Dow Jones Hits 40,000: Milestone Highlights Evolution and Declining Relevance of the Historic Index

The Dow Jones Industrial Average has surpassed 40,000 for the first time, marking a significant milestone in what has been a surprisingly strong year for Wall Street.

However, much like how New Year’s Day is merely an arbitrary point in the Earth’s orbit around the sun, such milestones for the Dow don’t hold inherent significance. This is because the Dow, comprising only 30 companies, represents a very small segment of Corporate America. Furthermore, most individual 401(k) accounts are not directly influenced by the Dow, which is increasingly viewed as a relic for historical comparisons.

Here’s an examination of what the Dow is, how it reached this point, and its declining relevance among investors:

What is the Dow?

The Dow is an index of 30 established, well-known companies often referred to as “blue chips,” implying they are on the steadier and safer side of Wall Street.

What’s in the Dow?

Despite its name, the Dow doesn’t only include industrial companies like Caterpillar and Honeywell. Since its inception in 1896, the roster has evolved in tandem with the U.S. economy. Out went companies like Standard Rope & Twine, and in came major technology companies such as Apple, Intel, and Microsoft. The financial sector is well-represented with American Express, Goldman Sachs, JPMorgan Chase, and Travelers, while the healthcare sector includes Amgen, Johnson & Johnson, Merck, and UnitedHealth Group.

What’s all the hubbub now?

The Dow recently crossed the 40,000-point threshold during midday trading on Thursday. It took approximately three and a half years to rise from 30,000 points, a milestone first reached in November 2020. This growth has persisted despite the worst inflation in decades, high interest rates aimed at controlling inflation, and fears that such rates would lead to a U.S. recession. Currently, companies are reporting their best profit growth in nearly two years, and the economy has managed to avoid a recession thus far.

Is the Dow the main measure of Wall Street?

No. The Dow represents a narrow segment of the economy. Professional investors prefer broader market measures like the S&P 500 index, which encompasses nearly 17 times more companies. As of the end of 2019, more than $11.2 trillion in investments were benchmarked to the S&P 500, compared to only $32 billion to the Dow Jones Industrial Average. Investors’ 401(k) accounts are much more likely to include an S&P 500 index fund than anything linked to the Dow. The S&P 500 recently surpassed its own milestone, topping 5,300 points for the first time. “That’s what more investors care about,” notes the article, highlighting the relative importance of the S&P 500’s performance compared to the Dow.

How different are the Dow and the S&P 500?

Historically, the performances of the Dow and the S&P 500 have been quite similar, though recently the S&P 500 has outperformed the Dow. Over the last 12 months, the S&P 500 rose by 29.3%, easily outpacing the Dow’s 21.1% gain. This disparity is partly because the S&P 500 has a heavier emphasis on Big Tech stocks, which have driven much of its gains in the past year. Hopes for a reduction in Federal Reserve interest rates and enthusiasm around artificial-intelligence technology have elevated these stocks to high levels. The Dow, in contrast, does not include marquee stocks like Alphabet, Meta Platforms, or Nvidia.

Is that it?

No, the Dow and the S&P 500 also differ in their methodologies for measuring index movements. The Dow assigns more weight to stocks with higher price tags, meaning stocks with larger dollar changes impact the index more significantly. For example, UnitedHealth Group, with its $523 stock price, exerts a greater influence on the Dow than Walmart, whose stock is priced at about $63. Conversely, the S&P 500 gives more weight to stocks based on their overall market size. Thus, a 1% move in Walmart carries more weight than a 1% move in UnitedHealth Group because Walmart has a larger total market value.

So why care about the Dow?

Due to its long history, the Dow provides a longer track record than other market measures. Historically, a triple-digit move in the Dow offered a straightforward way to gauge whether the stock market was experiencing a significant day. However, this is now less meaningful. “A 100 point swing for the Dow means a move of less than 0.3%,” reflecting its diminished relevance in the context of the broader market.

India Leads Global Remittances, Surpasses $100 Billion Mark: UN Report

India Leads Global Remittances, Surpassing $100 Billion Mark

India emerged as the global leader in remittances in 2022, surpassing the unprecedented $100 billion milestone, as reported by the United Nations migration agency. The International Organization for Migration (IOM), in its World Migration Report 2024, unveiled India’s remarkable achievement, alongside insights into the broader landscape of international migration.

According to the report, India, Mexico, China, the Philippines, and France stood out as the top recipients of remittances in 2022. India’s towering figure of over $111 billion marked a historic feat, solidifying its position as the foremost beneficiary. Notably, Mexico secured the second spot, a position it has maintained since 2021, overtaking China, which historically held the second-largest recipient status after India.

The report traces India’s journey as a remittance powerhouse, highlighting its consistent dominance over the years. India had previously topped remittance receipts in 2010, 2015, and 2020, with figures steadily climbing to culminate in the record-breaking $111.22 billion in 2022. This trend underscores the crucial role of Southern Asia as a significant hub for migrant workers, with India, Pakistan, and Bangladesh ranking among the top ten global recipients of remittances.

While celebrating India’s milestone, the report sheds light on the challenges faced by migrant workers from the region. Despite being a lifeline for many, remittances often come with risks such as financial exploitation, excessive debt due to migration costs, xenophobia, and workplace abuses. These issues underscore the importance of safeguarding the rights and well-being of migrant workers, especially in Gulf Cooperation Council (GCC) states, which continue to rely heavily on migrant labor.

The report emphasizes the profound impact of the COVID-19 pandemic on international migration patterns, particularly affecting low-skilled and undocumented workers. Loss of jobs, wage theft, and lack of social security have exacerbated vulnerabilities among Indian migrants, plunging many into debt and insecurity. Furthermore, the pandemic has reshaped labor dynamics, leading to a significant decline in urban migration and a surge in reverse internal migration.

Beyond remittances, the report delves into the broader landscape of international migration, highlighting key trends and challenges. It underscores the importance of Asia as a major source of internationally mobile students, with China leading in outbound student mobility. Meanwhile, countries like the US, the UK, Australia, Germany, and Canada remain prominent destinations for international students, shaping global education flows.

The report also addresses the evolving dynamics of irregular migration, particularly at the United States-Mexico border. While traditional source countries like Mexico and Central American nations continue to contribute to irregular migration, there has been a notable shift in origin countries, with increased arrivals from Venezuela, Cuba, Nicaragua, Haiti, Brazil, India, and Ukraine. This shift is attributed to various factors, including policy changes like Title 42, aimed at curbing the spread of COVID-19.

The World Migration Report 2024 offers a comprehensive overview of the complex landscape of international migration, with India’s remarkable remittance achievement serving as a focal point. As the global community grapples with the challenges and opportunities of migration, ensuring the rights and well-being of migrant workers remains paramount in shaping a more inclusive and sustainable future.

USCIRF Urges State Department to Include India in Religious Freedom Violator List Amidst National Elections

India is currently amidst a significant national election spanning six weeks, and amid this democratic process, the U.S. Commission on International Religious Freedom (USCIRF) has urged the U.S. State Department to include India in its roster of countries with severe violations of religious freedom. This bipartisan commission, established under the International Religious Freedom Act in 1998, holds the authority to recommend countries for special designations to the State Department. This year, in its 25th annual report, the commission called for India’s inclusion due to escalating hate speech, particularly targeting Muslims, in the lead-up to the elections.

According to the USCIRF report, hate speech has seen a surge in India, especially directed towards Muslims, ahead of the national elections. Commissioner David Curry highlighted instances where Prime Minister Narendra Modi and his Hindu-nationalist Bharatiya Janata Party have been accused of exacerbating tensions by making statements targeting religious minorities. In the northeastern state of Manipur, clashes between Hindu and Christian communities have resulted in the destruction of numerous places of worship.

The commission’s concerns extend beyond India. It has recommended that Afghanistan, Azerbaijan, Nigeria, and Vietnam be designated as “countries of particular concern” (CPC) due to their poor records on religious freedom. Additionally, the commission called for the retention of CPC designation for countries like China, Cuba, Iran, and Russia, among others.

In Nigeria, religious freedom conditions have remained dire, with thousands of Christians participating in protests following deadly attacks over the Christmas season. Commissioner Eric Ueland criticized the State Department for its failure to recognize Nigeria as one of the worst violators of religious freedom, emphasizing the government’s consistent failure to prevent or punish religiously motivated violence.

Azerbaijan and Kyrgyzstan have also come under scrutiny, with the former being recommended for CPC designation for the first time due to its refusal to register non-Muslim religious communities and its targeting of ethnic Armenians in disputed regions. Kyrgyzstan has been added to the special watch list for its strict penalties against religious practices.

The report also flagged China and India for engaging in “transnational repression,” with governments increasingly using digital surveillance to monitor religious minorities. However, there was a positive note regarding Syria, which was moved from the worst violators list to the special watch list due to changes in the nature of violations.

Commissioner Frank Wolf emphasized the need for meaningful consequences for governments designated as CPCs, suggesting that waivers based on other U.S. interests should not be reissued for countries like Pakistan, Saudi Arabia, Tajikistan, and Turkmenistan, which have avoided penalties for their abuses in the past.

Small U.S. Banks Under Stress: Threat of Failures Looms Amid Economic Challenges

Numerous small and regional banks throughout the United States are experiencing significant strain, with concerns rising about potential repercussions.

According to Christopher Wolfe, managing director and head of North American banks at Fitch Ratings, some banks could face dire circumstances, potentially failing or falling below their minimum capital thresholds.

Klaros Group, a consulting firm, conducted an analysis of approximately 4,000 U.S. banks, identifying 282 institutions confronting a double jeopardy scenario involving commercial real estate loans and the specter of losses linked to escalating interest rates.

The affected banks predominantly consist of smaller financial entities with assets totaling less than $10 billion.

Brian Graham, co-founder and partner at Klaros Group, clarified that while many of these banks aren’t insolvent or on the brink of insolvency, they are undoubtedly under pressure. This pressure, he emphasized, may result in fewer bank failures but could still have adverse effects on communities and customers.

Graham elaborated that communities may experience subtle ramifications due to banks opting out of investments in endeavors such as establishing new branches, embracing technological advancements, or expanding their workforce.

The ramifications of small bank failures are more tangential for individual depositors. As Sheila Bair, former chair of the U.S. Federal Deposit Insurance Corp., explained, there’s no immediate impact for depositors if banks fall below the insured deposit limits, which are presently set at $250,000. In the event of a bank failure insured by the FDIC, all depositors are entitled to receive compensation “up to at least $250,000 per depositor, per FDIC-insured bank, per ownership category.”

Analysis: Declining US Birth Rate Not the Economic Disaster Some Fear, Says Fisher Investments

Recent analysis from Fisher Investments suggests that the declining birth rate in the United States, though significant, may not spell the economic catastrophe that some anticipate. The advisory firm highlights a global trend of falling birth rates, with the US experiencing its lowest rate in decades, according to data from the Centers for Disease Control.

This downward trend in birth rates is not a new phenomenon. World Bank data indicates a consistent decline since the 1960s. Despite these numbers, Fisher Investments argues that a shrinking population may not be detrimental to the economy, citing previous instances in the 1980s and 1990s when economic growth persisted despite declining fertility rates.

The correlation between falling birth rates and economic prosperity is not straightforward. Wealthier nations tend to have lower birth rates due to factors such as improved healthcare leading to lower infant mortality rates and longer life expectancies, allowing individuals to delay or choose not to have children.

While acknowledging potential long-term implications of declining birth rates on human capital and other factors, Fisher Investments remains cautiously optimistic about the future. They emphasize the unpredictability of future developments and the potential for technological advancements, such as AI, to mitigate the effects of a smaller workforce.

Economists have also speculated on the impact of technological innovations like AI on the labor force. Goldman Sachs estimates that AI could disrupt millions of jobs worldwide, potentially offsetting the effects of a declining workforce.

Moreover, Fisher Investments suggests that any economic repercussions from declining birth rates would likely unfold gradually over time rather than having an immediate impact. Founder and co-chief investment officer Ken Fisher remains bullish on the stock market, downplaying concerns about a recession or prolonged periods of high-interest rates. He asserts that the recent fluctuations in the market do not signify the beginning of a bear market, as bear markets typically manifest through a gradual decline rather than sudden drops like those observed recently.

JPMorgan Stays Cautious on Cryptocurrencies Amid Lack of Bullish Catalysts

JPMorgan, a leading US bank, has expressed a cautious outlook towards cryptocurrencies in its recent report released on April 23rd. The report highlights several factors contributing to the current state of the cryptocurrency market. One notable observation is the absence of bullish catalysts following a decline in ETF inflows. Analysts at the bank point to various factors amplifying the bearish sentiment, including high market positioning, disappointing venture capital funding, and the associated production costs.

In a previous assessment, JPMorgan suggested that the impact of the Bitcoin halving had already been factored into the market, which tempered optimistic forecasts. This sentiment was echoed back in February when the bank projected a potential drop in Bitcoin’s value post-halving, envisioning a figure as low as $42,000 per coin. Additionally, JPMorgan foresaw a doubling in the production cost of individual coins. During this period, Bitcoin advocate Mike Novogratz also cautioned against an overheated market.

Despite hitting an all-time high of $73,737 in March and achieving eight consecutive months of gains, Bitcoin faced a significant downturn in April, followed by continued declines into May. This downward trajectory was attributed to substantial outflows from ETFs and broader macroeconomic uncertainties. As of the latest update, Bitcoin is trading at $59,110.

Meanwhile, Jamie Dimon, the CEO of JPMorgan, reiterated his longstanding skepticism toward Bitcoin, labeling it as “a fraud” and likening it to a “Ponzi scheme.” Dimon maintained his stance that Bitcoin lacks the fundamental qualities of a viable currency. However, he acknowledged the potential value of blockchain technology despite his reservations about cryptocurrencies.

Renowned Trader Peter Brandt Sparks Controversy with Bold Bitcoin Price Prediction

Renowned trader Peter Brandt has ignited yet another fervent discussion within the cryptocurrency community with his most recent Bitcoin price forecast. In a recent social media update, Brandt put forth the notion that should Bitcoin sustain its current price levels and persist on its upward path, it could adhere to a conventional pattern indicative of a continuation in the bull market.

Brandt’s analysis, coupled with an illustrative chart portraying his perspective, indicates that notwithstanding recent fluctuations, Bitcoin might be on the brink of a substantial surge towards the $74,000 threshold, potentially revisiting its prior all-time pinnacle. This buoyant prognosis, however, hasn’t garnered unanimous acceptance.

Some skeptics have cast doubt on Brandt’s credibility, pointing to his earlier prognostications which oscillated between predicting a downturn to $40,000 per BTC and speculating that Bitcoin had already peaked. Nevertheless, Brandt remains steadfast in his conviction that the cryptocurrency is amidst a bullish phase, underscoring the significance of adaptability in proficient trading.

In response to the criticism levied against him, Brandt dismissed detractors, underscoring his extensive decades-long experience in trading and stressing the indispensability of agility in maneuvering through volatile markets. Engaging in a direct confrontation with one skeptic, Brandt assertively proclaimed his readiness to capitalize on their skepticism, cautioning them against the risk of jeopardizing their capital in the process.

The veracity of whether Bitcoin will indeed adhere to Brandt’s envisaged trajectory remains uncertain, yet one aspect is indisputable: the esteemed trader has once again kindled deliberation and captured the attention of investors.

Americans Remain Concerned About Inflation: Gallup Survey Reveals Financial Worries

In the latest survey unveiled on Thursday, inflation maintains its prominent position as a foremost concern among Americans regarding their financial challenges.

Gallup’s findings reveal that 41 percent of Americans pinpoint inflation or a high cost of living as “the most important financial problem facing” their families, surpassing concerns such as taxes and energy expenses. This marks the third consecutive year where inflation has led the list, showcasing a marginal uptick from the previous year’s 35 percent, as per the survey.

The report from Gallup researchers emphasizes the significance of inflation as a domestic worry, standing just behind immigration, government affairs, and the broader economy when Americans identify the paramount issues confronting the nation.

Despite a robust labor market and a notable increase in inflation, the Federal Reserve opted to uphold interest rates at a 23-year peak.

