developed nation as it emerges from the pandemic economic slump”.

The price pressures occurring in the US have been seen to varying degrees around the world.

The Organisation for Economic Cooperation and Development, which represents more than 30 of the world’s largest economies, said this week that inflation among its members had hit its highest rate in 25 years in November.

Further rises

In the UK, inflation hit a 10-year high in November, while globally, prices are rising at their fastest pace since 2008, according to the World Bank.

While many countries are grappling with higher food and energy costs, the US has seen an unusually large pick-up in inflation.

That’s due in part to strong demand from households, whose spending got a boost from government coronavirus aid and shifted suddenly from things like travel to furniture during the pandemic.

Economists in the US were initially hopeful that the pressures would ease as the pandemic faded. But ongoing production snarls and the emergence of virus variants have made the price increases more persistent than expected.

“It’s proving more difficult than we had hoped to end the pandemic,” the head of America’s central bank, Jerome Powell, told Congress on Tuesday.

Sarah House, economist at Wells Fargo, said it is no longer likely that inflation will fade naturally as the pandemic abates, pointing to worker shortages and wages, which have also been rising – though not as fast as prices.

“Although the exceptional pace of goods inflation and momentum in shelter costs are still firmly rooted in the pandemic, the increasingly tight labour market and ensuing wage pressures will make it difficult for inflation to fall back on its own,” she said.

The issue has put pressure on the Biden administration, eroding consumer confidence despite other signs of a strong economy.

Mr Powell has pledged to keep inflation in check by raising interest rates. But on Tuesday he warned those moves would only go so far to address the problem if supply chain issues persist, pointing to risks from new shutdowns in China.

“Omicron, particularly if China sticks to a no-Covid policy, Omicron can really disrupt the supply chains again,” he said.

Official inflation figures from China on Thursday showed prices rose less than expected in November, with producer prices up 10.3% and consumer prices up 1.5%.

But that easing is not necessarily an indicator of what will happen elsewhere, said Gian Maria Milesi-Ferretti, senior fellow at the Brookings Institution, a Washington think tank.

“Indicators of what is happening [in China] to the labour market, to wage demands and to the supply bottlenecks that have pushed up some prices … those are more important indicators,” he said.

World Bank Downgrades 2022 Global Growth Forecast To 4.1%

The global economy is on track to grow by 4.1 per cent in 2022, down 0.2 percentage point from a previous projection, the World Bank Group said in its latest Global Economic Prospects release.

“The global recovery is set to decelerate markedly amid continued Covid-19 flare-ups, diminished policy support, and lingering supply bottlenecks,” the semiannual report added on Tuesday.

The global outlook is “clouded by various downside risks,” including renewed Covid-19 outbreaks due to new virus variants, the possibility of unanchored inflation expectations, and financial stress in a context of record-high debt levels, according to the report.

After rebounding to an estimated 5.5 per cent in 2021, global growth is expected to decelerate markedly to 4.1 per cent in 2022, the report noted. The latest projection for 2021 and 2022 is 0.2 percentage point lower than the June forecast, respectively.

The report also noted that the Covid-19 pandemic has raised global income inequality, partly reversing the decline that was achieved over the previous two decades, Xinhua news agency reported.

By 2023, annual output is expected to remain below the pre-pandemic trend in all emerging market and developing economy (EMDE) regions, in contrast to advanced economies, where the gap is projected to close.

Preliminary evidence suggests that the pandemic has also caused within-country income inequality to rise somewhat in EMDEs because of particularly severe job and income losses among lower-income population groups, according to the report.

“The world economy is simultaneously facing Covid-19, inflation, and policy uncertainty, with government spending and monetary policies in uncharted territory,” said World Bank Group President David Malpass.

Noting that rising inequality and security challenges are “particularly harmful” for developing countries, Malpass added that putting more countries on a favourable growth path requires concerted international action and a comprehensive set of national policy responses.

Eternalhealth Raises $10 Million Series A Funding After Initial $10 Million In Seed Financing

EternalHealth, the first new health plan to be approved in Massachusetts since 2013, announced today that it has raised another $10 million in Series A funding. This additional financing follows an initial $10 million in Seed and Pre-Series A investment by successful healthcare and tech entrepreneurs last summer.

John Sculley, former Apple CEO, is involved in the Series A funding round and believes in the mission of eternalHealth, which is founded by Pooja Ika, the first woman at the age of 24 to launch a new Medicare Advantage Health Plan in the United States.

“Around two decades ago, I decided I wanted to disrupt the healthcare industry by collaborating with entrepreneurs who believed in their mission,” said Sculley, former Apple CEO and an investors and shareholder in eternalHealth, “I truly believe we have a healthcare Moonshot with eternalHealth and I am excited to see how we can better the space together. I believe in Pooja’s mission and with the help of her team, she has been able to accomplish so much in one year.”

Ms. Ika said the Series A funding, which includes seed investors and additional successful technology and healthcare entrepreneurs, will be used to support the day-to-day operations, and help attract and retain membership, while most of the capital will be used as risk-based capital to support the company’s membership growth.

Typically, the launch of a new health plan takes two to three years and costs tens of millions of dollars, said Ms. Ika.

“At eternalHealth, we accomplished this historic goal within a year. The initial seed round helped us build a technology-powered infrastructure, optimize our operations, and hire a skilled team of 20 professionals,” added Ms. Ika. “Now, that we are operationally sound, we are actively trying to grow and increase our membership base. The goal has always been to build a sustainable business model, that is committed to doing things the right way.”

New insurers have raised hundreds of millions of dollars at the same stage Ms. Ika is at now, but Ms. Ika is very mindful about raising capital and said, “It is not because we cannot raise the capital, it is because we are being intentional with our use of capital. I strive to achieve the same results of some of my mentors who have started successful health plans across the country. Their advice to me was to get all of our regulatory approvals with as little capital as possible, and that is exactly what we did.”  Ms. Ika added that this is the first time ever that a health plan has been launched in the United States by a woman at 24 and not only that, but by a woman of color.

“Navigating through the healthcare system can be complicated, and insurance companies are not always the best at helping beneficiaries navigate through it,” said Ms. Ika. “eternalHealth is committed to empowering and educating our members so that they make informed decisions and take their care into their own hands. By educating our members, establishing collaborative relationships with the providers and health systems in our network, and using the latest technology and tools, we can deliver higher quality care at a lower cost to our members.”

eternalHealth believes that through their partnership with Red Sox legend David Ortiz, popularly known as Big Papi, Massachusetts residents will be able to connect Ortiz’s trustworthy and kind personality to eternalHealth’s commitment to offering high quality, affordable products, while acting as a trustworthy and transparent partner to its members.

Through its technology-driven, innovative platform, eternalHealth is looking to substantially reduce its administrative & operating costs (SG&A) across the entire enterprise. The cost savings will allow for more dollars to be allocated towards the total cost of care, while also passing down the savings to their members through its robust benefits to lead them in the healthy direction.

Once eternalHealth reaches the critical membership threshold, it will implement value-based contracting with providers, through which they will collaborate with providers and help them manage the overall quality of care for their patients through platform driven intelligence, improve the overall quality of life, and reduce healthcare costs. Ms. Ika says, “At eternalHealth, we believe we can really reduce healthcare costs by leveraging the right technology. That helps with member retention and satisfaction, which remains a key priority for eternalHealth. Just because it has not been done before, that does not mean it is impossible. eternalHealth strives to be a catalyst for change in a market that has seen little disruption.

About eternalHealth

Headquartered in Boston, eternalHealth provides high-quality care with low out-of-pocket costs to the residents of Massachusetts, while prioritizing preventive care and transparency. Founded, owned, and built by women, eternalHealth is a Medicare Advantage health plan that offers HMO and PPO products. For more information about our plans and services, please visit our website at www.eternalHealth.com

Democrats Look To Scale Back Biden Bill To Get It Passed

According to media reports, momentum is growing for narrowing the scope of President Biden’s social spending and climate package as Democrats seek a way to get the bill through the Senate with Sen. Joe Manchin’s (D-W.Va.) support.

Manchin effectively killed a much more wide-ranging bill, known as the Build Back Better Act, on Sunday by announcing his opposition, deeply disappointing and angering the White House and fellow congressional Democrats.

Days later, the pain still stings, but Democrats are actively seeking solutions that might find muster with the conservative West Virginia senator, whose vote is a necessity in the 50-50 Senate evenly divided between the two parties.

Democratic lawmakers, lobbyists and experts at think tanks believe Manchin might be won over if the bill is revised to include fewer programs for a longer period of time.

“That is the way forward here,” said Ben Ritz, director of the Center for Funding America’s Future at the Progressive Policy Institute, who has advocated for a bill with fewer items.  “Most of the party is starting to come around to that,” Ritz added. Some Democrats think their party made a mistake in going too large in the first place.

Progressives initially pushed a $6 trillion measure before falling back to $3.5 trillion — in part to signal that cut represented a concession on their party. The lower figure also proved too high for Manchin and fellow centrist Democratic Sen. Kyrsten Sinema (D-Ariz.), however, and the House ultimately passed a roughly $2 trillion version of Biden’s spending plan in November, which had a number of key provisions that were temporary. For example, the bill included provisions to extend the increased child tax credit amount for one year, and to create a universal preschool program for six years.

“To get someone like Manchin, a Democrat representing a conservative state, to a point where they can support something, [Democrats] started off on the wrong foot about letting the bill get too big about too many things,” said Tucker Shumack, a principal at Ogilvy Government Relations who previously served as an aide to former moderate Sen. Olympia Snowe (R-Maine).

Manchin argued that Democrats are not being honest about the cost of the bill, since temporary programs are likely to be extended in the future. “They continue to camouflage the real cost of the intent behind this bill,” Manchin said in a statement Sunday outlining his opposition to the measure.

In his recent comments, Manchin said he couldn’t explain voting for Build Back Better in West Virginia, a state former President Trump won twice by double digits. Jorge Castro, co-lead of the tax-policy practice at Miller & Chevalier and a former aide to former West Virginia Democratic Sen. Jay Rockefeller (D), said that a more focused bill could help Democrats counter Republican attacks that the bill is a grab-bag of spending. “I think it definitely helps from a messaging perspective,” he said.

Some moderate Democrats have long called for the Build Back Better Act to include fewer items for a longer time period, and are emphasizing this idea in the wake of Manchin’s recent comments.

“At the start of these negotiations many months ago, we called for prioritizing doing a few things well for longer, and we believe that adopting such an approach could open a potential path forward for this legislation,” Rep. Suzan DelBene (D-Wash.) chair of the centrist New Democrat Coalition, said in a statement Sunday.

White House Chief of Staff Ronald Klain tweeted a link to DelBene’s statement, saying the administration appreciates “all that @RepDelBene and the House New Dem Coalition has done to move forward on Build Back Better and the President’s agenda!”

Progressive lawmakers have been leading supporters of including more items in the bill, even if that means some programs are temporary. But they are acknowledging that some items may need to be removed from the package in subsequent negotiations.

In a statement on Wednesday, Congressional Progressive Caucus Chair Pramila Jayapal (D-Wash.) said that cuts should be as minimal as possible.

“In Congress, we will continue to prioritize a legislative path for Build Back Better, focused on taking the current text of the legislation passed by the House, keeping as much of it as possible — but no less than the elements contained in the framework negotiated by the President and committed to by Senators Manchin and Sinema some months ago,” Jayapal said.

It’s not certain exactly which items from the House-passed bill would end up in a narrower bill, and exactly which would be left out. The New Democrat Coalition in their statement mentioned as top priorities the expanded child tax credit, building on ObamaCare and addressing climate change. Senate Finance Committee Chairman Ron Wyden (D-Ore.) also made reference to those items in a statement.

Manchin has raised concerns about including Medicare expansion and paid family leave in the spending package, suggesting that those items might not make it into a package with fewer content areas.

The expanded child tax credit could prove to be challenging to include in a compromise with Manchin. The West Virginia senator has expressed a desire for the income limits for the credit to be lowered and for there to be work requirements associated with the credit.

The Washington Post on Monday reported that Manchin had provided the White House last week with a $1.8 trillion proposal that included universal preschool for 10 years, ObamaCare expansion and climate spending, but not the expanded child tax credit. Neither Manchin’s office nor the White House have publicly confirmed the report.

Ritz said it’s possible that Manchin and other Democrats could reach a compromise on the child tax credit, such as by targeting the child tax credit expansion more toward younger children or lowering the income level where the expanded credit starts to phase out.

He also said that even if a bill didn’t include an extension of the expanded child tax credit, a package that included other items such as universal preschool, Obama Care expansion, climate funding and affordable housing investments would still be transformative.

Biden Administration Extends Student Loan Pause Through May 1, 2022

The U.S. Department of Education announced a 90-day extension of the pause on student loan repayment, interest, and collections through May 1, 2022. The extension will allow the Administration to assess the impacts of the Omicron variant on student borrowers and provide additional time for borrowers to plan for the resumption of payments and reduce the risk of delinquency and defaults after restart.

The Department will continue its work to transition borrowers smoothly back into repayment, including by improving student loan servicing.

“Since Day One of this Administration, the Department has focused on supporting students and borrowers throughout the pandemic and ensuring they have the resources they need to return to repayment successfully,” said U.S. Secretary of Education Miguel Cardona. “This additional extension of the repayment pause will provide critical relief to borrowers who continue to face financial hardships as a result of the pandemic, and will allow our Administration to assess the impacts of Omicron on student borrowers.

As we prepare for the return to repayment in May, we will continue to provide tools and supports to borrowers so they can enter into the repayment plan that is responsive to their financial situation, such as an income-driven repayment plan. Students and borrowers will always be at the center of our work at the Department, and we are committed to not only ensuring a smooth return to repayment, but also increasing accountability and stronger customer service from our loan servicers as borrowers prepare for repayment.”

The pause on student loan payments will help 41 million borrowers save $5 billion per month. Borrowers are encouraged to use the additional time to ensure their contact information is up to date and to consider enrolling in electronic debit and income-driven repayment plans to support a smooth transition to repayment. More information can be found at StudentAid.gov.

This action is one of a series of steps the Biden-Harris Administration has taken to support students and borrowers, make higher education more affordable, and improve student loan servicing, including providing nearly $13 billion in targeted loan relief to over 640,000 borrowers. Actions within that include:

Revamping the Public Service Loan Forgiveness program in October, which has already provided $2.4 billion in loan relief to 38,000 borrowers. As part of that effort, the Department implemented a Limited PSLF Waiver to count all prior payments made by student borrowers toward PSLF, regardless of the loan program. Borrowers who are working in public service but have not yet applied for PSLF should do so before October 31, 2022, and can find out more at StudentAid.gov/PSLF.

Providing $7.0 billion in relief for 401,000 borrowers who have a total and permanent disability. Approving $1.5 billion in borrower defense claims, including extending full relief to approved claims and approving new types of claims.

Providing $1.26 billion in closed school discharges to 107,000 borrowers who attended the now-defunct ITT Technical Institute. Helping 30,000 small business owners with student loans seeking help from the Paycheck Protection Program.

The Temple Economy Of Goa, Famous For Its Churches

When Pune’s D.S. Pai visited Goa four years ago for an official conference, he took out time early one morning to visit his Kuldev, family deity, Ramnathi temple at Bandivade. “My colleagues were interested and came along with me. They said they did not even know of the existence of such a beautiful temple,” Pai, who is India Meteorological Department’s (IMD) head, Long-Range Forecast, told IANS on phone.

Pai’s family migrated to Kerala in the 17th century when the Portuguese took over Goa. Like him, several others chose to make Kerala their home, but almost all of them have retained ties with the family deity even now. The trips have increased since he was posted to Pune, he said.

Pai is not the only example. Not all visitors to this sunshine state go to the beach first but a bulk of them are actually temple goers. In fact, even when for the majority of tourists visiting Goa, the equation is simple: ‘Goa = Sun, Sand & Sea’, over a dozen major temples and several smaller ones attract regular and annual crowds that have a sizable contribution to Goa’s economy.

According to India Tourism Statistics 2019, a government of India publication, in 2017, Goa had 68,95,234 domestic and 8,42,220 foreign tourists while in 2018, the respective number of 70,81,559 and 9,33,841 showing a growth rate of 2.70 per cent and 10.88 per cent, respectively. Of course, the pandemic changed the situation, and the tourism sector was the hardest hit. In 2021, even when the domestic sector has picked up slowly, foreign tourists’ numbers are no match.

But even before the pandemic and lockdown, tourists in general were unaware of Goa’s rich tradition of multiple temples for centuries, and it would only be the niche tourists who would opt for it or those like Pai, who came for their deities.

Amongst the 50-odd main temples across Goa, about a dozen stand out for various reasons, their distinct architecture being one of them. Brick and mortar structures, most of these big temples are 400-year-old, have unique tiled, sloping roofs and almost all of them have ‘deep maal’, a vertical decorative pillar with niches to keep earthen oil lamps. Each temple compulsorily has a tank / water body next to it.

Mangeshi temple is amongst the most famous, but there are scores of others. Shantadurga at Kawale, Mhalsa Narayani at Mhardol, Lakshmi Nrusinha at Veling, Ramnathi and Mahalakshmi at Bandivade, Kamakashi at Shiroda, Santeri at Kelshi are amongst the bigger temples. Many of them are listed on the official website of Goa Tourism Development Corporation (GTDC).

And then there are temples with even older vintage. The 1000-year-old Mahadev temple at Tambdi Surla near the border with Maharashtra and about 700-year-old Rudreshwar temple at Harale are the stone temples. When the Portuguese conquered Goa, devotees of several temples lining the coastal areas took the deities away to either deep inside the forests and undulating landscape of Goan territory, which now comprises the area between Panaji and Fonda, or further away to coastal Karnataka. With it, a lot of community members — all Konkani speakers — too migrated away to almost the entire coastal belt from south Gujarat to Kerala. Konkani speaking Gaud Saraswat Brahmins (GSBs), scores of Marathi speaking families from across Maharashtra and of course, many from Goa itself, all have their family deities in Goa.

Shanta Durga at Amone is the family deity, the Kuldevi, of senior journalist Rajdeep Sardesai’s family that hails from Madgaon. Not much into religious rituals — “God resides in my heart” — Sardesai said, “but I visit Goa for family functions regularly”.

Sardesai agreed that outsiders are unaware of the rich temple traditions. “Goa lives by the river and not by the sea. Once you start discovering the river, you discover the real Goa. There is nothing wrong in promoting beaches but there is more to Goa than the beaches,” he said.

Over the decades, especially after Independence, the diaspora spread to other states and even abroad. Many families make it a point to annually visit their family deities, many visit when there is a special occasion such as a marriage in the family and likewise. “The Goan temples are unique by the fact that the deities are identified not just as Brahminical, but those belonging to all types of communities. The temples had a land of their own, they supported the economy of the area around them,” said Padmashree Vinayak Khedikar, author who has documented the folk arts and literary traditions of Goa.

Families and villages from ‘thal’, a local term meaning the catchment for that temple, were dependent on the temple as a central institution and in turn they donated to the temple. “Each of the temples is an independent Sansthan institution. Till a few decades ago, anyone from the thal getting married would get a saree and dhoti from the temple. Also, some minor repairs or such chores to be carried out at people’s homes were supported by the temple,” said Khedikar, who has authored a book ‘Goa Dev Mandal: Unnayan aani Sthalantar’ (Goa temple boards: upgradation and migration). e

“Except for the law & order, the temples reigned over their respective thal even in the Portuguese era. There was a Mahajan system — which led to a Mahajani Act in the late 18thecentury — who were responsible for the maintenance of the temples and all its real estate. There were separate families identified for daily puja. Much of it has changed later,” he said. But he was non-committal about the popularity of these temples. Sardesai said, “Temples would have to be promoted by the local community.”

“Last 6-8 years, lots of people who read my blogs budget a day or two for temples and inform me or ping me or ask for information. Sometimes, they also put out a thread on social media and tag me to say, it was because of my blog,” said Anuradha Goyal, author, columnist and blogger based in Goa and who has extensively written about Goa temples.

There has been no active promotion of temples by the state either. The BJP government for the last 10 years has had no promotional schemes for popularising temples to domestic tourists. However, given the political mileage that ‘pilgrimage’ is yielding — Delhi Chief Minister has announced trains to pilgrim places from Goa; West Bengal Chief Minister Mamata Banerjee said Trinamool Congress stood for the temple, mosque and church; the Congress seems to have slowly woken up to the opportunity.

Former Deputy Chief Minister Ramakant Khalap agreed that temple tourism has been neglected and also acknowledged the contribution of temples in Goa’s economy. “Ahead of the Assembly elections, we are preparing the Congress manifesto. It will prominently feature dev ghar (temple) promotion and planning to celebrate Goa as ‘God’s Own Abode’,” Khalap said.

However, his idea of places of worship is not restricted to Hindu temples. “We plan to promote all places of worship. Puranas tell us this is a place reclaimed by Parshuram. Parvati did her penance here, we have Shanta Durga. Then much later came the Buddhists and Jain, there are a lot of remnants. Jews were here, Muslims were here and last were the Portuguese. Goa is a good example of how all religions have a syncretic existence. The temples, churches, and mosques, we have all of them,” he said.

“Our manifesto will demand to have designated state festivals from each religion,” Khalap added.

How Elon Musk Became The Richest Private Citizen In The World

If you want to become a billionaire—and you didn’t happen to be born into the Saudi royal family—there are a few ways to get the job done. You could come up with one seriously good idea, like a new computer operating system or social network, and then build it into a gigantic company. Or you could take the Warren Buffet route, making a decades-long series of shrewd, low–risk investments, and then watch the wealth slowly trickle in. And then there’s what Elon Musk did.

Musk made his money differently than most of today’s famous billionaires. Instead of one amazing idea, he had several good ones. And instead of a bunch of clever, safe investments, he made just a few spectacularly risky ones. But there was a method to his madness, even if it wasn’t apparent to many at the time. The sum total of those bets made Musk the richest private citizen on the planet this year, and their world-altering effects—from privately-launched space missions to an electric vehicle titan that has left the auto industry desperate to catch up—have landed Musk as TIME’s 2021 Person of the Year.

Musk’s family was well-off. He had an early aptitude with computers, designing his own video game at 12-years-old. When he was 17, he left for Canada to escape military service in South Africa’s apartheid regime, attending Queens University in Ontario.

In 1992, he transferred to the University of Pennsylvania, where he studied physics and business. Penn’s tree-lined campus may have also given Musk his first taste for risky business ventures—he and a couple of friends rented out an off-campus house and turned it into a nightclub.

Then it was on to Silicon Valley and—briefly—to grad school. Musk enrolled in a physics Ph.D. program at Stanford, then dropped out after two days. Young entrepreneurs were starting to realize that the internet, a newfangled web of connections between computers, might be more than a playground for nerds, and Musk wanted to try his luck. Together with his brother Kimbal, Musk founded a company called Zip2 as an online business directory, a kind of web-enabled yellow pages with maps—a nifty idea back in the mid-nineties.

Elon and Kimbal recruited investors and brought on outside help to run the company, which made deals with publishers like the New York Times. In 1999, they sold the Zip2 to Compaq, a then-declining computer manufacturing giant, for $307 million. Musk netted a cool $22 million from the Zip2 sale; he promptly went out and spent $1 million on a McLaren F1 supercar. “It’s not consistent with the rest of my behavior,” he would tell CNN, which filmed Musk as the car was delivered to his home. A year later, Musk wrecked the car—he was trying to show off its acceleration and ended up accidentally launching it into the air like a frisbee. The million-dollar sports car was not insured.

But by then, Musk was already on to his next venture. Driving with him in the McLaren the day of the wreck was Peter Thiel, co-founder of a payments startup called Confinity. (Thiel and Musk weren’t injured in the crash).

Musk had plowed his millions into starting another online banking startup called X.com. The two companies would merge in March 2000, forming a business that eventually became PayPal. Musk was named CEO, but in September, while he was on vacation, the board fired him, replacing him with Thiel, partly due to a disagreement over switching the company’s servers.

“It’s not a good idea to leave the office when there are a lot of major things underway that are causing people a great deal of stress,” Musk would later reflect. Musk still had a stake in the company, though. When eBay bought PayPal for $1.5 billion in 2002, Musk netted a $180 million mega-fortune from the deal.

Musk didn’t end up relaxing with all the things his new millions could buy. In 2002, he founded SpaceX with the almost ludicrous mission of colonizing Mars. The next year, he sank an initial investment of more than $6 million into Tesla, which was then not much more than a pair of founders and a vision of electric sports cars.

The company planned to take advantage of new lithium-ion batteries, which were both light and energy-dense, to revolutionize the struggling field. At the time, lithium-ion cells were only being used in small electronic devices, and one of Tesla’s central innovations was scaling them up, which enabled it to create an electric vehicle with far greater range than previous electric cars had been able to achieve.

Both companies had a tough start in the first few years—Musk says he ended up pushing essentially all his proceeds from the PayPal sale into funding the ventures. SpaceX endured multiple failed launches, which almost put it out of business, while Tesla ran into trouble as its engineers realized its prototype battery packs were likely to catch fire. “It was a potentially company-ending discovery if we couldn’t fix it,” says former Tesla chief technical officer J.B. Straubel. Later, Tesla almost went bankrupt during the Great Recession in 2008.

Eventually, Musk’s investments began to pay off. In 2008, SpaceX secured a $1.6 billion deal with NASA, while Tesla in 2012 began cranking out its first mass-market car, the Model S. Today, Tesla is a behemoth, controlling about two-thirds of the U.S. electric vehicle market. SpaceX is the undisputed leader in private space exploration.

Rich Morgan

Though Tesla produces fewer vehicles than legacy carmakers like Ford and GM, its valuation has soared many times higher than theirs. In the past 18 months, Tesla’s stock price has more than tripled, pushing its market cap over $1 trillion.

Musk controls a healthy chunk of that stock, even after selling off almost $12 billion worth of shares in the past two months, though exercising his additional stock options may leave him with a bigger stake than when he started. It’s anyone’s guess as to whether the company will maintain its massive valuation—if Tesla’s stock falls, so does Musk’s fortune.

He currently holds about 17% of Tesla’s stock, valued at $175 billion, which constitutes the largest portion of his net worth. And with SpaceX’s value floating at over $100 billion, according to its October funding round, Musk’s 48% stake in the rocket-maker, plus cash and other assets, brings his total net worth to around $266 billion.

He’s put his money into new companies as well. In 2016, Musk started The Boring Company, which digs tunnels, and neurotechnology startup Neuralink. Both are now worth hundreds of millions of dollars. Those two most recent ventures are illustrative examples of the mindset that created Musk’s fortune. They’re both highly speculative endeavors—Neuralink is trying to develop telepathic interfaces with machines; The Boring Company aims to revolutionize infrastructure.

There’s not much chance either will pay off in the long run, experts say, but big-bucks risk-taking is Musk’s bread and butter. That same approach, throwing millions of dollars at impossibly difficult projects, is what turned Musk from a lucky kid with a dot.com fortune into the wealthiest person on the planet. Or at least the wealthiest private citizen. “I think [Russia’s] President Putin is significantly richer than me,” Musk told TIME in early December. “I can’t invade countries and stuff.”

The Reasons And Solutions To Rising Inflation In The US

With inflation at a 39-year high, Americans are feeling the pinch in just about every facet of daily life. The consumer price index jumped 6.8% from a year earlier, the fastest pace since 1982, as prices surged for staples such as food and gasoline, as well as new and used cars, rent and medical care, the Labor Department said Friday.

There’s been plenty of finger-pointing from both sides of the political aisle about who’s responsible for the spiraling costs, but as usual with issues that have such a broad impact, the causes are complex.

President Joe Biden acknowledged last month that “inflation hurts Americans’ pocketbooks, and reversing this trend is a top priority for me.’’ But he said his $1 trillion infrastructure package, including spending on roads, bridges and ports, would help ease supply bottlenecks.

Here’s a quick breakdown of how we got here and some of the strategies that might help reverse the trend:

►CPI Report: Consumer prices climbed 6.8% in November from a year earlier, the most since 1982, as inflation surged higher

►Inflation surges to 39-year high: How much more are you paying and what’s the damage for Biden?

►Personal finance: What’s not to love? The US savings bond that earns 7% with inflation protection, yet gets ignored

Why are grocery prices so high?

There are myriad reasons for the higher grocery bills, including the same labor shortages, supply chain bottlenecks and strong consumer demand that have driven up the cost of other goods and services. Toss in the wild cards plaguing the food industry: Extreme weather, particularly heat and drought that have curtailed crop yields. A surge in exports. COVID-19 outbreaks at meatpacking plants. Volatile consumer eating patterns amid the ups and downs of the health crisis.

Meanwhile, dire worker shortages, particularly at restaurants, have pushed up wages and the cost of dining out.

There are still fewer factory, warehouse and port workers as parents care for distance-learning children or stay home because of COVID-19 fears. Fuel costs have soared. Dozens of container ships are stuck in the waters near the Ports of Los Angeles and Long Beach, California, waiting to unload cargo. The cost to lease a shipping container for a delivery from China has increased nearly tenfold to $20,000.

Other factors driving inflation

Cars are one of the leading culprits.

Also behind the spike are items such as hotel rates and airline fares, which plunged last year in the early days of the pandemic and rose sharply from those lows this year as consumer demand returned amid the reopening economy.

Supply chain bottlenecks, with COVID-19-related worker absences at factories and ports still high, are also leading to low supplies and higher prices for consumer electronics, appliances and many other products.

The crunch comes on top of a semiconductor shortage and parts supply disruptions that have meant low inventories and higher prices for cars.

The average sales price of a new vehicle hit a record $42,802 in September, breaking the old record of $41,528 set in August, J.D. Power said. The average U.S. price is up nearly 19% from a year ago, when it broke $36,000 for the first time, J.D. Power said. The auto price increases have helped to drive up U.S. inflation.

The Gerald Jones Honda lot in Augusta, Ga., is mostly empty. On a late October morning, there were only six new cars available when there are usually around 250.

►Where are we going from here? Are we at risk of stagflation as prices rise and growth slows?