Data disclosed by the Commerce Department last week underscores a rise in inflation for March, attributed to escalated spending and augmented incomes. The personal consumption expenditures price index, a preferred gauge of inflation by the Fed, exhibited a 0.3 percent surge in March and a 2.7 percent increment over the preceding year.

Additionally, the survey divulges a minor decline in individuals who perceive their overall financial situation as deteriorating, dropping from 50 percent to 47 percent compared to the previous year. Conversely, the proportion of those expressing an improvement in their financial circumstances rose from 37 percent to 43 percent in comparison to last year.

The poll highlights other significant financial concerns, including excessive debt (8 percent), healthcare expenses (7 percent), insufficient income or low wages (7 percent), and energy costs or gasoline prices (6 percent).

Examining responses by age, older adults manifest a greater tendency to identify inflation as a primary impediment to their financial well-being. Notably, 46 percent of adults aged 50 or above cited inflation, contrasting with 36 percent among those under 50.

Furthermore, individuals with higher incomes exhibit a heightened propensity to perceive inflation as a financial burden, according to the survey’s findings.

The Gallup poll, conducted from April 1-22 with a sample size of 1,001 individuals, carries a margin of error of 4 percentage points.

Key themes at the IMF/World Bank Spring Meetings: Dollar dominance

  • The U.S. dollar has risen a stunning 30% over the past decade.
  • You would think—given this rise—consensus would be dollar-bearish, but last week’s meetings were the most dollar-bullish in a very long time.
  • There was lots of focus on cyclical outperformance of the U.S. economy, with that outperformance keeping U.S. inflation stickier than elsewhere, forcing the Fed to stay on hold even as other central banks start to cut.
  • U.S. elections and geopolitics were seen as adding to dollar strength.
  • Option-implied volatilities in currency markets are unusually low, which means that market volatility may rise in the rest of 2024

Half a year ago, debate at the IMF/World Bank annual meetings in Marrakech centered on geopolitics, with a lot of concern that the global security situation was spinning out of control. This was not the central theme at last week’s IMF/World Bank Spring Meetings. To be sure, there was lots of debate on the Middle East and Ukraine, but neither were seen as “systemic.” Instead, focus was on cyclical outperformance of the United States vis-à-vis its peers and the possibility that this might keep U.S. inflation stickier than elsewhere, preventing the Fed from cutting rates even as other major central banks begin easing cycles. This combination of factors made sentiment the most dollar-bullish in a very long time, with the U.S. election and geopolitical risk seen as additional sources of dollar strength. Not much of any of this is priced into markets. Option-implied volatilities for the euro and Mexican peso, for example, are at very depressed levels. This means volatility may rise, perhaps sharply, as the rest of 2024 unfolds.

US economic outperformance

A stylized fact following the 2008 crisis is that U.S. growth substantially outperformed the rest of the advanced world. This again looks to be true in the aftermath of COVID-19 (Figure 1), with lots of debate on the underlying drivers. Some argue that this outperformance reflects loose fiscal policy and rapid immigration, while others see a productivity boom linked to tight labor markets. Whatever the source, cyclical outperformance may keep U.S. inflation stickier than elsewhere. There are some signs of this. Figure 2 shows the combined weight of items in the U.S. consumer price index (CPI) with month-over-month inflation above 2% (on a seasonally adjusted, annualized basis), alongside the same measure for the eurozone’s harmonized index of consumer prices (HICP). This metric is noisier than if we used year-over-year inflation, but it has the advantage of focusing on recent inflation dynamics, since there are no base effects to muddy the picture. Elevated inflation remains relatively broad-based in the U.S., consistent with strong growth, while inflation momentum is clearly fading in the eurozone.

Figure 1. Real GDP vs. pre-COVID trend growth in the US and eurozone, indexed to 100 in Q4 2007

Source: BEA and Eurostat

Figure 2. Inflation generalization in the US and eurozone: Weight of items in CPI and HICP with m/m (saar) inflation > 2%

Source: BLS and Eurostat

Cyclical outperformance of the United States is not priced into markets. Figure 3 shows 5-year, 5-year forward breakeven inflation for the U.S. and eurozone. Prior to COVID-19, breakeven inflation in the eurozone was around 70 basis points below the U.S. That wedge has closed and is currently only half that, which means that markets are not differentiating sufficiently between the U.S. and the eurozone. The same picture emerges from interest rate differentials. Figure 4 shows 2-year, 2-year forward interest rates in the U.S. and eurozone—an estimate for where markets think the “terminal” rate will be—along with the corresponding rate differential. The rate differential is below where it was prior to COVID-19, even though the U.S. is now much more clearly outgrowing the eurozone. The fact that U.S. outperformance is not priced into markets suggests there is scope for the dollar to rise going forward, which explains bullish sentiment at last week’s Spring Meetings.

Figure 3. 5-year, 5-year forward inflation breakevens for the US and eurozone, in %

Source: Bloomberg

Figure 4. 2-year, 2 year forward interest rates in the US and eurozone, in %

Source: Bloomberg

While the charts so far have drawn the contrast with the eurozone, our basic points carry over to the broad dollar. Figure 5 shows the trade-weighted interest differential at different tenors of the U.S. vis-à-vis other advanced economies, where we use the same weights as the Federal Reserve’s dollar index. Much as in Figure 4, the rate differential of the U.S. versus key trading partners is below its peak in the run-up to COVID-19. Markets are not pricing U.S. “exceptionalism.” The same is true just looking at the trade-weighted nominal dollar versus advanced economies and emerging markets (Figure 6). The dollar has basically been in a decade-long holding pattern since its large rise in 2014/5.

Figure 5. US interest rate differentials vs. other advanced countries, in % (US – GDP weighted foreign)

Source: Bloomberg

Figure 6. US dollar vs. G10 and emerging markets, excluding China

Source: Bloomberg

US elections and geopolitical risk

The looming U.S. elections were—inevitably—a major discussion point, though there is little conviction on which way the election will go. What is clear, regardless of the outcome, is that markets have not yet begun to hedge this event risk in any material way, which is evident from meetings with investors and market pricing. Figure 7 shows option-implied volatility for EUR/$ on a six-month (does not cover the election) and one-year tenor (spans the election). Volatility spiked sharply in November 2016 and is currently far below those levels, even after the recent rise as markets priced a more hawkish Fed. Figure 8 shows the same thing for $/MXN, where it is again true that volatility rose sharply in November 2016 and is currently far below those levels. The fact that markets have not yet begun to hedge U.S. election risk is another source of dollar strength and volatility for the rest of 2024. An escalation of conflict in Ukraine or the Middle East would also prompt safe-haven flows to strengthen the dollar..

Figure 7. EUR/$ money option volatility

Source: Bloomberg

Figure 8. $/MXN money option volatility

Source: Bloomberg

FTC Narrowly Passes Ban on Noncompetes, Sparking Controversy and Legal Challenges

The Federal Trade Commission (FTC) narrowly passed a resolution on Tuesday to prohibit nearly all noncompete agreements, which are employment contracts typically barring workers from joining rival companies or launching their own ventures. The decision followed a period of public consultation during which the FTC received over 26,000 comments. Chair Lina Khan, in her remarks, reflected on testimonies from workers.

“We heard from employees who, because of noncompetes, were stuck in abusive workplaces,” she stated. “One person noted when an employer merged with an organization whose religious principles conflicted with their own, a noncompete kept the worker locked in place and unable to freely switch to a job that didn’t conflict with their religious practices.”

She underscored how these accounts “pointed to the basic reality of how robbing people of their economic liberty also robs them of all sorts of other freedoms.”

The FTC approximates that around 30 million individuals, ranging from minimum wage earners to CEOs, are subjected to noncompete agreements, which it asserts suppress wages. The policy shift is anticipated to spur wage growth of nearly $300 billion annually by empowering people to transition between jobs without hindrance.

Scheduled to take effect later this year, the ban features a provision exempting pre-existing noncompetes negotiated with senior executives, on the premise that such agreements are typically the result of negotiation. The FTC advises against enforcing other pre-existing noncompete agreements.

The vote, split 3 to 2 along party lines, sparked dissent from Commissioners Melissa Holyoke and Andrew Ferguson, who argued that the FTC was exceeding its authority. Holyoke anticipated legal challenges against the ban, foreseeing its eventual reversal.

Following the decision, the U.S. Chamber of Commerce announced its intention to challenge the ruling in court, denouncing it as unwarranted, illegal, and an overt power grab.

For over a year, the Chamber of Commerce has vehemently opposed the ban, asserting that noncompetes are essential to safeguarding companies’ proprietary information and providing employers with a greater incentive to invest in employee training and development.

“This decision sets a dangerous precedent for government micromanagement of business and can harm employers, workers, and our economy,” wrote Suzanne P. Clark, president and CEO of the U.S. Chamber, in a statement.

Analysis Reveals Six-Figure Incomes Required for Comfortable Living in Costliest U.S. States

In the United States, it takes a substantial income to live comfortably, especially in the most expensive states. A recent analysis by SmartAsset highlights that achieving a comfortable lifestyle as a single person requires earning over six figures annually in these areas.

The term “comfortable” refers to the monthly income required to cover a 50/30/20 budget. This budget allocates 50% of earnings for necessities like housing and utilities, 30% for discretionary spending, and 20% for savings or investments. SmartAsset based its calculations on data from the MIT Living Wage Calculator, extrapolating the income needed for each state.

Here’s a rundown of the top five most expensive states for single workers, along with the annual income required to live comfortably:

  1. Massachusetts: $116,022
  2. Hawaii: $113,693
  3. California: $113,651
  4. New York: $111,738
  5. Washington: $106,496

These figures illustrate a stark contrast with the U.S. median income for single, full-time workers, which hovers around $60,000 according to Labor Bureau data. In essence, to live independently in these states, one would need nearly double the median income.

The national median for comfortable solo living stands at $89,461, suggesting that the 50/30/20 budget might not be feasible for most single individuals. Living alone incurs additional expenses, often referred to as the “singles tax.” Apart from housing, single individuals bear extra costs for groceries, transportation, travel, and entertainment.

To maintain financial stability while living alone, adjustments to the budget are necessary. This might entail opting for a smaller living space or cutting back on discretionary spending such as travel.

The income required to live comfortably varies significantly across states. Below is a comprehensive list of states alongside the annual income needed for comfortable living, listed alphabetically:

– Alabama: $83,824

– Alaska: $96,762

– Arizona: $97,344

– Arkansas: $79,456

– California: $113,651

– Colorado: $103,292

– Connecticut: $100,381

– Delaware: $94,141

– Florida: $93,309

– Georgia: $96,886

– Hawaii: $113,693

– Idaho: $88,733

– Illinois: $95,098

– Indiana: $85,030

– Iowa: $83,366

– Kansas: $84,656

– Kentucky: $80,704

– Louisiana: $82,451

– Maine: $91,686

– Maryland: $102,918

– Massachusetts: $116,022

– Michigan: $84,365

– Minnesota: $89,232

– Mississippi: $82,742

– Missouri: $84,032

– Montana: $84,739

– Nebraska: $83,699

– Nevada: $93,434

– New Hampshire: $98,094

– New Jersey: $103,002

– New Mexico: $83,616

– New York: $111,738

– North Carolina: $89,690

– North Dakota: $52,807

– Ohio: $80,704

– Oklahoma: $80,413

– Oregon: $101,088

– Pennsylvania: $91,312

– Rhode Island: $100,838

– South Carolina: $88,317

– South Dakota: $81,453

– Tennessee: $86,403

– Texas: $87,027

– Utah: $93,683

– Vermont: $95,763

– Virginia: $99,965

– Washington: $106,496

– West Virginia: $78,790

– Wisconsin: $84,115

– Wyoming: $87,651

These figures underscore the significant financial demands of living independently across different states in the U.S.

India Marches Towards $5 Trillion Economy

Homegrown solutions and products built on top of the digital public infrastructure (DPI) by young entrepreneurs will pave the path towards India becoming a $5 trillion economy, industry experts said on Sunday.

With successful mass adoption and larger economic impact, DPIs are impacting approximately 1.3 billion citizens, covering 97 per cent of India’s population.

The matured DPIs enabled a value creation of $31.8 billion, equivalent to 0.9 per cent of India’s GDP in 2022, according to a Nasscom-led study that came out last month.

“Digital technology is creating an enabler for the larger ecosystem in India, whether it is in healthcare or agriculture. What is most exciting for me is in the space of education,” Mayank Kumar, Co-founder and MD of edtech platform upGrad, told IANS.

“A robust digital infrastructure has been laid across the country. Multiple companies and entrepreneurs can now build strong solutions on top of that which will pave the path towards India being a $5 trillion and a $10 trillion economy in the coming future,” Kumar added.

India Marches Towards $5 Trillion Economy

India’s interoperable and open-source DPIs are now being adopted or considered by over 30 countries to enhance social and financial inclusion.

According to experts, DPI provides a close-up approach to fostering digital inclusion and contributing to economic growth at scale.

“Think of ‘India stack’ as a bridge between the physical infrastructure such as broadband and an array of digital services that’s contributing to digital adoption at scale – ranging from identity (Aadhaar) to payments to health care, among others,” Prabhu Ram, Head, Industry Intelligence Group at market intelligence firm CMR, told IANS. (IANS)

How Voters Feel About The US Economy: 4 Takeaways From The Latest Polls

As the 2024 general election begins in earnest, voters’ assessment of the economy and of the candidates’ ability to manage it will, as usual, have a strong impact on the outcome of the race. With little more than seven months until Election Day, the economy remains a key advantage for former President Donald Trump, and a drag on President Biden’s reelection prospects. Here are four takeaways from recent survey research on this topic:

Inflation and high prices remain the electorate’s top concern and dominate voters’ assessment of the economy. In a just-released Economist/YouGov survey, 22% of voters identify inflation/prices as their most important issue, compared to only seven percent who cite jobs and the economy. According to a Data for Progress analysis, 68% of those who put inflation and prices first named the cost of food as their principal concern, followed by housing (17%), utilities (eight percent), and gas (three percent).

Despite some modest recent improvement, voters’ sentiments about the economy remain negative. A recent Wall Street Journal (WSJ) survey found 31% of voters endorse the proposition that the economy has improved over the past two years, up by 10 percentage points since December. In another sign of progress, a New York Times (NYT) survey from early March found that 26% regard economic conditions as excellent or good, up from 20% since last July.

Still, 74% of the NYT respondents regard the economy as only fair (23%) or poor (51%). And as an analysis of the WSJ data shows, inflation is still the main reason why economic sentiment remains depressed. More than two-thirds of voters say that inflation is headed in the wrong direction, and nearly three-quarters say that price increases are exceeding gains in household income. This helps explain why only 24% of voters expect the economy to get better over the next 12 months.

The Economist/YouGov survey helps us understand how key subgroups of the electorate are feeling about the economy. Only 22% of Black Americans, 13% of Hispanics, and 18% of young adults believe that they are better off financially today than they were a year ago.

(The figure for the electorate as a whole is a rock-bottom 15%.) And during a period in which party affiliation has a much greater effect on economic evaluations than it did two decades ago, only 26% of Democrats say that their economic circumstances have improved over the past year. Just 19% of Black Americans, 14% of Hispanics, 12% of young adults, and 21% of the full electorate believe that economic conditions are getting better, while an outright majority of voters (52%) say that things are getting worse.

President Biden continues to get low marks for his handling of inflation. Overall, only 35% of voters approve of his handling of this issue. Among Hispanics, just 34% approve; for young adults, 28%; among lower-income voters, 29%.

When it comes to the economy, Donald Trump enjoys a clear edge over Biden. According to a CBS News poll released in early March, 65% of voters rate the economy as good during Trump’s presidency, compared to 38% under Biden. Only 17% believe that Biden’s policies will make prices go down, compared to 44% for Trump. Consistent with these findings, 55% think that Trump would do a better job of dealing with the economy, compared to 33% who think that Biden would.1

These recent polls are a snapshot, not a forecast. Much can change between now and Election Day, as it has in the past. In 2012, for example, President Obama faced negative economic ratings and low consumer confidence early on. But as the year went on, voters’ sentiments improved, and Obama went on to defeat Mitt Romney in the fall. If the pace of inflation continues to moderate, allowing the Federal Reserve to cut interest rates, history could repeat itself. If this improvement occurs early enough to affect public opinion, which typically lags behind actual economic conditions, an outright decline in food prices might be enough to secure a second term for Biden, but there are few signs that this will occur. He will have to hope that the stabilization of prices will be enough to change the voters’ evaluation of his performance for the better.