►The high cost of buying a car: US vehicle sales tumble amid chip shortage, record prices

What role did the stimulus play in driving inflation?

That’s complicated. The stimulus checks, which started to get mailed out under President Donald Trump’s administration, continued through March, when eligible married couples, for example, received up to $2,800 – plus $1,400 for each dependent.

The economy looked very different in the spring of 2020, when Americans first started to receive stimulus checks: The U.S. economy had collapsed as lockdowns took effect, businesses closed or cut hours and consumers stayed home as a health precaution. Employers slashed 22 million jobs. Economic output plunged at a record-shattering 31% annual rate in last year’s April-June quarter.

Everyone braced for more misery. Companies cut investment. Restocking was put off. And a brutal recession ensued.

Yet instead of sinking into a prolonged downturn, the economy staged an unexpectedly rousing recovery, fueled by massive government spending and a bevy of emergency moves by the Fed. By the spring of 2021, the rollout of vaccines had emboldened consumers to return to restaurants, bars and shops.

Suddenly, businesses had to scramble to meet demand. They couldn’t hire fast enough to plug job openings – a near record 10.4 million in August – or buy enough supplies to fill customer orders. As business roared back, ports and freight yards couldn’t handle the traffic. Global supply chains became snarled.

Costs rose. And companies found that they could pass along those higher costs in the form of higher prices to consumers, many of whom had managed to sock away a ton of savings during the pandemic.

To curb inflation, fed reduces bond purchases

Last month, in a milestone for the U.S. recovery from the COVID-19 recession, the Federal Reserve agreed to gradually dial back the bond-buying stimulus it launched early in the health crisis.

The decision, which has been expected for months, reflects the strides the economy has made, with unemployment falling sharply from its pandemic peak. But it also pointedly reveals the central bank’s growing concern about inflation that has surged in recent months amid supply chain bottlenecks.

Fed Chair Jerome Powell told reporters the Fed will be patient and hold off on raising rates so the economy can reach full employment, but he added officials “won’t hesitate” to act if inflation doesn’t ease, presumably by the second half of next year.

►Worker shortage: As millions of jobs go unfilled, employers look to familiar faces in ‘boomerang employees’

►Personal finance and politics: What the jump in consumer prices means for your pocketbook, Joe Biden’s troubles

Biden announces ports open 24/7 to fight inflation, reduce supply chain crunch

In October, Biden announced that the Port of Los Angeles – at the center of the supply chain logjam – will operate around the clock to help clear out some of the hundreds of thousands of shipping containers from Asia stranded on its docks. The neighboring Port of Long Beach, which has been conducting a similar pilot project at one of its 12 terminals, is expected to follow.

As ports gear up operations, dozens of cargo vessels dot the surrounding harbor, waiting for the chance to unload 40-foot containers filled with food, clothing and even holiday gifts, from skateboards to elliptical bicycles. In normal times, there are no waits. But it’s not that simple.

A visit to the ports of Los Angeles and Long Beach and interviews with port officials, union representatives, workers and freight companies reveal it likely will take months to make a significant dent in the port backlog and disentangle the myriad other kinks in the nation’s vast supply network.

Other players, including truck drivers and warehouse workers, need to shift their schedules. There are also equipment shortfalls, bureaucratic hurdles and severe worker shortages at other hubs in the overwhelmed supply chain.

►Will it save holiday shopping? Biden says running LA ports 24/7 will help save Christmas shopping. It’s not that simple, experts warn.

Gasoline Costs More For A Host Of Reasons

Americans are acutely sensitive to gasoline prices, especially when they’re on the rise. One reason, of course, is that we buy a lot of gas: an estimated 570 gallons this year for the average driver, which at current national average prices would cost close to $2,000. Also, gas prices are posted all over town on large signs – unlike, say, milk prices – and people typically buy gas on its own rather than as part of a larger shopping trip, making price changes more noticeable. And gas prices can and do swing sharply and unpredictably, in ways that can seem unconnected to the rest of the economy.

Regular gas costs, on average, 58.7% more than it did a year ago this time – $3.491 a gallon last month, versus $2.20 in November 2020, according to the federal Energy Information Administration (EIA).

But looking just at the recent rise can be misleading, or at least incomplete. For one thing, a year ago the United States was battling yet another wave of COVID-19 cases, large parts of the economy were still shuttered and demand for gas was way down. Estimated consumption in 2020 was 534 gallons per driver, down 14.4% from 624 gallons in 2019.

How we did this

Also, the volatility of gas prices means they can go down as sharply and as suddenly as they go up. In the spring of 2020, as the COVID-19 pandemic sparked widespread lockdowns, the average gas price sank 27% between Feb. 24 and April 27. Since 1994, average gas prices have fluctuated between a low of 96.2 cents a gallon in February 1999 and a high of $4.114 in July 2008. The current average price, in fact, is almost exactly what it was in September 2014 – at least on a nominal basis.

When inflation is factored in, today’s prices appear more modest. In today’s dollars, gas cost an average of $5.20 a gallon in June 2008, and more than $4 as recently as September 2014.

Also, gasoline is not a single, uniform product. Besides regular, midgrade and premium gas, which differ by octane rating, there’s conventional and “reformulated” gas. The latter is required to be sold in California, along the Northeastern seaboard and in several other major urban areas to reduce smog and other air pollutants.

Over the past year, reformulated gas was consistently 30 to 35 cents more expensive than conventional gas until mid-October, when the differential began to widen, according to an analysis of EIA price data – it’s­ now about 46 cents more expensive. Over the same period, midgrade gas has ranged from 37 cents to 46 cents more expensive than regular, while premium has been 25 to 27 cents higher than midgrade.

Where you buy gas also matters. Much of the U.S. petroleum industry is concentrated along the Gulf Coast, making it perhaps unsurprising that gas tends to be cheapest there. The average price in that region was $3.072 a gallon in late November, and in Texas it was also a hairsbreadth above $3.

By contrast, California almost always has the most expensive gas in the country. The state’s average price in late November was $4.642 a gallon, and in San Francisco it was $4.816. Besides the fact that California already uses pricier reformulated gas and has relatively high gas taxes and environmental fees, it is geographically far removed from other refining centers and relatively few fuel pipelines cross the Rocky Mountains to connect California’s refineries to the rest of the country.

Under normal conditions, the state’s refineries can produce enough gasoline to meet demand there, according to the California Energy Commission. But if refineries go offline due to weather, accidents or mechanical breakdowns, the state typically imports gasoline from overseas – adding to the price because of the cost of marine shipments.

A Good Pay Raise Next Year Expected As Companies Struggle To Fill Jobs

The amount of money companies are setting aside for raises is expected to rise at the fastest rate in more than a decade, as employers fight to keep and hire workers in a historically tight labor market, a new survey says.  

Budgets for wage hikes are projected to jump 3.9% next year, the biggest annual leap since 2008, according to a November survey of compensation executives by the Conference Board, a nonprofit membership group of mostly large businesses.  

The growing pools of cash are meant to entice young workers and hold on to existing staff at a time when a record number of jobs are going unfilled, and consumers are dealing with the worst inflation in 39 years.   

“Growth in wages for new hires and accelerating inflation are the main causes of the jump in salary increase budgets,’’ the report said. It added that 46% of executives said higher pay for new employees was a reason for the larger pay pools that are expected, while 39% said inflation helped fuel the increase.

The consumer price index increased 6.8% in November as compared to the previous year, the fastest pace since 1982, with the cost of groceries, gas, rent and cars all on the rise, the Labor Department said Friday.

Labor shortage and wages

Budgets for salary increases have already risen, with the average pool of cash increasing by 3% in the survey taken last month, compared with the 2.6% that was predicted in an earlier survey in April.

A labor shortage has helped spark a ripple effect, enabling younger people entering the workforce to earn higher wages, more experienced employees to pursue new positions and potentially higher pay, and blue-collar workers to demand union representation and better work conditions.

“The rapid increase in wages and inflation are forcing businesses to make important decisions regarding their approach to salaries, recruiting, and retention,’’ the Conference Board report said, It tnoted that labor shortages will probably continue through 2022 while wages likely increase by more than 4%.

Blue-collar workers as well as those in unions are also expected to see pay hikes. “Wages for new hires, and workers in blue-collar and manual services jobs will grow faster than average,’’ the report wrote. 

Workers, from Kellogg cereal facilities to university faculty to Starbucks stores, are demanding higher wages and improved working conditions amid a pandemic that many say magnified inequities and disparities.

The pay hikes many businesses are offering could cost consumers if companies raise the price of services or goods to cover the higher wages, says the Conference Board.. 

And the Federal Reserve may boost interest rates beyond the two increases that economists are already projecting for next year to help slow inflation, according to the Board.

Gita Gopinath Promoted As First Deputy Managing Director At IMF

Indian-American Gita Gopinath, the chief economist of International Monetary Fund, is being promoted as IMF’s First Deputy Managing Director, the fund announced last week. She would replace Geoffrey Okamoto who plans to leave the Fund early next year. Ms. Gopinath, who was scheduled to return to her academic position at Harvard University in January 2022, has served as the IMF’s chief economist for three years. Gopinath was to return to her position as John Zwaanstra Professor of International Studies and of Economics, Harvard University in January 2022.

“Both Geoffrey and Gita are tremendous colleagues — I am sad to see Geoffrey go but, at the same time, I am delighted that Gita has decided to stay and accept the new responsibility of being our FDMD,” said Kristalina Georgieva, IMF’s Managing Director.

Ms. Georgieva said Ms. Gopinath’s contribution to the Fund’s work has already been exceptional, especially her “intellectual leadership in helping the global economy and the Fund to navigate the twists and turns of the worst economic crisis of our lives.”

She also said Ms. Gopinath — the first female chief economist in IMF history — has garnered respect and admiration across member countries and the institution with a proven track record in leading analytically rigorous work on a broad range of issues.

The IMF has had 10 occupants of the FDMD chair since the position was created in 1949. Each – only one of them a woman – has been a citizen of the US. Gopinath too is a US citizen.

Noteworthy that Gopinath wasn’t always the topper type she became as an economics undergraduate in Delhi’s Lady Shriram College. Till her Class 7, she was at around 45 per cent and then toyed with the idea of professional sports. Also, she briefly showed up for modelling.

In an interview to an Indian weekly some years back, her mother, V.C. Vijayalakshmi, had talked of the ascent since Class 7: “The girl who used to score 45 per cent till class seven, started scoring 90 per cent.”

Then a good science intermediate degree at Maharaja PU in Mysore and topping Delhi University in BA. “She created quite a flutter by bagging the gold medal as LSR had beaten St Stephen’s for the first time, and by just two marks.” Like many kids her age in India, Gopinath also entertained ideas of taking the civil services exam and MBA too.

Today, the IMF MD spoke of the struggling Class 7 student thus: “…given that the pandemic has led to an increase in the scale and scope of the macroeconomic challenges facing our member countries, I believe that Gita – universally recognised as one of the world’s leading macroeconomists – has precisely the expertise that we need for the FDMD role at this point. Indeed, her particular skill set – combined with her years of experience at the Fund as Chief Economist – make her uniquely well qualified. She is the right person at the right time.”

Georgieva, a Bulgarian economist, noted Gopinath’s contribution has already been exceptional, especially her “intellectual leadership in helping the global economy and the Fund to navigate the twists and turns of the worst economic crisis of our lives”.

She said Gopinath – also the first female Chief Economist in IMF history – has garnered respect and admiration across our member countries and the institution, with a proven track record in leading analytically rigorous work on a broad range of issues.

Georgieva said that the IMF’s Research Department had gone from “strength to strength”, particularly highlighting its contributions in multilateral surveillance via The World Economic Outlook, a new analytical approach to help countries respond to international capital flows (the integrated policy framework), and work on a Pandemic Plan to end the Covid-19 crisis by setting targets to vaccinate the world at feasible cost.

Born in Kolkata, Gopinath will take the lead on surveillance and related policies, oversee research and flagship publications and help foster standards for Fund publications.

Gopinath has a Ph.D. in economics from Princeton University in 2001 after the B.A. from LSR and M.A. degrees from Delhi School of Economics and University of Washington. She is the younger of two daughters of T.V. Gopinath and Vijayalakshmi. They are both from Kannur, Kerala and settled in Mysuru.

Understanding Medicare Fraud

“Corruption, embezzlement, fraud are all characteristics which exist everywhere. It is regrettably how human nature functions, whether we like it or not. What successful economies do is keep it to a minimum. But, unfortunately, no one has ever eliminated any of that stuff”- said. Alan Greenspan, on the evil characteristic of frauds in general.

In USA, the system of Medicare benefits has been an abundant resource for fraudsters. Medicare improper payments were estimated to be $25.74 billion in fiscal year 2020. However, the amount of improper payments made in Medicare are significant, during 2019 representing to an amount of $28.91 billion.

Medicare fraud occurs when someone, whether doctors or patients or scammers, knowingly deceives Medicare to receive payment when they receive a higher payment than they should. Committing fraud is illegal and should be reported. Anyone can commit or be involved in fraud, and there are cases of fraudsters  including doctors, other providers, and Medicare beneficiaries.

Some common examples of Medicare fraud include billing for services that were not provided, over billing, billing unnecessary services, misrepresenting dates of service or providers of service, and paying kickbacks for patient referrals.

Medicare fraud happens when someone illegally use their Medicare card to get medical care, supplies, or equipment, or sell their Medicare number to someone who bills Medicare for services not received, or provide their Medicare number in exchange for money or a gift.

But sporadic instances of frauds are committed by greedy doctors, and a recent case reported, unveils an example of similar cases.

Ravi Murali, 39, formerly from Wisconsin, was sentenced by Chief U.S. District Judge James D. Peterson to 54 months in federal prison for Dr. Murali’s role in defraud Medicare. He pleaded guilty to this charge on March 31, 2021.

Dr. Murali wrote thousands of fraudulent orders for Durable Medical Equipment (DME). Other participants in the scheme used Dr. Murali’s fraudulent orders to bill Medicare $26,000,000, of which Medicare paid $13,000,000.

As we all know, Medicare is complicated. What may seem like an error to the beneficiary, may result from a misunderstanding about benefits.

It may also be abuse, which involves billing Medicare for services that are not covered or are not correctly coded. The provider has not knowingly and intentionally misrepresented the facts to obtain payment.

Medicare fraud assumes criminal offense. The Centers for Medicare and Medicaid Services (CMS) defines fraud as “the intentional deception or misrepresentation that the individual knows to be false or does not believe to be true,” and that is made “knowing that the deception could result in some unauthorized benefit to themselves or some other person.

Some common examples of suspected Medicare fraud or abuse are:

  • Billing for services or supplies that were not provided
  • Providing unsolicited supplies to beneficiaries
  • Misrepresenting a diagnosis, a beneficiary’s identity, the service provided, or other facts to justify payment
  • Prescribing or providing excessive or unnecessary tests and services
  • Violating the participating provider agreement with Medicare by refusing to bill Medicare for covered services or items and billing the beneficiary instead
  • Offering or receiving a kickback (bribe) in exchange for a beneficiary’s Medicare number
  • Requesting Medicare numbers at an educational presentation or in an unsolicited phone call
  • Routinely waiving co-insurance to attract business

The federal government has made significant strides in reducing fraud, waste, and improper payments across the government.

The CMS “Guard Your Card” campaign tells people how they can protect themselves against fraud by:

  • Never give out their Medicare or Social Security Number to anyone except those you know should have it.
  • They reported any suspicious activities like being asked over the phone for their Medicare/Social Security number or banking information. Medicare will NEVER call you uninvited for this information.
  • By checking their billing statements and reporting suspicious charges. Using a calendar to track doctor’s appointments and services helps quickly spot possible fraud and billing mistakes. Check claims early by logging into gov.

Any suspicious activities may be reported by calling 1-800-MEDICARE (1-800-633-4227).

Under the False Claims Act (FCA), the government may pay a reward of up to 30% to people who report healthcare fraud. In September 2019, TELG client Kevin Manieri was awarded more than $12 million for reporting that a drug company defrauded Medicare and other government insurance programs by encouraging doctors to prescribe an unnecessary medication to patients.

Health care fraud is a felony under Michigan’s Health Care False Claims Act, punishable by up to four years in prison, a $50,000 fine and loss of health insurance. It’s also a federal criminal offense under the Health Insurance Portability and Accountability Act.

India Ranked Fourth Most Powerful Country In Asia

India is the fourth most powerful country in Asia, as per the Lowy Institute Asia Power Index 2021. The annual Asia Power Index — launched by the Lowy Institute in 2018 — measures resources and influence to rank the relative power of states in Asia. The project maps out the existing distribution of power as it stands today, and tracks shifts in the balance of power over time.

The top 10 countries for overall power in the Asia-Pacific region are the US, China, Japan, India, Russia, Australia, South Korea, Singapore, Indonesia and Thailand, Lowy Institute said.

India is ranked as a middle power in Asia. As the fourth most powerful country in Asia, India again falls short of the major power threshold in 2021. Its overall score declined by two points compared to 2020. India is one of eighteen countries in the region to trend downward in its overall score in 2021, the report said.

The country performs best in the future resources measure, where it finishes behind only the US and China. However, lost growth potential for Asia’s third largest economy due largely to the impact of the coronavirus pandemic has led to a diminished economic forecast for 2030, Lowy Institute said.

India finishes in 4th place in four other measures: economic capability, military capability, resilience and cultural influence.

India is trending in opposite directions for its two weakest measures of power.

On the one hand, it remains in 7th place in its defense networks, reflecting progress in its regional defense diplomacy — notably with the Quadrilateral Security Dialogue, which includes Australia, Japan and the US. On the other hand, India has slipped into 8th position for economic relationships, as it falls further behind in regional trade integration efforts, Lowy Institute said.

India exerts less influence in the region than expected given its available resources, as indicated by the country’s negative power gap score. Its negative power gap score has deteriorated further in 2021 relative to previous years.

As per the report, many developing economies, including India, have been hardest hit in comparison to their pre-Covid growth paths. This has the potential to reinforce bipolarity in the Indo-Pacific, driven by the growing power differential of the two superpowers, the US and China, in relation to nearly every other emerging power in the region.

The US beat the downward trend in 2021 and has overtaken China in two critical rankings. But its gains are dogged by a rapid loss of economic influence.

China’s comprehensive power has fallen for the first time, with no clear path to undisputed primacy in the Indo-Pacific.

Uneven economic impacts and recoveries from the pandemic will likely continue to alter the regional balance of power well into the decade. Only Taiwan, the United States and Singapore are now predicted to have larger economies in 2030 than originally forecast prior to the pandemic.

Yet richer countries, such as Japan, have seen their economic prospects improve not just relative to 2020, but also to economies with lower vaccination rates. China, which avoided a recession last year, is not far behind. (IANS)

VISA Complains To U.S. Of India Backing Rupay

Visa Inc has complained to the U.S. government that India’s “informal and formal” promotion of domestic payments rival RuPay hurts the U.S. giant in a key market, memos seen by Reuters show.

In public Visa has downplayed concerns about the rise of RuPay, which has been supported by public lobbying from Prime Minister Narendra Modi that has included likening the use of local cards to national service.

But U.S. government memos show Visa raised concerns about a “level playing field” in India during an Aug. 9 meeting between U.S. Trade Representative (USTR) Katherine Tai and company executives, including CEO Alfred Kelly.

Mastercard Inc has raised similar concerns privately with the USTR. Reuters reported in 2018 that the company had lodged a protest with the USTR that Modi was using nationalism to promote the local network.

Alfred Kelly, Jr., CEO, Visa Inc. speaks at the 2019 Milken Institute Global Conference in Beverly Hills, California, U.S., April 29, 2019. REUTERS/Lucy Nicholson/File Photo

“Visa remains concerned about India’s informal and formal policies that appear to favor the business of National Payments Corporation of India” (NPCI), the non-profit that runs RuPay, “over other domestic and foreign electronic payments companies,” said a USTR memo prepared for Tai ahead of the meeting.

Visa, USTR, Modi’s office and the NPCI did not respond to requests for comment.

Modi has promoted homegrown RuPay for years, posing a challenge to Visa and Mastercard in the fast-growing payments market. RuPay accounted for 63% of India’s 952 million debit and credit cards as of November 2020, according to the most recent regulatory data on the company, up from just 15% in 2017.

Publicly, Kelly said in May that for years there was “a lot of concern” that the likes of RuPay could be “potentially problematic” for Visa, but he stressed that his company remained India’s market leader.

“That’s going to be something we’re going to continually deal with and have dealt with for years. So there’s nothing new there,” he told an industry event.

Modi, in a 2018 speech, portrayed the use of RuPay as patriotic, saying that since “everyone cannot go to the border to protect the country, we can use RuPay card to serve the nation.”

When Visa raised its concerns during the USTR gathering on Aug. 9, it cited the Indian leader’s “speech where he basically called on India to use RuPay as a show of service to the country,” according to an email U.S. officials exchanged on the meeting’s readout.

Finance Minister Nirmala Sitharaman said last year that “RuPay is the only card” banks should promote. The government has also promoted a RuPay-based card for public transportation payments.

While RuPay dominates the number of cards in India, most transactions still go through Visa and Mastercard as most RuPay cards were simply issued by banks under Modi’s financial inclusion program, industry sources say.

Visa told the U.S. government it was concerned India’s “push to use transit cards linked to RuPay” and “the not so subtle pressure on banks to issue” RuPay cards, the USTR email showed.

Mastercard and Visa count India as a key growth market, but have been jolted by a 2018 central bank directive for them to store payments data “only in India” for “unfettered supervisory access”.

Mastercard faces an indefinite ban on issuing new cards in India after the central bank said it was not complying with the 2018 rules. A USTR official privately called the Mastercard ban “draconian”, Reuters reported in September.

Is India Against Cryptocurrencies?

While the crypto currency market is booming and thousands of new virtual currencies are being mined every week, many financial experts and governments are vehemently raising voice to ban all cryptos for various reasons.

Last week, RBI governor Shaktikanta Das said the Reserve Bank had “serious concerns from the point of view of macro-economic and financial stability” and that blockchain technology can thrive without cryptocurrencies. Really, there is a grain of truth to the claim that cryptocurrencies are rivals of central banks as they cannot control them like sovereign money.

India has recently taken a more keen note on cryptocurrencies, thanks to its robust growth in the country amid a lack of regulations. However, things are likely to undergo a drastic change, with the government eager to bring in rules and regulations in the digital currency sector. (News18.com 12/18/2021).

There are thousands of virtual currencies on the market today, which are known as cryptocurrencies. Such currencies exchanged through crypto exchanges have not yet been approved by any country or central bank. Recently, El Salvador, a Central American country, officially recognized only the powerful Bitcoin.

But the CBDC is the official cryptocurrency issued by the Central Bank of India. This is the main difference between other cryptocurrencies and CDBC. The CBDC (Central Bank Digital Currency) will also be  marketed through the blockchain technology as done by other virtual currencies . It is likely to be a digital token or electronic form of the current currency. The Reserve Bank of India will be in charge of supervising and monitoring the official crypto of the Indian government. Digital money cannot be withdrawn as we usually withdraw from banks and ATMs. Their transactions will be through digital platforms. It is not yet clear whether it will be listed on other crypto exchanges.

There is no doubt that the operation of private currencies is being restricted to strengthen the official cryptocurrencies. There are some valid points to know about the official cryptocurrency of India.

The primary concern for India’s central bank is the anonymity that virtual currencies offer to their investors. While the record of cryptos is kept on an open ledger, the owner’s identity is not revealed. This can create problems for banks and the IRS to track the flow of money. And hence cryptocurrencies could be used to transfer illegal money or evade taxes and fund terrorist activities.

Digital currency will reduce the difference between the value of an ordinary currency and the cost of printing it. The bottom line is that government spending will go down. Meanwhile, the RBI Due to the restrictions, the value of digital currency will not fluctuate as seen in cryptocurrencies. This is where investors are most likely to stay away.

The total amount of digital currency issued can be converted into cash and is part of the currency in circulation in the economy. Over the last 5-6 years, the currency, including notes and coins, has grown from Rs 16.63 lakh crore to Rs 28.60 lakh crore. One of the main reasons for the rise in inflation is the circulation of this currency in the markets.

With the advent of digital currency, the RBI’s ability to intervene in markets will increase. Digital currency can reduce the amount of money in the market. After Kovid, people are increasingly using digital means.

Tamil Nadu CM MK Stalin Appoints MR Rangaswami As State’s ‘Investment Ambassador’

Tamil Nadu Chief Minister M.K. Stalin has appointed a prominent Indian American venture capitalist, M.R. Rangaswami as Tamil Nadu’s ‘Investment Ambassador’ on Friday, November 26.

Rangaswami has been an active member of the Indian American community whose influence has inspired many.

Over the years he has worn many hats including being an entrepreneur, investor, corporate eco-strategy expert, community builder and a philanthropist.

Most importantly, he is the founder of Indiaspora, a nonprofit who mission is to unite the Indian diaspora and to transform their success into meaningful impact in India and on the global stage.

By sharing insights, hosting events and connecting people, Indiaspora unites the professionally, geographically and religiously diverse Indian American community toward collective action, the press release said.

On honoring him his new crown, CM Stalin praised Rangaswami for his achievements in the US.

Dr. VGP, an Indian American community leader and president of the World Federation of Tamil Youth, USA in Chicago, congratulated CM Stalin on the appointment and said Tamil Nadu will soon become India’s number one industrialized state under Rangaswami’s captaincy, it said.

Neil Khot, national chairman of the Indian American Business Coalition, based in Washington, D.C., congratulated Rangasawami, saying that he is an excellent and apt choice who can make things happen.

Tamil Nadu has made giant strides in attracting global investment recently, thanks to IAS officer T. Muruganandam, who was till recently industries secretary and was now promoted to the key position as the state’s finance secretary, noted the release.

The event was attended by Rangaswami wife and his two children, who have been supportive of his past endeavors and his current leadership position to tackle more India-centric issues.

Will The $1.75 Trillion Spending Bill Passed By US Congress Survive US Senate?

After months of wrangling, House Democrats managed a big win Friday, November 19th passing their roughly $1.75 trillion social and climate spending package despite a Republican effort to delay the final vote. House Speaker Nancy Pelosi, wearing white, announced the passage of President Joe Biden’s “Build Back Better Act,” with the vote falling largely along party lines at 220-213.

The final tally was 220 to 213. Rep. Jared Golden of Maine was the only Democrat to vote against the bill and no Republicans voted for it. The vote took place on Friday morning after House GOP leader Kevin McCarthy stalled an effort to vote Thursday evening by delivering a record-breaking marathon floor speech overnight.

The sweeping economic legislation stands as a key pillar of Biden’s domestic agenda. It would deliver on longstanding Democratic priorities by dramatically expanding social services for Americans, working to mitigate the climate crisis, increasing access to health care and delivering aid to families and children.

The legislation is meant to fulfill many of President Biden’s promises during the 2020 campaign, including plans to address climate change and provide a stronger federal safety net for families and low-income workers.  “We have the Built Back Better bill that is historic, transformative and larger than anything we have ever done before,” House Speaker Nancy Pelosi, D-Calif., said on the House floor. “If you’re a parent, a senior, a child, a worker, if you are an American … this bill’s for you and it is better.”

House Democrats overcame internal divisions over the cost and scope of the spending package, but the fight will continue as the bill heads to the Senate for revisions. The vote was delayed after House Minority Leader Kevin McCarthy, R-Calif., spoke all through the night — for more than eight hours. His speech decried Democrats’ spending plans, but also veered to subjects including China and border security.

“Never in American history has so much been spent at one time,” he said. “Never in American history will so many taxes be raised and so much borrowing be needed to pay for all this reckless spending.”

Biden praised House passage of the bill, noting it was the second time in two weeks that the chamber moved two “consequential” pieces of his legislative agenda, referencing the new infrastructure law. He described the vote as a “giant step forward in carrying out my economic plan to create jobs, reduce costs, make our country more competitive, and give working people and the middle class a fighting chance.” What’s in the measure

The legislation includes:

$550 billion to address climate change through incentives and tax breaks;

funding to extend the expanded, monthly child tax credit for one year; housing assistance, including $150 billion in affordable housing expenditures; expansions to Medicaid and further assistance to reduce the cost of health care premiums for plans purchased under the Affordable Care Act; four weeks of paid family and medical leave; funding for universal pre-K for roughly 6 million 3- and 4-year-olds; a provision to allow Medicare Parts B and D to negotiate prices directly with drug manufacturers on certain drugs and cap out-of-pocket spending for seniors at $2,000 per year; a $35 cap on monthly insulin expenses.

The spending is mostly offset with taxes on the wealthy and corporations, including:

a 5% surtax on taxpayers with personal income above $10 million, and an additional 3% added on income above $25 million; a 15% minimum tax on corporate profits of large corporations that report more than $1 billion in profits; a 1% tax on stock buybacks; a 50% minimum tax on foreign profits of U.S. corporations.

House Democrats unite after months of fighting

Moderate Democrats ultimately voted for the legislation after concerns that estimates from the nonpartisan Congressional Budget Office would show the measure to be more costly than leaders have projected.

Ultimately, the CBO found the bill would cost the federal government $367 billion over the next decade, “not counting any additional revenue that may be generated by additional funding for tax enforcement.” Many Democrats, including the White House, argue that when that is taken into account, the measure would pay for itself.

Members of the fiscally moderate New Democrat Coalition endorsed the legislation ahead of the final cost estimates. Rep. Brad Schneider, D-Ill., said the official estimates don’t take into account extra revenue from increased tax enforcement — or the broader economic benefits of the legislation.

“When discussing the importance of the bill, we also have to talk about the costs that would be incurred if we don’t pass this bill,” Schneider said on a call with reporters. “The cost of inaction is simply too high, and it can only be headed off if we act now.”

For progressive Democrats, the vote fulfills a promise from Biden and House leaders not to neglect policies that have energized the left wing of their party. Members of the Congressional Progressive Caucus set aside major demands throughout the negotiations, including more spending and plans for aggressive changes to the nation’s health care system, in order to reach an agreement that satisfied the full caucus.

Senate hurdles could drag on for weeks

The House vote is just the latest step in a lengthy process that will almost certainly involve further changes to the bill. Centrist Sens. Kyrsten Sinema, D-Ariz., and Joe Manchin, D-W.Va., have each expressed concerns about the House version of the legislation. Manchin is particularly opposed to a provision that would provide four weeks of paid family and medical leave for most workers. Sinema’s objections are less clear but Democrats need both lawmakers on board in order for the legislation to pass.

It is unclear how long it would take for senators to work out their disagreements and finalize the legislation. Once that work is done, the Senate would have to start a lengthy process to vote on the bill using the budget reconciliation process that would allow the bill to be passed in the Senate with 50 votes, rather than the 60 votes needed for most legislation.

Pelosi told reporters on Thursday that Senate staff have already completed a necessary step to ensure the legislation meets the basic requirements to avoid a Republican filibuster. But the process still has several steps, including a series of unlimited amendment votes known as a vote-a-rama.

Historic Immigration Reform Included In House-Passed Spending Bill

The social spending bill approved by the House Friday in a 220-213 vote includes the most extensive immigration reform package reviewed by Congress in 35 years, albeit in a much reduced version from what proponents originally sought.

If the provision is approved by the Senate as-is, the immigration measure in the bill would allow undocumented people present in the U.S. since before 2011 up to 10 years of work authorization, falling short of an initial goal to offer them a pathway to citizenship.

The provision approved by the House offers a sort of waiver to immigration laws, using a process known as parole to allow people to stay in the country for five years with the option to extend for another five years thereafter.

About 6.5 million people would stand to benefit from the measure directly, according to an analysis by the Congressional Budget Office (CBO).

According to that analysis, about 3 million of those people would become eligible to springboard from the parole status to legal permanent residency, the first step toward citizenship.

“CHC remains focused on passing immigration reform.

The Build Back Better Act includes long-term work permits and protections for seven million hardworking immigrant essential workers that will help prevent family separation, stabilize our workforce, boost our economy, and create jobs,” said Congressional Hispanic Caucus (CHC) Chair Raúl Ruiz (D-Calif.).

“The CHC urges the Senate to protect the work-permits and protections and we are hopeful they will use the Senate rules to build upon them and create an earned pathway to citizenship to further improve our nation’s economy,” added Ruiz.

Still, the immigration provisions fall short of Democrats’ initial goal of providing a pathway to citizenship for an estimated 11 million undocumented people living in the U.S.

Rep. Veronica Escobar (D-Texas) lamented that the package was ultimately reduced to protections through a decade of work authorization.

“While that is absolutely inadequate, we have to get that across the goal line. We have to. That would provide the ability for so many of these incredible people to be able to get to work every day without fear of retaliation, and to be able to live without fear of deportation. And in fact, for millions of them it would allow them the important step towards stabilizing their situation,” she told reporters Thursday.

“And hopefully at some point, getting them fully protected through a pathway to citizenship. It buys Congress more time, so that we can fulfill our obligation and ensure that we give them the path to citizenship that they deserve.”

The bill also includes visa recapture, preventing the loss of some 222,000 unused family-based visas and 157,000 employment-based visas that otherwise expired at the end of last fiscal year. The move will help retain immigration pathways for those abroad who often wait years to immigrate to the U.S.

The inclusion of immigration provisions has taken a secondary role in the political fight to craft President Biden‘s signature legislative package, as Democrats have publicly quarreled about the top-line pricing of the bill.

The immigration provisions, while a relatively small line item within the larger bill, are expected to raise deficits by around $111 billion over the next decade, according to the CBO analysis.

While the immigration debate was a minor issue through negotiations for the Build Back Better bill, as the spending proposal is known, it pitted Democrats and immigration advocates against each other behind closed doors.

Advocates often called out Democrats for showing a lack of interest in an issue that’s personal for millions of U.S. citizens and foreign nationals in the country.

At the center of that friction was the debate over whether Democrats should push for a path to citizenship in the bill, or settle for parole — only a temporary respite from immigration enforcement for millions of immigrants.

Three House Democrats, Reps. Jesús García (Ill.), Adriano Espaillat (N.Y.) and Lou Correa (Calif.) became known as “the three amigos” for their threat to withhold their votes for the final bill unless immigration provisions were included.

The three later campaigned to include permanent residency rather than parole in the bill, but those efforts faltered as the CHC failed to coalesce behind their cause.

“This is a good first step forward that allows our constituents to breathe. This historic legislation includes work authorizations and protection from deportation for more than 7 million individuals,” said the three lawmakers in a joint statement after the bill’s passage.

“Make no mistake, while this is the most transformational policy our communities have seen in over three decades, much work remains in our efforts to ensure a pathway to citizenship,” they added.

The core issue that protracted itself over weeks — and remains unresolved — was the Senate parliamentarian’s advisory opinion on what could and could not be included in a reconciliation bill, which is limited to budgetary line items.

The House-passed bill will now go to the Senate under reconciliation rules in an effort to sidestep a Republican filibuster and pass the package with only Democratic support.

The parliamentarian, an unelected official who provides counsel on Senate rules, advised the first two Democratic immigration proposals were incompatible with reconciliation, warning they went beyond a budgetary impact and represented a substantial change in policy.

Those two proposals would have granted the possibility of legal permanent residency, also known as green cards, to millions of foreign nationals, including undocumented immigrants.

The first proposal was innovative in that it made green cards available to specific groups of undocumented immigrants and other foreign nationals, in this case so-called Dreamers, beneficiaries of the temporary protected status program, essential workers and agricultural workers.

The second proposal nixed by the parliamentarian revived a provision of immigration law that’s been dormant since the Reagan administration, which allows Congress to change the registry date prohibiting certain immigrants from adjusting their status, essentially enacting a statute of limitations for long-tenured immigrants.

The parliamentarian’s ruling against that proposal stunned the five Senate Democrats who led the way on immigration — Sens. Dick Durbin (Ill.), Bob Menendez (N.J.), Alex Padilla (Calif.), Catherine Cortez Masto (Nev.) and Ben Ray Luján (N.M.) — because of the registry proposal’s historical precedent.

A third proposal — the parole option included in the House bill — has yet to be presented to the parliamentarian.

Menéndez on Friday celebrated House passage of the bill, saing “it provides long-overdue legal protections for millions of undocumented immigrants that kept the country afloat during the pandemic.”

“Now, the Senate will continue to fight for the broadest immigration relief possible. We cannot fully build back better without protecting the dignity of millions of people who are critical to our long-term economic recovery. This is their home, and it is time for the Senate to help them fulfill their American dream,” added Menéndez.

Grassroots groups and García, Espaillat and Correa explicitly called for the House to send the registry proposal to the Senate, giving the five Senate Democrats a stronger negotiating position, but that view was overruled by Democratic leaders and advocacy groups closer to party politics.

“We should be trying to do the most we can, push the most we can — we shouldn’t be negotiating against ourselves,” Correa previously told The Hill.  While the House version’s loophole could quell some of the tensions between Democrats and grassroots immigration advocates, a reversal from the parliamentarian could quickly reignite those flames.

What Does Current Inflation Tell Us About The Future?

What signal should we be taking from current inflation for future inflation? The answer: some signal, but not a lot. To be sure, inflation is running high (figure 1); and, after excluding the typically volatile categories of food and energy prices, is running higher than it has been in decades. But because the factors that are leading to inflation are pandemic-related and therefore temporary, the current trend does not forecast the future.

To examine whether this short-term run up in inflation points to higher inflation in the years ahead, I look at the factors that appear to be contributing. I find that the strength and composition of consumer demand for goods since the pandemic began as well as supply constraints caused by the pandemic are the sources of the current spike. The clearly temporary nature of those factors suggests we should not extrapolate recent inflation pressure into the future.

Key Points:

Goods inflation has indeed been extraordinarily high.

The identifiable factors behind goods inflation—a surge in consumer demand and lagging supply—are primarily pandemic-related.

Increasing vaccination rates and decreasing the health risks should rebalance spending patterns, leading to a decrease in demand for goods and an increase in demand for services.

If increases in the supply of services lags behind increases in demand for services, we would see new and worrying inflation risks arise.

Inflation as of October 2021

Figure 1 shows inflation from 1969 to 2021, both by the consumer price index (CPI) and by the personal consumption expenditure (PCE) deflator. Some observers have tried to draw parallels between the current episode in inflation and the 1970s; this is incorrect.

While inflation has increased relative to recent years, inflation is significantly below the levels seen in the 1970s.

As measured by the CPI, the annual rate of inflation from October 2020 to October 2021 was 6.2 percent. As measured by the PCE deflator, the annual rate of inflation from September 2020 to September 2021 (the most recent available data) was 4.4 percent. Some of those price increases reflect a bounce back from the unusually low level of prices in the first part of the pandemic. For example, if the CPI had grown at a rate close to the Federal Reserve’s target from the first month of the pandemic through October 2020, the CPI annual inflation rate over the last year would have been 5.1 percent. That rate is still quite high, but a percentage point lower than the actual annual rate.

Which goods and services have driven the recent run-up in inflation? Figure 2 shows that the answer is core commodities, or goods. As figure 2a shows, core goods inflation has been strikingly high in recent months. In contrast, inflation in core services (2b) has been far more muted and has generally recovered to pre-pandemic rates.

Figures 2c and 2d show that inflation in energy and in food, which are excluded from core inflation, are both elevated. Energy inflation is quite volatile; domestic energy producers faced very low prices early in the pandemic, and those producers may be waiting to see if price increases are durable before increasing supply. Food inflation is worrying and appears to be a global trend related to the pandemic among other factors. The same trends are evident looking at PCE inflation (not shown).

Figure 3 shows just how unusual core goods inflation has been: it is higher than it’s been over the last 30 years. Since 2000, core goods inflation has been negative roughly half the time, meaning that the price of goods (on a quality-adjusted basis) falls on average. Given this recent history, the skyrocketing goods prices seen during the pandemic are all the more extraordinary. In contrast, core services inflation has been close to its average from the early 1990s to 2008 (when the significant decline in house prices dampened shelter costs).

Inflation in Economic Recoveries

As I have shown, the primary contributor to the recent spike in inflation is core goods. The strength in real consumer spending (shown in figure 4a) has reflected a surge in spending on consumer goods (shown in figure 4b). Real goods spending is currently about 15 percent higher than it was pre-pandemic, and there were a couple of months when it was 20 percent higher.

Are the trends described above a signal that we should expect continued extraordinary inflation for core goods—everything from automobiles to exercise mats—in the coming years? Three factors suggest no.

First, the surge in spending on goods has put upward pressure on prices as suppliers have been unable to keep up with demand. Suppliers have strong incentives to iron out issues with the supply chain to get more product onto shelves; in addition, the problems with the supply chain that owe more directly to the pandemic will ebb as the pandemic is brought under control globally.

Second, that surge in goods spending is no doubt temporary because households—as the pandemic recedes—will rebalance consumer spending toward services, which has been unusually depressed (figure 4c).

Third, the fiscal support to households that has helped to finance the surge in goods spending has largely waned.

In contrast to spending on consumer goods, spending on services remains below its pre-pandemic peak. This pattern is a significant departure from previous business cycles where services were relatively unaffected.

Inflation Risks on the Horizon

Although the recent surge in consumer goods inflation does not suggest persistent inflation in this sector going forward, two other issues present risk to the inflation outlook: labor supply and demand in the services sector as well as the recent increases in housing prices.

As consumer spending rebalances towards services, demand for labor in the services sector will rise beyond already-elevated levels. For example, in September, job openings in leisure and hospitality were a remarkable 530,000 higher than trend but employment was 1.5 million below its pre-pandemic level. If consumer demand for leisure and hospitality services return to (or temporarily exceeds) pre-pandemic levels, demand for labor will likely increase significantly.

Softness in labor force participation rates and a frustratingly slow pace of matching job seekers with jobs has raised concerns about weakness in the supply of labor. To be sure, the pace of job matching is probably slowed by the sheer number of job openings and opportunities across multiple industries that candidates have to consider. In addition, because of pandemic-related issues, some people are constrained from working or worried about the health risks of working. My expectation is that those issues will resolve.

However, continued weakness in labor supply may suggest that the experience of the pandemic and the changing nature of work since March 2020 could persistently dampen how much labor people are willing to supply. If labor supply continues to be restrained, this will affect the ability of the U.S. economy to produce goods and services.

That would increase inflationary pressures for a given level of aggregate demand, which is a problem. But, in that circumstance the more significant problem to address would be that our standard of living would be lower.

The other factor that is creating some inflationary risks on the horizon is house price growth and how that is going to spill over into the rental market. Historically, there is a strong relationship between house price growth and inflation in the rental market (figure 5). After rents grew at roughly a 3¾ percent annual pace before the pandemic, this inflation rate was at a remarkably low level of less than 2 percent in the first half of this year.

Rent inflation is now rising to more typical levels; rents grew 2¾ percent between October 2020 and October 2021 and that rate looks poised to increase. While deserving of notice, worrying inflation in this sector would be more of the plain vanilla-type that less accommodative monetary policy would be well-equipped to dampen.

Conclusion

The biggest risk to inflation going forward is not a continuation of the forces currently at work in the goods sector: this will not be persistent. Instead, the biggest risk is that large increases in demand for workers in the services sector will not be met by equally large increases in labor supply.

Policymakers can encourage labor supply by continuing to get the pandemic under control through vaccinations and sensible health policies. Moreover, policymakers can also remove barriers that make work costly, such as lack of access to affordable, high-quality childcare. Policymakers can facilitate the matching of job seekers with jobs through job fairs and better access to labor market information. Finally, immigrants are a critical source of workers in the U.S., and rates of immigration are significantly down relative to pre-pandemic projections.

A return to more typical levels of, for example, green card issuance would help to expand labor supply in the U.S. to meet the growing demand for labor. In short, the policies that will rein in inflation in the future are the same policies that support a sustained and equitable labor market recovery.

World Bank Reports, India Received Largest Remittances In 2021

The recently launched report by World Bank noted that India received $87 billion in remittances in 2021, and the United States was the biggest source, accounting for over 20% of these funds.

On Wednesday, November 17, the World Bank report stated, “Flows to India (the world’s largest recipient of remittances) are expected to reach $87 billion, a gain of 4.6% — with the severity of COVID-19 caseloads and deaths during the second quarter (well above the global average) playing a prominent role in drawing altruistic flows (including for the purchase of oxygen tanks) to the country,”

India is followed by China, Mexico, the Philippines, and Egypt, the report said. In India, remittances are projected to grow 3% in 2022 to $89.6 billion, reflecting a drop in overall migrant stock, as a large proportion of returnees from the Arab countries await return, it said.

Remittances to low- and middle-income countries are projected to have grown a strong 7.3% to reach $589 billion in 2021, the Bank said.

This return to growth is more robust than earlier estimates and follows the resilience of flows in 2020 when remittances declined by only 1.7% despite a severe global recession due to COVID-19, according to estimates from the World Bank’s Migration and Development Brief.

“Remittance flows from migrants have greatly complemented government cash transfer programs to support families suffering economic hardships during the COVID-19 crisis. Facilitating the flow of remittances to provide relief to strained household budgets should be a key component of government policies to support a global recovery from the pandemic,” said Michal Rutkowski, World Bank Global Director for Social Protection and Jobs.

USCIS To Allow Automatic Renewal Of Employment Authorization For H-4 Workers

U.S. Citizenship and Immigration Services has settled a lawsuit Nov. 10, which allows the spouses of L-2 workers to automatically receive work authorization, and also provides an automatic 180-day extension of work authorization for some spouses of H-1B workers.

“Once implemented by the agency, L-2 spouses will no longer have to apply for work authorization and need an EAD (Employment Authorization Document) as proof in order to work in the United States,” said Jesse Bless, director of litigation at the American Immigration Lawyers Association, in an interview with Forbes magazine. This means L-2 spouses could immediately work upon entering the U.S.

“For H-4 spouses who have lawful status and merely need to renew their employment authorization, they will now enjoy an automatic extension of their authorization for 180 days after expiration should the agency fail to process their timely-filed applications,” said Bless.

Concerns have arisen that the extension of EAD is only valid as long as the H-4 status is valid. The law firm Puyang and Wu noted on Twitter: “In most cases, filing the H-4 extension and H-4 EAD renewal concurrently does not grant you the automatic extension. The H-4 extension would have to be approved first before you may benefit from the full 180-day auto extension.”

The lawsuit, Shergill vs. Mayorkas — Alejandro Mayorkas heads up the Department of Homeland Security — was initiated by the law firm Wasden Banias, which represented 15 plaintiffs in the class action case, filed with the U.S. District Court in Seattle, Washington, and the American Immigration Lawyers Association. The lawsuit arose in response to lengthy delays by USCIS in processing H-4 Employment Authorization Document applications.

“After years of outreach to the agency, it became clear that litigation was unfortunately necessary,” said attorney Jon Wasden in a press statement. “Despite the plain statutory language, USCIS failed to grant employment authorization incident to status for L-2s.”

“The other issue relates to H-4s whose work permits expire prior to their H-4 status; this is a group that always met the regulatory test for automatic extension of EADs, but the agency previously prohibited them from that benefit and forced them to wait for re-authorization. People were suffering. They were losing their high-paying jobs for absolutely no legitimate reason causing harm to them and U.S. businesses. So, while I’m glad the agency finally followed the law, it is frankly frustrating that an easily fixable issue took this long to address,” he stated.

In their lawsuit, the plaintiffs alleged that USCIS unlawfully withholds employment authorization to spouses of L-2 workers, and unlawfully withholds automatic extensions of L-2 employment authorization.

They further alleged that USCIS unlawfully withholds automatic extensions of employment authorization for H-4 workers, who are overwhelmingly women from India, many with degrees and qualifications equal to or exceeding those of their H-1B spouses.

About 100,000 immigrants currently hold H-4 EADs. A great amount of controversy has arisen over the authorization, especially during the Trump administration, which tried to end the program created by former President Barack Obama via executive order. In a long-simmering lawsuit, SaveJobs USA contends that allowing H-4 women to work in the U.S. means American workers have to compete with foreign workers for jobs, and that overall salaries are reduced as a result.

H-4 visa holders are allowed to get work authorization after their spouse has filed for permanent status, usually within six years. Current policies often force workers with H-4 EAD to lose their jobs as they wait for USCIS to adjudicate their renewal application, which could take up to two years.

Immigration attorney Cyrus Mehta noted the limitations of the settlement. “USCIS needs to be sued again. H-4s who file EAD renewals concurrently with an I-539 extension may receive only a brief auto-extension, just to the end of their current I-94 date, but most existing EADs end with the current I-94 date,” he tweeted.

“The H-1B spouse will have to premium the H-1B extension, and upon approval, the H-4 will need to leave and be readmitted in H-4 status coterminous with new H-1B validity. Highly impractical as visa stamping appointments are not being issued quickly in India,” wrote Mehta.

H-1B workers and their spouses could also apply for the H-1B/H-4 extension six months in advance via premium processing and if H-4 status is granted, file the EAD renewal and get a 180-day auto extension, noted the attorney, cautioning however: “Not sure whether USCIS is competent enough to approve H-4 status within 6 months though. So this too is highly impractical.”

Wasden Banias Law also addressed those who were unhappy with the settlement in a statement on Twitter. “For the H-4s disappointed/angry at the scope of the Shergill policy, three quick points: (1) we have an all-encompassing H-4 delay suit pending; (2) we don’t control the headlines of news articles; and (3) a small step forward is still a step forward.”

Several Indian publications have reported that this is a major step forward for H-4 EAD.

Rajeshwar Prasad Presented Life Time Achievement Award At NIAASC Annual Meeting In New York

Rajeshwar Prasad, founder and chairman of  The National Indo-American Association for Senior Citizens (NIAASC) was honored with a Lifetime Achievement Award, During the 32nd annual Conference and 23rd Annual meeting of NIAASC on Sunday, November 7th, 2021 at the India Home in Jamaica, New York. He was recognized for his 23 years of admirable and outstanding community outlook and service, creating and nurturing NIAASC and dedicated to all seniors across the USA.

Dr. Vasundhara Kalasapudi, who is the founder of India Home nonprofit organization and a current board member of NIAASC hosted the conference, which  was informative and entertaining with vegan breakfast and lunch served.  Dr. Bhavani Srinivasan, Vice president – NIAASC was the coordinator of the conference and coordinated the event effectively and flawlessly.

The conference started with opening remarks and greetings by NIAASC Chairman and founder Rajeshwar Prasad. in his speech, Prasad reflected on the growth of the organization since its inception in 1998. He stated “NIAASC helps Senior Citizens and Senior Associations through information, referral and advocacy services “. Following the Chairman’s speech, Mrs. Gunjan Rastogi, the current president of NIAASC welcomed ­­the attendees and echoed the chairman’s message and reaffirmed and reminded everyone that NIAASC is a unique nonprofit organization that provides resources for all the seniors while collaborating with other nonprofit organizations and this was well received and acknowledged.

The main speaker was Dr. Vikas Malik, a board-certified medical professional in both Child-Adolescent Psychiatry and Adult Psychiatry and his PowerPoint presentation on Mental Health in light of COVID-19 captivated the audience of roughly 70 physical attendees and 30 virtual attendees, who appreciated the information and knowledge that was succinctly explained.  His presentation was followed by Dr. Swaminathan Giridharan, a Geriatric specialist, who spoke about COVID-19 Vaccination.  The conference also focused on physical health and a presentation by   Mrs. Suman Munjal, president of World Vegan Vision, who discussed the health benefits pertaining to a vegan diet.

The occasion marked NIAASC honoring Mr. Mukund Mehta, President of Indo-American Senior citizen center, a nonprofit organization and the President of India Home. In introducing Mr. Mukund Mehta, Dr. Vasundhara Kalasapudi informed the audience about his active involvement as a director with the Federation of Indian American Seniors Associations of North America (FISANA).

NIAASC’s goal of collaboration with other organizations was evident as the conference was well attended by members of the National Federation of Indian American Associations (NFIA). Members included current executive board members and past presidents who made the effort to connect via zoom. NFIA attendees belonged to different states/different time zones and remained present throughout the duration of the program. Also in attendance were members from several other organizations such as World Vegan Vision (WVV) and India Association of Long Island (IALI). Many IALI members attended In-person and on Zoom, including nine past presidents. Other NIAASC Board members that joined via zoom were: Satpal and Satya Malhotra(New York), Baldev Seekri ( Florida), Chandrakant Shah (Florida), Santosh Kumar (Chicago), Asha Samant (New Jersey ) and Jyotsna Kalavar (Indiana).

Lunch was followed by Diwali cultural program that was presented by Ms. Jyoti Gupta and her team consisted of several singers, Dr.Jag Kalra, Kul Bhooshan Sharma, Gautam Chopra and Raj Dhingra. The group entertained and regaled the audience with lively Bollywood songs. Music program was followed by Diwali Felicitation by Nilima Madan.

In her closing remarks, Gunjan Rastogi thanked the sponsors that supported the entire event financially and also thanked the India Home volunteers who had helped set up the venue while precluding any hiccups.

The vote of thanks was given by Mr. Harbachan Singh, NIAASC Secretary who appreciated the presence of large number of audiences, sponsors, and well-wishers.

Upon adjournment of the conference, the 23rd general body meeting was conducted by NIAASC president, Gunjan Rastogi, who requested Mr. Rajeshwar Prasad to present the report of nominating committee, since the chairman of the nominating committee Chandrakant Shah, was not able to the report due to some technical issue. Rajeshwar Prasad informed the members that as per NIAASC constitution and bylaws; 1/3rd members retire every year, but based on eligibility criteria, members are eligible to be re-elected for another term of three years that resulted in all the retiring members Gunjan Rastogi, Bhavani Srinivasan, E.M. Stephen, Santosh Kumar, and Rajeshwar Prasad to be elected for three additional years and was approved by the General Body.        For additional information about NIAASC, please email the president at gunjan.p.rastogi@gmail.com.

Inflation Explained: Why Prices Keep Going Up And Who’s To Blame?

Confused about inflation? You’re not alone. Inflation is, paradoxically, both incredibly simple to understand and absurdly complicated.  Let’s start with the simplest version: Inflation happens when prices broadly go up.

That “broadly” is important: At any given time, the price of goods will fluctuate based on shifting tastes. Someone makes a viral TikTok about brussels sprouts and suddenly everyone’s gotta have them; sprouts prices go up. Meanwhile sellers of cauliflower, last season’s trendy veg, are practically giving their goods away. Those fluctuations are constant.

Inflation is when the average price of virtually everything consumers buy goes up. Food, houses, cars, clothes, toys, etc. To afford those necessities, wages have to rise too.

It’s not a bad thing. In the United States, for the past 40 years or so (and particularly this century), we’ve been living in an ideal low-and-slow level of inflation that comes with a well-oiled consumer-driven economy, with prices going up around 2% a year, if that. Sure, prices on some things, like housing and health care, are much higher than they used to be, but other things, like computers and TVs, have become much cheaper — the average of all the things combined has been relatively stable.

Still with me?

All right, let’s cut to today, and why inflation is all over the news.

When ‘inflation’ is a bad word

Inflation becomes problematic when that low-and-slow simmer gets fired up to a boil. That’s when you hear economists talk about the economy “overheating.” For a variety of reasons, largely stemming from the pandemic, the global economy finds itself at a rigorous boil right now.

In the United States, prices have climbed 6.2% — the biggest increase since November 1990, and well above the Federal Reserve’s long-term inflation goal of around 2%.

And here’s where Econ 101 merges a bit with Psych 101. There’s a behavioral economics aspect to inflation where it can become a self-fulfilling prophecy. When prices go up for a long enough period of time, consumers start to anticipate the price increases. You’ll buy more goods today if you think they’ll cost appreciably more tomorrow. That has the effect of increasing demand, which causes prices to rise even more. And so on. And so on.

That’s where it can get especially tricky for the Federal Reserve, whose main job is to control money supply and keep inflation in check.

How’d we get here? Blame the pandemic.

In the spring of 2020, as Covid-19 spread, it was like pulling the plug on the global economy. Factories around the world shut down; people stopped going out to restaurants; airlines grounded flights. Millions of people were laid off as business disappeared practically overnight. The unemployment rate in America shot up to nearly 15% from about 3.5% in February 2020.

It was the sharpest economic contraction on record.

By early summer, however, demand for consumer goods started to pick back up. Rapidly. Congress and President Joe Biden passed a historic $1.9 trillion stimulus bill in March that made Americans suddenly flush with cash and unemployment assistance. People started shopping again. Demand went from zero to 100, but supply couldn’t bounce back so easily.

When you pull the plug on the global economy, you can’t just plug it back in and expect it start humming at the same pace as before.

Take cars, for example. Automakers saw the Covid crisis beginning and did what any smart business would do — shut down temporarily and try to mitigate losses. But not long after the pandemic shut factories down, it also drove up demand for cars as people worried about exposure on public transit and avoided flying. Automakers had whiplash.

Cars require an immense number of parts, from an immense number of different factories around the world, to be built by highly skilled laborers in other parts of the world. Getting all of those discreet operations back online takes time, and doing so while keeping workers from getting sick takes even more time.

Economists often describe inflation as too much money chasing too few goods. That’s exactly what happened with cars. And houses. And Peloton bikes. And any number of other items that became hot ticket items.

How’s the supply chain involved in all this?

“Supply chain bottlenecks” — that’s another one you see all over, right?

Let’s go back to the car example.

We know that high demand + limited supply = prices go up.

But high demand + limited supply + production delays = prices go up even more.

All modern cars rely on a variety of computer chips to function. But those chips are also used in cellphones, appliances, TVs, laptops and dozens of other items that, as bad luck would have it, were all in high demand at the same time.

That’s just one example of the disconnect in the global supply chain. Because new cars have been slow to roll in, used car demand shot through the roof, which drove overall inflation higher. In some cases, car owners were able to sell their used cars for more than what they paid for them a year or two prior.

What happens next?

Prices and wages are likely to keep going up well into 2022, officials and economists say. But for how long and how much depends on countless variables across the globe.

Policymakers’ top priority is to unclog the supply chain bottlenecks to get goods moving at their pre-pandemic pace. That’s a lot easier said than done. And there’s no telling what kind of shocks — a resurgent Covid variant, a massive shipping container getting stuck in a key waterway, a natural disaster — could set back progress.

Economists and investors in the United States expect that the Fed will tighten monetary policy by raising interest rates and dialing back emergency stimulus, thereby slow the pace of inflation. When money becomes more expensive to borrow, that can take the heat off price increases and bring the economy back down to that nice, gentle simmer.

US Announces Big Hike In Medicare Premiums

The federal government announced a large hike in Medicare premiums Friday night, blaming the pandemic but also what it called uncertainty over how much it may have to be forced to pay for a pricey and controversial new Alzheimer’s drug.

The 14.5% increase in Part B premiums will take monthly payments for those in the lowest income bracket from $148.50 a month this year to $170.10 in 2022. Medicare Part B covers physician services, outpatient hospital services, certain home health services, medical equipment, and certain other medical and health services not covered by Medicare Part A, including medications given in doctors’ offices.

The Centers for Medicare and Medicaid Services played down the spike, pointing out that most beneficiaries also collect Social Security benefits and will see a cost-of-living adjustment of 5.9% in their 2022 monthly payments, the agency said in a statement. That’s the largest bump in 30 years.

“This significant COLA increase will more than cover the increase in the Medicare Part B monthly premium,” CMS said. “Most people with Medicare will see a significant net increase in Social Security benefits. For example, a retired worker who currently receives $1,565 per month from Social Security can expect to receive a net increase of $70.40 more per month after the Medicare Part B premium is deducted.”

The increase, however, is far more than the Medicare trustees estimated in their annual report, which was released in late August. They predicted the monthly premium for 2022 would be $158.50. The actual spike — the largest since 2016 — could hurt some seniors financially.

It “will consume the entire annual cost of living adjustment (COLA) of Social Security recipients with the very lowest benefits, of about $365 per month,” said Mary Johnson, a Social Security and Medicare policy analyst for The Senior Citizens League, an advocacy group. “Social Security recipients with higher benefits should be able to cover the $21.60 per month increase, but they may not wind up with as much left over as they were counting on.”