World Bank’s Positive About Indian Economy

The World Bank has revised its projections for the Indian economy, forecasting a growth rate of 7.5% in 2024, an increase of 1.2% from previous estimates.

This growth contributes to a strong outlook for South Asia, with the region expected to grow at 6.0% in 2024, driven by India’s robust performance and recoveries in Pakistan and Sri Lanka.

Fastest growing in region

The World Bank’s South Asia Development Update predicts South Asia to maintain its position as the fastest-growing region globally for the next two years, with a projected growth of 6.1% in 2025.

India is highlighted as a significant contributor to the region’s economy, with expected output growth of 7.5% in FY 2023-24, followed by a moderate decrease to 6.6% in the medium term.

The services and industry sectors are anticipated to sustain robust activity.

Economic performance

India’s economic performance in Q4 of 2023 surpasses expectations, driven by investments and government spending.

Favorable financial conditions are noted, with domestic credit issuance growing by 14% year-on-year in December 2023.

The nonperforming-loan ratio has decreased to 3.2%, and regulatory capital adequacy surpasses requirements.

Optimizing demographic dividend

“South Asia is failing right now to fully capitalize on its demographic dividend. This is a missed opportunity,” said Franziska Ohnsorge, World Bank Chief Economist for South Asia.

If the region employed as large a share of the working-age population as other emerging markets and developing economies, its output could be 16% higher, Ohnsorge said.

Challenges ahead

While short-term growth prospects for South Asia appear promising, fiscal vulnerabilities and climate-related shocks pose challenges to the region’s resilience.

Strengthening private investment and employment growth are crucial to bolstering economic resilience.

Trump’s Financial Gambit: Can Stock Market Rescue Him?

Donald Trump seems to be in a hurry to secure funds to settle a substantial $464 million fraud penalty. Is there a chance the stock market could come to his aid?

Trump Media, the operator of the Truth Social platform, is on the verge of going public following a decisive vote by the majority of Digital World Acquisition Corp shareholders. This move positions Mr. Trump to hold a minimum stake of 58% in the merged entity, which, at the current share prices of Digital World, would be valued at nearly $3 billion.

Despite significant concerns surrounding the deal, including pending lawsuits from past business associates and an $18 million settlement Digital World agreed to pay over alleged fraud in the merger process, shareholders of Digital World, predominantly individual investors, many of whom are believed to be loyal to Trump, seem undeterred.

“This is just the start,” remarked Chad Nedohin, a supporter of the deal, on his show DWAC Live, broadcasted on Rumble. “There’s no reason to freak out.”

Digital World, known as a Special Purpose Acquisition Company (SPAC), will undergo a name change to Trump Media & Technology Group and is poised to begin trading on Nasdaq as DJT possibly next week. However, this move may not immediately resolve Trump’s financial predicaments, such as the substantial fraud fine in New York. Restrictions prevent Trump from selling or transferring his shares for at least six months, although exemptions might be granted by the new company. Alternatively, Trump could seek a loan backed by the share value, though analysts caution that banks may lend him significantly less than the shares’ paper value due to the business’s inherent risks.

Some supporters, like Mr. Nedohin, speculate that backing this deal could aid Trump in his legal battles. “This is putting your money where your mouth is for free speech, to save your country, potentially losing it all,” he remarked on his show.

Analysts warn of significant risks for Digital World shareholders, especially considering the drop in share prices since the announcement of plans to acquire Trump Media in 2021. Despite Friday’s decline, the implied valuation of Trump Media remains substantial, considering its modest revenue of $3.3 million and a loss of nearly $50 million in the first nine months of the preceding year.

The merger injects over $200 million in cash into Trump Media, potentially facilitating growth and expansion. However, Truth Social, positioned as an alternative to major social media platforms, remains relatively small, with approximately 8.9 million sign-ups, as per its claims. The platform does not track user growth or engagement metrics, a fact it doesn’t intend to change, according to regulatory filings. In February, Truth Social received an estimated five million visits, significantly lower than major platforms like X, previously known as Twitter, which recorded over 100 million visits.

Financial experts categorize Digital World as a “meme stock,” wherein share prices detach from a company’s fundamentals, posing an eventual risk of decline. While predictions about the timeline of this collapse remain uncertain, there’s an understanding that it’s a matter of when, not if.

Individual investors, particularly drawn in after the announcement of the Trump deal and his primary win in Iowa, have been instrumental in driving Digital World’s stock activity. However, ahead of the recent vote, there’s been a notable decrease in activity, suggesting that professional firms may be assuming a more dominant role in trading.

Despite Trump’s minimal contributions beyond his name and posts to the platform, he stands to be the primary beneficiary of this deal. Michael Ohlrogge, a law professor at New York University, who has scrutinized listings like Trump Media, describes it as “an enormous transfer of value from [investors]… to Trump, which stands to be extremely lucrative for him.”

The Bitcoin dips, but soars to new record highs, turning skeptics into believers.

The lowest closing price of Bitcoin (BTC) was $0.05 on July 18, 2010. After 14 years of roller coaster rides, as of this writing today, the price of Bitcoin is trading at $63,147, It is down 5.6% in the last 24 hours. To say that despite this short-term volatility, Bitcoin is up more than 50% year-to-date is no mean feat!
Not only from its origins in the 1970s to the impact of the 2008 financial crisis, but also the recent massive expansion of cryptocurrency continues to grow like a craze on the Internet today. It is a thriller story of mystery, mistrust, risk and reward.
Bitcoin is a form of digital money (cryptocurrency) in which unit transactions are recorded on a digital ledger called the “blockchain”. It started as a concept in a white paper in 2008 and has become the best performing asset of the last decade with its 9,000,000% rise in 2021. You can’t actually hold a Bitcoin in your hands, but you can make a ton of money from one.
Bitcoin blockchain technology works by recording all Bitcoin transactions across a network of computers. Due to its decentralized nature, it is considered a digital ledger that operates on a peer-to-peer basis. Perhaps the most famous value investor of all time, Warren Buffett is against Bitcoin and other cryptocurrencies, saying, “You can’t value Bitcoin because it’s not a value-producing asset.” Buffett and his holding company, Berkshire Hathaway, are known for their investments in sustainable and profitable companies. However, Buffett’s strong anti-crypto stance may change after reviewing the firm’s performance in 2024.
Dave Ramsey, a personal financial expert and best-selling financial author, explains that the value of any currency is based on people’s trust, “Bitcoin has the least amount of trust.” He concluded: “I don’t invest in things where people haven’t established a long track record of trust. ” One day he may change his views!
No one wants to lose money and that is what puts the crypto bear market under so much pressure. As investments begin to decline, investors may struggle to decide how best to manage their portfolios. It would be great if the crypto market was always going up. However, that is not true. As the old saying goes, “Without risk, there is no reward.” Market volatility drives investors to profit. In crypto markets, volatility is considered a feature, but not a constant problem. Bitcoin is not run by any bank or government; It is a peer-to-peer currency.
Unlike the US dollar or any other country’s currency, Bitcoin is not underwritten by any government regulation. As MasterCard and other notable companies bring cryptocurrency to their networks, many are asking: Does this shift signal the “beginning of the end” for the dollar?.
Among the main contextual reasons for Bitcoin’s inception, which began in the middle of the 2008 financial crisis, was mistrust of banks. Bitcoin started as a white paper titled “Bitcoin: A Peer-to-Peer Electronic Cash System” published on October 31, 2008 by a man named Satoshi Nakamoto. The paper outlined the blockchain technology that underpins the cryptocurrency. The problem with digital money. In March 2014, a news article called “The Face Behind Bitcoin” claimed that the inventor of Bitcoin was a retired physicist named Dorian Nakamoto.
Bitcoin is likely to halve when the reward for mining Bitcoin transactions is halved. These “halvings” reduce the rate at which new coins are created and reduce the available amount of new supply. Bitcoin’s last halving took place on May 11, 2020, when supply was halved, resulting in the creation of a block of 6.25 BTC. A bitcoin halving event occurs when the reward for mining bitcoin transactions is halved. Halves reduce the rate of creation of new coins and reduce the available amount of new supply. Bitcoin last halved on May 11, 2020, resulting in a block reward of 6.25 BTC.
By the end of 2024, a crypto storm may be imminent following the upcoming halving and other favorable developments. With a halving, fewer new bitcoins will be created and they will become more scarce. This scarcity could lead to higher Bitcoin prices in the long run. As a result, the price will rise to $67,500 and reach an all-time high between $72,500 and $73,100. Some experts predict UK fintech firm Finder conducted a study based on expert predictions of 40 crypto industry experts on how Bitcoin will perform until 2030. If hearing is to be believed, it’s predicted to go as high as $200,000!
Interesting tidbit: In the early days of Bitcoin, a programmer named Laszlo Hanics traded 10,000 Bitcoins for two Papa John’s pizzas on May 22, 2010. Today, those pizzas are worth about $613 million. In the crypto community, that date is now celebrated as “Bitcoin Pizza Day.” Now talk about an expensive slice of pizza!

Supreme Court Directs Full Disclosure on Electoral Bonds: SBI Ordered to Reveal All Details Including Alphanumeric Codes

The Supreme Court instructed the State Bank of India (SBI) on Monday to reveal all information regarding electoral bonds purchased or redeemed after its April 12, 2019 interim order. The court, led by Chief Justice of India D Y Chandrachud, emphasized the necessity for comprehensive disclosure, including the disclosure of unique alphanumeric codes, to facilitate matching donors with recipients. The Bench, also comprising Justices Sanjiv Khanna, B R Gavai, J B Pardiwala, and Manoj Misra, directed SBI to submit an affidavit on compliance by March 21.

The court expressed dissatisfaction with the bank’s selective disclosure practices, insisting that all pertinent details must be revealed without exception. It emphasized that disclosure encompasses the alphanumeric and serial numbers of bonds purchased and redeemed. However, the request to disclose codes of bonds transacted before the April 12, 2019 interim order was declined.

The Bench further instructed the SBI Chairman and Managing Director to affirm, by March 21, that the bank has disclosed all pertinent electoral bond details and has withheld no information. It referred to previous orders mandating the submission of purchase details, including dates, purchaser names, and bond denominations, alongside details of bonds encashed by political parties.

In light of the court’s decision to strike down the electoral bond scheme on February 15, 2024, it stressed the significance of complete disclosure by SBI, covering both purchases and contributions received by political parties.

The court also directed the Election Commission to promptly upload the information provided by SBI, reiterating the bank’s obligation to disclose all details without delay or selectivity.

During the hearing, Chief Justice Chandrachud expressed disappointment with SBI’s approach, emphasizing that the court’s directive encompassed the disclosure of all details, including bond numbers. He criticized the bank’s selective disclosure, urging it to comply fully with the court’s orders without waiting for further directives.

The Chief Justice questioned SBI’s reluctance to disclose certain details, asserting that the court’s orders were clear and inclusive. He emphasized that the bank’s compliance should be unequivocal, guided solely by its duty to adhere to the court’s directives.

Senior Advocate Harish Salve, representing SBI, assured the court of the bank’s willingness to provide all required information. He sought to clarify the bank’s interpretation of previous court orders and judgments, emphasizing the distinction between political parties’ obligations and the bank’s responsibilities.

Salve explained that the interim order of April 2019 pertained to political parties’ disclosure obligations, not the bank’s obligation to reveal bond numbers. He emphasized the bank’s commitment to transparency while acknowledging the perception that SBI was withholding information.

Responding to concerns raised by the court, Salve affirmed the bank’s readiness to disclose all information, including bond numbers, to dispel any doubts regarding its transparency and compliance.

The court reiterated its expectation of full disclosure from SBI, emphasizing the need for clarity and finality in the matter. It urged the bank to take proactive steps to address any perceptions of non-compliance and ensure complete transparency.

Despite arguments from Advocate Prashant Bhushan to extend the disclosure timeline, the court upheld the April 12, 2019 interim order as the cutoff date for disclosure. It emphasized the need to strike a balance and maintain consistency in its decisions.

The Supreme Court reaffirmed its directive for SBI to disclose all details pertaining to electoral bonds purchased or redeemed after April 12, 2019, underscoring the importance of transparency and compliance with its orders.

Viswas Raghavan Appointed As Head Of Citigroup’s Banking

With experience in investment, corporate, and commercial banking, Raghavan will head one of Citi’s five primary businesses in his role.

“The experience Raghavan brings in banking and as EMEA CEO makes him the perfect partner to lead the Cluster and Banking Heads across Citi’s global network,” CEO of Citigroup Jane Fraser wrote. 


Citigroup has appointed Viswas (“vis”) Raghavan, an Indian American executive from JP Morgan, as its new head of banking and executive vice chair. He will report to CEO Jane Fraser and is anticipated to join the new role this summer.


With experience in investment, corporate, and commercial banking, Raghavan will head one of Citi’s five primary businesses in his role. 


“He will support me on important strategic initiatives and help formulate and implement Citi’s company-wide strategy. He will become a member of the Citi Foundation Board of Directors and the Citi Executive Management Team. Vis is a proven leader and his appointment is another example of our ability to attract the best talent to our firm,” Fraser said in a memo to the bank’s employees. 


“I couldn’t be more excited to welcome Vis to our firm. He is a strategic leader who brings a strong track record of delivering results across a global banking business,” Fraser added.

Raghavan comes from JP Morgan, where he was co-head of global investment and corporate banking since 2020, and most recently held the position of head of global investment banking.

Since joining JP Morgan in 2000, he has held prominent positions in the company’s worldwide debt and equity capital markets. In 2012, he was named head of treasury services, corporate banking, and EMEA investment.


Raghavan was born and raised in India. He graduated with a BSc in Physics from Mumbai University and an honorary doctorate in electronic engineering and computer science from Aston University (Birmingham, UK). He also serves the Institute of Chartered Accountants in England and Wales as a chartered accountant.


“He is the right person to take over at this critical moment for our Banking franchise. Since first announcing the structural changes last year that established our Banking & International organization, we have begun to operate more efficiently and have strong momentum with clients,” Fraser said of Raghavan.


“He will also work closely with David Livingstone and our Vice Chairs in the Client organization to ensure we are delivering a consistent and disciplined client strategy,” she added.

Biden Unveils Budget Proposal: Tax Hikes for Corporations, Benefits for Middle Class

President Biden is set to reveal his budget plan for the upcoming fiscal year on Monday, proposing tax hikes for major corporations and advocating for a minimum 25 percent tax rate for billionaires.

The proposed budget for fiscal 2025, as outlined by the White House, aims to slash the federal deficit by approximately $3 trillion over a decade primarily through increased taxation on the wealthiest Americans and corporate entities. Additionally, the budget seeks to tighten regulations on corporate profit distribution.

A spokesperson from the White House noted that the budget aims to decrease taxes for numerous low- and middle-income households, alongside initiatives to reduce the expenses associated with childcare, prescription medications, housing, and utilities.

Furthermore, the proposal includes provisions to fortify Medicare and Social Security, aligning with several other administration priorities such as allocating funds to combat climate change, support small businesses, implement national paid leave policies, and advance cancer research.

In many respects, the upcoming proposal mirrors last year’s budget put forth by the White House, which also targeted a $3 trillion deficit reduction, intensified taxes for billionaires, and heightened the Medicare tax for individuals earning over $400,000 annually.

Traditionally, budget requests do not translate directly into law, and Biden’s proposal will likely follow suit, given the Republican control in the House and the Democrats’ slim majority in the Senate.

However, the submission will hold significant weight in the discussions revolving around raising the debt ceiling and financing government operations this year. Additionally, it will serve as a pivotal messaging tool for the White House as Biden pursues reelection.

During his recent State of the Union address and subsequent campaign appearances in Pennsylvania and Georgia, the president highlighted his administration’s strides in deficit reduction, dismissing notions that former President Trump could effectively address the national debt.