Medicare premiums have typically increased at a far faster rate than Social Security’s annual adjustments, the league said. And much of the 2022 increase in Social Security benefits will be eaten up by inflation, which is also rising at a rapid clip.

CMS said part of the increase for 2022 was because of uncertainty over how much the agency will end up paying to treat beneficiaries to be treated with Aduhelm, an Alzheimer’s drug approved by the US Food and Drug Administration in June over the objections of its advisers. Some experts estimate it will cost $56,000 a year. Medicare is deciding whether to pay for it now on a case-by-case basis.

Because Aduhelm is administered in physicians’ offices, it should be covered under Medicare Part B, not Part D plans, which pay for medications bought at pharmacies. Traditional Medicare enrollees have to pick up 20% of the cost of most Part B medications, which would translate into about $11,500 in out-of-pocket costs for those prescribed Aduhelm.

“The increase in the Part B premium for 2022 is continued evidence that rising drug costs threaten the affordability and sustainability of the Medicare program,” CMS Administrator Chiquita Brooks-LaSure said in a statement. “The Biden-Harris Administration is working to make drug prices more affordable and equitable for all Americans, and to advance drug pricing reform through competition, innovation, and transparency.”

Also, Congress last year limited the 2021 premium increase even as emergency Medicare spending surged during the coronavirus pandemic. The monthly charge rose less than $4.

Along with the premium spike, the annual deductible for Medicare Part B beneficiaries is rising to $233 in 2022, up from $203 in 2021.

Medicare is the federal health insurance plan covering more than 62 million people, mostly 65 and older.  Part B premiums are based on income. Individuals earning $500,000 or more a year and joint filers making $750,000 or more annually will pay $578.30 a month for coverage in 2022.

China Overtakes U.S. To Grab Top Spot On Global Wealth

Global wealth tripled over the last two decades, with China leading the way and overtaking the U.S. for the top spot worldwide.

That’s one of the takeaways from a new report by the research arm of consultants McKinsey & Co. that examines the national balance sheets of ten countries representing more than 60% of world income.

“We are now wealthier than we have ever been,” Jan Mischke, a partner at the McKinsey Global Institute in Zurich, said in an interview.

Net worth worldwide rose to $514 trillion in 2020, from $156 trillion in 2000, according to the study. China accounted for almost one-third of the increase. Its wealth skyrocketed to $120 trillion from a mere $7 trillion in 2000, the year before it joined the World Trade Organization, speeding its economic ascent.

Richest 10%

The U.S., held back by more muted increases in property prices, saw its net worth more than double over the period, to $90 trillion.

In both countries — the world’s biggest economies — more than two-thirds of the wealth is held by the richest 10% of households, and their share has been increasing, the report said.

As computed by McKinsey, 68% of global net worth is stored in real estate. The balance is held in such things as infrastructure, machinery and equipment and, to a much lesser extent, so-called intangibles like intellectual property and patents.

Financial assets are not counted in the global wealth calculations because they are effectively offset by liabilities: A corporate bond held by an individual investor, for instance, represents an I.O.U. by that company.

The steep rise in net worth over the past two decades has outstripped the increase in global gross domestic product and has been fueled by ballooning property prices pumped up by declining interest rates, according to McKinsey. It found that asset prices are almost 50% above their long-run average relative to income. That raises questions about the sustainability of the wealth boom.

“Net worth via price increases above and beyond inflation is questionable in so many ways,” Mischke said. “It comes with all kinds of side effects.”

Surging real-estate values can make home ownership unaffordable for many people and increase the risk of a financial crisis — like the one that hit the U.S. in 2008 after a housing bubble burst. China could potentially run into similar trouble over the debt of property developers like China Evergrande Group.

The ideal resolution would be for the world’s wealth to find its way into more productive investments that expand global GDP, according to the report. The nightmare scenario would be a collapse in asset prices that could erase as much as one-third of global wealth, bringing it more in line with world income.

Spouses Of H-1B Visa Holders Can Now Look Forward To Getting Work Permit Faster

The Biden administration has been making gradual changes in the immigration department to make it easier for foreign professionals to travel to US, unlike the previous administration.

In the past few months, President Biden has been signing off crucial documents that will let IT professionals find working in the US more comfortably.

One of the major issues many H-1B visa holders facing were getting work permit for their spouses in the US.

Several visa holders, especially, Indian American has been urging the Biden admin to take this into consideration.

Now the administration has agreed to provide automatic work authorization permits to the spouses of H-1B visa holders, most of whom are Indian IT professionals.

An H-4 visa is issued by the US Citizenship and Immigration Services (USCIS) to immediate family members (spouse and children under 21 years of age) of the H-1B visa holders. The visa is normally issued to those who have already started the process of seeking employment-based lawful permanent resident status in the US.

The H-1B visa is a non-immigrant visa that allows US companies to employ foreign workers in specialty occupations that require theoretical or technical expertise. The technology companies depend on it to hire tens of thousands of employees each year from countries like India and China.

A settlement was reached by the Department of Homeland Security in a class-action lawsuit, which was filed by the American Immigration Lawyers Association (AILA) on behalf of immigrant spouses this summer.

“This (H-4 visa holders) is a group that always met the regulatory test for automatic extension of EADs (employment authorization documents), but the agency previously prohibited them from that benefit and forced them to wait for reauthorization. People were suffering. They were losing their high-paying jobs for absolutely no legitimate reason causing harm to them and US businesses,” Jon Wasden from AILA said.

The litigation successfully achieved the reversal of the USCIS policy that prohibited H-4 spouses from benefiting from the automatic extension of their employment authorization during the pendency of stand-alone EAD applications.

“Although this is a giant achievement, the parties’ agreement will further result in a massive change in position for the USCIS, which now recognizes that L-2 spouses enjoy automatic work authorization incident to status, meaning these spouses of executive and managers will no longer have to apply for employment authorization prior to working in the United States,” AILA said.

“We are delighted to have reached this agreement, which includes relief for H-4 spouses, through our litigation efforts with Wasden Banias and Steven Brown. It is gratifying that the administration saw that settling the litigation for non-immigrant spouses was something that should be done, and done quickly,” said Jesse Bless, AILA director of federal litigation.

The Obama administration had given work authorization to certain categories of spouses of H-1B visa holders. So far, more than 90,000 H-4 visa holders, a significant majority of whom are Indian-American women, have received work authorization.

100 Most Expensive U.S. Zip Codes In 2021: Include Boston’s Back Bay And Weston

BOSTON–PropertyShark released its annual most expensive zip codes of 2021. New England is home to 11 of the priciest U.S. zip codes, including #2 with Boston’s Back Bay. The full list is included towards the end in this article.

Key Takeaways:

  • At nearly $7.5 million, Atherton, Calif.’s 94027 remains #1 most expensive zip code for fifth consecutive year
  • Record $5.5 million median sale price gives Boston’s 02199 #2 spot
  • Top 10 most expensive zip codes in 2021 all surpass $4 million mark — a historic first
  • 33109 in Miami jumps 66% Y-o-Y, becomes #5 priciest in U.S.
  • Nationally, 30 zips feature median sale prices higher than $3 million, more than double the number of areas in 2020
  • Country’s 100 most expensive zip codes located in 10 states, with 70% from California
  • Bay Area claims 47 of nation’s most exclusive zip codes
  • Los Angeles County remains priciest county with 21 entries
  • Once again, San Francisco boasts highest concentration of pricey zip codes, while NYC drops out of top 20
  • Gibson Island’s 97% Y-o-Y price surge claims Maryland’s highest position yet at #23
  • Exclusive Lake Tahoe enclaves rule Nevada real estate, Paradise Valley returns Arizona for 3rdconsecutive year

Ranking the Priciest U.S. Zip Codes by Closed Home Sales

Even as another uniquely challenging year — marked by the efforts of tackling the pandemic and boosting the economy — is coming to an end, the U.S. residential market continues to experience vertical price trends. And, that picture is clearly visible in our 2021 edition of the 100 most expensive zip codes in the U.S. — which, for the first time ever, includes 127 zip codes due to multiple ties.

Compiled by calculating median home sale prices as opposed to listing prices to ensure an accurate picture of market conditions as opposed to selling prices that reflect sellers’ wishes, this year’s edition highlights the ever-increasingly competitive residential markets of economically vital urban centers.

The Bay Area, Los Angeles County, and New York City yet again have a heavy presence, joined by exclusive pockets of affluence scattered across the country, like Arizona’s Paradise Valley, Washington state’s Medina and Connecticut’s Fairfield County. What’s more, 2021’s competitive residential landscape is further evidenced by the country’s 10 most expensive zip codes — all of which surpassed the $4 million threshold, marking a new record.

For the full ranking of 2021’s 100 most expensive zip codes, scroll to the bottom of the page. For an even more detailed picture, explore last year’s rankings.

California Claims Overwhelming Majority of Expensive Zips Yet Again, Alongside New York & 8 Other States

Unsurprisingly, California continued to provide the bulk of the country’s most expensive zip codes: The Golden State originated 70% of all of the zip codes on this list, including six of the top 10 priciest. And, as usual, New York came in second, providing 17 zip codes in our ranking.

Notably, New York logged three fewer than last year — demonstrating California’s more vertical price trends, as well as the pricing slowdown in NYC’s top markets. In fact, while 2020 marked the first time that no NYC zips ranked among the country’s 10 most expensive, 2021 brought another historic first for the East Coast giant: No NYC zip codes ranked among the 20 priciest in the U.S. this year, with the state represented only by the Hamptons at the top of our ranking.

The East Coast made its presence further known with Massachusetts, home to seven of the top 100 zips in the U.S., up from last year’s four. Not only that, but as sales activity improved in Boston’s Back Bay area, Massachusetts claimed the #2 most expensive zip code in the country with 02199’s $5.5 million median sale price, which was only surpassed by California’s Atherton at more than $7 million.

To the south, Connecticut’s presence also improved compared to previous years: For the first time since 2018, it contributed four zips to the country’s priciest, most of which ranked in the bottom half of our list — similar to the three zips provided by New Jersey. Out west, Nevada and Washington added two zips each, with Washington state claiming #10 with Medina’s ever pricey 98039.

Additionally, Arizona, Florida and Maryland each contributed one zip code. Florida claimed the #5 most expensive zip code with Miami Beach’s 33109 — the highest-ranking for the Sunshine State since 2017. Meanwhile, New Hampshire missed the top 100 this year, having secured a presence during the last two years with Rye Beach.

Maryland Claims Sharpest Price Gain at 97%, While NYC’s Upper West Side Contracts 39%

The U.S. residential market’s vertical price trends were evident among the country’s top zip codes as well, with 92 zips registering price gains — including 23 where the median surged by more than 25%. Conversely, only 12 locations among the priciest registered drops in their medians this year – by comparison, 2020 brought median increases to 78 zips and drops to 23 locations.

At the same time, a record 30 zip codes posted median sale prices of $3 million and above — more than double those in 2020 — with the top 10 most expensive zips coming in at $4 million and higher. Moreover, the last zip code to enter our ranking — San Francisco’s 94122 — did so with a 12% year-over-year (Y-o-Y) increase in its median sale price, managing to hold onto its #100 position from last year.

The sharpest price gain was claimed by 21056 in Maryland’s Gibson Island, which nearly doubled its median sale price, surging 97% Y-o-Y to hit $3,195,000. Gibson Island was followed by 89402 in Nevada’s Crystal Bay, which swelled 68% to reach #39 with a $2.5 million median. The third-sharpest gain was claimed by 33109 in Miami Beach, which rose 66% to a $4,475,00 median sale price to become the #5 most expensive zip code in 2021.

The sharpest price contraction was registered in NYC’s Upper West Side, where zip 10069 contracted 39% Y-o-Y to stabilize at $1,663,000. As a result, the Upper West Side zip dropped from last year’s #22 to #93 this year. Notably, this zip code was actually the leader of price growth in 2020, when its median shot up 42% Y-o-Y.

Across the country, the second-sharpest price drop was registered by 94904 in Greenbrae, Calif., which contracted 12% Y-o-Y. It was followed by Bridgehampton, N.Y.’s 11932, down 11% Y-o-Y. Located in the famously pricey Hamptons, 11932’s price contraction meant that this zip — which was the #7 most expensive in 2020 — came in at #31 this year, its lowest position in three years.

Unshakeable Atherton Maintains #1 Spot for 5th Consecutive Year, Boston Grabs #2 with Record $5.5M Median

A record-setting year for the most expensive zip codes in the U.S., the 10 priciest zip codes in the country now sport median sale prices of $4 million and above. All in all, the 10 most expensive zip codes in the U.S. were provided by five states (as opposed to last year’s three): California claimed six of the top 10 and was joined by Massachusetts, Florida and Washington, as well as New York, which was solely represented by the Hamptons.

Reaching a new record median sale price at $7,475,000, Atherton’s 94027 remains the #1 most expensive zip code in the U.S. for the fifth consecutive year — nearly $2 million ahead of the runner-up. Not only that, but the billionaire favorite also saw its median rise 7% Y-o-Y, suggesting that this exclusive enclave may continue to retain its leading position in the future.

Meanwhile, on the opposite coast, Boston’s 02199 was conspicuously absent last year due to depressed sales activity during the onset of the pandemic — despite that it historically features one of the highest median sale prices in the U.S. However, the Prudential Center area of Back Bay returned in 2021 with a $5.5 million median sale price — its highest figure yet. Consequently, Boston’s 02199 became the #2 most expensive zip code nationwide, outpacing even ultra-exclusive Hamptons enclaves.

Similarly, another well-established presence among the priciest zip codes in the country, Sagaponack’s 11962 was this year’s #3 most expensive zip code, dropping from the runner-up slot it held for three consecutive years, despite a 29% Y-o-Y price uptick that raised its median sale price from $3,875,000 to $5 million. It was also the only zip from New York state to rank in the top 10, as NYC lost further pricing ground, failing to rank a single zip among even the top 20.

In Ross, Calif., 94957 retained its previous year’s position at #4 with a $4,583,000 median sale price, the result of a 27% Y-o-Y increase. A favorite of Silicon Valley executives and celebrities, this marked the first time that Ross surpassed the $4 million pricing mark.

Conversely, Miami Beach’s 33109 may have ventured into the $4 million and over category back in 2017, but this exclusive Florida enclave reached new pricing heights in 2021: 33109 on exclusive Fisher Island stabilized at $4,475,000 to become the #5 most expensive zip code after a staggering 66% Y-o-Y price jump.

Bay Area Still the Priciest Metro with 47 of the Top U.S. Zip Codes

As has increasingly been the case in recent years, greater Los Angeles, the vast New York metropolitan area and the Bay Area remained the leading metros for pricey zip codes. In particular, the Bay Area was yet again the uncontested leader, contributing 47 zip codes to our list — including three of the top 10 zips — while the greater Los Angeles was represented by 30 Orange and L.A. County zips.

The New York metro was represented by 22 zip codes, with only six of those from NYC proper and the rest located in the Hamptons, Nassau County and Westchester, as well as Connecticut’s Fairfield County and New Jersey’s Bergen and Monmouth counties.

L.A. County Remains Most Expensive, Santa Clara & San Mateo Form Pricey Zip Supercluster

Clearly, not even the tech dollars of Silicon Valley could unseat Los Angeles County, which again was the hottest county in the country for expensive real estate with 21 of the priciest zips in the U.S. Its most expensive zip was Beverly Hills’ famed 90210, a veteran of our yearly rankings and the #6 nationally with a $4,125,000 median sale price.

Not to be outdone, the Bay Area’s Santa Clara and San Mateo counties contributed 15 and 10 zips, respectively, to our ranking as the second- and third-most expensive counties in the U.S. As a result, they form a nearly contiguous supercluster of ultra-expensive zip codes that cover high-profile tech centers such as Menlo Park, Mountain View, Palo Alto, San Jose and Sunnyvale. And, while San Mateo’s top zip was overall leader 94027 in Atherton, Santa Clara’s highest-ranking zip was 94022 in Los Altos, which landed at #9 with a $4,052,000 median sale price.

A special note goes to Santa Barbara County, which increased its presence from just one zip code in 2020 to five in 2021. Its top zip code was 93108 in Santa Barbara’s exclusive enclave of Montecito — home to the likes of Oprah and former royals Prince Harry and Meghan Markle — which claimed #7 overall with a $4,103,000 median, following a 40% Y-o-Y pricing jump.

San Francisco, Los Angeles & New York City Hold Highest Concentrations of Exclusive Zips

For the fifth year in a row, San Francisco had the highest concentration of expensive zip codes of any city, ranking seven among the top 10. It was followed by Los Angeles and NYC, with six zips each. However, while San Francisco led the way, most of its zip codes were actually in the bottom half of our ranking: Its priciest zip (94123) placed at #46 — down 10 positions compared to 2020, despite a 7% uptick in its median. Covering the iconic Marina District, 94123 featured a $2,307,000 median sale price.

Of L.A.’s six zips that ranked nationally, its top three — 90272, 90077 and 90049 — form an uninterrupted cluster of pricey real estate with medians greater than $2 million. The trio was led by Pacific Palisades’ 90272 at #21 with a $3.25 million median sale price after an 18% Y-o-Y increase. Covering Bel Air, Holmby Hills and areas of Beverly Glenn, 90077 was #42 nationally with a $2.46 million median, while Brentwood’s 90049 grabbed #52 at $2,165,000.

Back in the Empire State, NYC’s presence weakened yet again: While 2020 marked the first time ever that no NYC zip codes were among the country’s 10 most expensive, in 2021, NYC came in below the top 20, too. More precisely, its most expensive zip — 10013 — just missed out, landing at #22 with a $3,212,000 median sale price, followed by 10007 at #25 with a median of $3,125,000.

Next up, Newport Beach had the the third-highest concentration of pricey zips in a city, with five entries, followed by Santa Barbara with four. Specifically, the most expensive Newport Beach zip — Balboa’s 92662 — grabbed #15 with a $3,577,000, while Santa Barbara’s top zip — 93108 in the exclusive community of Montecito — was #7 nationally.

Sagaponack Finishes as #3 Priciest Nationally, NYC Drops Out of Top 20

Usually one of the strongest presences in the 100 most expensive zip codes in the U.S. (second only to California), New York state retained its position in 2021 — although with a weakened presence. Specifically, the state recorded just 17 zip codes, only six of which were in NYC. Historically speaking, the East Coast powerhouse has had a strong presence in the uppermost levels of our ranking, but only two New York state zips were among the 20 most expensive in 2021 — none of which were in New York City proper.

Rather, the Hamptons’ 11962 in Sagaponack was the #3 most expensive zip code in the U.S. And, although its median sale price of $5 million was up 29% Y-o-Y, Boston’s Back Bay pushed it down one position, ending Sagaponack’s three-year reign as runner-up to the priciest zip code in the country.

The next-highest New York zip code was fellow Hamptons zip 11976 in Water Mill, which came in at #13 with a $3,745,000 median sale price, up an impressive 51% Y-o-Y. At the same time, last year’s #7 nationally — 11932 in Bridgehampton— dropped to #31 after an 11% Y-o-Y price contraction suppressed its median to $2,963,000.

Other zip codes outside of NYC included four more Hamptons locations: The pricey North Shore’s 11568 in Old Westbury which climbed to #62 with a $1.95 million median, as well as two Westchester zip codes. The latter included top 100 veteran 10580 in Rye at #72, plus newcomer 10577 in Purchase, which placed 88th with a $1.7 million median sale price.

Of NYC’s famously expensive real estate, only six zip codes ranked nationally in 2021. And, as a historic first, not one of them placed among the country’s 20 most expensive. Overall, NYC’s top two zips were Manhattan’s 10013 and 10007, claiming #22 and #25, respectively.

To be precise, 10013 — which covers parts of TriBeCa, SoHo, Little Italy and Hudson Square — posted a $3,212,000 median sale price, up 7% Y-o-Y, but still reeling from the 19% price crunch it experienced in 2020. Likewise, Downtown Manhattan, TriBeCa and SoHo’s 10007 posted a $3,125,000 median sale price, dropping 14 spots Y-o-Y. They were followed by Battery Park City’s 10282 with its $2,725,000 median at #35.

And, while Brooklyn made waves in 2019 with zip 11231’s break into the top 100, the Red Hook and Carroll Gardens zip code departed the top 100 in 2021 after a two-year stint, outpaced by sharper price gains in dozens of other zip codes nationwide.

At $2M Median, Alpine’s 07620 Leads New Jersey Real Estate for 5th Consecutive Year

While the Mid-Atlantic region was, as expected, dominated by exclusive New York locations, three New Jersey zip codes also represented the region — the highest number New Jersey has ever contributed to our list. Just 15 miles from Midtown Manhattan and with a $2 million median sale price, 07620 in Bergen County’s Alpine was the most expensive New Jersey zip code. Landing at #58 nationally, Alpine’s median was up 38% Y-o-Y, but, nonetheless, fell short of its 2018 pricing high of $2.2 million.

Alpine was joined by two beach communities, with 08750 in Monmouth County’s Sea Girt placing #70 nationally with a $1,892,000 median sale price, and 08202 in Cape May County’s Avalon landing at #92 with a $1.67 million median. Notably, both zip codes ranked among the 100 most expensive zip codes in the country for the first time.

New England Home to 11 of the Priciest U.S. Zip Codes, Including #2 with Boston’s Back Bay

Further north, New England originated 11 of the most expensive zip codes in the country — the highest figure yet for the region — with Massachusetts contributing seven zips and Connecticut adding four. What’s more, New England also provided the #2 most expensive zip code in the U.S. with Boston’s ultra-pricey 02199.

Zip 02199, which covers the Prudential Center area of Back Bay, usually ranks among the country’s most expensive areas, but was conspicuously absent in 2020 due to depressed sales activity. However, in 2021, zip 02199 returned not only to its highest position yet at #2 nationally, but also reached a new pricing record with a $5.5 million median sale price.

Meanwhile, Nantucket’s 02554 was Massachusetts’ next most expensive zip code, with its $2 million median sale price placing it #58 nationally and marking a new median peak for the exclusive island. It was followed by Weston’s 02493 at $1.85 million,as well as Wellesley Hills’ 02481, Waban’s 02468 and Chilmark’s 02535. Boston also ranked a second time with Beacon Hill and Downtown Boston’s zip 02108, which was the 91st most expensive in the U.S. at $1,673,000.

Connecticut was represented by four Fairfield County zip codes that regularly post some of the highest median sale prices in the country: Greenwich’s perennial representative, 06830, reached its highest median sale price yet at $2.05 million — up 36% Y-o-Y. It was joined by another Greenwich zip code, newcomer 06831, which claimed the #94 spot with a $1,653,000 median.

Notably, last year’s most expensive New England zip — Riverside, Conn.’s 06878 — was only the 4th priciest in the region this year, despite reaching a new median sale price high at $1.98 million. Finally, Connecticut’s contributions were rounded out by 06870 in Old Greenwich, which returned to national rankings after last year’s absence with a $1,807,000 median in 2021 — its highest pricing point yet.

Miami Beach Returns to Top 10 Nationally, Maryland’s Gibson Island Hits Historic $3M Mark

Down south, Florida’s perennially pricey 33109 zip in Miami Beach’s Fisher Island was on the upswing compared to last year, climbing all the way from #23 to #5 nationally. And, although it wasn’t the highest position yet for the popular celebrity location (having been the #3 most expensive in the U.S. in 2017), the exclusive 33109 zip nevertheless reached a new pricing peak in 2021 with its $4,475,000 median. That came as the result of a 66% Y-o-Y price surge — the third-sharpest increase among the country’s 100 leading zip codes.

In Maryland, Gibson Island’s 21056 was among the most expensive zip codes in the U.S. yet again and marked the sixth consecutive year that it has led the state in terms of pricing. However, while 21056 usually ranked in the bottom half of our list (even ranking at #100 in 2019), the Chesapeake Bay community reached its highest position yet this year, placing #23 nationally. That was the result of a whopping 97% Y-o-Y surge — by far the sharpest gain among the country’s top zips. Not only that, but by nearly doubling its median year-over-year, Gibson Island also reached a $3,195,000 median sale price — nearly double its previous record from 2016.

Arizona & Nevada’s Most Expensive Communities Enter Top 50 for 1st Time

Across the country, the Mountain States were again led by three high-income enclaves — Nevada’s Glenbrook and Crystal Bay on the shores of Lake Tahoe, as well as Arizona’s Paradise Valley — marking the first time that all three landed in the upper half of our ranking.

Specifically, 85253 in Arizona’s Paradise Valley claimed #50 after a 41% Y-o-Y price jump raised its median to $2,175,000. A favorite of some of the highest-profile rock stars in the world, the Maricopa County zip finally broke into the country’s most expensive zip codes in 2019, although it had already been the leader of pricey Arizona real estate for years.

Nevada was represented by two zip codes — 89413 and 89402 — for the third consecutive year, with both Lake Tahoe enclaves reaching their highest positions and pricing points to date. In particular, Glenbrook’s 89413 placed in the upper third of our ranking, landing at #29 with a record $3 million median sale price, the result of a 38% Y-o-Y price jump.

The Douglas County zip was joined by 89402 in Washoe County’s Crystal Bay at #39 with a record $2.5 million median sale price. Up 56 positions compared to last year, 89402 logged a staggering 68% median sale price surge, the second-sharpest price increase among the country’s top 100 zips.

Exclusive King County Enclaves Lead Pacific Northwest’s Priciest Real Estate

About 1,000 miles further north, the Pacific Northwest was, once again, represented not by Seattle or Portland, but by the high-income enclaves of Medina and Mercer Island in Washington state.

Specifically, Medina’s 98039 reached its highest pricing point with a $4 million median. This was the result of a 24% Y-o-Y increase that helped the tech-billionaire favorite remain among the most exclusive zip codes in the U.S., ranking as the #10 priciest. It’s also worth noting that 2021 marked the sixth consecutive year that Medina’s 98039 was the undisputed leader of expensive real estate in the Pacific Northwest.

And, returning to our list after its 2019 debut, fellow King County zip 98040 landed at #82. Also a favorite of tech executives, high-profile sports figures and media personalities, the Mercer Island zip code posted a $1,795,000 median sale price.

# Zip Code Location County State Median Sale Price 2021
1 94027 Atherton San Mateo County CA $7,475,000
2 2199 Boston Suffolk County MA $5,500,000
3 11962 Sagaponack Suffolk County NY $5,000,000
4 94957 Ross Marin County CA $4,583,000
5 33109 Miami Beach Miami-Dade County FL $4,475,000
6 90210 Beverly Hills Los Angeles County CA $4,125,000
7 93108 Santa Barbara Santa Barbara County CA $4,103,000
8 90402 Santa Monica Los Angeles County CA $4,058,000
9 94022 Los Altos Santa Clara County CA $4,052,000
10 98039 Medina King County WA $4,000,000
11 94024 Los Altos Santa Clara County CA $3,856,000
12 94301 Palo Alto Santa Clara County CA $3,800,000
13 11976 Water Mill Suffolk County NY $3,745,000
14 90742 Huntington Beach Orange County CA $3,625,000
15 92662 Newport Beach Orange County CA $3,577,000
16 94970 Stinson Beach Marin County CA $3,500,000
17 94028 Portola Valley San Mateo County CA $3,400,000
18 92067 Rancho Santa Fe San Diego County CA $3,399,000
19 92657 Newport Beach Orange County CA $3,365,000
20 92661 Newport Beach Orange County CA $3,293,000
21 90265 Malibu Los Angeles County CA $3,250,000
21 90272 Los Angeles Los Angeles County CA $3,250,000
22 10013 New York New York County NY $3,212,000
23 21056 Gibson Island Anne Arundel County MD $3,195,000
24 95070 Saratoga Santa Clara County CA $3,150,000
25 10007 New York New York County NY $3,125,000
26 94528 Diablo Contra Costa County CA $3,100,000
27 94010 Hillsborough/Burlingame San Mateo County CA $3,075,000
28 94920 Belvedere Tiburon Marin County CA $3,050,000
29 89413 Glenbrook Douglas County NV $3,000,000
30 95030 Los Gatos Santa Clara County CA $2,995,000
31 11932 Bridgehampton Suffolk County NY $2,963,000
32 90266 Manhattan Beach Los Angeles County CA $2,910,000
33 94306 Palo Alto Santa Clara County CA $2,810,000
34 93953 Pebble Beach Monterey County CA $2,750,000
34 11975 Wainscott Suffolk County NY $2,750,000
35 10282 New York New York County NY $2,725,000
36 92625 Corona Del Mar Orange County CA $2,695,000
37 11930 Amagansett Suffolk County NY $2,645,000
38 11959 Quogue Suffolk County NY $2,593,000
39 94025 Menlo Park San Mateo County CA $2,500,000
39 94062 Redwood City San Mateo County CA $2,500,000
39 89402 Crystal Bay Washoe County NV $2,500,000
40 91108 San Marino Los Angeles County CA $2,490,000
41 92651 Laguna Beach Orange County CA $2,475,000
42 90077 Los Angeles Los Angeles County CA $2,460,000
43 90212 Beverly Hills Los Angeles County CA $2,429,000
44 94507 Alamo Contra Costa County CA $2,400,000
45 95014 Cupertino Santa Clara County CA $2,310,000
46 94123 San Francisco San Francisco County CA $2,307,000
47 93921 Carmel By The Sea Monterey County CA $2,300,000
48 93067 Summerland Santa Barbara County CA $2,190,000
49 94087 Sunnyvale Santa Clara County CA $2,180,000
50 85253 Paradise Valley Maricopa County AZ $2,175,000
51 10001 New York New York County NY $2,171,000
52 90049 Los Angeles Los Angeles County CA $2,165,000
53 90274 Rolling Hills Los Angeles County CA $2,118,000
54 92660 Newport Beach Orange County CA $2,111,000
55 94040 Mountain View Santa Clara County CA $2,100,000
55 93920 Big Sur Monterey County CA $2,100,000
56 94070 San Carlos San Mateo County CA $2,055,000
57 6830 Greenwich Fairfield County CT $2,050,000
58 2554 Nantucket Nantucket County MA $2,000,000
58 94127 San Francisco San Francisco County CA $2,000,000
58 7620 Alpine Bergen County NJ $2,000,000
58 91008 Bradbury Los Angeles County CA $2,000,000
59 90048 Los Angeles Los Angeles County CA $1,985,000
59 94041 Mountain View Santa Clara County CA $1,985,000
59 91436 Encino Los Angeles County CA $1,985,000
60 90254 Hermosa Beach Los Angeles County CA $1,980,000
60 6878 Riverside Fairfield County CT $1,980,000
61 94402 San Mateo San Mateo County CA $1,968,000
62 11568 Old Westbury Nassau County NY $1,950,000
62 94002 Belmont San Mateo County CA $1,950,000
63 92118 Coronado San Diego County CA $1,940,000
64 10012 New York New York County NY $1,935,000
65 91302 Calabasas Los Angeles County CA $1,925,000
66 94705 Berkeley Alameda County CA $1,913,000
67 95032 Los Gatos Santa Clara County CA $1,911,000
68 90291 Venice Los Angeles County CA $1,907,000
69 95129 San Jose Santa Clara County CA $1,900,000
69 94563 Orinda Contra Costa County CA $1,900,000
69 91011 La Canada Flintridge Los Angeles County CA $1,900,000
69 90036 Los Angeles Los Angeles County CA $1,900,000
69 11963 Sag Harbor Suffolk County NY $1,900,000
70 8750 Sea Girt Monmouth County NJ $1,892,000
71 94118 San Francisco San Francisco County CA $1,868,000
72 10580 Rye Westchester County NY $1,861,000
73 94506 Danville Contra Costa County CA $1,860,000
73 94939 Larkspur Marin County CA $1,860,000
74 90211 Beverly Hills Los Angeles County CA $1,850,000
74 95120 San Jose Santa Clara County CA $1,850,000
74 2493 Weston Middlesex County MA $1,850,000
74 92014 Del Mar San Diego County CA $1,850,000
75 94904 Greenbrae Marin County CA $1,849,000
76 92663 Newport Beach Orange County CA $1,845,000
77 94030 Millbrae San Mateo County CA $1,840,000
78 94114 San Francisco San Francisco County CA $1,830,000
79 90232 Culver City Los Angeles County CA $1,819,000
80 6870 Old Greenwich Fairfield County CT $1,807,000

 

81 93109 Santa Barbara Santa Barbara County CA $1,805,000
82 98040 Mercer Island King County WA $1,795,000
83 94549 Lafayette Contra Costa County CA $1,775,000
84 94061 Redwood City San Mateo County CA $1,773,000
85 94941 Mill Valley Marin County CA $1,758,000
86 2481 Wellesley Hills Norfolk County MA $1,756,000
87 94121 San Francisco San Francisco County CA $1,701,000
88 95130 San Jose Santa Clara County CA $1,700,000
88 10577 Purchase Westchester County NY $1,700,000
89 2468 Waban Middlesex County MA $1,695,000
90 93103 Santa Barbara Santa Barbara County CA $1,682,000
91 93923 Carmel Monterey County CA $1,665,000
91 2108 Boston Suffolk County MA $1,673,000
92 8202 Avalon Cape May County NJ $1,670,000
93 2535 Chilmark Dukes County MA $1,663,000
93 10069 New York New York County NY $1,663,000
94 6831 Greenwich Fairfield County CT $1,653,000
95 93110 Santa Barbara Santa Barbara County CA $1,650,000
95 94131 San Francisco San Francisco County CA $1,650,000
95 94574 Saint Helena Napa County CA $1,650,000
95 92861 Villa Park Orange County CA $1,650,000
95 94707 Berkeley Alameda County CA $1,650,000
96 11030 Manhasset Nassau County NY $1,647,000
97 94960 San Anselmo Marin County CA $1,645,000
98 90027 Los Angeles Los Angeles County CA $1,640,000
99 94303 Palo Alto Santa Clara County CA $1,633,000
100 94122 San Francisco San Francisco County CA $1,627,000

Make sure to explore 2020’s rankings as well.

Methodology

To determine the most expensive zip codes in the U.S., we looked at residential transactions closed between January 1, 2021, and October 22, 2021, taking into account condos, co-ops, and single- and two-family homes. All package deals were excluded.

For an accurate representation, we considered only zip codes that registered a minimum of three residential transactions. Due to a number of ties, 127 zips made it onto our list of the 100 most expensive zip codes in 2021.

2020 and 2021 median sale prices were rounded to the nearest $1,000.

The Bay Area was defined as Alameda, Contra Costa, Marin, Napa, Santa Clara, San Francisco, San Mateo, Sonoma and Solano counties; the Los Angeles metropolitan area was defined as Los Angeles County and Orange County; and the 23-county New York metropolitan area was defined as New York City, Long Island, the Mid- and Lower Hudson Valley, Central and Northern New Jersey, Western Connecticut and Pike County, Penn

$1.2 Trillion Infrastructure Bill Passed By Congress Welcomed By Industrial Leaders

Corporations and business groups are calling on President Biden to sign the bipartisan $1.2 trillion infrastructure bill into law quickly after it finally cleared Congress late Friday, November 5th, after several months of painstaking negations.

The infrastructure bill passed the House 228-206 on Friday. Thirteen Republicans voted for the bill, while six progressive Democrats voted against it, arguing that Democratic leaders didn’t do enough to ensure that the party’s moderates would support the larger reconciliation package. The infrastructure legislation had cleared the Senate in August, with 19 Republicans joining all 50 Democrats in support.

The business community has rallied behind the infrastructure package, which makes huge investments in roads, bridges, broadband internet, drinking water, rail and public transit without raising taxes on corporations. Business groups say that Biden should sign the bill as soon as possible so transportation officials can get started on construction projects.

According to reports, nearly every major business group in Washington, D.C., backed the infrastructure bill while opposing the reconciliation package, which will implement a minimum tax on corporate profits.The Business Roundtable, which represents CEOs at some of the nation’s largest companies, urged Biden to “swiftly sign” the infrastructure bill. The U.S. Chamber of Commerce, the largest American corporate lobbying group, called the bill’s passage “a major win for America.”

Ford Motor Co., which will benefit from the bill’s investment in electric vehicle charging stations, lauded the House vote as “great news for the United States’ infrastructure and transition to a zero emissions transportation future” and said it looked forward to Biden’s signature.

“We urge President Biden to quickly sign this bipartisan package into law, so we can build back better with increased jobs, enhanced safety, and improved roads,” Jay Hansen, executive vice president for advocacy at the National Asphalt Pavement Association, said in a statement after the bill passed the House.

The United Steelworkers union welcomed the bill’s passage. “The House has passed the #InfrastructureBill, which would provide roughly $1 trillion for upgrading the nation’s critical infrastructure. This is a big freakin’ deal for us because Steelworkers supply America in so many ways!” the union tweeted.

Biden and Vice President Kamala Harris appeared in the White House State Dining Room about 12 hours after moderate and progressive Democrats in the House of Representative overcame internal bickering and delivered the president his biggest legislative win thus far. WASHINGTON, Nov 6 (Reuters) – A giddy President Joe Biden on Saturday hailed congressional passage of a long-delayed $1 trillion infrastructure bill as a “once in a generation” investment and predicted a broader social safety net plan will be approved despite tense negotiations.

Biden and Vice President Kamala Harris appeared in the White House State Dining Room about 12 hours after moderate and progressive Democrats in the House of Representative overcame internal bickering and delivered the president his biggest legislative win thus far.v”Finally, infrastructure week,” Biden said with a chuckle. “I’m so happy to say that – infrastructure week!”

President Joe Biden on Saturday hailed congressional passage of a long-delayed $1 trillion infrastructure bill as a “once in a generation” investment and predicted a broader social safety net plan will be approved despite tense negotiations.

Biden and Vice President Kamala Harris appeared in the White House State Dining Room about 12 hours after moderate and progressive Democrats in the House of Representative overcame internal bickering and delivered the president his biggest legislative win thus far.

The president’s comment referred to a running joke in recent years after Biden’s Republican predecessor Donald Trump declared “Infrastructure week” in 2018 but was unable to pass a bill after multiple tries during his presidency.

The bipartisan bill’s passage gives Biden a jolt of good news after sobering election losses for his Democratic party this week and a drop in his approval ratings. Referring to the losses, Biden said they showed American people “want us to deliver.” “I think the one message that came across was – ‘get something done. It’s time to get something done – stop talking,'” said Biden

Inflation Expectations Among Consumers Hit New Highs, Fed Survey

Americans’ inflation fears continued to accelerate in October, climbing for the 12th consecutive month in a row to another record high, according to a key Federal Reserve Bank of New York survey published Monday, November 8, 2021.

“Median inflation uncertainty – or the uncertainty expressed regarding future inflation outcomes – increased at both the short- and medium-term horizons. Both measures reached series highs in October,” the survey said.

Heads of households surveyed by the New York Fed expected consumer prices to rise by a median of 5.7 percent over the next year, according to the bank’s October Survey of Consumer Expectations.  The one-year inflation rate projected by consumers rose 0.4 percentage points since September and reached the highest level since the survey began in 2013.

The Fed and economists pay close attention to inflation expectations among consumers, particularly long-term expectations, when assessing the future of price increases. Steady increases in consumer inflation expectations could lead to what economists call a wage-price spiral: higher prices prompting workers to hold out for higher wages, which exacerbates the need to raise prices.

With consumers braced for the highest inflation levels in nearly a decade, they are also expecting the price of things like food, gasoline, rent and college tuition to rise over the next year. The only things that Americans expect to get cheaper over the next year are home prices and medical care.

The report is based on a rotating panel of 1,300 households.

Federal Reserve Chairman Jerome Powell has largely attributed the spike in consumer prices to pandemic-induced disruptions in the supply chain, a shortage of workers that has pushed wages higher and a wave of pent-up consumers flush with stimulus cash.

Although Powell has repeatedly said the rise in inflation is likely “transitory,” he acknowledged last week during the Fed’s two-day policy-setting meeting that the surge may not fade until the latter half of 2022. He maintained that wild swings in consumer prices will stop once current pressures on the supply chain dissipate.

“Our baseline expectation is that supply bottlenecks and shortages will persist well into next year and elevated inflation as well,” Powell told reporters. “And that, as the pandemic subsides, supply chain bottlenecks will abate and job growth will move back up. And as that happens, inflation will decline from today’s elevated levels.”

His comments came after the Federal Open Market Committee voted to begin pulling back on the extraordinary stimulus it has given the economy since March 2020. The U.S. central bank announced that it would reduce its aggressive bond-buying program by $15 billion a month in mid-November, lowering its purchases of long-term Treasury bonds by $10 billion a month and purchases of mortgage-backed securities by $5 billion a month.

Mahatma Gandhi Engraved On UK Coin

A new 5 pound coin to commemorate the life and legacy of Mahatma Gandhi was unveiled by Chancellor Rishi Sunak to mark the Hindu festival of Diwali.

Available in a range of standards, including gold and silver, the special collectors’ coin was designed by Heena Glover and features an image of a lotus, India’s national flower, alongside one of Gandhi’s most famous quotes — “My life is my message”.

Building on the enduring relationship and cultural connections between the UK and India, it is the first time that Gandhi has been commemorated on an official UK coin with the final design chosen by Sunak, who is the Master of the Mint.

“This coin is a fitting tribute to an influential leader who inspired millions of people around the world,” he said.

“As a practicing Hindu, I am proud to unveil this coin during Diwali. Mahatma Gandhi was instrumental in the movement for Indian independence and it is fantastic to have a UK coin commemorating his remarkable life for the first time.”

The coin, which goes on sale, is part of the Royal Mint’s wider Diwali collection, which includes 1g and 5g gold bars in henna-style packaging, and the UK’s first gold bar depicting Lakshmi — the Hindu Goddess of wealth.

The 20g gold Lakshmi bar was designed in partnership with the Hindu community in South Wales, where the Royal Mint is based.

The Mint will join the celebrations at the Shree Swaminarayan Temple in Cardiff, where worshippers will offer prayers to goddess Lakshmi and lord Ganesha for the coming year.

Chief Customer Officer for The Royal Mint, Nicola Howell, said: “As we approach Diwali celebrations, we are delighted to unveil the first official UK coin commemorating the life and legacy of Mahatma Gandhi. The beautiful design builds on the enduring relationship and cultural connections between the UK and India.”

The announcement comes as India is celebrating its 75th year of Independence this year. Last year, the Chancellor commissioned the new “Diversity Built Britain” 50p coin following discussion with the ‘We Too Built Britain’ campaign, which works for fair representation of minority communities’ contributions across all walks of life.

Around 10 million of the coins, which recognise and celebrate Britain’s diverse history, went into circulation in October 2020.

Politics of Petrol Prices In India

On the eve of Diwali, the Central government had cut excise duty on petrol and diesel prices by Rs 5 and Rs 10, pronouncing this as “Diwali Gift” .This brought relief to customers, who were reeling under inflation and skyrocketing fuel prices. Following this, at least 22 states and UTs cut VAT in different proportions.

The petrol price was cut in the range of Rs 5.7 to Rs 6.35 per litre and diesel rates by Rs 11.16 to Rs 12.88 across the country on November 4. The BJP-ruled states have slashed VAT rates on petrol and diesel by Rs 8 and 9, respectively.

According to Indian Oil Corporation, the country’s largest fuel retailer, in the national capital, petrol is retailing at Rs 103.97 per litre and diesel is available at Rs 86.67 per litre. The rate of petrol stands at Rs 109.98 in Mumbai and diesel costs Rs 94.14 per litre. The prices of petrol and diesel are the highest in India’s financial hub, Mumbai, among all the four metro cities.

In Tamil Nadu’s capital, Chennai, petrol is available at Rs 101.40 per litre and people have to shell out Rs 91.43 for one litre of diesel. Similarly, the prices of petrol and diesel remained unchanged in Kolkata and stood at Rs 104.67 and Rs 89.79 per litre, respectively.

Petrol, diesel prices in major Indian cities

CITY PETROL (PER LITRE) DIESEL (PER LITRE)
DELHI Rs 103.97 Rs 86.67
MUMBAI Rs 109.98 Rs 94.14
CHENNAI Rs 101.40 Rs 91.43
KOLKATA Rs 104.67 Rs 89.79
HYDERABAD Rs 108.20 Rs 94.62
BENGALURU Rs 100.58 Rs 85.01
BHOPAL Rs 107.23 Rs 90.87
CHANDIGARH Rs 94.23 Rs 80.90
BHUBANESWAR Rs 107.91 Rs 94.51

The Mechanism of Fuel Prices

 Fuel prices are revised by OMCs like Indian Oil, Bharat Petroleum and Hindustan Petroleum based on international prices in the preceding 15 days and foreign stock exchanges. The prices of petrol and diesel vary from state to state and also in cities, depending on the incidence of local taxes like value-added tax (VAT) and freight charges.

Politics Behind Price Cut

 The Rs 5 cut in the central levy on petrol and Rs 10 on diesel is the highest-ever reduction. This reduction came immediately after Bypoll election losses of BJP and comments from Himanchal Pradesh Chief Minister that inflation (mahangai) was the main reason of dismal performance of BJP in that state. To pacify or rather to fool people, this small reduction in fuel prices was announced as Diwali Gift.

The Central Government had increased fuel taxes twice by Rs 13 and Rs 16 per litre effected between March 2020 and May 2020. The twin hikes in central levies had taken the Centre’s collection on each litre of petrol to their highest level of Rs 32.9 and diesel to Rs 31.8 a litre. So even after reducing levy by Rs.5 per litre on petrol, the Center is collecting Rs27.9 (32.9-5) on petrol and Rs.21.8 on diesel. Clearly, the BJP government is trying to fool the people without giving them real relief.

The second politics is that for the coming five state elections, the BJP government is indirectly pressurizing the opposition ruled states to give up their major source of revenue which is VAT on fuel prices.

This would significantly reduce the budget of states and curtail their ability to spend on welfare measures just before elections. So if the opposition ruled states reduce VAT, they will be in a weaker position to fulfill the welfare demands of their voters. If they don’t reduce VAT, BJP will shift the entire blame of inflation on them. So far, except Odisa, non of the opposition ruled states have reduced their VAT while BJP ruled states immediately reduced their VATS. In the coming election advertisement, BJP will show the price differentials of petrol in BJP ruled states vs non-BJP ruled states. That way BJP expects to get the best of both the worlds in the coming state elections by playing this master stroke politics of small fuel price concessions.

Opposition States Cry Foul

The Centre had lowered not the excise component but the road and infra cess to Rs 13 from Rs 18 on petrol and to Rs 8 from Rs 18 on diesel. Since the Centre has cut cess and not the excise on fuels, there is going to be no change in the revenue share states get from the Centre. They will continue to get 41 per cent of Rs 12.40 per litre among states for unbranded petrol and Rs 9.80 a litre for diesel as per the recommendation of the 15th Finance Commission.

Chhattisgarh Chief Minister Bhupesh Baghel criticised the Centre for making minor tweaks to fuel prices that don’t make an impact. He claimed that the Centre first raised the price of petrol and diesel by up to Rs 30 and then decreased it by Rs 5. Punjab Finance Minister Manpreet Singh Badal confirmed that the state government will soon take a call on the Center’s demand to reduce state levies on fuel. The Kerala government has also spoken up against the Centre’s move on fuel prices.

105 Countries At Climate Summit Pledge To Limit Methane

The  announcement on November 2nd, 2021 by 105 countries, representing two thirds of the global economy, joining a U.S. and E.U.-led coalition to cut up to 40% of methane emissions by 2030 has been the most positive outcome from the ongoing Climate Summit from Glasgow.

Despite the fact that the world’s biggest methane emitters—China, Russia and India, which together contribute 35% of methane emissions—have not signed on, it’s a significant step that could go a long way toward meeting the climate conference’s goal of limiting global warming to 1.5°C above pre-industrial levels.

The Global Methane Pledge announced today at COP26 in Glasgow, UK, commits signatories to reducing their overall emissions by 30 per cent by 2030, compared with 2020 levels. The US government also published a detailed blueprint of how it intends to meet the goal.

The new initiative emphasises making cuts by tackling methane leaking from oil and gas wells, pipelines and other fossil fuel infrastructure. Significant amounts of the gas also come from other sources, such as livestock farming and decaying waste in landfill sites.

While international climate summits usually focus mostly on carbon dioxide, the dominant driver of the 1.1°C of global warming that has occurred since pre-industrial levels, methane is responsible for about 30 per cent of global warming to date, and atmospheric concentrations of the gas have surged since 2007, sparking concern from scientists.

Methane is the second-largest contributor to global warming after carbon dioxide and is responsible for more than a quarter of current global warming, says Ilissa Ocko, senior climate scientist at the Environmental Defense Fund (EDF). “Cutting methane is the fastest, most effective way to slow down warming now.” The pledged reductions alone would slash warming projections by 0.2°C, according to the United Nations Global Methane Assessment.

According to analysts, Methane emission reductions from oil and gas production are the low-hanging fruit of the climate crisis: easy to fix with existing technology, and easy to track. Methane is the principal component of the natural gas used for cooking, heating and energy generation.

Human activity accounts for about 60% of global methane emissions annually, and about a third of that comes from the fossil fuel industry, according to the International Energy Agency’s 2020 Methane Tracker. Unlike carbon dioxide, which is a by-product of fossil fuel combustion, no one wants to actually emit methane, it’s just that up until recently, no one noticed, or cared, if it escaped into the atmosphere.

The Paris Agreement called for holding temperature rise to “well below 2°C,” and the countries gathered in Paris called upon the U.N.’s climate science arm to research the effects of climate change at a 1.5°C limit. The resulting report warned that even that seemingly low level of temperature rise would be catastrophic and, in doing so, galvanized a push for a more ambitious climate agenda. Today, 1.5°C is the reference point for business leaders, government officials and activists alike.

The Glasgow pledge has been hailed as “game-changing” by US president Joe Biden, who has worked with the European Union to lead the initiative. “One of the most important things we can do to keep 1.5°C in reach is reduce our methane emissions,” he said. Biden said he would tackle US methane emissions using regulations from the US Environmental Protection Agency and the Department for Transportation, which has responsibility for some gas pipelines.

In yet another big announcement made, over 100 countries have pledged to end global deforestation by 2030, with rich countries agreeing to send $19 billion dollars in public and private finance to help forested countries keep trees in the ground. It’s not the first such promise—40 countries already committed to the 2030 target in 2014. But advocates say the scale of the new deal, which covers 85% of the world’s forests, is promising, as are accompanying initiatives announced by businesses and the finance sector.

Canadian prime minister Justin Trudeau announced his country would cut methane emissions from its sizeable oil and gas industry by 75 per cent by 2030. That is how fast the International Energy Agency says methane emissions will need to be cut if the world is to reach net zero by mid-century.

The voluntary pledge is backed by 15 of the world’s biggest methane emitters including the European Union, Indonesia and Iraq. In total, 105 countries have signed up and John Kerry, the US president’s special envoy on climate, said he expects the number to grow.

Democrats Ready To Vote On Deal Achieving Biden Agenda

After months of tense talks, delayed votes and internal clashes, Democratic leaders are on the cusp of solidifying a deal on President Biden’s sweeping domestic agenda, setting the stage for the House to vote on both a bipartisan infrastructure bill and a larger social benefits package in the coming days, media reports stated.

Party leaders have announced a hard-fought agreement on a proposal to rein in prescription drug costs — which stood among the last stubborn divisions between liberals and party moderates — and lawmakers said they were also nearing a deal on a new tax cut for those living in high-income regions of the country, which was demanded by centrists.

Speaker Nancy Pelosi (D-Calif.) said the final language of the social spending package could be released as early as October 2nd night — “That’s the hope,” she said — and across the Capitol, Senate Majority Leader Charles Schumer (D-N.Y.) said the upper chamber is aiming to consider the legislation on the week of Nov. 15.  “We’re coming to our conclusions,” Pelosi said.

Congressional Democrats unveiled updated text of the Build Back Better Act (H.R. 5376) on Oct. 28. The $1.75 trillion social spending package is a scaled-back version of the budget reconciliation legislation originally advanced by several House committees of jurisdiction in September.

“We have a bill,” Progressive Caucus Chair Pramila Jayapal (D-Wash.) declared Tuesday. “We did not have that last week” when Biden came to Capitol Hill. “We had a wish and a prayer and a promise and a framework … And now we’re going to have a vote on both bills.” “The day-by-day stuff — it all fades away,” said Rep. Matt Cartwright (D-Pa.). “I’m feeling really good about it.”

Speaking with CNN’s Victor Blackwell on “CNN Newsroom,” Jayapal said that after spending the weekend reviewing the legislative text and conferring with the progressive caucus, she is ready to pass the $1 trillion bipartisan infrastructure bill as well as the $1.75 trillion social safety net expansion bill once a few details in the latter are finalized. Progressives, who have so far held up the bipartisan measure by demanding a concurrent vote on the larger package, trust that Biden can get all Democratic senators on board with the social safety net legislation, she said.

“The President said he thinks he can get 51 votes for this bill. We are going to trust him. We are going to do our work in the House and let the Senate do its work,” the Washington state Democrat said. “But we’re tired of, you know, just continuing to wait for one or two people.”

Republicans have lashed out throughout the process, attacking Biden’s social benefits package as a dangerous case of government overreach while characterizing the majority Democrats as ineffective legislators. Not a single GOP lawmaker in either chamber is expected to support the $1.75 trillion legislation.

Democrats dismissed those criticisms outright, saying the messy infighting is part of the routine “sausage-making” that goes into crafting any major legislation. Those tensions will be long forgotten, Democrats maintain, when the president’s agenda is enacted and the numerous family benefits begin to reach workers and families across the country.

Even as Democrats were celebrating, however, there were reminders that more work needs to be done to get the two bills to Biden’s desk. Sen. Joe Manchin (D) — the centrist West Virginian who’s led the effort to scale back Biden’s social safety net expansion — declared Tuesday that he hasn’t endorsed a framework Biden unveiled last week, let alone a final bill.  “There [were] a couple of concerns that we had that we needed to work through,” Manchin said.

Still, Biden predicted late Tuesday that Manchin will ultimately get on board.  “He will vote for this if we have in this proposal what he has anticipated,” Biden told reporters in Scotland, where the president has been participating in a global climate summit — a gathering  that’s only increased the stakes for securing the climate provisions in his social spending package. “We’re going trust the president that he’s going to deliver 51 votes. He’s confident he can deliver 51 votes. We’re going to trust him,” Jayapal said.

The agreement would empower Medicare to negotiate drug prices in limited instances; prevent drug companies from raising prices faster than inflation; and cap out-of-pocket costs for seniors on Medicare at $2,000 per year.

Tuesday’s drug pricing deal was scaled back significantly from House Democrats’ original proposal in order to win support from key moderates who contended a more sweeping overhaul would have harmed innovation from drug companies to develop new treatments. A trio of moderates — Sen. Kyrsten Sinema (D-Ariz.) and Reps. Scott Peters (D-Calif.) and Kurt Schrader (D-Ore.) — helped negotiate the compromise.

“It’s not everything we all wanted; many of us would have wanted to go much further. But it’s a big step in helping the American people deal with the price of drugs,” Sen. Schumer told reporters as he announced the deal.

C.S. Venkatakrishnan To Be CEO of Barclays

Barclays new CEO is CS Venkatakrishnan, an Indian-American and the first person of color to hold that position. Mysore-born CS Venkatakrishnan has replaced Jes Staley as Barclays CEO after the latter stepped down on Monday, November 1st. Barclays said succession planning has been in place for some time, and he had been identified as the preferred candidate more than a year ago.

Jes Staley stepped down from Barclays, which is Britain’s third-biggest bank by market value, after a probe into his relationship with financier and sex offender Jeffrey Epstein. The bank said Staley will get a 2.5 million pound ($3.5 million) payout and receive other benefits for a year.

Better known as ‘Venkat’, he studied at Massachusetts Institute of Technology, where he got a PhD in operations research, after which he joined JPMorgan Chase in 1994. At JP Morgan Chase, venkat had held senior roles in Asset Management, where he was Chief Investment Officer for approximately $200 billion in Global Fixed Income, as well as in Investment Banking, and in Risk.

He joined Barclays in 2016. Prior to his appointment as Group CEO, Venkat was Head of Global Markets, Co-President of Barclays Bank PLC (BBPLC), and a member of the Group Executive Committee of Barclays, based in New York. He has also served as Chief Risk Officer at Barclays.

Venkat will be on a higher base salary than his predecessor and will receive £2.7 million ($3.69 million) in fixed pay – half in cash and half in shares. This amount is more than Staley’s 2.4 million pounds a year, it’s still a cut from Venkat’s – undisclosed – fixed pay as head of global markets, Barclays’ board said. Venkat will be eligible for a bonus up to a maximum of 93 per cent of his fixed pay and long-term incentives up to 140 per cent of fixed pay per year and a cash payment instead of a pension of £135,000 a year.

Venkatakrishnan joined Barclays as chief risk officer and initiated a comprehensive review of the bank’s exposure to bad credit card debt. The review led to Barclays taking a £320 million impairment charge after Venkatakrishnan urged the bank to adopt a more conservative approach to predicting how much of its credit card book would not be paid. Venkat is the executive sponsor for Embrace, the global multi-cultural network at Barclays, the bank said in its stock exchange announcement on Monday.

The board “identified Venkat as its preferred candidate for this role over a year ago, as a result of which he moved from the position of group chief risk officer to head of global markets,” London-headquartered Barclays noted in an announcement to the stock exchange. “The board has long been confident in Venkat’s capabilities to run the Barclays Group.”

The executive, known for his “genial unflappability” and “fondness for emojis,” appears to care about diversity. He has made progress on promoting women, Bloomberg reported. Venkatakrishnan is also the executive sponsor for Embrace, the global multi-cultural network at Barclays. He leads the company’s “Race at Work Action Plan,” which has strived to improve diversity at the company where underrepresented minorities comprise just 5% and 21% of the staff in the UK and the US respectively.

The 56-year-old who is now based in New York was born in Mysore, the southernmost city in the southern Indian state of Karnataka. Even now, Venkatakrishnan enjoys a meal at an Indian restaurant that would “serve lunch on orange plastic trays,” Ken Abbott, Barclays’ chief risk officer for the Americas until 2018, told Bloomberg. “He thought that was very authentic.”

Cardamom Goes Hi-Tech, Launches Cloud Based E-Auction

Hailed as the ‘Queen of Spices,’ cardamom is one of the most expensive spices on the planet. The dark seeds found within a light green pod of perennial plants belonging to Zingiberaceae, the ginger family is recognised by its two main forms– Elettaria cardamomum, the more popular smaller fusiform variety with a thin peel called chhoti elaichi, and the larger woodier dark brown Amomum subulatum, better known as badi elaichi.

The latter is found mostly in Eastern Himalayas and China and used in naturopathy and certain food preparations like meat dishes, stews and barbecue sauces, owing to its bolder flavor. And, it is now one of the much soiught after spices India exports around the world.

The Spices Board in India has turned hi-tech when it launched the cloud based live e-auction at Idukki. Inaugurating it, Congress MP Dean Kuriakose said that the cardamom trade and exports play a significant role in the economy of the state and the cloud based live e-auction will empower the supply chain ensuring hassle free trade transactions benefitting the traders and farmers alike.

The live e-auction took place at the centre in Puttady, near Idukki. The Spices Board digitally integrated two of its e-auction centres at Bodinayakanur, Tamil Nadu and Puttady, Idukki and is expanding the market opportunity for cardamom growers and traders equally.

The new facility will double the number of participants in the e-auction and the farmers will get to pitch their produce to a wider market place. Earlier both farmers, traders and auctioneers had to travel between the auction facilities in Tamil Nadu and Kerala to take part in the auctions at the respective auction centres.

D.Sathiyan, secretary, Spices Board, said that by introducing this technologically advanced platform they aim to expand the opportunity for farmers and traders in terms of market and competition ensuring better price realization for cardamom.