Biden has consistently pledged to safeguard Medicare and Social Security, a cornerstone of his appeal to voters, adamantly stating his intention to veto any congressional endeavors aimed at reducing these programs.

Although Trump, presumed to be Biden’s adversary in the forthcoming election, has publicly declared his commitment to maintaining Social Security and Medicare, his budget proposals during his tenure featured reductions in these programs.

India Unveils Ambitious Rs 10,372 Crore AI Mission to Propel Technological Innovation

The Cabinet has given its nod to the India AI Mission, allocating Rs 10,372 crore over five years to stimulate AI advancements within the nation, announced Union Minister Piyush Goyal. The sanctioned funds are earmarked for establishing a robust AI ecosystem through a collaborative effort between the public and private sectors. Goyal highlighted the significance of this initiative, stating, “With an outlay of Rs 10,372 crore, one very ambitious India AI Mission that will encourage AI segment and ongoing research in this field…has been approved by the cabinet.”

To oversee the implementation of the mission, an Independent Business Division (IBD) dubbed IndiaAI will operate under the auspices of the Digital India Corporation (DIC). The mission aims to democratize access to high-performance computing resources, including over 10,000 GPUs (graphics processing units), to facilitate the development of an AI ecosystem. GPUs have garnered attention for their ability to process data more rapidly than CPU-based servers, prompting increased demand.

Various stakeholders, including startups, academia, researchers, and industry players, will have access to the AI supercomputing infrastructure established under the India AI Mission, fostering innovation and collaboration. Minister of State for Electronics and IT Rajeev Chandrasekhar emphasized the pivotal role of AI in India’s digital economy, asserting, “This program will catalyse India’s AI ecosystem and position it as a force shaping the future of AI for India and the world.”

Recognizing the potential impact of the mission, Minister Chandrasekhar highlighted its relevance for states like Kerala, which have lagged in establishing a robust tech ecosystem. An integral component of the India AI Mission is the establishment of an India AI Innovation Centre (IAIC), which will serve as a premier academic institution fostering research talent and facilitating the development and deployment of foundational AI models.

Furthermore, the approved funds will bolster the India AI Startup Financing mechanism, providing crucial support to budding AI startups and accelerating their journey from ideation to commercialization. The mission also prioritizes industry-led AI projects aimed at driving social impact and promoting innovation and entrepreneurship.

A critical aspect of the India AI Mission involves the establishment of a National Data Management Office to enhance data quality and availability for AI development and deployment. This office will collaborate with various government departments and ministries to streamline data utilization.

The government’s commitment to AI development is underscored by recommendations from working groups on Artificial Intelligence (AI), which advocate for the establishment of a robust compute infrastructure. These recommendations include the creation of a three-tier compute infrastructure comprising 24,500 Graphics Processing Units (GPUs), aimed at closing the gap with global leaders like the US and China in AI computing capacity.

Despite the strides made in AI development globally, India has lagged behind, with only three supercomputers listed in the Top 500 rankings. To address this gap, the government aims to establish best-in-class AI computing infrastructure at five locations, boasting 3,000 AI Petaflops computing power, significantly surpassing current capacities.

In pursuit of AI excellence, the government has allocated substantial resources, investing Rs 1,218.14 crore over the past eight years to bolster compute capacity under the National Supercomputing Mission. However, significant challenges persist, with companies like NVIDIA facing a backlog of 12-18 months in GPU deliveries due to overwhelming global demand.

The global race for AI dominance has seen major investments from tech giants like Microsoft and IBM. Microsoft’s billion-dollar investment in Open AI in 2019 and a subsequent $10 billion injection in 2023 underscore the company’s commitment to AI innovation. Similarly, IBM has allocated $6.5 billion for research, development, and engineering, focusing on AI, hybrid cloud, and emerging technologies like quantum computing.

The approval of the India AI Mission represents a significant step towards fostering AI development and innovation within the country. By investing in infrastructure, startups, and research, India aims to position itself as a key player in the global AI landscape, driving economic growth and societal advancement.

Study Reveals Alarming Link Between Medical Debt and Declining Health in the United States

Medical debt in the United States correlates with deteriorating physical and mental well-being, as well as premature mortality, according to a recent study conducted by the American Cancer Society. The research revealed that with each $100 rise in medical debt, there was an increase of eight days in poor physical health and 6.8 days in poor mental health per month per 1,000 individuals.

The escalating costs of healthcare nationwide present an ongoing obstacle for millions of Americans. Data from the Centers for Medicare and Medicaid Services illustrates the enormity of the issue, indicating that healthcare expenditure reached $4.5 trillion in 2022, roughly translating to $13,500 per person, with out-of-pocket spending amounting to $471.4 billion.

Despite over 90% of the population possessing some form of health insurance, the burden of medical debt persists for both insured and uninsured individuals due to out-of-network expenses, high deductibles, and unforeseen bills, experts explained.

Examining data spanning nearly 3,000 counties, encompassing 93% of the nation, researchers sought to understand the repercussions of medical debt on health outcomes. While the study did not establish causation, it highlighted a robust correlation, aligning with prior research indicating that financial strain contributes to poorer health outcomes.

For every 1% increase in the prevalence of medical debt within a population, the study found a corresponding increase of 18 days in poor physical health, 18 days in poor mental health, and one additional year lost per 1,000 individuals.

Dr. Xuesong Han, the lead author of the study, emphasized the systemic nature of the issue, stating, “[Medical debt] is a problem that needs to be addressed systematically.”

The study identified certain demographic trends associated with higher rates of medical debt. Counties with larger proportions of non-Hispanic Black residents, lower educational attainment, higher rates of poverty, and greater numbers of uninsured and unemployed individuals tended to exhibit a higher prevalence of medical debt. On average, across all counties, approximately 19.8% of Americans had medical debt in collections. Geographically, Southern counties bore the brunt of the highest medical debt burdens.

Researchers noted that the data analyzed preceded the onset of the COVID-19 pandemic, underscoring the necessity for further investigation into post-pandemic shifts in the healthcare system and public health.

Han underscored the importance of policy interventions aimed at tackling this issue, advocating for initiatives such as “expanding access to affordable and comprehensive health insurance coverage” and “providing financial guidance and linking patients with pertinent resources to mitigate any adverse impacts.”


Understanding Bank Surveillance: Navigating Large Cash Transactions in Compliance with Financial Regulations

“Many Americans experience a sense of surveillance when handling significant sums of money in their bank transactions,” expressed a TikTok duo, Alexis and Dean, who operate a financial advice startup. The couple’s video titled ‘What occurs upon depositing over $10,000 in your bank account?’ has resonated with over 3.6 million viewers and elicited more than 2,300 comments since its upload on February 12.

The clip features Alexis questioning Dean about the purported prohibition against depositing $10,000 into a bank account at once. Dean refutes this claim, asserting that such transactions are permissible, provided they are conducted within legal parameters. He proceeds to elucidate on how banks handle large cash deposits and outlines their anti-money laundering protocols.

Under federal regulations, all banks must report significant financial transactions to the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury. Although there exists no blanket prohibition on handling substantial amounts of currency, banks are mandated to report transactions exceeding $10,000 in a single day via a Currency Transaction Report (CTR). Dean clarifies that exceeding this threshold doesn’t equate to criminal activity but merely triggers reporting for transactions surpassing $10,000.

These CTRs are essential components of the Bank Secrecy Act (BSA) and serve to safeguard the financial sector from money laundering and other illicit financial activities. To comply with CTR regulations, financial institutions must gather specific customer information, including Social Security numbers and government-issued identification.

In response to queries about circumventing the $10,000 CTR threshold by depositing slightly less or splitting deposits, Dean warns against such actions, termed “structuring,” which could prompt banks to file Suspicious Activity Reports (SARs). Structuring may involve tactics like selling a vehicle for $15,000 and depositing the proceeds in two $7,500 increments on the same day to different bank personnel. Violating structuring laws may result in civil and criminal penalties, including imprisonment and substantial fines.

Dean emphasizes that CTRs and SARs primarily serve anti-money laundering objectives and reassures viewers that engaging in lawful activities poses no risk. He advises individuals with significant cash deposits to proceed with their transactions without apprehension but suggests seeking guidance from financial advisors for optimal money management and growth.

BRICS Alliance Contemplates Alternative Currency to Challenge US Dollar Dominance

The BRICS alliance is exploring the development of an alternative currency as a countermeasure against the dominance of the US dollar. Discussions within the bloc involve various strategies aimed at reducing reliance on the US dollar and advocating for the utilization of local currencies in global trade. Additionally, efforts are being made to persuade other developing nations to diminish their dependence on the US dollar and instead prioritize the use of their own currencies.

Reports suggest that BRICS is contemplating the establishment of a unified currency, akin to the Euro, as part of its endeavor to challenge the supremacy of the US dollar. However, it’s important to note that this potential shift towards a BRICS currency mirroring the Euro’s model remains speculative at this stage, with no definitive decision reached. The bloc is scheduled to convene at its upcoming summit in October, where discussions will continue, potentially leading to a consensus on this matter. This forthcoming 16th summit holds the promise of introducing transformative policies that could significantly reshape the trajectory of the alliance.

The ramifications of such policies could extend beyond the BRICS nations, impacting the Western sphere and the dominance of the US dollar in global transactions. A reduction in the international usage of the US dollar would pose considerable challenges to the American economy, potentially exerting significant strain throughout the current decade.

Persistent Home Shortage Fuels Surging Prices Despite Record Mortgage Rates

The persistent scarcity of available homes is propelling a surge in house prices despite the unprecedentedly high mortgage rates, marking the 11th consecutive month of ascent in home prices, as indicated by the S&P CoreLogic Case-Shiller 20-city price index, which revealed a 0.2 percent increase in December compared to the previous month, with a year-on-year surge of 6.1 percent (“The persistent shortage of homes on the market is sending house prices climbing despite the highest mortgage rates in decades”).

The prevailing scenario sees most homeowners benefitting from substantially lower interest rates on their mortgages compared to the current rates offered by lenders. Consequently, there’s a reluctance among these homeowners to part ways with their properties and incur new loans at higher rates, acting as a dampener on home sales but concurrently bolstering home prices and spurring residential construction (“The persistent shortage of homes on the market is sending house prices climbing despite the highest mortgage rates in decades”).

The Case-Shiller 20-city index is hailed as the foremost indicator of home prices in the United States, meticulously tracking repeat sales of homes to prevent distortions arising from the mix of homes sold in a given period. It encompasses not only sales within city centers but also those in the metropolitan vicinities surrounding the 20 largest U.S. cities (“The persistent shortage of homes on the market is sending house prices climbing despite the highest mortgage rates in decades”).

Notably, the Case-Shiller indexes represent three-month averages; thus, the December data amalgamates figures from November and October, encompassing transactions initiated as far back as August 2023, considering that home sales conclude 45 to 60 days post-transaction (“The persistent shortage of homes on the market is sending house prices climbing despite the highest mortgage rates in decades”).

The broader national index reflecting home prices also witnessed a 0.2 percent uptick in December, marking a 5.5 percent increase over the preceding year. Likewise, the 10-city index, which primarily focuses on major metropolitan areas, saw a similar 0.2 percent rise for the month, culminating in a seven percent surge over the past 12 months. Notably, all three indices have scaled to record highs (“The persistent shortage of homes on the market is sending house prices climbing despite the highest mortgage rates in decades”).

Throughout 2023, home prices experienced a consistent upward trajectory, save for a decline in January, which stands as the sole exception. The marginal monthly increase observed in December represents the most modest escalation since that particular downturn (“The persistent shortage of homes on the market is sending house prices climbing despite the highest mortgage rates in decades”).

Traditionally, the housing sector is deemed highly responsive to fluctuations in interest rates. However, the widespread adoption of low and fixed-rate mortgages during the pandemic and preceding periods has mitigated the anticipated impact of interest rate hikes by the Federal Reserve, making it anomalous for home prices to sustain such rapid and steady growth amidst climbing interest rates (“The persistent shortage of homes on the market is sending house prices climbing despite the highest mortgage rates in decades”).

The December figures aligned with the projections put forth by Wall Street analysts (“The persistent shortage of homes on the market is sending house prices climbing despite the highest mortgage rates in decades”)

India: The Next Global Economic Powerhouse

India’s optimistic outlook stems from various factors, including its youthful population and burgeoning industrial sector. The International Monetary Fund predicts India’s growth to outpace China’s, with Jefferies analysts envisioning India becoming the world’s third-largest economy by 2027.

Similar to China’s transformative phase decades ago, India is embarking on an infrastructure overhaul, investing in roads, ports, airports, and railways. Suresh highlights the substantial economic impact of such investments, stating, “There is a very strong multiplier effect… which you cannot roll back.”

India’s appeal extends to global companies reevaluating their supply chains, seeking alternatives to China’s challenges. Hubert de Barochez of Capital Economics notes India’s potential to benefit from this shift, terming it “friend-shoring” of supply chains.

Leading global companies, including Apple supplier Foxconn and Tesla, are expanding operations in India. Elon Musk expressed keen interest in investing in India, citing Modi’s encouragement.

However, some caution against excessive optimism. While India’s allure is growing, the steep valuation of Indian stocks deters some international investors. Suresh points out that Indian shares have always commanded a premium compared to other emerging markets, a trend exacerbated in recent times.

Domestic investors currently dominate India’s stock market, with foreign interest expected to increase post-election. Nonetheless, challenges remain, including India’s capacity to absorb the massive capital outflow from China.

Yet, India’s reliance on domestic investors strengthens its resilience against global market fluctuations. Suresh highlights this, stating, “It just massively insulates India from global dynamics.”

Unlike China, India enjoys favorable relations with major economies and actively courts foreign investment. Finance Minister Nirmala Sitharaman emphasized India’s commitment to attracting foreign investment, signaling a conducive environment for sustained economic growth.

Analysts assert that India’s economic momentum is irreversible, positioning it as a formidable player on the global stage. Mittal reflects on India’s rise, stating, “Even if China comes back to the table and resolves a lot of problems, I don’t think India is going back into the background anymore. It has arrived.”

**India’s Growth Story Captures Global Attention**

Peeyush Mittal has been making the 185-mile journey from the Indian capital to Jaipur for over three decades. Despite infrastructure improvements, the trip always took six hours. Mittal, a portfolio manager at Matthews Asia, expressed his long-standing frustration: “For 30 years there’s been this promise of doing that journey in three hours. It has never been possible.” However, last year, he experienced a significant change. Driving at 75 miles per hour on a new expressway, he completed the journey in just half the time, leaving him astonished: “My jaw dropped when I first time got on that highway. I was like, ‘Wow, man, how is this even possible … in India?”

The quality of India’s new infrastructure is just one factor driving excitement among investors like Mittal, who manage funds focused on emerging markets. India’s development trajectory since 2014, under Prime Minister Narendra Modi’s leadership, has sparked optimism. Modi’s ambition to elevate India to a $5 trillion economy by 2025 has garnered attention globally.

Contrastingly, China faces economic challenges, including capital flight and stock market slumps, with trillions of dollars lost in market value. In contrast, India’s stock market is thriving, surpassing $4 trillion in value last year, with projections indicating it could double to $10 trillion by 2030.

Investors are eyeing India as a potential replacement for China in driving global growth. With China facing uncertainties, India’s prominence in international markets is on the rise. Aditya Suresh, head of India equity research at Macquarie Capital, notes the significant shift: “India’s weight in the MSCI emerging market index was about 7% a couple of years back. Do I think that 18% [in the MSCI index] is naturally gravitating more towards 25%? Yeah, that’s kind of clearly where our conversations are leading us to believe.”

As India approaches national elections, market observers anticipate that a continued mandate for Modi’s Bharatiya Janata Party could provide stability and further boost investor confidence. Mittal asserts, “If Modi is back with a majority and political stability is there, then I can certainly say with confidence that there’ll be a lot more investor interest in India on a more sustainable basis.”