“By the introduction of the new platform, there is scope to conduct the e-auction in multi centres, if the stakeholders desire,” said Sathiyan. A.G. Thankappan, chairman Spices Board said: “90 per cent of the cardamom produce is sold in the domestic market and cloud based e-auction will bring in a lot of competitiveness.”

Green cardamom or true cardamom is an ancient spice that grew wild in the southern forests of India and has been used for centuries in food and therapy. One of the oldest spices in the world, it was known across India by myriad regional names, derivatives of its Sanskrit label — eli or ela. It is called elaichi in Hindi, Punjabi, Gujarati, Kashmiri, elach in Bengali, yelakki in Kannada, yelakkai in Tamil and Telugu and elathari in Malayalam. The West called it cardamom from its Greek root kardamomom or amomum. The Cardamom Hills or Yela Mala in Kerala’s Idukki district gets its name from the spice that grows in its cool climes, along with pepper. The moist forests of the Western Ghats in Kerala’s Malabar region and Kodagu, Chikmagalur and Uttar Kannada districts of Karnataka provided the ideal environment for growing cardamom, known locally as maley maley yalakki or yelakki

Democrats Inch Closer To Legislative Deal On Biden’s Biggest Domestic Agenda

President Joe Biden and Democratic leaders are driving toward a $1.75 trillion agreement that will unlock the votes for the separate infrastructure package — and arm Biden with two momentous legislative victories — as he departs for the world stage later this week.

Half its original size, President Joe Biden’s big domestic policy plan is being pulled apart and reconfigured as Democrats edge closer to satisfying their most reluctant colleagues and finishing what’s now about a $1.75 trillion package.

How to pay for it all remained deeply in flux, with a proposed billionaires’ tax running into criticism as cumbersome or worse. That’s forcing difficult reductions, if not the outright elimination, of policy priorities — from paid family leave to child care to dental, vision and hearing aid benefits for seniors.

As per reports, Democrats stepped closer to an agreement on President Joe Biden’s agenda as Sen. Joe Manchin, who has been pushing to shrink the size of a sweeping social-spending package, said a deal on the outlines of the plan is within reach this week.

Manchin’s expression of optimism Monday marked a turnabout from his forecast last week of drawn-out negotiations, and mark the best recent sign for Biden’s domestic agenda after months of intra-party wrangling over tax and spending increases.

The once hefty climate change strategies are losing some punch, too, focusing away from punitive measures on polluters in a shift toward instead rewarding clean energy incentives.

All told, Biden’s package remains a substantial undertaking — and could still top $2 trillion in perhaps the largest effort of its kind from Congress in decades. But it’s far slimmer than the president and his party first envisioned.

House Speaker Nancy Pelosi told lawmakers in a caucus meeting they were on the verge of “something major, transformative, historic and bigger than anything else” ever attempted in Congress, according to a person who requested anonymity to share her private remarks.

“We know that we are close,” said Rep. Joyce Beatty, D-Ohio, the chair of the Congressional Black Caucus, after a meeting with Biden at the White House.

“We want to have something to give our progressives confidence we will do both bills,” House Majority Leader Steny Hoyer said Monday evening. “We don’t have a timeline” for the infrastructure vote, he said.

Schumer said there are “three to four outstanding issues” that remain to be resolved on the tax and spending package. He said he wants to nail down the climate provisions before the president leaves for his trip.

One of the biggest issues still unsettled is how to pay for the package. Manchin, of West Virginia, had supported rolling back some of the Trump tax cuts for high earners and corporations, as Biden had proposed. But Sinema signaled her opposition to higher tax rates, turning focus to a so-called billionaires tax on assets. Manchin indicated he’s open to that idea.

The tax would apply to a wide variety of items like stocks, bonds, real estate and art, with gains in value taxed on an annual basis, regardless of whether or not the asset is sold. Annual decreases in value could also be deducted, according to a version of the proposal, which dates to 2019.

Senate Finance Chair Ron Wyden said after a meeting among key Senate Democrats, including Manchin, that the tax plan would be drafted in the “next two days.”

Other tax proposals in flux include a possible two-year suspension of the $10,000 cap on state and local tax deductions, the imposition of a minimum corporate income tax and a stock buyback tax.

Sen. Joe Manchin is a pivotal player in negotiations on the tax and spending package along with Arizona Sen. Kyrsten Sinema, who also has raised objections to elements of the package. Both are key Democratic votes in the 50-50 Senate.

Manchin met on Sunday with Biden and Schumer in an effort to break a months long stalemate. Biden said Monday he hopes to get an agreement on the plan before he leaves Thursday for summits in Europe that include a UN climate change conference in Glasgow.

On healthcare policy, Manchin indicated there are still differences between him, Biden and progressive Democrats. Manchin has resisted expanding Medicare to include dental, hearing and vision benefits. He said Monday that because the program faces insolvency in five years it shouldn’t be expanded without addressing deeper fiscal problems.

“I believe a final deal is within reach,” Schumer said, while signaling that members are much closer to agreement on “robust” climate provisions. There was also movement on how to pay for the package, as Sen. Kyrsten Sinema (D-Ariz.) threw her weight behind a proposal for a minimum tax on corporate profits.

“This proposal represents a commonsense step toward ensuring that highly profitable corporations — which sometimes can avoid the current corporate tax rate — pay a reasonable minimum tax on their profits, just as everyday Arizonans and Arizona small businesses do,” Sinema, who also met with Biden on Tuesday evening, said in a statement.

Meanwhile, Senate Finance Committee Chairman Ron Wyden (D-Ore.) on Wednesday unveiled his proposal to tax billionaires’ investment gains annually, which could become a key provision in Democrats’ social-spending package.

The proposal comes as Democrats are working to determine how to raise revenue to finance spending in the package. It’s the second major tax proposal Wyden has released in recent days, following a proposal he released Tuesday to create a minimum tax on corporate profits.

“We have a historic opportunity with the Billionaires Income Tax to restore fairness to our tax code, and fund critical investments in American families,” Wyden said in a statement.

Wyden’s proposal is aimed at preventing billionaires from avoiding taxes. Currently, people don’t have to pay taxes on investment gains until they sell the assets. The proposal would affect taxpayers with assets of more than $1 billion or income of more than $100 million for three years in a row. About 700 taxpayers are expected to be subject to the tax. The proposal also includes rules designed to prevent billionaires from avoiding paying the tax.

The reality remains there are a handful of significant — and thorny — policy disputes that still must be reconciled in a matter of days. But there is no question that in the minds of top White House officials and congressional Democrats, the time for busted deadlines or elongated policy deliberations have come to an end.

The bottom line is that by the time Biden leaves for his foreign trip on Thursday, his $1.2 trillion bipartisan infrastructure bill could be signed into law, with an agreement on a $1.75 trillion economic and climate package in hand. Biden told reporters on Monday, “With the grace of God and the goodwill of neighbors,” a deal will be made before the trip, adding, “It’d be very positive to get it done before the trip.”

2 Indians Led Firms In Forbes List of Future Billion Dollar Companies

Two Indian American-led companies made Forbes magazine’s annual list of 25 venture-backed startups that are most likely to become unicorns, with valuations of more than $1 billion.

Legion Technologies, founded by Sanish Mondkar; and Alchemy, co-founded by Nikil Viswanathan and Joseph Lau are featured in the new List released by Forbes earlier this month.

“A $1 billion valuation isn’t what it used to be, as companies reach that milestone at breakneck speed, noted Forbes, adding that even startups with barely any revenue are earning sky-high valuations as investors bet on future growth.

The average estimated 2020 revenue for companies on this year’s list is just $12 million; last year’s list featured startups with an average of $30 million in revenue.

“Still there are plenty of up-and-comers worth keeping an eye on, including one that tests your dog’s DNA and another that will help you notarize documents from the comfort of your home. This list represents the 25, in alphabetical order, that we think have the best shot of becoming future stars,” said the magazine, in its introduction to the list.

Mondkar, a former chief product officer at SAP, left his job in 2015. He then traveled around the country with his two dogs, talking with people outside of Silicon Valley, according to his profile in Forbes. A year later, he founded Legion Technologies, a workforce management software that helps employers manage their hourly wage workers.

“There is no innovation targeted at these hourly workers,” says Mondkar, 48. The Redwood City, California-based company uses artificial intelligence and machine learning to help its customers forecast demand and optimize their labor costs, while taking into account employees’ preferences for when and how they work. “Most employees quit these jobs because of schedule conflicts,” he said. “The goal for the algorithms is to prioritize both sides.”

“Good jobs create happier, more productive employees who are less likely to quit,” wrote Mondkar in a blog post. “At an average cost of $4,969 per employee who quits, imagine how much money could be saved if they stayed on board.”

Philz Coffee was Legion’s first customer. Dollar General and SoulCycle also use Mondkar’s technology. With increased attention on workforce issues during the pandemic, Legion revenues are expected to more than double this year, to $11 million, predicted Forbes, noting that Legion’s 2020 revenue was $5 million. Mondkar has raised $85 million in equity from First Round Capital, Norwest Venture Partners, Stripes, XYZ.

Viswanathan and Lau co-founded Alchemy in 2017, a year after building Down to Lunch, which The New York Times touted as “the hottest new social app in America.” Alchemy makes it easier to read and write information onto blockchains, such as Ethereum and Flow. “Alchemy provides the leading blockchain development platform powering over $30 billion in transactions for tens of millions of users in every country globally. Our mission is to enable developers to bring the magic of blockchain to the world,” wrote Viswanathan in his LinkedIn profile.

“The computer and internet fundamentally improved human life on planet earth. We’re excited to help enable the global opportunity of blockchain – the next tectonic shift,” he said.

The service starts free for smaller developers, but larger customers pay a monthly fee. The San Francisco-based firm is on pace to increase revenue tenfold this year, to an estimated $20 million, as it helps clients like PwC, Unicef and OpenSeat conduct more than $30 billion in volume annually, noted Forbes in its profile of the company. Alchemy’s 2020 revenue was $2 million. The company has raised $96 million in equity from Addition, Coatue, and Pantera.

Biden Is Confident As $2T Plan Edges Closer To Deal

A deal within reach, President Joe Biden and Congress’ top Democrats edged close to sealing their giant domestic legislation, as they worked to scale back the measure and determine how to pay for it. The bill, which was originally proposed at a $3.5 trillion figure and contained funding for paid family leave, education and climate programs, has been paired with a $1 trillion infrastructure bill, which received widespread bipartisan support when it passed the Senate earlier this summer.

“I do think I’ll get a deal,” Biden told CNN’s Anderson Cooper on Thursday night during a Town Hall Meeting, strongly signaling his belief that progressives and moderates, two wings of the Democratic caucus that have been at odds with one another, are reaching an accord on the Build Back Better bill, a sweeping bill that aims to expand the social safety net.

Biden’s town hall capped off what has been the most momentous week of negotiation in months, with the president acquiescing to losing some key programs from his initial $3.5 trillion wish list, in order to meet those moderates calling for less government spending. The acknowledgement of the concessions could send a signal to Democrats that a deal on the package, which has been whittled from Biden’s $3.5 trillion wish list to just under $2 trillion, is imminent.

The two pieces of legislation crucial to Biden’s agenda have been stalled as moderates and progressives have haggled over the price tag of the Build Back Better bill — which requires no Republican support thanks to the Senate’s budget reconciliation process — and the order in which both bills would be passed.

“We’re down to four or five issues,” Biden said of the ongoing negotiations, but did not detail what those issues are. “I think we can get there. It’s all about compromise,” Biden said, adding: “Compromise has become a dirty word, but … bipartisanship and compromise still has to be possible.”

In order to reach an accord, the size of the sweeping 10-year spending plan has been whittled down to somewhere in the neighborhood of $2 trillion, and President Biden laid out Thursday evening what’s in it — and, importantly, what’s not. For instance, the paid leave provision has been reduced to four weeks from the originally proposed 12 weeks. “It is down to four weeks,” Biden confirmed. “The reason it’s down to four weeks is I can’t get 12 weeks.”

Biden also noted that it might be a “reach” to include dental and vision coverage in Medicare, a progressive priority opposed by moderate Sen. Joe Manchin, D-W.Va., one of the key centrist senators in the caucus. Though Biden detailed Manchin’s opposition to a number of the bill’s programs, including that he “has indicated that they will not support free community college,” another of the bill’s provisions, the president called him “a friend.”

“Joe is not a bad guy,” Biden said. “He is a friend. He has always at the end of the day come around and voted.” Biden noted that “one other person” indicated they would not support the free community college provision, and said that Democrats are looking into expanding Pell grants to help bridge the gap. “It’s not going to get us the whole thing,” Biden said, but noted that he would be forging ahead with his free college education plans in the coming months.

“I’m gonna get it done,” Biden pledged. “And if I don’t, I’m going to be sleeping alone for a long time,” referring to his wife, first lady Dr. Jill Biden, an educator and staunch education advocate. Of fellow moderate Sen. Kyrsten Sinema of Arizona, Biden also had kind words – “She’s as smart as the devil” – praising her support for some of the bill’s economic proposals.

He did, however, note that Sinema is “not supportive where she says she won’t raise a single penny in taxes on the corporate side and on wealthy people.” Biden said that in an evenly divided Senate, every senator’s vote is crucial: “Look, in the United States Senate, when you have 50 Democrats, every one is the president.”

President Biden noted the importance of combatting climate change, calling it “the existential threat to humanity” and pledging that he will debut his plans to get to “net zero emissions” at the upcoming United Nations Climate Change Conference, COP26, in Glasgow, Scotland, at the end of the month.

Biden touted the fact that on his first day in office, he rejoined the Paris climate accord, and said that he is “presenting a commitment to the world that we will in fact get to net zero emissions on electric power by 2035 and net zero emissions across the board by 2050 or before.” “But we have to do so much between now and 2030 to demonstrate what we’re going to do,” he pledged. The president also said that corporations must pay their fair share of taxes. The U.S., Biden said, is “in a circumstance where corporate America is not paying their fair share.”

“I come from the corporate state of the world: Delaware,” Biden said. “More corporations in Delaware than every other state in the union combined. Okay? Now, here’s the deal, though. You have 55 corporations, for example, in the United States of America making over $40 billion, don’t pay a cent. Not a single little red cent. Now, I don’t care — I’m a capitalist. I hope you can be a millionaire or billionaire. But at least pay your fair share. Chip in a little bit.”

Bided added that corporate leaders know “they should be paying a little more” in taxes. “They know they should be paying a little more than 21% because the idea that if you’re a school teacher and a firefighter you’re paying at a higher tax rate than they are as a percentage of your taxes.”

Biden met at the White House on Friday with House Speaker Nancy Pelosi, and Senate Majority Leader Chuck Schumer joined by video call from from New York, trying to shore up details. The leaders have been working with party moderates and progressives to shrink the once-$3.5 trillion, 10-year package to around $2 trillion in child care, health care and clean energy programs.

Pelosi said a deal was “very possible.” She told reporters back at the Capitol that more than 90% of the package was agreed to: The climate change components of the bill “are resolved,” but outstanding questions remained on health care provisions.

No agreement was announced by Friday’s self-imposed deadline to at least agree on a basic outline. Biden wants a deal before he leaves next week for global summits in Europe. Pelosi hoped the House could start voting as soon as next week, but no schedule was set.

Sticking points appear to include proposed corporate tax hikes to help finance the plan and an effort to lower prescription drug costs that has raised concerns from the pharmaceutical industry. Democrats are in search of a broad compromise between the party’s progressives and moderates on the measure’s price tag, revenue sources and basic components.

At the White House, the president has “rolled up his sleeves and is deep in the details of spreadsheets and numbers,” press secretary Jen Psaki said. Vice President Kamala Harris sounded even more certain. On a visit to New York City, she said tensions often rise over final details but “I am confident, frankly — not only optimistic, but I am confident that we will reach a deal.”

Parag Mehta Named President of JPMorgan Chase Policy Center

Indian American executive Parag Mehta has been appointed head of public policy at JPMorgan Chase & Co., the largest bank in the United States and the fifth-largest bank in the world, according to a press release. Mehta announced Oct. 18 on LinkedIn and social media that he will serve as the new managing director and president of the JPMorgan Chase Policy Center.

Most recently, Mehta served as the senior vice president at Mastercard, where he led the company’s efforts to advance sustainable and equitable economic growth around the world as executive director of the company’s Center for Inclusive Growth. In that role, he led a global team of professionals dedicated to ensuring that the benefits of economic growth are broadly shared and who work to leverage the core competencies and assets of Mastercard to achieve the same.

He has spent the past 21 years working to advance justice, inclusion and human rights through political activism, public service and now philanthropy.

Mehta played several leadership roles in former President Barack Obama’s administration including as liaison to the AAPI and LGBTQ communities and as chief of staff to the 19th U.S. Surgeon General, Dr. Vivek Murthy. In the Obama administration, Mehta spent more than four years directing communications for a civil rights agency in the U.S. Department of Labor and served on Obama’s presidential transition team as a liaison to the Asian American and Pacific Islander communities and to LGBT Americans.

In his position with the Surgeon General, he organized a series of campaigns to address some of the most pressing public health issues of our time. Mehta also serves as the Board Chair of New American Leaders, a national nonprofit organization that works to strengthen American democracy by electing first and second generation immigrants and refugees to public office.

Mehta is from Central Texas and a graduate of The University of Texas at Austin, as well as the Maxwell School of Citizenship and Public Affairs at Syracuse University where he earned a master’s degree in public administration.

India Defies Housing Price Rise Among 60 Countries Surveyed By IMF

While most economic indicators deteriorated in 2020, house prices largely defied the pandemic in over 57 of the 60 countries surveyed by the International Monetary Fund. India, Philippines and the UAE bucked the housing bite reported in the IMF Global House Price Index released Monday. Three quarters saw increases in house prices in 2020. The trend has largely continued in countries with more recent data.

The increases in house prices relative to incomes makes housing unaffordable to many segments of the population, as highlighted in the Fund’s recent study of housing affordability in Europe. The post-pandemic working arrangements could also exacerbate inequality concerns as high-earners in tele-workable jobs bid for larger homes, making homes less affordable for less affluent residents, IMF researchers said.

The surge in house prices has also had an impact on headline inflation in some countries and could contribute to more persistent inflationary pressures. IMF research indicates that low interest rates contributed to the boom in house prices, as did policy support provided by governments and workers’ greater need to be able to work from home.

In many countries, including the US, online searches for homes reached record levels. The American home-sales market has been on a historic rally during the pandemic and well into the current Fall season. Along with these demand factors, house prices also increased as supply chain disruptions raised the costs of several inputs into the construction process.

While fundamentals of demand and supply can account for much of the buoyancy of housing markets during the pandemic, policymakers are nonetheless keeping a close watch on developments in this sector. Over a decade ago, a turnaround in house prices marked the onset of the Global Financial Crisis. However, the twin booms in household credit and house prices in many countries before that crisis-and many previous housing crashes-appear less prevalent today.

Hence, in a plausible scenario, a rise in interest rates, a withdrawal of policy support as economies start to recover, and a restoration of the timely supply of building materials, could lead to some normalization in house prices, the researchers said.

Shortages, High Prices Likely During Holiday Season

Newswise — Despite President Biden’s announcement of round-the-clock operations at key West Coast ports and expanded operations by the likes of Walmart and UPS – plus pledging further federal government efforts — to alleviate the U.S. supply chain backlog, Maryland Smith supply chain expert Martin Dresner says federal government involvement will be most effective long term — through infrastructure spending.

“The President is proposing making better use of our current infrastructure by increasing working hours and spreading business more evenly throughout the day,” says Dresner, professor and chair of the logistics, business and public policy department at the University of Maryland’s Robert H. Smith School of Business. 

“Although this may help at the margin, there is only limited warehouse, rail and trucking capacity,” he adds. “It is difficult to expand this capacity in the short run. Although the backlogs will eventually work their way out of the system, this may take some time. It is unlikely that the backlogs will be alleviated by the holiday season.”

Dresner, also an associate editor for the Journal of Business Logistics, points to the complexity of the current supply chain problems. Significantly, the pandemic “created increased demand for products shipped from Asia that arrive via container at major U.S. ports, putting pressure on shipping, port, truck and rail capacity.”

In the meantime, work rules designed to curtail the spread of the coronavirus and some port shutdowns reduced the throughput of the shipping industry — especially in Asia, he says. “This was coupled with a decline in the workforce as people retired and quit lower-paying jobs, including transportation and warehousing positions. And, finally, government policies pumped considerable cash into the economy increasing consumer spending, thereby further increasing demand for consumer goods.”

Regarding the federal government’s role in solving the crisis, Biden this week said, “If federal support is needed, I’ll direct all appropriate action, and if the private sector doesn’t step up, we’re going to call them out and ask them to act.”

But Dresner, in response, says such federal support is best channeled through infrastructure spending: “The Biden Administration has plans to spend on infrastructure. In the long run, better infrastructure should improve the functionality of supply chains.”

In the short run, “the Administration should leave it to businesses to work out the backlogs, he adds. “Prices are already adjusting and these prices will cause adjustments in consumer demand. And higher interest rates, should they be forthcoming, will also curtail consumer demand.” However, Dresner cautions that the Biden Administration and the Fed “need to tread a fine line.”

“If interest rates are too low and too much money is pumped into the economy, consumer demand could stoke inflation,” he says. “If rates are hiked too quickly and government spending is curtailed, then we could get pushed into a recession.”

Sitharaman Meets With U.S. Businesses In New York

India’s Finance Minister Nirmala Sitharaman’s meetings with U.S. businesses and institutions continued at a feverish pitch, including talks with two key investors asking them to broaden their world view and look at India for investment. As part of this, Sitharaman on Oct. 16 met Scott Sleyster, executive Vice president and chief operating officer of Prudential Financial, and Philip Vassiliou, chief investment officer of Legatum, in New York.

Her discussions with Sleyster revolved around the reforms towards capital bond market, investor charter and other initiatives. The robust structural growth and continued interest of the company to invest in India formed part of the discussion with Vassiliou. Earlier during the day, Sitharaman addressed global business leaders and investors at a Roundtable organized by USISPForum and Ficci India in New York.

“With the current reset in the global supply chain and clear headed and committed leadership in India, I see opportunities galore in India for all investors and industry stakeholders,” she said at the Roundtable.

The finance minister also met Jane Fraser, CEO of Citi.

Fraser talked about the strength of India’s economic recovery and how India will increasingly become an important destination of investment for multinational corporations looking to grow their operations.

Sitharaman also held one-to-one meetings with Raj Subramanyam, Indian American CEO of FedEx; Ajay Banga, executive chairman, and Meibach Michael, CEO at Mastercard; and Arvind Krishna, chairman and chief executive officer at IBM.

The discussions revolved around getting more investment into India.

All the business leaders talked about the positive impact India’s reforms, in particular the PLI schemes, will have on labor-intensive sectors in the country. IBM indicated its interest in India in the areas of hybrid cloud, automation, 5G, cybersecurity, data, and AI.

The recently launched initiative of the National Infrastructure Master Plan, GatiShakti and India having the third largest start-up ecosystem and unicorn base formed part of discussion with Subramanyam.

India’s Economy To Grow By 8.3%, Making It 2nd Fastest Growing-Major Economy

India’s economy is expected to grow by 8.3 per cent this fiscal year, according to the World Bank, making it the second-fastest-growing major economy. The Bank’s Regional Economic Update released on Thursday said that after the “deadly second wave” of Covid-19 in India “the pace of vaccination, which is increasing, will determine economic prospects this year and beyond”. “The trajectory of the pandemic will cloud the outlook in the near-term until herd immunity is achieved,” it cautioned.

According to the Update issued ahead of the Bank’s annual meeting next week, India’ gross domestic product (GDP) — which shrank by 7.3 per cent (that is, a minus 7.3 per cent) under the onslaught of the pandemic last fiscal year — is expected to record the 8.3 per cent growth this fiscal year, which will moderate to 7.5 per cent next year and 6.5 per cent in 2023-24. Of the major economies, China is ahead with its economy expected to grow by 8.5 per cent during the current calendar year after the Bank revised it upwards from the 8.1 per cent projection in April.

China’s growth rate is projected to come down to 5.4 per cent next year and 5.3 per cent in 2023. Last year, it grew by 2.3 per cent. For the entire South Asia region, the Bank’s Update estimates the GDP growth to be 7.1 per cent this year and the next. Maldives’ tiny economy of $3.8 billion, which had the steepest fall of 33.6 per cent last calendar year is expected to recover and record a growth of 22.3 per cent this year. Next year it is expected come down to 11 per cent and 12 per cent in 2023.

Bangladesh, which recorded a growth of 5 per cent last fiscal year, is expected to grow by 6.4 per cent this year and 6.9 per cent the next.

Pakistan’s economy that grew by 3.5 last fiscal year, is expected to grow by 3.4 per cent this year and 4 per cent next year.

For Sri Lanka, the Bank expects a growth of 3.3 per cent this calendar year compared to a shrinkage of 3.6 per cent last year and to grow by 2.1per cent next year and 2.2 per cent the following year.

Bhutan, which had a negative growth of 1.2 per cent the last fiscal year, is expected to reach 3.6 per cent this fiscal year and 4.3 per cent the next.

Nepal’s growth is expected to rebound from last fiscal year’s 1.8 per cent to 3.9 per cent this fiscal year and 4.7 per cent the next.

The Bank said, “The Covid-19 pandemic led India’s economy into a deep contraction in FY21(fiscal year 2020-21) despite well-crafted fiscal and monetary policy support.”

It said that growth recovered in the second half of the last fiscal year “driven primarily by investment and supported by aunlocking’ of the economy and targeted fiscal, monetary and regulatory measures. Manufacturing and construction growth recovered steadily.”

Although significantly more lives were lost during the second wave of the epidemic this year in India, compared to the first wave in 2020, “economic disruption was limited since restrictions were localised,” with the GDP growing by 20.1 per cent in the first quarter of the current fiscal year compared to the first quarter of 2020-21, the Update said. It attributed the spurt to “a significant base effect” (that is, coming off a very big fall in the compared quarter), “strong export growth and limited damage to domestic demand.”

Looking ahead, the Bank’s Update said that “successful implementation of agriculture and labour reforms would boost medium-term growth” while cautioning that “weakened household and firm balance sheets may constrain it.” “The Production-Linked Incentives scheme to boost manufacturing, and a planned increase in public investment, should support domestic demand,” it said.

The extent of recovery during the current fiscal year “will depend on how quickly household incomes recover and activity in the informal sector and smaller firms normalises.” Among the risks, it listed “worsening of financial sector stress, higher-than-expected inflation constraining monetary-policy support, and a slowdown in vaccination.”

Taking stock of the pandemic’s effects, the Bank said, “The toll of the crisis has not been equal, and the recovery so far is uneven,leaving behind the most vulnerable sections of the society – low-skilled, women, self-employed and small firms.” But it said that the Indian government has taken steps to strengthen social safety nets and ease structural supply constraints through agricultural and labour reforms deal with the inequality.

It said that the government continued investing in health programs “have started to address the weaknesses in health infrastructure and social safety nets (especially in the urban areas and the informal sector) exposed by the pandemic.” (IANS

Mukesh Ambani Tops 2021 Forbes List Of India’s Richest

A soaring stock market propelled the combined wealth of members of the 2021 Forbes list of India’s 100 Richest to a record US$775 billion, after adding $257 billion — a 50 per cent rise — in the past 12 months.

In this bumper year, more than 80 per cent of the listees saw their fortunes increase, with 61 adding $1 billion or more. At the top of the list is Mukesh Ambani, India’s richest person since 2008, with a net worth of $92.7 billion. Ambani recently outlined plans to pivot into renewable energy with a $10 billion investment by his Reliance Industries. Close to a fifth of the increase in the collective wealth of India’s 100 richest came from infrastructure tycoon Gautam Adani, who ranks No. 2 for the third year in a row. Adani, who is the biggest gainer in both percentage and dollar terms, nearly tripled his fortune to $74.8 billion from $25.2 billion previously, as shares of all his listed companies soared.

At No. 3 with $31 billion is Shiv Nadar, founder of software giant HCL Technologies, who saw a $10.6 billion boost in his net worth from the country’s buoyant tech sector. Retailing magnate Radhakishan Damani retained the fourth spot with his net worth nearly doubling to $29.4 billion from $15.4 billion, as his supermarket chain Avenue Supermarts opened 22 new stores in the fiscal year ending March.

India has administered over 870 million Covid-19 vaccine shots to date, thanks partly to Serum Institute of India, founded by vaccine billionaire Cyrus Poonawalla, who moves into the top five with a net worth of $19 billion. His privately held company makes Covishield under license from AstraZeneca and has other Covid-19 vaccines under development. India’s recovery from a deadly second wave of Covid-19, which broke out earlier this year, restored investor confidence in the world’s sixth-largest economy.

There are six newcomers on this year’s list, with half of them from the booming chemicals sector. They include Ashok Boob (No. 93, $2.3 billion) whose Clean Science and Technology listed in July; Deepak Mehta (No. 97, $2.05 billion) of Deepak Nitrite and Yogesh Kothari (No. 100, $1.94 billion) of Alkyl Amines Chemicals. Arvind Lal (No. 87, $2.55 billion), the executive chairman of diagnostics chain Dr Lal PathLabs, also debuted on the list after a pandemic-induced surge in testing caused shares of his company to double in the past year.

The country’s IPO rush returned property magnate and politician Mangal Prabhat Lodha (No. 42, $4.5 billion) to the ranks, following the April listing of his Macrotech Developers. Among the four other returnees is Prathap Reddy (No. 88, $2.53 billion), whose listed hospital chain Apollo Hospitals Enterprise has been testing and treating Covid-19 patients.

Eleven listees from last year dropped off, given the increased cut-off for gaining entry to this year’s list. The minimum amount required to make this year’s list was $1.94 billion, up from $1.33 billion last year. Naazneen Karmali, Asia Wealth Editor and India Editor of Forbes Asia, said: “This year’s list reflects India’s resilience and can-do spirit even as Covid-19 extracted a heavy toll on both lives and livelihoods. Hopes of a V-shaped recovery fueled a stock market rally that propelled the fortunes of India’s wealthiest to new heights. With the minimum net worth to make the ranks approaching $2 billion, the top 100 club is getting more exclusive.”

Facebook Whistleblower Testimony Should Prompt New Oversight

‘I think we need regulation to protect people’s private data,’ influential Democrat says in wake of Frances Haugen revelations. Testimony in Congress this week by the whistleblower Frances Haugen should prompt action to implement meaningful oversight of Facebook and other tech giants, the influential California Democrat Adam Schiff told the Guardian in an interview to be published on Sunday.

“I think we need regulation to protect people’s private data,” the chair of the House intelligence committee said.

“I think we need to narrow the scope of the safe harbour these companies enjoy if they don’t moderate their contents and continue to amplify anger and hate. I think we need to insist on a vehicle for more transparency so we understand the data better.”

Haugen, 37, was the source for recent Wall Street Journal reporting on misinformation spread by Facebook and Instagram, the photo-sharing platform which Facebook owns. She left Facebook in May this year, but her revelations have left the tech giant facing its toughest questions since the Cambridge Analytica user privacy scandal.

At a Senate hearing on Tuesday, Haugen shared internal Facebook reports and argued that the social media giant puts “astronomical profits before people”, harming children and destabilising democracy via the sharing of inaccurate and divisive content. Haugen likened the appeal of Instagram to tobacco, telling senators: “It’s just like cigarettes … teenagers don’t have good self-regulation.”

Richard Blumenthal, a Democrat from Connecticut, said Haugen’s testimony might represent a “big tobacco” moment for the social media companies, a reference to oversight imposed despite testimony in Congress that their product was not harmful from executives whose companies knew that it was.

The founder and head of Facebook, Mark Zuckerberg, has resisted proposals to overhaul the US internet regulatory framework, which is widely considered to be woefully out of date. He responded to Haugen’s testimony by saying the “idea that we prioritise profit over safety and wellbeing” was “just not true”.

“The argument that we deliberately push content that makes people angry for profit is deeply illogical,” he said. “We make money from ads, and advertisers consistently tell us they don’t want their ads next to harmful or angry content.” Schiff was speaking to mark publication of a well-received new memoir, Midnight in Washington: How We Almost Lost Our Democracy and Still Could.

The Democrat played prominent roles in the Russia investigation and Donald Trump’s first impeachment. He now sits on the select committee investigating the deadly attack on the US Capitol on 6 January, by Trump supporters seeking to overturn his election defeat – an effort in part fueled by misinformation on social media. In his book, Schiff writes about asking representatives of Facebook and two other tech giants, Twitter and YouTube, if their “algorithms were having the effect of balkanising the public and deepening the divisions in our society”.

Facebook’s general counsel in the 2017 hearing, Schiff writes, said: “The data on this is actually quite mixed.” “It didn’t seem very mixed to me,” Schiff says. Asked if he thought Haugen’s testimony would create enough pressure for Congress to pass new laws regulating social media companies, Schiff told the Guardian: “The answer is yes.”

However, as an experienced member of a bitterly divided and legislatively sclerotic Congress, he also cautioned against too much optimism among reform proponents. “If you bet against Congress,” Schiff said, “you win 90% of the time.”

Tata Group Is Frontrunner To Acquire Air India

The new owners of Air India will be decided in the next few days as the financial bids for India’s flag carrier, AIR INDIA are being scrutinized. The Tata Group, which was the original founders of the now largest air carrier in India, is one of the bidders, and is said to be the frontrunner to get hold of the carrier.

Tata Group and SpiceJet chairman Ajay Singh in his private capacity had bid for debt-laden state-run airline Air India earlier this month. Accordingly, sources said that the two bids are being scrutinized against a reserve price set for the airline. The process will not go ahead if the bids come in short of the reserve price. Reports stated, a panel of ministers accepted a proposal from bureaucrats, who recommended the conglomerate’s bid ahead of an offer from Ajay Singh, according to people with knowledge of the matter, who asked not to be identified as the decision isn’t yet public.

On the official front, DIPAM Secretary Tuhin Kanta Pandey on Friday tweeted: “Media reports indicating approval of financial bids by Government of India in the AI disinvestment case are incorrect. Media will be informed of the Government decision as and when it is taken.” The tweet comes after a media report indicated that the Centre has selected a winning bid.

Furthermore, sources said that at present senior government officials are conducting separate meetings with the two bidders regarding other aspects of the sale such as the indemnity clause and carry over debt levels of the airline. More or less, the final decision can be made within the next few days by the AISAM (Air India Specific Alternative Mechanism).

The AISAM headed by Home Minister Amit Shah is an empowered GoM, which has the authority to take the final call on the matter, without the need of a Cabinet approval. The AISAM is scheduled to meet after all its members are back in the country.

After the announcement of the winning bid is made, the process of a complete handover is expected to take place within three-four months time. The Centre on September 15 had received multiple financial bids for divestment of Air India. The government has of late taken several steps to fast-track the much-delayed privatization of the national carrier.

Recently, the Centre decided to waive taxes on the transfer of assets from the national carrier to Air India Assets Holding Ltd, a special purpose vehicle (SPV). During the Budget speech for FY22, Finance Minister Nirmala Sitharaman had said that all the proposed privatization process would be completed by the end of the fiscal, including the much-delayed strategic disinvestment of Air India.

This is the second attempt of the current Central government to divest its stake in the airline. In the pre-pandemic era, the airline, on a standalone basis, operated over 50 domestic and more than 40 international destinations. Besides, it operated over 120 aircraft prior to the Covid pandemic. During that period, the airline had over 9,000 permanent and 4,000 contractual employees.

Headquartered in Bombay (Mumbai), AIR INDIA’s first ever scheduled air service was inaugurated in 1932 by J.R.D. Tata, flying mail and passengers between Karāchi, Ahmadābād, Bombay, Bellary, and Madras. By 1939 routes had been extended to Trivandrum, Delhi, Colombo, Lahore, and intermediate points. After World War II, in 1946, Tata Airlines was converted into a public company and renamed Air-India Limited. Two years later, to inaugurate international services between Bombay (Mumbai) and Cairo, Geneva, and London, Air-India International Limited was formed.

In 1953 India nationalized all Indian airlines, creating two corporations—one for domestic service, called Indian Airlines Corporation (merging Air-India Limited with six lesser lines), and one for international service, Air-India International Corporation. The latter’s name was abbreviated to Air-India in 1962. In the following decades as India’s flag carrier, the airline extended its international routes to all continents except South America and Australia, and it expanded its cargo operations. To gain a competitive advantage in computerized reservation searches, the airline removed the hyphen from its name in 2005 to become Air India.1946 R. D. Tata founded Tata Airlines in 1932 as a division of Tata Sons Ltd. (now Tata Group). After World War II, regular commercial service in India went back to normal, Tata Airlines changing its name to Air India and becoming a public limited company on the 29th of July 1946.

On June 9th, 1948, Air India introduced a regular service from Bombay to London, and two years later, AIR INDIA started regular flights to Nairobi. In 1993, AIR INDIA’s first Boeing 747-400, named Konark, operated the first non-stop flight between New York City and Delhi. In 1996, Air India started using its second US gateway at O’Hare International Airport in Chicago. Services to Air India’s third US gateway at Newark Liberty International Airport in Newark were introduced in the year 2000.

In October 2016, AIR INDIA changed the Delhi – San Francisco route previously operated over the Atlantic Ocean to flying over the Pacific Ocean, in order to take advantage of jet stream winds and use less fuel. With the total flown distance being over 15,200 kilometres (9,400 miles), AIR INDIA operated the world’s longest non-stop regular scheduled commercial flight.

In December 2020, the government had invited expression of interest for the divestment of Air India. Four bidders had entered the race to take over the beleaguered airline, but Tata Group and Spicejet CEO Ajay Singh were the only ones to make it to the final stage. The Centre had made an unsuccessful attempt to sell the ailing airline earlier in March 2018. However, its expression of interest to sell 76 per cent stake in Air India had no takers at that juncture due to concerns regarding the airline’s burgeoning debt. Top sources from the Ministry of Civil Aviation said all formalities for the Air India disinvestment process will be completed by December 2021.

Pandora Papers Expose World Leaders Of Secret Wealth

A massive leak of financial documents was published by several major news organizations on Sunday that allegedly tie world leaders to secret stores of wealth, including King Abdullah of Jordan, Czech Prime Minister Andrej Babis and associates of Russian President Vladimir Putin.

The dump of more than 11.9 million records, amounting to about 2.94 terabytes of data, came five years after the leak known as the “Panama Papers” exposed how money was hidden by the wealthy in ways that law enforcement agencies could not detect.

The International Consortium of Investigative Journalists, a Washington, D.C.-based network of reporters and media organizations, said the files are linked to about 35 current and former national leaders, and more than 330 politicians and public officials in 91 countries and territories. It did not say how the files were obtained, and Reuters could not independently verify the allegations or documents detailed by the consortium.

Jordan’s King Abdullah, a close ally of the United States, was alleged to have used offshore accounts to spend more than $100 million on luxury homes in the United Kingdom and the United States.

DLA Piper, a London law office representing Abdullah, told the consortium of media outlets that he had “not at any point misused public monies or made any use whatsoever of the proceeds of aid or assistance intended for public use.”

The Washington Post, which is part of the consortium, also reported on the case of Svetlana Krivonogikh, a Russian woman who it said became the owner of a Monaco apartment through an offshore company incorporated on the Caribbean island of Tortola in April 2003 just weeks after she gave birth to a girl. At the time, she was in a secret, years-long relationship with Putin, the newspaper said, citing Russian investigative outlet Proekt.  The Post said Krivonogikh, her daughter, who is now 18, and the Kremlin did not respond to requests for comment.

Days ahead of the Czech Republic’s Oct. 8-9 parliamentary election, the documents allegedly tied the country’s prime minister, Babis, to a secret $22 million estate in a hilltop village near Cannes, France.  Speaking during a television debate on Sunday, Babis denied any wrongdoing. “The money left a Czech bank, was taxed, it was my money, and returned to a Czech bank,” Babis said. (Courtesy: Reuters)

Over 1,000 Indians Have Net Worth of Rs 1,000 Crore

India has achieved the milestone of having over 1,000 individuals with net worth of Rs 1,000 crore, said Hurun India. Accordingly, the IIFL Wealth Hurun India Rich List 2021 revealed that 1,007 individuals across 119 cities have a net worth of Rs 1,000 crore. The report cited that cumulative wealth was up 51 percent, while average wealth increased by 25 percent. Besides, it showed that 894 individuals saw their wealth increase or stay the same, of which 229 are new faces, while 113 saw their wealth drop and there were 51 dropouts.

Currently, India has 237 billionaires, up 58 compared to last year. “While ‘Chemicals’ and ‘Software’ sectors added the greatest number of new entrants to the list, Pharma is still at number one and has contributed 130 entrants to the list. The youngest in the list is aged 23, three years younger than the youngest last year.” Furthermore, the list report pointed out that Reliance Industries’ Chairman and Managing Director Mukesh Ambani continued to be the richest man in India for the 10th consecutive year with a wealth of Rs 718,000 crore.

“With INR 505,900 crore, Gautam Adani & family moved up two places to the second spot in the IIFL Wealth Hurun India Rich List 2021.” The Adani group has a combined market capitalization of Rs 9 lakh crore, except Adani Power, all listed companies are valued at more than a lakh crore. “Gautam Adani is the only Indian to build not one, but five Rs 1 lakh crore companies,” said Anas Rahman Junaid, MD and chief researcher, Hurun India. In addition, Shiv Nadar of HCL retained the third rank, as HCL’s limited exposure to Covid affected segments such as travel, retail and hospitality resulted in a 67 percent increase in his wealth to Rs 236,600 crore.

For the 12 months that ended in December 2020, HCL became only the third Indian IT company to break through the $10 billion revenue mark. With 255 individuals Mumbai tops the list of richest Indians followed by New Delhi (167), Bengaluru (85). Hyderabad retained the fourth position. Chennai overtook Ahmedabad at the fifth place.

Under BJP Regime, India’s External Debt Rises To $571 Billion

India’s external debt for the quarter ended June 2021 increased on a year-on-year as well as on sequential basis, official data showed last week. The external debt during the period under review rose to $571.3 billion from $555.2 billion reported for the quarter ended June 2020.

On a sequential basis, at end-June 2021, the external debt recorded an increase of $1.6 billion over $569.7 billion reported for end-March 2021 period. “The external debt to GDP ratio declined to 20.2 per cent at end-June 2021 from 21.1 per cent at end-March 2021,” the RBI said in a statement.

“Valuation gain due to the appreciation of the US dollar vis-a-vis Indian rupee was placed at $1.7 billion. Excluding the valuation effect, external debt would have increased by $3.3 billion instead of $1.6 billion at end-June 2021 over end-March 2021.”

According to the RBI, commercial borrowings remained the largest component of external debt, with a share of 37.4 per cent, followed by non-resident deposits at 24.8 per cent, and short-term trade credit 17.4 per cent. “At end-June 2021, long-term debt (with original maturity of above one year) was placed at $468.8 billion, recording an increase of $0.2 billion over its level at end-March 2021.” (IANS)

In Meeting With CEOs, Modi Urges Investment in India

Prime Minister Narendra Modi on Thursday commenced his visit in Washington D.C. with meetings with the top brass of the multinational companies based in the United States, hard-selling his government’s initiatives to draw more foreign investments to revive the Covid-hit economy of India, including the recently launched Production Linked Incentive scheme.

On the first leg of his visit to the United States, Prime Minister Narendra Modi Sept. 23 met leading American CEOs here, including Indian American executives. He held one-on-one meetings with the CEOs of semiconductor and wireless technology manufacturer Qualcomm, software major Adobe, renewable energy firm First Solar, arms manufacturer General Atomics and investment management company Blackstone.

India has great potential for attracting investments and manufacturing under the various programs introduced by Prime Minister Narendra Modi as companies try to diversify their global footprints, according to hi-tech CEOs who met him. “Because of the necessity to diversify and build a very resilient supply chain for semiconductors, we believe India could be an important destination for manufacturing,” Qualcomm CEO Cristiano Amon told reporters in Washington after his meeting with Prime Minister Modi on Thursday.

Prime Minister Modi’s “approach to drive economic growth in making India, a destination for investment for investment has been very successful,” said the CEO of the $150 billion company that is a leader in the manufacture of chips used in everything from cameras to aircraft and a pioneer in 5G technology. The high level of optimism for India comes as the US and several other countries rethink their supply chains and their manufacturing bases, while also keeping an eye on China, which is set on trying to get a stranglehold on future technologies with strategic goals.

First Solar’s CEO Mark Widmar said that what Prime Minister Modi has done to “create a really strong balance between industrial policy as well as trade policy” makes it an ideal opportunity for companies like First Solar to establish manufacturing in India. “His commitment to ensuring domestic capabilities and ensuring his long term climate goals and objectives with focus on energy independence and security”, Widmar said is an alignment that “couldn’t be better for companies that are looking to manufacture in India. And I think the enablement of an environment that is pro-business, this is more opportunity for us to be successful to help India achieve its climate goals.”

First Solar is one of the world’s largest developer and financier of photovoltaic solar power systems connected to grids. The “very laudable policy prescriptions and reforms” introduced by Prime Minister Modi “will certainly catalyse a lot of interest and investments in India,” Vivek Lal, the CEO of General Atomics, said in the series of video interviews posted on twitter by the Ministry of External Affairs. “Many of my colleagues at US companies see India as a very promising destination,” he said.

He said that the reforms in both India and the US have created a “win-win” situation and both countries can benefit from their collaboration. General Atomics is a defence and technology company and a leader in the development and manufacture of drones. Shantanu Narayen, the CEO of Adobe, said he was “a huge supporter, and fan of what the Prime Minister’s doing” to improve the business and investment climate in India. He said the ecosystem for startups in India is “awesome”.

“As Indian Americans, I mean, what could be more inspiring or a matter of pride than seeing what the Prime Minister is doing to really encourage startups, to really encourage investment in India,” he said. “What’s really inspiring, is that these Indian startups are actually having as their growth the entire world,” he said. “So their aspirations are not restricted to India, they’re actually thinking about how they conquer the world.”

Adobe is the maker of ubiquitous document software and the leader in multi-media solutions.

Prime Minister Modi met with Stephen Schwarzman, the CEO of the investment company, Blackstone.

A tweet from the Prime Minister’s Office said that “giving greater momentum to investments in India,” they discussed “various investment opportunities in India, including those arising due to the National Infrastructure Pipeline and National Monetisation Pipeline.” (The two programmes provide for privatisation with time limits for some national resources or government enterprises.)

About his meeting with Modi, Amon said, “We talked about incredible opportunity to advance the industry not only domestically in India but Indian as an exporter of technology as we think about the digital transformation.”

“Very pleased with the conversations and we’re very, very happy with everything we’re doing together with India,” he added. Narayen said that the key topic was “continued investment in innovation, because he certainly believes that technology is the way to help move things forward.”

They also “talked about artificial intelligence and what might happen with artificial intelligence, we talked about creativity, the importance of creativity and how media, the ever-changing nature of video,” he said.

About his company’s plans, he said, “India is a big area of investment for us. Adobe has three growth initiatives: Everything around creativity, document productivity and powering digital businesses, and artificial intelligence is going to change how all those three solutions are delivered. So we intend to continue to invest heavily in it.”

Widmar said, “One of the things we want to do in India is not only to be there to support the domestic market, but we want to be a technology leader in leveraging capabilities that India can provide. And then also compete on a global platform and to participate in export into international markets.” He said that India’s goal of producing 450 gigawatts of renewable energy by 2030 was of global significance in dealing with climate change and “we would want to be part of this.”

Is U.S. Losing The Race To Decide The Future Of Money?

In cities across China, the country’s central bank has begun rolling out the e-renminbi—an all-digital version of its paper currency that can be accessed and accepted by merchants and consumers without an internet connection, credit or even a bank account. Already having conducted more than $5 billion in e-renminbi transactions, China has opened its digital currency up to foreigners. Next year, when Beijing hosts the Winter Olympic Games, authorities are expecting to let the world test drive its technological achievement.

The U.S., by contrast, is having trouble even concluding its multi-year exploration into the possibility of an e-dollar. In fact, an upcoming Federal Reserve paper on a potential U.S. digital currency won’t take a position on whether the central bank of the United States will, or even should, create one. Instead, Federal Reserve Chair Jerome Powell said in recent testimony to Congress, this paper will “begin a major public consultation on central bank digital currencies…” (Once planned for July, the paper’s release has since been moved to September.)

Once the world leader in digital payments and technological innovation, the U.S. is being outpaced by its top global adversary as well as much of the industrialized and the developing world. The Bahamas recently announced the integration of its digital Sand Dollar into a stock exchange, while Australia, Malaysia, Singapore and South Africa are moving forward with the world’s first cross-border central bank digital currency exchange program led by the Bank for International Settlements (BIS), which is known as the central bank of central banks.

Such developments have been somewhat outshined by El Salvador’s recent decision to make bitcoin a legally accepted currency, which few expect to make significant impact in the payment space. But outside of the cryptocurrency space, nations around the globe are making significant strides in the development of the digital future of money — supported by governments and backed by powerful central banks. Leadership in this space will have implications for more than just payments: geopolitical ambitions, economic growth, financial inclusion and the very nature of money could all be dictated by who leads the charge and how.

“I don’t think the U.S. is aware there is a race”

Digital currencies are the next wave in the “evolution of the nature of money in the digital economy,” Hyun Song Shin, economic adviser and co-leader of the Monetary and Economic Department at the Bank for International Settlements, tells TIME. As more of our world migrates from physical brick-and-mortar to wireless and cloud-based, the way we pay for things is changing as well. A central bank digital currency would operate just like cash, but instead of having to carry it in a physical wallet or put it into a bank account, it would be stored and accessed digitally. Not only could U.S.-backed digital currency facilitate easier, modern banking, it could prove vital in protecting American international influence.

Late to the party, the U.S. is “stepping up its research and public engagement” on digital currencies, the Federal Reserve says, including forming working groups on cryptocurrency and other kinds of digital money, and experimenting with technology that would be central to producing a digital dollar. The Fed’s regional Boston branch is overseeing these efforts with the Massachusetts Institute of Technology on what’s known as Project Hamilton. But the path towards a digital U.S. dollar has met many challenges, skeptics and outright opponents. All while China, and other countries, push forward.

Lagging behind the world

Just how far behind is the U.S. in the development of a central bank-issued digital currency (CBDC)? According to global accounting firm PwC’s inaugural CBDC global index, which tracks various CBDCs’ project status from research to development and production, the U.S. ranks 18th in the world. America’s potential efforts trail countries like Sweden, South Korea and China but also countries like the Bahamas, Ecuador, Eastern Caribbean and Turkey. China, with its government’s hyperfocus on maintaining control and overseeing data, has been working to develop a CBDC for almost a decade.

And the U.S. is probably not close to catching up. Analysts like Harvard economics professor Kenneth Rogoff, who study monetary policy and digital currencies, estimate that the U.S. could be at least a decade away from issuing a digital dollar backed by the Fed. In that time, Rogoff argued in an op-ed earlier this year, the modernization of China’s financial markets and reduction or removal of its currency controls “could deal the dollar’s status a painful blow.”

China has already largely moved away from coin and paper currency; Chinese consumers have racked up more than $41 trillion in mobile transactions, according to a recent research paper from the Brookings Institution, with the lion’s share (92%) going through digital payment processors WeChat Pay and Alipay.

“The reason you could say the U.S. is behind in the digital currency race is I don’t think the U.S. is aware there is a race,” Yaya Fanusie, an Adjunct Senior Fellow at the Center for a New American Security, and a former CIA analyst, tells TIME in an interview. “A lot of policymakers are looking at it and concerned…but even with that I just don’t think there’s this sense of urgency because the risk from China is not an immediate threat.” Not only is the U.S. running significantly behind in the development of a CBDC, we are trailing the rest of the world in digital payments broadly.

Kenya, for example, has almost fully digitized its economy through its digital currency and payment system MPESA, making transactions free and almost instantaneous. India’s Unified Payments Interface (UPI) allows users to transfer money instantly between bank accounts with no cost. Brazil’s PIX facilitates the transfer of money between people and companies in up to 10 seconds. All of these programs work through and are overseen by the countries’ central banks rather than commercial banks or other private companies.

What’s holding the U.S. back?

Critics argue CBDCs are simply a solution in search of a problem and potentially harmful. Many see support from the banking sector as vital to the success of a digital U.S. dollar, however commercial banks in the U.S. have taken a largely adversarial stance. “The proposed benefits of CBDCs to international competitiveness and financial inclusion are theoretical, difficult to measure and may be elusive,” the American Bankers Association said in a statement at a recent congressional hearing on digital currencies. “While the negative consequences for monetary policy, financial stability, financial intermediation, the payments system, and the customers and communities that banks serve could be severe.”

The Bank Policy Institute, which lobbies on behalf of the country’s largest banks, went so far as to argue that neither the Fed nor the U.S. Treasury even has the constitutional authority to issue a digital currency. Commercial banks dominate the U.S. financial system to such a degree that unraveling them would be ostensibly impossible, experts say, they also would be a powerful adversary. Former Goldman Sachs managing director Nomi Prins notes banks have clearly seen the writing on the wall.

“Banks are centralized middlemen with respect to financial transactions,” Prins, author of Collusion: How Central Bankers Rigged The World, tells TIME. “The more popular cryptocurrency or digital currency becomes, the fewer profits the banking system can reap from traditional services and verification methods that allow them to hold, take or use their customers’ money, and the more financial power they stand to lose as a result.” Even disruptive financial technologies like PayPal, Venmo and Zelle work through the banking system, rather than around it, thanks in large part to the banks’ power.

Central bankers also generally have concluded that commercial banks are a necessary piece of a potential CBDC ecosystem, thanks to their pre-existing regulatory guardrails and ability to move money. Top policymakers at the Fed, including influential Vice Chair for Supervision Randal Quarles, have joined the banking industry in arguing that a digital dollar “could pose significant and concrete risks” and that the potential benefits “are unclear.” Fed Governor Christopher Waller said in August he was “skeptical that a Federal Reserve CBDC would solve any major problem confronting the U.S. payment system,” in a recent speech he titled “CBDC: A Solution in Search of a Problem?”  Further, there’s no central U.S. authority with direct oversight or responsibility for any of this.

In addition to the Fed, the Office of the Comptroller of the Currency, the Securities and Exchange Commission, the Federal Trade Commission, the Consumer Financial Protection Bureau, the Federal Deposit Insurance Corporation, Office of Thrift Supervision, Financial Stability Oversight Council, Federal Financial Institutions Examination Council and the Office of Financial Research would all have some stake in the development of a digital currency backed by the central bank, to say nothing of state and regional authorities.

“The U.S. has an active congressional debate, which is beneficial and very important,” Federal Reserve Governor Lael Brainard tells TIME in an interview. “But the U.S. also has a diffusion of regulatory responsibility with no single payments regulator at the federal level, which is not as helpful. That diffusion of responsibility is part of what creates the lags that our system is working through.” None of this exists in China where the Chinese Communist Party oversees the central bank, commercial banks and their regulators and is unconcerned with privacy.

How a downgraded dollar could hamstring U.S. influence

An American CBDC could have lasting geopolitical impact and curb a longstanding international effort to reduce reliance on the mighty U.S. dollar. “Why we should care about this is that the U.S. financial system is not intrinsically dominant,” Fanusie says. “Other countries, both allies and adversaries, are sincerely interested in finding ways to decrease their dependence on the dollar.” With the U.S. dollar as the world’s reserve and primary funding currency, the U.S. can restrict access to funding from financial markets, limit countries’ ability to sell their natural resources and hinder or block individuals’ access to the banking sector.

“Other countries, both allies and adversaries, are sincerely interested in finding ways to decrease their dependence on the dollar”

While dollar dominance has rankled much of the world for decades, there has been no suitable replacement for the U.S., with its massive economy, sophisticated banking system and sprawling international presence. China is in the midst of a long-term push to simultaneously grow its financial markets and internationalize its currency. Both have the end goal of allowing China and its allies to limit the ability of the U.S. to enforce its will through economic actions like sanctions. Fanusie wrote in a January report that being the first major economy to roll out a digital currency is “part of China’s geopolitical ambitions.”

However, the renminbi will not become the world’s reserve currency — at least, not any time soon. But what China has done by being in the forefront of CBDC development is put itself in position to take the lead on development and implementation of rules and regulations for digital currencies on a global scale. “While America led the global revolution in payments half a century ago with magnetic striped credit and debit cards, China is leading the new revolution in digital payments,” writes Brookings’ economic studies fellow Aaron Klein.

Why should central banks offer digital currencies?

Over the past decade, digital currencies, including cryptocurrency and “stablecoins,” have sprung up like weeds. Some purport to be just as safe as dollars, but are backed by questionable assets. In a crisis regulators worry they could fluctuate wildly in value or lose their value altogether. Having central banks, which are responsible for the printing and circulation of coins and paper money, issue digital currencies is in part a reaction to this private sector activity, Shin says, “accelerated by the potential encroachment of private digital currencies, and the need to preserve the role of money as a public good.”

“The status quo is not an option”

Notably, a U.S. digital currency could provide benefits to everyday people. It could increase financial inclusion and fix flaws in current payments systems, Shin adds, citing findings of a recent BIS study.

For example, transferring money between U.S.-based bank accounts, even those held by the same person, can take days. The process can be even longer when crossing international borders. Credit and debit card transactions similarly don’t settle for days and come with significant fees for merchants, who sometimes pass them on to customers. CBDCs could grant universal access to the banking sector and quickly facilitate the distribution of paychecks and government funds, reducing the need for costly bank workarounds like check cashing and payday loans.

Championing CBDCs

Brainard has been pushing the Fed to move on a digital currency for years, but there was little urgency from others at the Fed or in Congress. Companies developing their own currencies, consumers investing in cryptocurrency and the COVID-19 pandemic making paper notes anathema to many Americans changed that. Before COVID-19, Facebook’s Libra project (now known as Diem) showed lawmakers and central bankers the potential for a private company to step in and fill the void by effectively minting its own currency that could be spent by users around the world.

“The status quo is not an option,” Diem co-creator David Marcus said at the International Monetary Fund’s 2019 fall meeting. “Whether it’s Libra or something else, the world is going to change in a profound way.” Brainard, for one, has taken notice. “My own thinking is that stablecoins and related private sector initiatives are moving very rapidly, which makes it incumbent on us to move more rapidly,” she tells TIME. “That is why I have been pushing to advance outreach, cross-border engagement, and policy and technology research for several years now.” So-called stablecoins — unregulated digital currencies created by private companies that purport to represent dollars but are completely unregulated — have become a significant worry for lawmakers and shown the importance of considering tying currency to a central bank.

“It’s getting harder and harder for community banks to compete for new customers when big tech companies can afford to spend billions on marketing and technology,” Sen. Sherrod Brown, who chairs the Senate Banking Committee, tells TIME. “But many of these new ‘fintech’ products don’t come with the consumer protections, federal backing or customer service and relationships with the community that small banks and credit unions provide.”

During a hearing on digital currencies in June, Sen. Elizabeth Warren, the ranking member of the Subcommittee on Financial Institutions and Consumer Protection, compared stablecoins to worthless “wildcat notes” that were issued by speculators in the 19th century. Her expert at that hearing, Lev Menand, an Academic Fellow and Lecturer in Law at Columbia Law School, went further in his testimony, calling stablecoins “dangerous to both their users and … to the broader financial system.”

With private companies pushing deeper into the digital currency space, rival countries seeking to seize leadership and a public that is moving further away from physical currency, the U.S. is facing a world in which it may not control or even lead the world’s payment systems. That would make the future of money look very different from the past.

South-South & Triangular Cooperation To Help Achieve UN’s Development Goals

The 2021 high-level commemoration of the United Nations Day for South-South Cooperation, organized ahead of the opening of the seventy-sixth session of the United Nations General Assembly, provided an opportunity to discuss Southern solidarity in support of a more inclusive, resilient and sustainable future while effectively responding to the global COVID-19 crisis across the global South. The 2021 United Nations Day for South-South cooperation presented the opportunity for stakeholders to highlight concrete follow-up to the twentieth session of the High-level Committee on South-South Cooperation (HLC), which took place from 1 to 4 June 2021 in New York. “South-South and triangular cooperation must have a central place in our preparations for a strong recovery”, says Secretary-General António Guterres, reminding us that “we will need the full contributions and cooperation of the global South to build more resilient economies and societies and implement the Sustainable Development Goals”.