Growing Interest as 34 Countries Eye Joining BRICS Alliance in 2024

A wave of interest from developing nations signals a potential expansion of the BRICS alliance in 2024, with the upcoming summit scheduled for October in Russia’s Kazan region. According to India’s Foreign Affairs Minister S Jaishankar, more than two dozen countries are considering joining BRICS this year, reflecting a growing trust in the alliance and a desire to reduce reliance on the US dollar amidst a global debt crisis.

Jaishankar revealed in a recent press conference, “We tested it last year in the market, asking how many want to join BRICS. We got almost 30 countries who were willing to join BRICS. Clearly, 30 countries saw value in it; there must be something good with that.” This surge in interest comes as developing nations grapple with a staggering $34 trillion debt burden, primarily denominated in US dollars. The desire to mitigate this risk has prompted countries to prioritize their local currencies in trade transactions.

The recent inclusion of Saudi Arabia into BRICS has further fueled interest from other developing nations seeking alternatives to the US dollar. The Kingdom’s induction into the alliance is perceived as a response to mounting US dollar debt and White House sanctions against emerging economies. If the trend continues and more developing countries opt for settling trade in local currencies within the BRICS framework, the US dollar could face significant repercussions.

As of February 1, 2024, a total of 34 countries have officially expressed their interest in joining BRICS, as confirmed by South Africa’s Foreign Minister Naledi Pandor in a press conference. While Pandor did not disclose the names of these countries, the growing enthusiasm indicates a broader shift in financial dynamics, with developing nations aiming to position themselves favorably amid changing global economic landscapes.

The increasing attraction towards the BRICS alliance is part of a larger initiative to shift away from the dominance of the US dollar. BRICS aims to create a multipolar world order that prioritizes local currencies over the US dollar, challenging the traditional financial order controlled by Western powers. This paradigm shift could potentially jeopardize the global reserve status of the US dollar, setting the stage for a new era in international finance.

The next decade holds significant implications for the fate of the US dollar as developing countries increasingly prioritize their local currencies. The BRICS alliance, with its growing roster of interested nations, poses a formidable challenge to the established order, and the October 2024 summit may witness the formal inclusion of new members into this influential bloc.

India Contemplates BRICS Currency: Finance Experts Engaged in Deliberation Ahead of Summit

India has mandated a group of financial analysts and research institutions to evaluate the potential of a proposed BRICS currency. The directive calls for experts in finance to deliberate on whether India should endorse the establishment of an upcoming BRICS currency.

According to a high-ranking government official speaking on condition of anonymity, this deliberation will carry significant weight at the forthcoming summit scheduled for October. India intends to be well-prepared with its stance at the 16th BRICS summit, set to be held in the Kazan region of Russia later this year.

Russia, a fellow member of BRICS, is also exploring the concept of a BRICS currency, prompted by the economic impact of US sanctions. Seeking a renewed and extensive dialogue, Russia has initiated discussions with India regarding the potential of such a currency.

A source quoted by Business Standard stated, “We have not changed our position at all, but there is no harm in a study.” While speculation suggests that the experts enlisted for this study could include senior officials from the Reserve Bank of India (RBI), the RBI declined to comment when contacted by Business Standard.

Hence, the identities of the financial experts tasked with assessing the viability of the BRICS currency remain undisclosed. India prefers to keep them anonymous, recognizing that undue attention could compromise the integrity of the study by potentially leading to media leaks.

The prospect of India’s acceptance of the new BRICS currency hangs in the balance as officials have yet to commence their examination this year. It may take six months or more for these officials to thoroughly comprehend the intricacies of the forthcoming global tender.

India may opt to keep its decisions confidential, revealing its stance only during the next BRICS summit. Consequently, the verdict on whether India will embrace or spurn the BRICS currency remains uncertain until all pertinent details are disclosed to the public.

Financial Literacy Gains Momentum in U.S. Schools: A Comprehensive Look at the Growing Emphasis on Personal Finance Education

Personal finance education has gained significant traction in recent years, with many states now mandating it as a requirement for high school graduation. This development has been hailed by activists who have long advocated for greater emphasis on financial literacy.

According to a tracker maintained by Next Gen Personal Finance, the availability of standalone personal finance courses for high school students was limited to just eight states in 2020. However, this year marks a significant increase, with 25 states offering financial literacy classes in K-12. Of these, eight states have fully implemented the course, while 17 are still in the process of doing so.

Jessica Pelletier, the executive director of FitMoney, noted the sudden surge in state initiatives towards financial education, stating, “All of a sudden, it does seem like states are sitting up and taking notice, and it’s really just happened in the past couple of years.”

Experts emphasize that these classes go beyond basic financial tasks like writing checks. Despite the challenges posed by the COVID-19 pandemic, there is optimism that financial literacy education will continue to expand, potentially reaching students in middle school as well.

The pandemic appears to have heightened awareness about the importance of financial literacy among educators and parents. Pelletier suggested that the economic downturn and financial hardships experienced by many households during the pandemic contributed to a sense of urgency around financial education.

Lindsay Torrico, the executive director of the American Bankers Association (ABA) Foundation, highlighted the increased efforts to promote financial education. She stated, “Last year, we launched a new effort in a new commitment to engage more banks in financial education.”

Laura Levine, president and CEO of Jump$tart Coalition for Personal Financial Literacy, observed a steady growth in financial literacy education in schools over the past two decades. She emphasized that economic instability, such as the 2008 recession and the 2020 pandemic, often catalyzes interest in financial education.

The curriculum for financial literacy covers various topics, including earning income, spending, saving, investing, managing credit, and managing risk. Levine emphasized the comprehensive nature of the curriculum, stating, “We’re seeing if you look at the standard, it covers investing, insurance, savings, spending, budgeting, you know, it’s kind of a full spectrum.”

Recognizing the limitations of relying solely on financial education at home, many schools are now integrating financial literacy into their curriculum. Levine pointed out that not all students have access to financial education at home, particularly those from disadvantaged backgrounds or in foster care.

Efforts to promote financial literacy are not limited to high school education; there is also a growing emphasis on starting financial education at an earlier age. The ABA Foundation, for example, has programs targeting kindergarten through eighth grade, where bankers deliver presentations and lessons directly to students.

Kelsey Havemann, senior manager of the ABA Foundation’s youth financial education program, highlighted the community-driven initiatives to promote financial literacy, stating, “So the communities have taken it upon themselves to really step up and help out as much as they can with having bankers go into these classrooms and get these kids on the path to financial understanding.”

Despite the legislative progress, the push for greater financial literacy largely hinges on convincing adults to prioritize the subject. Pelletier noted that students are generally eager to learn about financial matters, recognizing the practical relevance of the knowledge they gain. She stated, “This is one of the only classes I’ve really heard of that almost every single student wants to take.”

The widespread adoption of personal finance education in schools reflects a growing recognition of the importance of financial literacy. While legislative efforts have played a role, community-driven initiatives and grassroots activism are also driving progress in this field. As financial education becomes more comprehensive and accessible, there is hope that future generations will be better equipped to navigate the complexities of personal finance.

New York Judge Orders Former President Trump to Pay $355 Million in Civil Fraud Case

A New York judge has handed down a significant ruling in a civil fraud case against former President Donald Trump, compelling him to pay nearly $355 million in penalties. This decision by Judge Arthur Engoron, outlined in a comprehensive 92-page document, follows weeks of closing arguments that concluded a lengthy trial, marked by frequent criticism from Trump towards both the judge and the prosecuting attorney.

In 2022, New York Attorney General Letitia James filed a lawsuit against Trump, alleging that he manipulated his net worth on crucial financial statements to obtain favorable tax and insurance benefits. The documents, providing details on the Trump Organization’s assets, were submitted to banks and insurers to secure loans and deals, presenting a case for fraud according to the state.

The potential financial burden on Trump and his business, including interest, may surpass $450 million, as indicated by the New York attorney general’s office. Engoron held Trump, the Trump Organization, and key executives, including his adult sons, liable for fraud before the trial began, as there was no jury present.

The imposed fine is slightly less than the $370 million sought by the attorney general’s office, and it also entails a three-year ban preventing Trump from engaging in New York business activities. Furthermore, Trump’s adult sons, Donald Trump Jr. and Eric Trump, were individually ordered to pay over $4 million each, accompanied by a two-year prohibition from serving as officers or directors of any New York corporation or legal entity.

Former Chief Financial Officer Allen Weisselberg faced a $1 million penalty, along with a three-year ban from New York business. Both Weisselberg and former controller Jeffrey McConney were also prohibited for life from serving in the financial control function of any New York corporation or business entity. Additionally, the judge extended the term of the independent monitor overseeing Trump’s business for three years and appointed an “Independent Director of Compliance.”

However, the judge overturned a pre-trial decision that ordered the cancellation of the defendants’ business certificates, stating that the order could potentially be renewed.

In response to the ruling, Attorney General Letitia James hailed it as a “tremendous victory” for the state and the nation, emphasizing the importance of holding powerful individuals accountable for dishonest practices that impact hardworking citizens.

“When powerful people cheat to get better loans, it comes at the expense of honest and hardworking people. Now, Donald Trump is finally facing accountability for his lying, cheating, and staggering fraud,” James remarked, emphasizing that no one is above the law.

Despite the substantial penalties, Trump’s legal team decried the ruling. Alina Habba, Trump’s lawyer, labeled it a “manifest injustice” and the outcome of a “multi-year, politically fueled witch hunt.” Chris Kise, Trump’s lead lawyer, characterized the case as an “unjust political crusade” against a leading presidential candidate and criticized the process as unfair and tyrannical. Kise confirmed that Trump would appeal the decision.

The trial spanned over two months, featuring testimony from 40 witnesses, including Michael Cohen, a former fixer for Trump, top Trump Organization executives, Trump’s adult children, and the former president himself. Trump’s defense rested on the argument that there was no fraud, with Deutsche Bank executives testifying that they conducted their own due diligence and found no evidence of fraud when working with the Trump Organization.

The strained relationship between Trump and Judge Engoron was evident early on when the judge ruled on Trump’s fraud liability. During Trump’s testimony in November, he launched attacks on the judge and Attorney General James, referring to them as “frauds,” “political hacks,” and “Trump haters.” Engoron had to admonish a Trump lawyer at one point, reminding him that the trial was not a political rally.

The financial ramifications of the $354.8 million judgment, coupled with another $83.3 million judgment against Trump for defamation, are expected to impact his estimated net worth significantly. Forbes estimates Trump’s wealth at $2.6 billion, while the Bloomberg Billionaires Index values him at $3.1 billion. These judgments could potentially result in a loss of 13 percent or more of his estimated net worth if these figures hold true.

Legal fees are also mounting for Trump, with approximately $50 million spent on legal consulting in 2023 by his fundraising committees. Notably, more than $18 million of this amount was allocated to lawyers Chris Kise, Alina Habba, and Clifford Robert, who represented Trump in the fraud case and other legal matters.

As Trump faces increasing legal challenges, including criminal cases and impending appeals in civil cases, the financial and legal implications of these recent judgments add another layer of complexity to his post-presidential life.

Tax Season Alert: IRS Audit Risks and Red Flags for American Filers

As Americans submit their tax returns this season, there’s a growing concern about IRS audits amidst the agency’s efforts to enhance service, technology, and enforcement.

Recent IRS actions have targeted affluent individuals, large corporations, and intricate partnerships. However, ordinary taxpayers might still find themselves under audit, with specific issues drawing greater IRS scrutiny, experts note.

Ryan Losi, an executive vice president at CPA firm Piascik, cautioned against the risks of the “audit lottery.” He emphasized the importance of accuracy in tax reporting to avoid potential audit triggers.

Audit rates for individual income tax returns have declined across all income brackets from 2010 to 2019 due to decreased IRS funding, according to a Government Accountability Office report. Syracuse University’s Transactional Records Access Clearinghouse reported that in fiscal year 2022, the IRS audited 0.38% of returns, down from 0.41% in 2021.

However, Mark Steber, chief tax information officer at Jackson Hewitt, believes that many Americans might feel overly secure about their audit risk.

Here are some key factors that could raise red flags for IRS audits:

1.Unreported Income: The IRS can easily detect unreported income through information returns sent by employers and financial institutions. Income from freelancing or investments, reported via forms like 1099-NEC or 1099-B, can be particularly scrutinized.

  1. Excessive Deductions: Claiming deductions significantly higher than what’s typical for your income level could draw attention. For instance, if your reported deductions are disproportionate to your income, especially in areas like charitable deductions, it might trigger scrutiny.
  2. Rounded Numbers: Filing with rounded figures, especially for significant deductions, may increase the likelihood of an audit. Experts advise against using rounded estimates and emphasize the importance of accurate reporting.
  3. Earned Income Tax Credit (EITC): This credit, designed for low- to moderate-income earners, has historically attracted scrutiny due to improper payments. While higher-income earners are more likely to be audited, EITC claimants face a substantially higher audit rate due to issues with improper payments.

Despite this, the IRS has announced plans to reduce correspondence audits for EITC claimants starting in fiscal year 2024.

While audit rates have decreased overall, taxpayers should remain vigilant about potential audit triggers and ensure accurate reporting to avoid unnecessary scrutiny from the IRS.

Virginia: A Safe Haven for Seniors – The Ideal Retirement Destination with Legal Protections, Tax Benefits, and Abundant Amenities

Ensuring the well-being and security of seniors during their golden years is imperative. Nevertheless, each year, approximately five million elderly individuals in the United States suffer from various forms of abuse, including physical, mental, and financial exploitation, as per data from the National Council on Aging. The severity of the issue is further underscored by the Centers for Disease Control, which suggests that numerous non-fatal injuries often go unreported, exacerbating the problem. This pervasive issue significantly impacts the health and overall welfare of older adults, potentially leading to conditions such as depression, malnutrition, and anxiety.

Should prioritizing senior safety resonate with you, Virginia emerges as a promising retirement destination. Recent findings from a WalletHub survey assessing the best retirement locales placed Virginia in the third position overall, owing largely to its robust legal framework targeting elder abuse.

According to WalletHub, “This makes seniors physically safer and less vulnerable to being taken advantage of financially. The state has high-quality geriatrics hospitals and a lot of doctors and dentists to choose from, too.”

The study evaluated states based on their provisions against financial, emotional, and physical abuse. Virginia, known as the Old Dominion, boasts legislative measures safeguarding retirees from economic exploitation, allocating funds to various elder abuse prevention initiatives, and furnishing legal assistance.

Virginia counts 1.9 million adults aged 60 and above, constituting 22 percent of the Commonwealth’s populace, as reported by the Virginia Department of Aging and Rehabilitative Services.

Quoting from the report, “In a survey of older Virginians conducted in 2022, 79 percent of older Virginians rated their overall quality of life as excellent or good. Most respondents scored their communities positively, and about 50 percent indicated that their communities valued older residents.”

Additionally, Virginia hosts numerous hospitals that receive commendable rankings in US News’s Best Hospitals list.

WalletHub further highlights that the Commonwealth does not impose estate or inheritance taxes, rendering it an appealing retirement destination. Furthermore, Virginia stands among the 39 states nationwide that do not levy taxes on Social Security income, permitting seniors to deduct $12,000 annually against withdrawals from other retirement accounts.

Beyond safety and tax advantages, Virginia offers an array of amenities, including 375 golf courses, abundant outdoor recreational opportunities, a picturesque wine region, numerous lakes, thousands of miles of shoreline, and a well-developed infrastructure.

However, these benefits come with a price tag. According to a recent report by, the annual cost of living in Virginia amounts to $58,454. Additionally, retirees contemplating Virginia should be prepared with approximately $907,922 in savings. It’s worth noting that this figure may be higher in Northern Virginia, where housing costs persistently escalate due to inventory shortages.

2023: A Year of Global Economic Uncertainty

The year 2023 marked a period of uncertain recovery for the global economy, grappling with the lingering impacts of the COVID-19 pandemic and the conflict in Ukraine. Across emerging markets and developing economies, economic activity struggled to return to pre-pandemic levels, hindered further by tightening monetary policies aimed at curbing inflation. The International Monetary Fund (IMF) projected a slowdown in economic growth for advanced economies and a modest decline for emerging markets and developing economies in October 2023.

Examining the economic landscapes of leading nations like the United States, China, and India reveals the challenges they faced amidst this uncertainty. The United States notably performed better than anticipated, buoyed by the resilience of its labor and housing markets. Despite ongoing interest rate hikes by the Federal Reserve, unemployment remained relatively low at 3.7% during the third quarter of 2023, while homeowners managed to sustain their net worth despite soaring home prices.

In contrast, China, the world’s second-largest economy, struggled to drive global economic growth in 2023. The country faced various challenges, including the lingering effects of strict lockdowns imposed during the pandemic’s early stages, leading to an overall economic slowdown. Foreign direct investment in China saw a significant decline, compounded by issues such as a property crisis and high youth unemployment rates. Additionally, demographic challenges like declining fertility rates posed long-term concerns for the country’s labor supply and debt burden.

Despite these hurdles, India emerged as a resilient force, contributing significantly to global growth in 2023. With a reported 16% contribution to global growth, India’s economic prowess was evident. The World Economic Forum projected India to become the world’s third-largest economy within the next five years, a testament to its robust growth trajectory fueled by investments in innovation and public infrastructure.

Global Economic Outlook for 2024

Looking ahead, the IMF forecasts global economic growth to remain at 3.1% in 2024, slightly higher than previous estimates but still below historical averages. Advanced economies are expected to see a drop in growth before a modest recovery, while emerging markets and developing economies are projected to maintain steady growth, with India and China leading the charge.

Regional Forecast for Economies in 2024

Advanced economies, including the United States and the euro area, are expected to experience varying growth trajectories, with factors like real income growth and reduced inflation driving recovery. Emerging markets and developing economies, particularly in Asia and Europe, are poised to improve their growth rates in 2024, supported by domestic demand and government spending.

United States: A Hub of Economic Power

The United States remains a powerhouse in the global economy, home to some of the world’s most valuable companies like Amazon, Microsoft, and Apple. These companies continue to innovate and drive economic growth through initiatives focused on AI, digital innovation, and financial performance.

Amazon, for instance, has joined the U.S. Artificial Intelligence Safety Institute Consortium to promote safe and responsible AI development, while Microsoft enhances its offerings with AI-driven tools like Copilot. Apple, boasting an installed base of over 2.2 billion active devices globally, reported strong financial results for the first quarter of fiscal 2024, underscoring its continued success and market dominance.

25 Largest Economies in the World in 2024


Utilizing data from the IMF, we’ve compiled a list of the 25 largest economies in the world in 2024 based on their GDP as of 2023. GDP per capita figures have also been included to provide additional context.

  1. United States

GDP: $26.95 Trillion

GDP Per Capita: $80,410

  1. China

GDP: $17.7 Trillion

GDP Per Capita: $12,540

  1. Japan

GDP: $4.23 Trillion

GDP Per Capita: $33,950

  1. Germany

GDP: $4.43 Trillion

GDP Per Capita: $52,820

  1. India

GDP: $3.73 Trillion

GDP Per Capita: $2,610

  1. United Kingdom

GDP: $3.33 Trillion

GDP Per Capita: $48,910

  1. France

GDP: $3.05 Trillion

GDP Per Capita: $46,320

  1. Italy

GDP: $2.19 Trillion

GDP Per Capita: $37,150

  1. Brazil

GDP: $2.13 Trillion

GDP Per Capita: $10,410

  1. Canada

GDP: $2.12 Trillion

GDP Per Capita: $53,250

  1. Russia

GDP: $1.86 Trillion

GDP Per Capita: $13,010

  1. Mexico

GDP: $1.81 Trillion

GDP Per Capita: $13,800

  1. South Korea

GDP: $1.71 Trillion

GDP Per Capita: $33,150

  1. Australia

GDP: $1.69 Trillion

GDP Per Capita: $63,490

  1. Spain

GDP: $1.58 Trillion

GDP Per Capita: $33,090

  1. Indonesia

GDP: $1.42 Trillion

GDP Per Capita: $5,110

  1. Turkey

GDP: $1.15 Trillion

GDP Per Capita: $13,380

  1. Netherlands

GDP: $1.09 Trillion

GDP Per Capita: $61,770

  1. Saudi Arabia

GDP: $1.07 Trillion

GDP Per Capita: $32,590

  1. Switzerland

GDP: $905.68 Billion

GDP Per Capita: $102,870

  1. Poland

GDP: $842.17 Billion

GDP Per Capita: $22,390

  1. Taiwan

GDP: $751.93 Billion

GDP Per Capita: $32,340

  1. Belgium

GDP: $627.51 Billion

GDP Per Capita: $53,660

  1. Argentina

GDP: $621.83 Billion

GDP Per Capita: $13,300

  1. Sweden

GDP: $597.11 Billion

GDP Per Capita: $55,220

2023 proved to be a year of economic resilience and uncertainty, with nations navigating challenges and opportunities amidst a complex global landscape. Looking ahead to 2024, cautious optimism prevails, with forecasts suggesting continued growth albeit at varying rates across regions and economies.

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China Faces Economic Crisis as Record Defaults Signal Deepening Financial Strain Amidst Pandemic Fallout and Political Tensions

China is grappling with a significant economic downturn reminiscent of the 2008 global financial crisis, with a record number of borrowers facing defaults.

“Defaults by Chinese borrowers have surged to an unprecedented level since the Covid pandemic as the country faces huge economic challenges.”

According to official records, an alarming 8.54 million individuals in China, predominantly aged between 18 and 59, are now officially blacklisted due to missed payments on various financial obligations, spanning from home mortgages to business loans.

“This figure has sharply risen from 5.7 million defaulters in early 2020, as lockdowns and economic restrictions stemming from the pandemic significantly impacted economic growth and household incomes.”

The surge in defaults, representing approximately one percent of working-age Chinese adults, poses a substantial risk not only to China’s economy but also to the global economy.

“Making the situation worse for individuals, China also does not have any personal bankruptcy laws, intensifying the financial and social repercussions of escalating debt.”

Under Chinese law, defaulters on the blacklist encounter restrictions on various economic activities, including purchasing plane tickets and conducting transactions via popular mobile apps such as Alipay and WeChat Pay.

“The economic strain is also visible in the surge of household debt, which almost doubled over the past decade to 64 percent of the Gross Domestic Product (GDP) in September.”

Wage growth has stagnated or even turned negative amid the economic downturn, exacerbating the challenge of meeting financial obligations for many Chinese consumers.

“The economic challenges extend to the job market, with youth unemployment reaching a record 21.3 percent in June. Authorities have even stopped reporting this data.”

Financial institutions are feeling the squeeze as well, with China Merchants Bank reporting a 26 percent uptick in bad loans from credit card payments that were 90 days overdue in 2022 compared to the previous year.

“As the number of defaults rises, legal experts have proposed introducing personal bankruptcy laws to provide relief for individual insolvencies.”

However, the lack of transparency surrounding personal finances renders the implementation of such measures nearly impossible. Government officials and other interest groups are likely to oppose these policies, fearing exposure of corruption.

“Adding to China’s challenges, a recent pneumonia outbreak further strains the nation. The Department of Health recorded 182,721 cases as of November 11, surpassing the 158,307 cases reported from January to October last year.”

This economic crisis unfolds against a backdrop of escalating tensions in the region, particularly with Taiwan gearing up for a new presidential election, which adds complexity to the geopolitical dynamics in the Asia-Pacific region.

Zuckerberg’s Wealth Soars as Meta Beats Expectations: Billionaire’s Net Worth Surges by $29 Billion in One Day

Mark Zuckerberg’s financial status is once again making headlines following a significant victory for Meta, the parent company of Facebook, which he co-founded and leads as CEO. The billionaire is poised to see a substantial increase in his wealth as Meta surpassed expectations with its latest quarterly earnings report.

According to Forbes, Zuckerberg’s net worth surged by a staggering $29 billion in just one day due to the remarkable rise in Meta’s stock price. As of the latest update, his total net worth stands at $167.9 billion on Forbes’ continuously updated billionaires list, a notable jump from the estimated $139 billion in January.

Meanwhile, Bloomberg’s real-time list places Zuckerberg’s net worth at $142 billion, although it’s yet to reflect the impact of the recent earnings report. Discrepancies in estimated net worth figures among different outlets are not uncommon, as they factor in Meta’s share values along with evaluations of his other assets like real estate holdings.

Currently, Zuckerberg holds the fourth position among the wealthiest individuals globally according to Forbes, while Bloomberg ranks him as the fifth richest.

Together with his wife Priscilla Chan, Zuckerberg has committed to donating 99% of their wealth throughout their lifetimes via the Chan Zuckerberg Initiative, which has already pledged over $4.9 billion in grants since its establishment in 2015.

This week has been monumental for Zuckerberg. Alongside Meta’s soaring stock, he also faced questioning before the Senate, alongside other prominent tech CEOs, addressing concerns about the proliferation of sexually explicit content involving minors on social media platforms.

Karnataka Congress Leader Warns of Southern Secession Over Alleged Central Fund Diversion

A Karnataka Congress leader, immediately following the unveiling of the interim budget today, accused the Central government of diverting developmental funds from south India to bolster the northern regions. DK Suresh Kumar, a Congress MP, warned that if this issue remains unaddressed, it might necessitate the southern states to seek autonomy, stating, “If we don’t condemn this in the upcoming days, we will have to place a demand for a separate country as a result of the situation the Hindi-speaking region has forced on us.”

The Bharatiya Janata Party (BJP) responded by accusing the Congress of promoting divisive sentiments. Chaluvadi Narayanaswamy of the BJP criticized the Congress’s stance, suggesting that instead of fostering unity (“Bharat Jodo”), they seem to advocate for division (“Bharat Todo”). He condemned the Congress mindset, drawing parallels to the partition of India in 1947, and questioned the party’s commitment to upholding the nation’s unity despite Rahul Gandhi’s calls for integration.

This discontent echoes Mamata Banerjee’s grievances in West Bengal, where the Congress, newly in power in Karnataka, aligns itself with her narrative of inadequate central funding. DK Suresh Kumar emphasized the perceived injustice faced by southern states, asserting, “We want to receive our money. Whether it is the GST, Custom or Direct taxes, we want to receive our rightful share… our share of money for development is getting distributed to north India.”

Recently, the Karnataka Congress administration released a white paper highlighting the disparity between the state’s contributions to the national economy and the funds it receives from the Centre. M. Lakshmana, a spokesperson for the state Congress, cited figures indicating that Karnataka’s tax contributions far exceed the returns it receives. Despite contributing significantly to corporate and other taxes, as well as GST, Karnataka is reportedly receiving disproportionately low allocations from the Centre.

The grievances are not limited to Karnataka alone. Similar concerns have been raised by Kerala and the DMK-led government in Tamil Nadu. This discontent culminated in Karnataka’s Congress government contemplating the formation of a coalition to challenge what they perceive as biased tax devolution by the Central government. Officials noted a decrease in Karnataka’s share of taxes from 4.71% to 3.64% under the current Finance Commission, further exacerbating the perceived imbalance in resource allocation.

Paytm Plummets: Regulatory Woes and Market Turmoil Lead to Sharp Stock Decline

The once-thriving Paytm, a leading startup in India, has experienced a dramatic decline in the stock market this week, marking a continued plummet since its massive initial public offering (IPO) in 2021. Shares of the digital payment giant have undergone a staggering decline, hitting the maximum allowable decrease in Mumbai for two consecutive days, despite India’s stock markets reaching new highs. Since Wednesday’s closing, Paytm has tumbled by 36%, with a nearly 25% drop this year alone.

The company has faced significant challenges since its turbulent market debut in November 2021, failing to persuade investors of its potential profitability amid intensifying competition from domestic and international tech companies. Compounding its woes, regulatory issues emerged when the central bank prohibited its banking division from onboarding new customers two years ago.

With shares now trading at a mere 487 rupees (approximately $6) per share, the recent nosedive has erased a staggering $2 billion in market capitalization, leaving the company with a diminished valuation of only $3.7 billion. The latest downturn was triggered by additional regulatory actions from India’s central bank.

The Reserve Bank of India (RBI) recently instructed Paytm Payments Bank to cease accepting deposits and suspend other essential services due to “persistent non-compliances.” This directive, which caught the Indian tech community off guard, prompted Paytm to adopt damage control measures in an attempt to reassure investors and its vast user base of over 300 million.

However, despite pledges to swiftly address regulatory concerns and a subsequent conference call held after trading hours on Thursday, investor confidence continued to erode. According to Manish Chowdhury, head of research at brokerage firm StoxBox, the RBI’s directive poses a significant “reputational risk” to Paytm’s overall business and raises uncertainties about its future performance.

Founded in 2017 as a joint venture with founder Vijay Shekhar Sharma, Paytm initially operated as a payments bank, allowing deposits but not extending loans to customers. During Thursday’s conference call, Sharma downplayed the central bank’s actions as a temporary setback, asserting that Paytm will henceforth collaborate solely with other banks.

Paytm gained widespread recognition in 2016 when Indian Prime Minister Narendra Modi invalidated the nation’s two largest currency denominations, constituting approximately 86% of the country’s cash supply, as part of efforts to combat tax evasion and illicit wealth accumulation. Although the move caused significant disruptions to the economy, it fueled Paytm’s rapid expansion, attracting 10 million new users within a month and cementing its status as a household name in India.

Annie George Mathew Appointed As A Member Of The 16th Finance Commission Of India

Annie George Mathew, a senior of the Indian Audit and Accounts Service (IA & AS) of the 1988 Batch has been appointed as a member of the Sixteenth Finance Commission on Tuesday, January 30th, 2024.

Annie George Mathew recently retired as the Special Secretary Expenditure from the Ministry of Finance, Government of India.  She has over 34 years of experience in areas of Public Finance, Financial Management, Government Audit and Accounts, and Public Procurement including Defense Capital Acquisitions, Human Resource Management

The 16th Finance Commission was constituted on 31.12.2023 with Shri Arvind Panagariya, former Vice-Chairman, NITI Aayog as its Chairman. According to a government order issued on January 30, 2024, three full-time members of the 16th Finance Commission include former Expenditure Secretary Ajay Narayan Jha; former Department of Expenditure official Annie George Mathew; and Niranjan Rajadhyaksha, executive director of policy consultancy firm, Artha Global. Dr. Soumya Kanti Ghosh, Group Chief Economic Advisor, State Bank of India will serve as a Part-time member of the powerful financial body.

“The chairman and other members of the commission shall hold office from the date on which they respectively assume office up to the date of the submission of report or October 31, 2025, whichever is earlier,” the order from President of India, Droupadi Murmu appointing members to the constitutional body stated.

AnnieThe Sixteenth Finance Commission has been requested to make its recommendations available by October 31, 2025, covering an award period of 5 years commencing 1st April, 2026. The Finance Commission usually takes about two years to consult stakeholders in the States and Centre and arrive at their conclusions.

The Finance Commission mainly decides the tax-sharing formula between the Centre and the states.  The Sixteenth Finance Commission’s terms of reference include a review of the present arrangements for financing disaster management initiatives and mooting measures to augment States’ consolidated funds to supplement resources available with panchayats and municipalities.

Per reports, in November last year, the Indian Cabinet chaired by Prime Minister Narendra Modi had approved the Terms of Reference for the 16th Finance Commission. As per the terms of reference (ToR), “The Finance Commission shall make recommendations as to the following matters, namely: The distribution between the Union and the States of the net proceeds of taxes which are to be, or may be, divided between them under Chapter I, Part XII of the Constitution and the allocation between the States of the respective shares of such proceeds.”

The commission is expected to make recommendations on the “principles which should govern the grants-in-aid of the revenues of the States out of the Consolidated Fund of India and the sums to be paid to the States by way of grants-in-aid of their revenues under article 275 of the Constitution for the purposes other than those specified in the provisos to clause (1) of that article,” according to a statement issued after the Union Cabinet meeting on November 29.

Ms. Mathew was the Government’s nominee on the Boards of the Pension Fund Regulatory and Development Authority (PFRDA) and Indian Overseas Bank (IOB).  She had served earlier on the Board of State Bank of Hyderabad.