The General Assembly High-level Committee (HLC) on South-South Cooperation met in June to review progress made in implementing the Buenos Aires Action Plan (BAPA+40) and other key decisions on South-South cooperation. This HLC session considered follow-up actions arising from previous sessions and hosted a thematic discussion on “Accelerating the achievement of the SDGs through effective implementation of the BAPA+40 outcome document while responding to the COVID-19 pandemic and similar global crises”. The HLC hosted 75 member states – including a Head of State and Ministers from around the world – as well as 23 intergovernmental organizations, 25 UN entities, civil society and the private sector. More than 400 people participated during side events which HLC Bureau Members took the lead in organizing on issues of importance to the South.

Deliberations focused on actions arising from the Report of the Secretary-General to the nineteenth session, which proposed concrete ways to enhance the role and impact of the United Nations Office for South-South Cooperation, as well as the key measures taken to improve the coordination and coherence of UN support to South-South cooperation. In terms of important messages and statements, Member States highlighted that COVID-19 has taught the world that South-South development cooperation is critical to an effective response to emergencies.

South-South cooperation was strongly reaffirmed as the means to support countries’ national development priorities, alignment with the SDGs, and the acceleration of achievement toward the 2030 Agenda. South-South cooperation was also recognized as an effective approach to accelerate and deepen the efforts to build back better, healthier, safer, more resilient and sustainable. It was emphasized that over the past decade, the world has witnessed the increase in the scale, scope, and diversity of approaches of South-South and triangular cooperation.

Countries of the Global South have strengthened institutional capacities for cooperation by formulating and implementing national development policies, strategies, and agencies, and by developing information and performance management systems for data gathering, expertise and technology mapping, and impact assessment. With the strengthening of national capacities on South-South and triangular cooperation there is opportunity to collect and exchange evidence of how much South-South and triangular cooperation is being done, how it benefits people, and how to create institutional mechanisms to help countries align South-South collaboration with their national and regional agendas.

As the world fights the COVID-19 pandemic and strives to build back better, international development organizations must offer innovative, timely responses to remain relevant. This includes new forms of coordination based on more “coherent” and “integrated support” capable of unleashing change on the ground. Traditionally, South-South and triangular cooperation has taken place among governments on bilateral terms. As development becomes more dynamic in nature and unprecedented in scale, South-South and triangular cooperation is now used to source innovation from wherever it is.

Also highlighted was that South-South and triangular cooperation is increasingly recognized as an important complement to North-South cooperation in financing for sustainable development. UNOSSC will continue to promote, coordinate and support South-South and triangular cooperation globally and within the UN system. It will also continue to support governments and the UN system to analyse and articulate evolving and emerging trends, dynamics and opportunities in South-South cooperation.

In response to Member States requests, UNOSSC consistently demonstrates strong convening power across the UN system and serves as secretariat of UN Conferences including BAPA+40. UNOSSC has developed research networks at the global level, compiling evidence of good practices in South-South cooperation toward achievement of the SDGs, and created a global network of think tanks on South-South and triangular cooperation. UNOSSC also offers the South-South Galaxy platform for sharing knowledge and brokering partnership. The Office also manages a number of South-South cooperation trust funds and programmes. Given UNOSSC’s mandate to support South-South and triangular cooperation globally and within the UN system, the Secretary-General requested UNOSSC to coordinate the preparation and launch of the UN System-wide Strategy on South-South and Triangulation Cooperation for Sustainable Development with the engagement of the UN Inter-Agency Mechanism for South-South and Triangular Cooperation, and other stakeholders.

The Strategy’s objective is to provide a system-wide policy orientation to UN entities in order to galvanize a coordinated and coherent approach to policy, programmatic and partnership support on South-South and triangular cooperation and increase impact across UN activities at all levels: national, regional and global. Implementation is governed by each entity individually, based on its own mandate and programme of work. UNOSSC is also currently developing its 2022-2025 Strategic Framework. It is an opportunity for the Office to catalyze the use of South-South and triangular cooperation to accelerate the speed and scale of action towards achieving the SDGs.

For example, the Office aims to offer a platform whereby: (i) countries of the Global South can exchange knowledge, develop capacities, and transfer technologies to address their own development priorities as well as coordinate and co-design solutions to shared development challenges; (ii) UN agencies, programs, and funds can strengthen their support to SSTC at the global, regional and country levels. No country is too poor to contribute to South-South cooperation for development, and no country is too rich to lean from the South. All partners have important elements to contribute. So, it follows that triangular cooperation is an important element of our work.

The COVID-19 pandemic has laid bare severe and systemic inequalities. The pandemic has also highlighted the importance of the digital revolution. Building institutional capacity in sub-Saharan Africa and LDCs through South-South and triangular cooperation is essential for countries to fully harness digital transformation and recovery. Triangular cooperation is a flexible platform where partners can mobilize different funding capacities in support of developing countries’ priorities. Triangular cooperation demands horizontality and shared governance approved by all parties. It is based on a clear respect for national sovereignty and the seeking of mutual benefit in equal partnerships.

Recovery from pandemic requires additional support, innovative development solutions and arrangements between public and private sectors. We must facilitate opportunities to expand development cooperation and its processes and to improve the effectiveness of multilateral cooperation. Fostering multi-dimensionality and multi-stakeholders approaches is the way forward to enhance development impact.

During the June HLC Member States highlighted that in the COVID and post-COVID era, the below priority areas for triangular cooperation could be considered: 1) health, 2) data infrastructure, 3) manufacturing capacity and supply chain for relevant medical material and equipment, as well as treatment; 4) solar energy and reducing carbon footprint; 5) a coalition for disaster resilient initiatives; and 6) currency swap arrangements from international financial institutions.

Cash Will Soon Be Obsolete. Will America Be Ready?

When was the last time you made a payment with dollar bills?

Some people still prefer to use cash, perhaps because they like the tactile nature of physical currency or because it provides confidentiality in transactions. But digital payments, made with the swipe of a card or a few taps on a cellphone, are fast becoming the norm. To keep their money relevant, many central banks are experimenting with digital versions of their currencies. These currencies are virtual, like Bitcoin; but unlike Bitcoin, which is a private enterprise, they are issued by the state and function much like traditional currencies. The idea is for central banks to introduce these digital currencies in limited circulation—to exist alongside cash as just another monetary option—and then to broaden their circulation over time, as they gain in popularity and cash fades away. ChinaJapan, and Sweden have begun trials of central bank digital currency. The Bank of England and the European Central Bank are preparing their own trials. The Bahamas has already rolled out the world’s first official digital currency. The end of cash is on the horizon, and it will have far-reaching effects on the economy, finance and society more broadly.

The U.S. Federal Reserve, by contrast, has largely stayed on the sidelines. This could be a lost opportunity. The United States should develop a digital dollar, not because of what other countries are doing, but because the benefits of a digital currency far outweigh the costs. One benefit is security. Cash is vulnerable to loss and theft, a problem for both individuals and businesses, whereas digital currencies are relatively secure. Electronic hacking does pose a risk, but one that can be managed with new technologies. (As it happens, offshoots of Bitcoin’s technology could prove helpful in increasing security.)

Digital currencies also benefit the poor and the “unbanked.” It is hard to get a credit card if you don’t have much money, and banks charge fees for low-balance accounts that can make them prohibitively expensive. But a digital dollar would give everyone, including the poor, access to a digital payment system and a portal for basic banking services. Each individual or household could have a fee-free, noninterest-bearing account with the Federal Reserve, linked to a cellphone app for making payments. (About 97 percent of American adults have a cellphone or a smartphone.) To see how this might help, consider the payments that the U.S. government made to households as part of the coronavirus stimulus packages. Millions of low-income households without bank accounts or direct deposit information on file with the Internal Revenue Service experienced complications or delays in getting those payments. Checks and debit cards mailed to many of them were delayed or lost, and scammers found ways to intercept payments. Central-bank accounts could have reduced fraud and made administering stimulus payments easier, faster and more secure.

A central-bank digital currency can also be a useful policy tool. Typically, if the Federal Reserve wants to stimulate consumption and investment, it can cut interest rates and make cheap credit available. But if the economy is cratering and the Fed has already cut the short-term interest rate it controls to near zero, its options are limited. If cash were replaced with a digital dollar, however, the Fed could impose a negative interest rate by gradually shrinking the electronic balances in everyone’s digital currency accounts, creating an incentive for consumers to spend and for companies to invest. A digital dollar would also hinder illegal activities that rely on anonymous cash transactions, such as drug dealing, money laundering and terrorism financing. It would bring “off the books” economic activity out of the shadows and into the formal economy, increasing tax revenues. Small businesses would benefit from lower transaction costs, since people would use credit cards less often, and they would avoid the hassles of handling cash.

To be sure, there are potential risks to central-bank digital currencies, and any responsible plan should prepare for them. For example, a digital dollar would pose a danger to the banking system. What if households were to move their money out of regular bank accounts and into central-bank accounts, perceiving them as safer, even if they pay no interest? The central bank could find itself in the undesirable position of having to allocate credit, deciding which sectors and businesses deserve loans. But this risk can be managed. Commercial banks could vet customers and maintain the central-bank digital currency accounts along with their own interest-bearing deposit accounts. The digital currency accounts might not directly help banks earn profits, but they would attract customers who could then be offered savings or loan products. (To help protect commercial banks, limits can also be placed on the amount of money stored in central-bank accounts, as the Bahamas has done.) A central-bank digital currency could be designed for use across different payment platforms, promoting private sector competition and encouraging innovations that make electronic payments cheaper, quicker and more secure.

Another concern is the loss of privacy that central-bank digital currencies entail. Even with protections in place to ensure confidentiality, no central bank would forgo the ability to audit and trace transactions. A digital dollar could threaten what remains of anonymity and privacy in commercial transactions—a reminder that adopting a digital dollar is not just an economic but also a social decision. The end of cash is on the horizon, and it will have far-reaching effects on the economy, finance and society more broadly. With proper preparation and open discussion, we should embrace the advent of a digital dollar.

In Kerala Village, Expatriates Join Hands To Set Up Steel Plant

After working in Sharjah for 15 years, T C Shiju, 42, returned to his home in Thikkodi village, in Kozhikode district of Kerala, about two years ago. He was exploring investment choices, when he found a viable option in his village itself. With an investment of just Rs 1 lakh, he became a partner in GTF Steel Pipes and Tubes LLP, a novel manufacturing venture set up by expatriates hailing from Thikkodi and its surrounding villages. Set up by the Global Thikkodiyans Forum (GTF) — a social media group of expatriates from Thikkodi floated in 2015 following a looming job crisis in the Middle East – in May 2018, the unit commenced production earlier this month.

This is the first such attempt in the state where expatriates, and returnees, of a village have come together and mobilized capital for a business enterprise of this kind. The total investment of Rs 18 crore was raised from 207 people. Of these, 147 invested only Rs 1 lakh each. The price of a share was fixed at Rs 50,000, and an individual had to invest in at least two shares. There was a cap on the maximum investment as well – Rs 40 lakh per person. “The major highlight of the venture is that a large section of investors are ordinary people who have some small savings, a few lakh rupees, after years of toil in the Gulf. But for an initiative of this type, they would not have been able to be a part of a professional business venture,” said GTF Steels Chairman Mohammed Basheer Nadammal.

“Most of these returnees invest in trade or hotel industry, and then back out after incurring huge losses. Our concern was to make such people a part of a business venture,’’ he said. Ummer Koyilil, 60, returned to Thikkodi village about two years ago, after working in Bahrain for 18 years. “I tried to set up a small business, but it did not materialise,” he said. “I have invested only Rs 1 lakh in this venture. This has given me exposure to a business enterprise. Otherwise, I would have ended up as a small trader,’’ he said. Before deciding to set up a unit to manufacture galvanised iron pipes and tubes, the GTF explored other possibilities, including integrated farming and tourism.

Explaining why they opted to set up the unit, GTF Steels CEO Ishaq Koyilil, also from Thikkodi, said: “As per our analysis, the monthly demand of GI pipes and tubes in Kerala was 40,000 metric tones during pre-Covid. It would be down to 25,000 metric tones now. However, the production in Kerala is only 4,000 metric tones per month. Our monthly production capacity is 3,000 metric tones. We see a huge growth potential, as construction and infrastructure sectors are poised for major growth in Kerala.” None of the partners work in the factory. The recruitment was done in a professional manner, with only qualified, trained workers being selected.

Abdul Latheef, also from Thikkodi, said they wanted to put forward a business and investment model which could be emulated across the state. “This model will help ordinary expatriates to invest their hard-earned savings in viable business ventures. We have 2,000-odd members in the GTF. Only those interested in investing in the steel industry were selected as partners. We are planning other enterprises too, in which others in the forum can invest,’’ he said.

Dubai To Allow Indian Expats With Expired Residence Visa To Return

In a move that brings relief to thousands of Indian expats, Dubai announced it will allow them to come back even if their residence visas have expired. Also allowed to return were residence visa holders from Pakistan, Nepal, Nigeria, Sri Lanka, and Uganda. Anyone holding an expired Dubai residence visa now has time to return until November 10. A large number of Indian expats had flown back to the country earlier this year when the second wave of Covid-19 was rampant, and were then unable to return to the UAE as the flights were suspended.

Fly Dubai, the low-cost carrier operating from the emirates, posted on its website: “The GDRFA has extended the expiry date of Dubai-issued UAE resident visas for nationals of India, Nepal, Nigeria, Pakistan, Sri Lanka and Uganda who are stranded outside of the UAE. “This applies to Dubai-issued UAE resident visas which have expired or will expire between April 20, 2021 and November 9, 2021 inclusive.”

However, the airline said that the expiry will not be extended for holders of Dubai-issued visas who have stayed outside of the UAE for more than six months, if they left before October 20, 2020. It was unclear at the moment if the same offer applied to residence visas issued by Abu Dhabi, Sharjah, or other emirates.

The move was later confirmed by the General Directorate of Residency and Foreigners Affairs (GDRFA) to Gulf News. In a statement, the GDRFA said: “The procedure will be done according to certain conditions and procedures including that the beneficiaries must be outside the country since the expiry date of residency between April 20, 2021 and November 8, 2021. GDRFA-Dubai will extend the residency visas until November 9.” Once the expats return with expired visa enter the country, the system will give them a 30-day grace period from the date of entry to change their status and renew their visas. (IANS) Boom! United Airlines Just Bought 15 Supersonic Jets That Fly on ‘Sustainable’ Fuel .The airline plans to buy the Overture jets from Boom Supersonic to make its fleet faster and more sustainable.

United Airlines Plans To Purchase 15 Supersonic Overture Jets From Boom Supersonic

The US airline is the first to announce plans to go supersonic, reviving dreams from the late 1960s when British Airways and Air France offered transatlantic flights aboard the Concorde. Only 20 were built during the aircraft’s 24-year operational life. The Overture, which would seat between 65 and 88 passengers, would cut flight time in half over a conventional commercial airliner, with a top speed of Mach 1.7, or 1,304 mph. A flight from New York to London would take just 3.5 hours, according to Boom, and Los Angeles to Sydney would be about eight hours. Unlike the Concorde, which was neither fuel-efficient nor quiet, the Overture will be designed to be “net-carbon zero,” and will cut emissions, according to Boom, by running on sustainable aviation fuel. The first aircraft is slated to roll out in 2025, fly in 2026 and carry its first passengers by 2029.

“United continues on its trajectory to build a more innovative, sustainable airline and today’s advancements in technology are making it more viable to include supersonic planes,” said United CEO Scott Kirby. “Boom’s vision for the future of commercial aviation, combined with the industry’s most robust route network in the world, will give business and leisure travelers access to a stellar flight experience.” The announcement is not the first of an intended partnership between a supersonic firm and a large aviation company.

Both Flexjet and NetJets announced that they planned to buy business jets from Aerion. The Reno-based company had the fastest, most ambitious rollout of its AS2, while also planning to break ground on a new research and production campus near Orlando sometime this year. Last week, it abruptly said it was shutting down because it couldn’t secure long-term funding. Boom seems to be farther along in its development stages than its former competitor. It rolled out a third-scale demonstrator aircraft, the XB1, last year. Boom CEO Blake Scholl recently told a Congressional panel that it plans to fly it for the first time by the end of 2021 or in early 2022.

Overture will be designed with in-seat entertainment screens, large personal space and contactless technology. “At speeds twice as fast, United passengers will experience all the advantages of life lived in person, from deeper, more productive business relationships to longer, more relaxing vacations to far-off destinations,” said Scholl in announcing the deal. United also has the option to buy 35 more Overtures. Scholl recently said that the Overture represents the first dramatic speed gains in new aircraft since the Concorde. “We see ourselves as picking up where Concorde left off, and fixing the most important things which are economic and environmental sustainability,” he told CNN recently, adding: “Either we fail or we change the world.”

U.S. Crypto Regulation Talks Are Heating Up, With Three Major Themes Emerging Here’s What They Mean For Investors

One of the founding principles of cryptocurrency is that it’s decentralized and unregulated. But the U.S. government isn’t too worried about crypto’s founding principles. SEC chair Gary Gensler spoke at the Aspen Security Forum Tuesday, highlighting his view of the SEC’s role in cryptocurrency regulation. Gensler called the current crypto landscape the ‘Wild West’. A few key themes have emerged on the subject of new U.S. cryptocurrency regulation: stopping cryptocurrency crime and tax evasion, stablecoin regulation, and the potential for investment vehicles like crypto ETFs and other funds.

For many crypto enthusiasts, the decentralized nature of digital currencies — which, unlike traditional currencies, aren’t backed by any institution or government authority — is a big draw. But regulatory guidance can help protect investors. “As much as I like the decentralization and the lack of government [involvement], I am glad that they are paying attention because unfortunately with cryptocurrency, there are a lot of scams,” says Kiana Danial, author of “Cryptocurrency Investing for Dummies.” Here’s a rundown of the proposals we’ve seen so far, and how they may affect cryptocurrency investors in the future: Cryptocurrency Crime and Tax Evasion Cryptocurrency regulation is tucked into a provision of the $1 trillion bipartisan infrastructure bill moving through Congress.

The provision would expand the definition of a brokerage to include companies that facilitate digital asset trades — like cryptocurrency exchanges. The change would mean increased tax reporting responsibility to help the IRS track crypto tax evasion. Some lawmakers and industry groups argue that the language of the draft is too broad, according to reporting by the Washington Post. Additionally, SEC Chairman Gensler spoke recently about a need to increase regulation and help prevent more ransomware attacks, like the one that shut down the Colonial Pipeline back in May. The pipeline attack was one of a number of high profile instances of hackers seeking Bitcoin ransoms.

While Gensler didn’t comment on exactly how the SEC planned to help stop these crimes, he did say that the agency would continue to exercise the full extent of its power. “[The SEC] will continue to take our authorities as far as they go,” Gensler said during an appearance at the Aspen Security Forum in Colorado. A recent U.S. treasury report voiced the same concerns as Gensler, saying cryptocurrency “poses a significant detection problem by facilitating illegal activity broadly including tax evasion.”

[READ MORE]: Cryptocurrency Crime Is Booming. Here’s How to Invest Safely

What Investors Should Know Under the proposed law included in the infrastructure bill, companies that facilitate crypto trades would be required to report tax information about those trades to the IRS (just as brokers of traditional investments like stocks do) starting in the 2024 tax season. “The bill is generally investor-friendly because it makes crypto tax compliance easier for investors,” says Shehan Chandrasekera, CPA, head of tax strategy at CoinTracker.io, a crypto tax software company. “This is because if the bill passes, exchanges will have to issue 1099-B tax forms with cost basis information to investors.”

That means the exchange would provide a record of taxable events on the platform, like how much your Bitcoin was worth when you bought it and when you sell it back into U.S. dollars. Today, only some exchanges report this info. “This will significantly reduce the crypto tax filing burden,” Chandrasekera says. It’s already important to keep your own records of any capital gains or losses on your crypto trades, which you should report on your federal tax returns. But this regulation would make it even more essential, since the IRS would more easily be able to find any cases of tax evasion related to crypto. Stablecoin Regulation Gensler also hinted Tuesday that increased stablecoin regulation could help with the cryptocurrency crime problem, as “the majority of what happens [on cryptocurrency exchanges and platforms] is cryptocurrency to cryptocurrency.” Gensler says that by bypassing the involvement of U.S. dollars in direct crypto-to-crypto trades, bad actors may be more able to evade public policy measures and other sanctions aimed at preventing money laundering or ensuring tax compliance.

PRO TIP

Apart from federal regulation, there have been many state-specific cryptocurrency legislations passed. Know what regulations apply in your state. Stablecoins are a type of cryptocurrency pegged to an existing currency, like USDT (Tether). USDT is tied to the price of the U.S. dollar, so its value is constantly $1. And the SEC isn’t the only agency that’s taken interest. Federal Reserve Chairman Jerome Powell has spoken about stablecoin regulation recently, too, while testifying before the U.S. House Committee on Financial Services earlier this month. Powell said that if stablecoins are going to be a “significant” part of the payments universe, “we need an appropriate regulatory framework, which we frankly don’t have.”

Treasury Secretary Janet Yellen echoed that sentiment recently, coordinating a meeting with the President’s Working Group on Financial Markets to discuss “the rapid growth of stablecoins, potential uses of stablecoins as a means of payment, and potential risks to end-users, the financial system, and national security,” according to a meeting readout. What Investors Should Know Nearly three-quarters of trading on all crypto trading platforms occurred between a stablecoin and some other token in July, Gensler said. While it’s unclear yet what any regulatory action on stablecoins would look like, any regulation could impact investors who hold or use stablecoins as part of their strategy.

Crypto-to-crypto trades often incur lower fees on many exchanges than buying crypto outright in U.S. dollar-to-cryptocurrency transactions, and stablecoins’ low price volatility makes them a potentially better option for purchases than transferring cash each time. But for investors, they’re not as great a store of value as more volatile cryptos like Bitcoin. If you’re investing in crypto looking for long-term growth, experts recommend sticking with more established coins like Bitcoin or Ethereum. In anticipation of any coming guidance, you should also make sure to choose a cryptocurrency exchange that maintains compliance with evolving federal and state regulators in the United States. This includes many established, high-volume U.S.-based exchanges, like Coinbase and Gemini. “I only purchase my cryptocurrency assets from regulated brokers at this point, because we have the luxury of doing so. Of course in other countries they don’t have it, but we do,” says Danial.

Cryptocurrency ETFs While the government considers how to make it harder to use cryptocurrency for illicit activities and tax evasion, there is still no way for Americans to buy into crypto using more traditional investment accounts like those at a Fidelity or a Vanguard. The SEC has yet to approve a cryptocurrency ETF (exchange-traded fund) — despite several proposed funds from different institutions and exchanges —  but Gensler revealed on Tuesday that it may be coming. “We do it in the equity market, we do it in the bond markets, people might want it here,” Gensler said. While acknowledging there have already been SEC filings for ETFs, “I anticipate we’ll have some new ones under what’s called the Investment Companies Act — and when combined with other federal laws, the law provides significant investor protections,” he says. The Investing Companies Act requires companies, including mutual funds, to disclose information about their finances and investments on a “regular basis,” according to the SEC.

Until an ETF gets approved, “there’s not really a way to buy a security that closely tracks the price of a specific cryptocurrency,” says Jeremy Schneider, the personal finance expert behind Personal Finance Club. That means the only way for investors to really do that is to buy coins directly from an exchange. While there has been some confusion about whether cryptocurrencies are securities (and under SEC regulation), Gensler made clear that every initial coin offering (ICO) he has seen is a security: “Generally, folks buying these tokens are anticipating profits, and there’s a small group of entrepreneurs and technologists standing up and nurturing the projects … I believe we have a crypto market now where many tokens may be unregistered securities, without required disclosures or market oversight.” But Gensler reiterated that the SEC has jurisdiction, and “our federal securities laws apply.”

Cryptocurrency ETFs are not yet available in the U.S., but may offer a way for investors to get into cryptocurrency without having to buy directly from an exchange in the future. If you’re interested in crypto, these funds could help you diversify your holdings across different coins, like a conventional ETF or index fund. But they’re still just as speculative as any crypto investment; if you’re waiting for a Bitcoin ETF because you’re unwilling to take on the risk, you may want to reconsider whether crypto belongs in your portfolio at all. In the meantime, Gensler’s stance that every ICO is a security could mean investors should look to the SEC for protections as regulation becomes more concrete.

Biden Administration Grants Automatic Student Loan Forgiveness To 325,000 Permanently Disabled Borrowers

The Biden administration moved Thursday (Aug. 19, 2021)  to grant 325,000 people who are severely disabled automatic federal student loan forgiveness to the tune of $5.8 billion, setting the stage for reforms to a process that is widely criticized as cumbersome and onerous. “The Department of Education is evolving practices to make sure that we’re keeping the borrowers first and that we’re providing relief without having them jump through hoops,” Education Secretary Miguel Cardona said on a call with reporters Thursday.  “I’ve heard from borrowers over the last six months that the processes are too difficult so we’re simplifying it.”

By law, anyone who is declared by a physician, the Social Security Administration or Department of Veterans Affairs to be totally and permanently disabled is eligible to have their federal student loans discharged. The benefit has never been widely publicized, so few have taken advantage. And when they do, many are met with tedious paperwork and requirements. There is a three-year monitoring period in which borrowers must submit annual documentation verifying their income does not exceed the poverty line. The requirement routinely trips up people who wind up having their loans reinstated. To ease the burden, the Biden administration in March waived the paperwork requirement during the coronavirus pandemic, retroactive to March 13, 2020, when President Donald Trump declared a national emergency.

On Thursday, Cardona said the Education Department will indefinitely extend the income waiver. The department will also pursue the elimination of the requirement altogether through the negotiated rulemaking process in October. The federal agency is proposing new rules to provide automatic disability discharges for anyone identified as eligible through data matching initiatives with Veterans Affairs and the Social Security Administration.

In 2016, the Education Department partnered with the two other agencies to identify eligible borrowers. While the department removed the application requirement in 2019 for veterans, it did not do the same for people identified through the SSA match. Only half of the people identified through the SSA match have received the discharge, according to the Education Department. A bipartisan coalition of congressional lawmakers, including Sens. Chris Coons, D-Del., and Rob Portman, R-Ohio, had urged Trump to automatically discharge the debt, much like his administration had done in 2019 for permanently disabled veterans. But the Trump administration failed to act, while hundreds of thousands of disabled borrowers defaulted on their loans.

A Freedom of Information Act request made by the D.C.-based nonprofit National Student Legal Defense Network found over 517,000 individuals as of May had not received relief. Asked about the discrepancy between the May figure and the 325,000 announced Thursday, Ben Miller, a senior adviser at the Education Department, said the older figure likely includes duplicates that may be showing up in multiple matches. He assured the latest figure accounts for all of the borrowers currently on the books.

“Obviously, we anticipate there will be new matches each quarter,” Miller said. “This is not just a one-time action.” Eligible borrowers will receive notice of their approved discharge in September and the department expects cancellation will occur by the end of the year. People who wish to opt-out of forgiveness will be given the opportunity. While borrowers will not be subject to federal income taxes on the canceled debt, they may encounter state taxes. Consumer groups had urged the Biden administration to automatically discharge the federal student loans of eligible borrowers, rather than require them to submit an application for debt forgiveness. Many were disappointed when the Education Department announced the income waiver in March without automating the process. Advocates praised the administration Thursday for stepping up.

“This is a life-altering announcement for hundreds of thousands of student loan borrowers with disabilities,” Dan Zibel, chief counsel at the National Student Legal Defense Network. “Today’s step is another indication that the Department is listening to the voices of student loan borrowers.”

TCS Attrition Rate, 8.63%, Lowest Among IT Giants

TCS reported that its employee headcount crossed the 500,000-mark in the quarter ending June 2021, even though close to 43,000 people left the IT major.Indian IT major Tata Consultancy Services (TCS) reported an 8.6% attrition in the past year, in its results for the first quarter of the 2021-22 financial year.

According to the report, it rose from 7.2% in the previous quarter—ending on March 31, 2021 – even the attrition rate is pegged to be the lowest in the county. IT companies such as Accenture announced their attrition rate for the first quarter of 2021-22 fiscal at 17% against 11% in the year-ago quarter., while Infosys and Wipro’s attrition rates were reported to be 15.2% and 12.1% in the fourth quarter of 2020-21 financial year.

The trend in employee attrition is a concern the IT firms were plagued by. However, TCS reported that its employee headcount crossed the 500,000-mark in the quarter ending June 2021, when the company hit a total workforce of 509,058. In July, TCS announced a 29% rise year-on-year in quarterly profit, powered by higher demand from businesses ramping up digital services during the coronavirus disease (Covid-19) pandemic crisis, Hindustan Times’ sister publication LiveMint reported. The IT giant’s net profit rose to ₹9,008 crore, between April and June, up from ₹7,008 crore a year earlier, while its revenue from operations jumped 18.5% to ₹45,411 crore.

Even as some of the big IT firms were expecting the attrition rate to inch up in the financial quarters to come, riding on the back of a talent war, outgoing employees make direct and indirect impacts on a company and its resources. Industry experts often pointed out that attrition is an important human resources metric that indicates a lot about the direction of a company’s business, as well as the possible problems that need the attention of the HR managers.

One of the major causes behind the strong attrition at TCS is its remuneration, said a Kolkata-based tech analyst who recently left TCS for another major IT firm. “Compared to the industry standards, the remuneration is less when compared with lateral recruits,” the techie told HT, adding, “The effort by TCS to retain an employee after they put in their papers do cut it. It often offers an onsite opportunity to an employee in a bid to retain them but such opportunities do not work, especially when an employee has made up their mind to leave over remuneration concerns, as people want to earn a standard salary staying home.”