She has varied experience in the Indian Audit and Accounts Department through her postings within the country and abroad.  She has also led audit teams working with different international and multi-lateral organizations like the United Nations, and UNHCR in Europe, Africa, and Asia. She has been a member of the International Standards Laying Committees on Auditing.

With her vast experience of working in public finance at various levels in the Ministry of Finance and her exposure to state finances during her tenure in various Accountant General Offices in the states of Uttar Pradesh, Andhra Pradesh, Madhya Pradesh, Orissa, Delhi, Ms. Mathew has a deep understanding of  India’s Federal and State finances.

Ms. Mathew graduated from Miranda House and completed post-graduation from the University of Delhi and after that, joined India’s civil services as an IA & AS Officer.

India Emerges as a Stock Market Superpower with Market Values Crossing $4 Trillion

In a spectacular turn of events, India’s stock market has achieved a historic milestone, surging past the $4 trillion mark in market valuation. The year 2023 witnessed India securing its position as a stock market superpower, trailing only behind the United States, China, Japan, and Hong Kong. This momentous feat underscores the remarkable performance of Nifty and Sensex, India's primary stock market indices, which soared to new heights. Notably, Nifty experienced a remarkable growth of 18.5%, while Sensex posted a robust 17.3% growth in 2023.

As the world grappled with ongoing conflicts and a global economic slowdown, India’s stock exchanges displayed resilience and outshone their counterparts worldwide. To put India’s success into context, it is essential to examine the broader global economic environment. The International Monetary Fund (IMF) reported in October 2023 that the global growth rate was expected to dip from 3.5% in 2022 to 3% in 2023. In contrast, India defied expectations with a projected annual growth rate of 6.3%, surpassing the realized growth rate of 7.2% in 2022.

Despite a global inflation rate expected to decline to 6.9% in 2023, India’s quarterly growth rates in 2023 exceeded expectations, with the economy expanding by 7.8% in Q2-23 and 7.6% in Q3-23. These positive indicators, coupled with India’s ability to maintain annual average retail inflation within 6%, contributed to the investor confidence evident in the record-breaking performance of the Indian stock markets.

In a stark contrast to the global economic landscape, India received a net Foreign Portfolio Investment (FPI) of $20.2 billion in 2023, the highest among emerging markets, bringing the total FPI to an impressive $723 billion. Notably, while Foreign Direct Investment (FDI) saw a decline of 16% in 2023 globally, India’s stock market continued to attract significant foreign investments. The aftermath of the Covid-19-induced global economic recession witnessed a negative growth rate of -3.1% worldwide. However, India’s high growth rate positioned Indian companies as attractive options for global investors seeking better returns on their investments. The surge in Foreign Portfolio Investment (FPI) reflects the confidence global investors place in India’s economic resilience.

Several factors contribute to India’s sustained high economic growth rate. First, under the leadership of Prime Minister Narendra Modi, India has demonstrated political stability and proactive market reforms. Initiatives such as Goods and Services Tax (GST), the JAM trinity (Jandhan, Aadhar, Mobile), Digital Payments (UPI), Make in India, and Production Link Incentives (PLI) schemes have propelled India’s economic growth.

Second, the Indian government, led by Prime Minister Modi, has significantly increased capital expenditure, reaching $250 billion in 2023-24, a remarkable 433% increase from the FY 2013-14 figure of $48 billion. The focus on infrastructure development is expected to stimulate private investment, further bolstering economic growth.

Post Covid-19, GDP data indicates a strengthening of private investment, with Q3 estimates showing a year-on-year growth rate of 7.8%. The surge in government and private capital expenditure has boosted domestic demand, insulating the Indian economy from external shocks and global economic challenges.

Third, despite a substantial increase in capital expenditure, India’s fiscal deficit is contracting. The government’s commitment to fiscal consolidation, supported by robust growth in net direct tax and GST collections, instills confidence in external investors. India’s fiscal deficit target of 5.9% in FY 2023-24 is expected to be achieved, further facilitating access to cheaper investment funds.

Fourth, proactive measures by the Reserve Bank of India have strengthened the Indian banking system, reducing bad loans and supporting credit growth, which is projected to exceed 15% in FY 2023-24. The health of the banking system reflects robust economic activity within India and ensures the availability of funds for consumption and investment expenditure.

In conclusion, 2023 has been a triumphant year for the Indian economy, marking a significant milestone in its capital market. India’s outperformance and positive economic indicators signal a bright future, with the nation poised to continue leading the global economy despite prevailing challenges. The convergence of political stability, proactive reforms, increased capital expenditure, and a resilient banking system positions India as a beacon of confidence in the global economic

The Global Dance of Currencies: Forbes Unveils Top 10 Strongest Currencies and Their Economic Significance

Currency, often described as the lifeblood of global trade, serves as a pivotal indicator of a country’s economic vitality. The strength of a nation’s currency not only reflects its stability but also showcases a robust financial health that resonates internationally, attracting investments and fostering crucial global partnerships. In essence, a strong currency becomes a shield, enabling nations to weather economic storms and fortify their positions in the intricate web of global commerce. Officially recognized by the United Nations, there are 180 legal tender currencies worldwide. However, the popularity and widespread use of certain currencies don’t necessarily correlate with their actual value or strength.

The delicate dance of currency strength is orchestrated by the interplay of supply and demand, with influences ranging from interest rates and inflation to geopolitical stability.

“A robust currency not only enhances a country’s purchasing power but also underlines its credibility on the world stage,” states a report. Investors seek refuge in currencies that stand firm, setting off a ripple effect that molds financial markets worldwide.

Forbes recently unveiled a list detailing the 10 strongest currencies globally, comparing them with the Indian Rupee and USD, shedding light on the factors contributing to their prominence.

Topping the list is the Kuwaiti Dinar, with one Kuwaiti Dinar equivalent to ₹ 270.23 and $3.25. Following closely is The Bahraini Dinar, valued at ₹ 220.4 and $2.65. The Omani Rial (Rs 215.84 and $2.60), Jordanian Dinar (Rs 117.10 and $1.141), Gibraltar Pound (Rs 105.52 and $1.27), British Pound (Rs 105.54 and $1.27), Cayman Island Dollar (Rs 99.76 and $1.20), Swiss Franc (Rs 97.54 and $1.17), and the Euro (Rs 90.80 and $1.09) make up the rest of the prestigious list.

Notably, the US Dollar, despite its global popularity and status as the most widely traded currency, finds itself at the bottom of the list, with one USD valued at ₹ 83.10. Forbes explains that the US Dollar, while holding the position of the primary reserve currency globally, ranks 10th among the world’s strongest currencies.

According to the exchange rates published on the International Monetary Fund’s (IMF) website as of Wednesday, India holds the 15th position with a value of 82.9 per US Dollar.

The Kuwaiti Dinar, which claims the top spot, has consistently been recognized as the world’s most valuable currency since its introduction in 1960. The success of this currency is attributed to Kuwait’s economic stability, driven by its abundant oil reserves and a tax-free system.

Forbes also highlights the Swiss Franc, the official currency of Switzerland and Liechtenstein, as widely regarded as the most stable currency globally.

It’s crucial to note that the list is based on currency values as of January 10, 2024, and comes with a disclaimer acknowledging the potential for fluctuations in these values.

The unveiling of Forbes’ list not only provides insight into the current strength of global currencies but also emphasizes the intricate relationship between economic stability, natural resources, and taxation systems in determining the strength of a nation’s currency. As the world continues to navigate the complex landscape of international trade, these currency dynamics play a pivotal role in shaping the interconnected web of global commerce.

White House Proposes Overdraft Fee Reduction to Alleviate Financial Strain on Consumers

The White House has unveiled a proposal aimed at significantly lowering the cost of overdrawing a bank account, potentially reducing it to as little as $3. This move, announced by the Consumer Financial Protection Bureau (CFPB), is part of the Biden administration’s ongoing efforts to tackle what it perceives as excessive fees burdening American consumers, especially those living paycheck to paycheck.

President Joe Biden expressed his concerns, stating, “For too long, some banks have charged exorbitant overdraft fees — sometimes $30 or more — that often hit the most vulnerable Americans the hardest, all while banks pad their bottom lines. Banks call it a service — I call it exploitation.”

The proposed rule from the CFPB suggests that banks should only charge customers an amount equal to their cost of providing overdraft services. This would necessitate banks to disclose the operational costs associated with their overdraft services, a requirement that many financial institutions may find challenging.

Alternatively, banks could opt for a benchmark fee applicable across all affected financial institutions. The proposed benchmark fees range from $3 to $14, with the CFPB seeking industry and public input to determine the most suitable amount. The suggested figures are derived from an analysis of the costs incurred by banks in recovering losses from accounts with negative balances that were never repaid.

Another option presented in the proposal is for banks to offer small lines of credit, functioning similarly to credit cards, to allow customers to overdraft. Some banks, such as Truist Bank, already provide such services.

The average overdraft fee, according to Bankrate’s research in August, was $26.61, with certain banks charging as much as $39. Despite various changes made by banks in recent years, the largest banks in the nation still generate around $8 billion annually from overdraft fees, disproportionately impacting low-income households and communities of color.

President Biden, in line with his economic agenda leading into the 2024 election, aims to eliminate what he terms as “junk fees,” with overdraft fees being a major focus. The regulations proposed by the CFPB would exclusively apply to banks with assets exceeding $10 billion, approximately 175 banks that constitute the majority of financial institutions Americans engage with. Smaller banks and credit unions, which often rely more heavily on overdraft fees, would be exempt.

The roots of overdraft services trace back to decades ago when banks initially offered a niche service to allow certain checking account customers to go negative to avoid bouncing paper checks. However, with the surge in popularity of debit cards, overdraft fees became a substantial profit center for banks.

Despite industry changes in response to public and political pressure, the proposed regulations are expected to face strong opposition from the banking sector. The regulations could potentially lead to a prolonged legal battle, with the Supreme Court being the final arbiter. If adopted and successfully navigates political and legal challenges, the new rules are anticipated to take effect in the autumn of 2025.

Acknowledging industry concerns, Lindsey Johnson, President and CEO of the Consumer Bankers Association, warned that the proposal might have unintended consequences, stating, “If enacted, this proposal could deprive millions of Americans of a deeply valued emergency safety net while simultaneously pushing more consumers out of the banking system.”

Despite some banks having introduced measures like reducing fees and adding safeguards to prevent overdrafts, concerns persist that increased regulations might prompt banks to eliminate the service altogether. The fate of the proposal will likely have significant implications for both consumers and the banking industry, setting the stage for a contentious debate on financial regulations and consumer protection.

SEC Approves Groundbreaking Bitcoin ETFs Despite Mixed Reactions

In a historic move, the Securities and Exchange Commission (SEC) greenlit nearly a dozen exchange-traded funds (ETFs) backed by bitcoin on Wednesday, marking the first time the regulatory body has permitted the trading of funds directly invested in a cryptocurrency.

The SEC’s approval extends to 11 spot bitcoin ETFs from major financial players such as BlackRock, Fidelity, and Grayscale Investments, all gaining the regulatory nod as the agency faced a looming deadline to rule on at least one of the applications.

SEC Chairman Gary Gensler articulated his stance on the matter, stating, “I feel the most sustainable path forward is to approve the listing and trading of these spot bitcoin ETP shares.”

This decision comes on the heels of the U.S. Court of Appeals for the District of Columbia ruling in August, asserting that the SEC had erroneously rejected Grayscale’s application for a spot bitcoin ETF. Prior to this, the agency had consistently turned down all applications for such funds.

“I feel the most sustainable path forward is to approve the listing and trading of these spot bitcoin ETP shares,” reiterated Gensler in a statement.

Grayscale CEO Michael Sonnenshein celebrated the regulatory breakthrough, acknowledging, “Today’s historic outcome is a testament to GBTC’s investors for their unwavering patience and support, and to the entire Grayscale team and our partners for their hard work and dedication.”

House Financial Services Chairman Patrick McHenry (R-N.C.) and Rep. French Hill (R-Ark.), chair of the Digital Assets, Financial Technology, and Inclusion Subcommittee, lauded the SEC’s move as a “historic milestone for the future of the digital asset ecosystem.” They emphasized that while legislation for digital assets clarity is still necessary, the approvals represent a positive shift away from the SEC’s previous approach of regulation through enforcement.

“We are pleased that investors and our markets will finally be afforded greater access to this generational technology,” added McHenry and Hill in a joint statement.

However, not everyone shares the optimism surrounding the SEC’s decision. Critics of cryptocurrencies and advocates for stricter financial regulations expressed their discontent with the approval.

Dennis Kelleher, co-founder, president, and CEO of the non-profit Better Markets, denounced the decision as a “historic mistake,” asserting that it will “unleash crypto predators” on investors and potentially “undermine financial stability.”

“It will be interpreted and spun as a de facto SEC – if not U.S. government – endorsement of crypto generally,” warned Kelleher. He expressed concerns that the crypto industry might exploit the decision to portray cryptocurrency as a safe and suitable investment for retail investors and those saving for retirement.

In response to these concerns, Gensler sought to clarify that the SEC’s approvals exclusively pertain to ETFs holding bitcoin and should not be misconstrued as a broader endorsement of crypto assets. “It should in no way signal the Commission’s willingness to approve listing standards for crypto asset securities,” emphasized Gensler.

“Nor does the approval signal anything about the Commission’s views as to the status of other crypto assets under the federal securities laws or about the current state of non-compliance of certain crypto asset market participants with the federal securities laws,” he continued.

The long-anticipated decision came amid a brief moment of confusion, as the SEC’s official Twitter account, previously known as Twitter and now referred to as X, was hacked on Tuesday. The compromised account falsely announced the approval of spot bitcoin ETFs, creating a 30-minute window of misinformation before the announcement was rectified and replaced with an official disavowal by the agency.

IMF Commends India’s Economic Growth Amid Global Recession

The executive board of the International Monetary Fund (IMF), recently commended India for its “economy’s strong economic performance, resilience, and financial stability, while also facing continued global headwinds.”

They observed that while India is one of the fastest growing economies globally, it has the ability to “grow faster and more sustainably if a comprehensive structural reform agenda is implemented” and that its excellent performance will probably continue in the future.

In its report, the IMF said “India’s economy showed robust growth over the past year. Headline inflation has, on average, moderated although it remains volatile. Employment has surpassed the pre pandemic level and, while the informal sector continues to dominate, formalization has progressed.”

“Real GDP is projected to grow at 6.3 percent in FY2023/24 and FY2024/25. Headline inflation is expected to gradually decline to the target although it remains volatile due to food price shocks,” their projections said.

The report also praised India’s G20 presidency for demonstrating the country’s important role in as well as  the Reserve Bank of India’s (RBI) proactive monetary policy actions and strong commitment to price stability.

“(IMF Executive) Directors welcomed the authorities’ near-term fiscal policy, which focuses on accelerating capital spending while tightening the fiscal stance,” the IMF’s Article IV consultation report said.

India’s Economic Surge: S&P Predicts Fastest Growth, Aims for Third-Largest Global Economy by 2030

India is poised to maintain its status as the swiftest-growing major economy over the next three years, propelling it toward claiming the position of the world’s third-largest economy by 2030, according to a report from S&P Global Ratings.

“S&P anticipates that India, presently ranking as the fifth-largest global economy, will witness a growth rate of 6.4% in the ongoing fiscal year, with projections indicating a further acceleration to 7% by fiscal 2027,” as reported by the original article. In contrast, the report foresees a deceleration in China’s growth to 4.6% by 2026 from an estimated 5.4% in the current year.

Recent data revealing a more substantial than expected 7.6% growth in India’s gross domestic product (GDP) during the second quarter of fiscal 2024 has led several brokerages to revise their full-year estimates upward. However, S&P, having revised its forecast prior to this data release, emphasizes that India’s growth trajectory hinges on a successful transition from a services-dominated economy to one dominated by manufacturing.

“A paramount test will be whether India can become the next big global manufacturing hub, an immense opportunity,” emphasizes S&P in its Global Credit Outlook 2024 report dated December 4th. While the Indian government, led by Prime Minister Narendra Modi, has actively promoted domestic manufacturing through initiatives such as the “Make in India” campaign and production-linked incentives (PLIs), the manufacturing sector still contributes only about 18% to the GDP. In stark contrast, services constitute more than half of India’s GDP.

S&P underscores the pivotal role of developing a robust logistics framework for India to truly emerge as a manufacturing hub. Additionally, the report emphasizes the necessity to “upskill” the workforce and boost female participation in the labor force to fully leverage the demographic dividend.

The report notes, “India possesses one of the youngest working populations globally, with nearly 53% of its citizens under the age of 30.” This demographic advantage could be a significant driver of economic growth if the country strategically addresses challenges in its economic structure and focuses on enhancing the capabilities of its workforce.

In essence, S&P’s projections for India’s economic trajectory highlight both the potential for remarkable growth and the challenges that must be addressed for the nation to realize its economic ambitions. As the government continues its efforts to promote manufacturing and economic diversification, the outcomes in the coming years will play a crucial role in shaping India’s position on the global economic stage.

 India’s Energy Policy and the Global Climate Debate: A Closer Look

As the global focus on India’s role in climate change intensifies, it’s apparent that many critics are quick to point fingers at New Delhi’s energy policies without considering the complexities at play. This lopsided debate calls for a more balanced perspective, considering the challenges India faces in its journey towards sustainable energy. The need for an equitable approach is evident.

New Delhi acknowledges the environmental drawbacks of coal, but it’s equally aware that a hasty exit from a carbon-based economy carries immense human costs. The real issue that warrants attention is whether developed nations have made substantial reductions in emissions. So, why impose rapid coal phase-out on India?

Let’s delve deeper into this argument with some illuminating statistics.

India requires power to uplift an estimated 75 million people who have fallen into poverty due to the pandemic, living on less than $2 per day. Power is the lifeline to eradicate poverty, improve nutrition, enhance education, boost healthcare, and increase industrial and agricultural productivity. In India, coal plays a critical role in power generation because viable alternatives are still in the early stages of development.

Consider India’s electricity consumption – it’s strikingly low. The annual per capita electricity consumption in India stands at 972 kilowatt-hours, merely 8% of what Americans and 14% of what Germans consume. India is gradually transitioning to cleaner cooking fuels and embracing bottled cooking gas, which not only reduces indoor air pollution but is also prevalent in many developing countries. Looking ahead to 2040, India’s energy demand is projected to grow significantly, making it the world’s largest growth in energy demand, as certified by the International Energy Agency.

Consequently, India will require a diverse mix of conventional and renewable energy sources, with coal playing a dominant role as it currently powers 75% of the country’s electricity generation. The rest comes from wind and solar power, which are still evolving.

India boasts an estimated 100 billion tonnes of coal reserves, and the state-owned Coal India, the world’s largest miner, produces around 600 million tonnes of coal annually. Coal is not just about power generation; it’s a vital source of employment and economic growth, driving India’s industrialization efforts. Over four million people are associated with the coal sector, and coal also contributes to various non-power sectors like cement, brick, fertilizers, steel, sponge iron, and other industries. More than 800 districts in India have coal dependence. This situation mirrors the experiences of developed nations when they embarked on their paths to prosperity.

But now, these very nations criticize India’s coal policy without considering the complexities. They underestimate the difficulties of transitioning millions of workers into green jobs, a process fraught with challenges. They also ignore that the UN Secretary-General Antonio Guterres has urged developed nations to lead in phasing out coal, not countries like India.

However, developed countries have not taken this step, instead allowing themselves flexibility in transitioning to renewables. Yet, they focus their criticism on India. This is nothing short of hypocrisy.

Take Germany as an example, often lauded as a green champion. It’s expected to witness its highest emissions surge in three decades, primarily due to increased coal use. Germany generates 27% of its electricity from coal, and this figure will rise when it closes its nuclear plants, leading to an additional 60 million tonnes of carbon emissions annually to meet electricity demand.

It’s crucial to recognize that India, as a billion-plus nation and the world’s third-largest emitter, is making determined efforts to decarbonize its power sector. The goal is to develop 450 gigawatts of renewable energy capacity by 2030, with plans to employ technologies like advanced battery storage for enhanced reliability. The installation of solar, wind, hydro, biomass, and nuclear plants is set to reach over 500 gigawatts by 2030, nearly tripling the current capacity and constituting 64% of India’s generation capacity.

New Delhi is also striving to become a global hub for green hydrogen and green ammonia production. However, coal will continue to account for half of India’s electricity generation until 2030, remaining the primary source of electricity. India aims to phase out 2 gigawatts of coal-burning plants by 2030, with plans to shut down 25 gigawatts of older plants.

Moreover, coal contributes significantly to government revenues through various taxes, including royalty, Goods and Services Tax (GST), and GST compensation cess. The central and state governments rely on coal for a substantial portion of their tax revenues. Electricity, largely generated from the coal sector, also contributes to energy tax revenues for governments. Phasing out coal, as proposed at the Conference of Parties (COP 26) in Glasgow, would have severe implications for government tax collections and could negatively impact the economy at various levels.

It is imperative for the West to consider all these factors before casting judgment. India is committed to phasing out coal but, like Western nations, it must do so on its terms, considering its unique challenges and priorities.

Elon Musk’s Vision for X: Transforming It into the Ultimate Financial Hub

Elon Musk has ambitious plans to transform X into the central hub for all things financial in people’s lives. He anticipates that these new features will be unveiled by the close of 2024. Musk shared his vision with X employees during a recent company-wide meeting, expressing his belief that users will be astounded by the platform’s capabilities.

In Musk’s words, “When I say payments, I actually mean someone’s entire financial life. If it involves money, it’ll be on our platform. Money or securities or whatever. So, it’s not just like send $20 to my friend. I’m talking about, like, you won’t need a bank account.”

Linda Yaccarino, the CEO of X, echoes this sentiment, stating that the company envisions this development as a full-fledged opportunity that could come to fruition in 2024. Musk reiterated his optimism by declaring, “It would blow my mind if we don’t have that rolled out by the end of next year.”

To achieve this transformation, the company is actively working to secure money transmission licenses across the United States. Musk has expressed his hopes of obtaining the remaining licenses that X needs in the coming months.

Musk has previously outlined his intention to mold X into a comprehensive financial center. He even renamed Twitter after his online bank from the dot-com era,, which later became part of PayPal. His plans encompass a wide array of financial services, including high-yield money market accounts, debit cards, checks, and loan services, all with the ultimate goal of enabling users to send money globally in an instant and in real-time.

Musk couldn’t help but reflect on the original vision during the internal meeting. “The X/PayPal product roadmap was written by myself and David Sacks actually in July of 2000,” Musk revealed. “And for some reason PayPal, once it became eBay, not only did they not implement the rest of the list, but they actually rolled back a bunch of key features, which is crazy. So PayPal is actually a less complete product than what we came up with in July of 2000, so 23 years ago.”

The vision of transforming X into a comprehensive financial services hub aligns with Musk’s broader goal of making the platform an “everything app,” similar to super apps like WeChat in China. These super apps offer users a one-stop destination for a range of services, from shopping to transportation, and more.

However, Musk is well aware that achieving this vision will be no easy task. Convincing users of the necessity and advantages of such a platform is just one of the many challenges. Gaining their trust to entrust X with their entire financial lives is another significant hurdle.

US SEC’s Action Halts $130 Mn Fraud Targeting Indian Americans

US market regulator Securities and Exchange Commission (SEC) has announced that it has obtained a temporary restraining order, asset freeze, and other emergency relief to halt an ongoing fraud targeting the Indian-American community that has raised nearly $130 million since April 2021.

The fraud is allegedly being committed by Nanban Ventures LLC; its three founders, Gopala Krishnan, Manivannan Shanmugam, and Sakthivel Palani Gounder; and three other entities that
the founders control, an SEC release said.

The SEC’s complaint, unsealed on Monday in the Eastern District of Texas, alleged that the defendants raised more than $89 million from over 350 investors for investments in purported venture capital funds that the founders managed via Nanban Ventures and more than $39 million from 10 investors that invested directly in the three other entities.

The complaints claimed that the founders overstated the profitability of the investments and paid investors at least $17.8 million in fake profits that were actually Ponzi payments. Further, the defendants misrepresented Krishnan’s expertise and success using his eponymous “GK Strategies” options trading method.

Krishnan claimed in a YouTube video that he achieved returns of “more than a hundred per cent,” and Nanban Ventures claimed in its venture capital funds’ private placement memorandums that Krishnan would manage the funds to generate returns that would “consistently overperform the S&P 500 Index”.

The SEC’s complaint claimed that the actual trading returns using GK Strategies were, with limited exceptions, lower than the returns of the S&P 500 index, lower than the percentage
returns that Krishnan claimed in YouTube videos, and negative on numerous occasions.

“We allege that the defendants engaged in a large-scale affinity fraud that targeted hundreds of investors, largely from the DFW-area Indian American community,” said Gurbir S. Grewal,
Director of the SEC’s Division of Enforcement.

“Through allegedly false promises of unrealistic returns and lies about the success of their investing strategies, the defendants raised nearly $130 million from investors. But in classic Ponzi fashion, the complaint alleges, the defendants used investor money to make fake profit distribution payments, while allegedly siphoning off millions in investors’ funds for themselves,”
Grewal added.

SEC urged all investors to confirm the credentials of supposed investment professionals and to view investments that advertise outsized returns skeptically.

In addition, the complaint said that Nanban Ventures and the founders were all investment advisers who violated their fiduciary duties by causing the venture capital funds to invest more than $70 million into companies the Founders controlled.

The founders commingled that money with more than $39 million from at least 10 other investors and then used the commingled funds to, among other things, make Ponzi payments and pay themselves at least $6 million, the SEC statement read.

The SEC’s complaint charged all defendants with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.

It also charged the founders and Nanban Ventures with violating the antifraud provisions of Section 206 of the Investment Advisers Act of 1940 and Rule 206(4)-8 thereunder.

The complaint sought permanent injunctions, disgorgement of ill-gotten gains with prejudgment interest, and civil penalties from all the defendants, in addition to an order prohibiting the founders from acting as officers or directors of a public company. (IANS)

International Blackmail Scam via Loan Apps Menace Sweeping Across India and Beyond

In an alarming revelation, a nefarious blackmail scheme has emerged, employing instant loan applications to ensnare and disgrace individuals across India, as well as in various Asian, African, and Latin American nations. A heart-wrenching report has exposed the grave consequences of this perilous extortion racket, with at least 60 Indian citizens resorting to suicide after enduring relentless abuse and threats. The BBC’s undercover investigation has shone a light on those profiting from this deadly deception, which has proliferated in India and China.

Astha Sinhaa’s world was abruptly upended when her aunt, in a state of panic, urgently contacted her. “Don’t allow your mother to leave the house,” she implored. Still half-asleep, the 17-year-old was gripped with fear as she discovered her mother, Bhoomi Sinhaa, in the adjacent room, distraught and agitated.

Bhoomi, a vibrant and fearless Mumbai-based property lawyer, had, as a widowed single mother, earned respect for her dedication to her daughter. However, on this fateful day, she was reduced to a state of chaos.

Astha recalls, “She was breaking apart.” Bhoomi urgently began to provide her daughter with instructions on the whereabouts of important documents and contacts, a palpable desperation to exit the premises. Her aunt’s admonition resonated in Astha’s mind: “Don’t let her out of your sight, because she will end her life.”

Little did Astha know the extent of her mother’s torment, who had become a victim of a global scam that had ensnared individuals in at least 14 countries, wielding shame and extortion as its weapons.

The sinister modus operandi of this scam is uncompromising yet straightforward. Numerous apps promise rapid, hassle-free loans. While not all of them operate maliciously, many, once downloaded, surreptitiously harvest users’ contacts, photos, and identification documents, employing this sensitive data as leverage for future extortion.

When borrowers fail to meet repayment deadlines – and sometimes even when they do – these apps transmit user information to a call center. There, young agents in the gig economy, equipped with laptops and smartphones, are trained to relentlessly harass and demean individuals until they comply with demands for repayment.

By the end of 2021, Bhoomi had borrowed roughly 47,000 rupees ($565; £463) from several loan apps, expecting that her work-related expenses would soon be covered. While the funds arrived promptly, a substantial portion was deducted in fees. A week later, her expenses remained unpaid, compelling her to borrow from other apps, creating a spiraling debt that ultimately reached two million rupees ($24,000; £19,655).

Subsequently, the recovery agents commenced their relentless calls, which swiftly devolved into a barrage of insults and abuse directed at Bhoomi. Even after making payments, she was accused of dishonesty. The agents phoned her up to 200 times daily, asserting knowledge of her residence and even sending gruesome images as threats.

As the abuse escalated, Bhoomi’s tormentors threatened to expose her as a thief and a prostitute to all 486 contacts in her phone. When her daughter’s reputation became a target, Bhoomi found herself unable to sleep.

In a desperate attempt to repay her mounting debts, she borrowed from friends, family, and additional apps, eventually totaling 69 in all. Every night, she hoped the morning would never come. However, at 7:00 a.m., her phone would start buzzing relentlessly.

Although Bhoomi eventually managed to repay all the money, one app, in particular, Asan Loan, persisted in its harassment. Overwhelmed and emotionally drained, Bhoomi’s ability to concentrate at work waned, and panic attacks became a daily occurrence.

One day, a colleague showed her a disturbing image on his phone – a lewd, pornographic picture of herself. The photograph had been crudely manipulated, superimposing Bhoomi’s head onto another person’s body. However, it filled her with revulsion and humiliation. The image had been disseminated to every contact in her phone book by Asan Loan, pushing Bhoomi to contemplate suicide.

Disturbingly, this devastating scam has affected numerous lives across the world. However, in India alone, the BBC’s investigation has uncovered that at least 60 individuals have taken their own lives after enduring harassment from loan apps.

These victims, mostly in their 20s and 30s, include a firefighter, an award-winning musician, a young couple leaving behind their three- and five-year-old daughters, and even a grandfather and grandson who were both ensnared in the clutches of loan apps. Shockingly, four of the victims were teenagers.

Regrettably, many of the victims are too ashamed to discuss their ordeal, while the perpetrators, for the most part, remain anonymous and concealed. After a months-long search for an insider, the BBC managed to locate a former debt recovery agent who had worked for call centers associated with multiple loan apps.

This informant, referred to as Rohan (a pseudonym), was deeply troubled by the abuse he witnessed. He recounted customers’ tears and their threats of self-harm, admitting, “It would haunt me all night.” Eventually, Rohan agreed to assist the BBC in exposing the scam.

He successfully secured employment at two separate call centers, Majesty Legal Services and Callflex Corporation, and spent weeks covertly recording their activities. His recordings captured young agents mercilessly harassing clients, issuing threats and profanities. In one incident, a woman resorted to threats of violence. She accused a client of committing incest and, upon their disconnection, callously laughed.

Rohan managed to document over 100 instances of harassment and abuse, thus providing the first tangible evidence of this systemic extortion.

The most egregious instances of abuse occurred at Callflex Corporation, located just outside Delhi. At this call center, agents routinely employed obscene language to degrade and threaten clients. Notably, these agents were not acting independently but rather under the supervision and direction of call center managers, including one named Vishal Chaurasia.

Rohan succeeded in gaining Chaurasia’s trust and, alongside a journalist posing as an investor, arranged a meeting during which they pressured him to elucidate the intricacies of the scam.

Chaurasia revealed that when a customer acquires a loan, the app gains access to their contact list. Callflex Corporation is then contracted to recover the funds, resorting to relentless harassment if a client misses a payment, targeting both the client and their contacts. According to Chaurasia, the agents can say anything, as long as it secures repayment.

“The customer then pays because of the shame,” Chaurasia divulged. “You’ll find at least one person in his contact list who can destroy his life.”

The BBC approached Chaurasia for direct comment, but he declined to provide a statement. Regrettably, Callflex Corporation also failed to respond to the BBC’s outreach efforts.

One of the countless lives torn apart by this scam was that of Kirni Mounika, a 24-year-old civil servant. She was the pride of her family, the only student at her school to secure a government job, and a devoted sister to her three brothers.

Her father, a successful farmer, was ready to support her to do a masters in Australia. The Monday she took her own life, three years ago, she had hopped on her scooter to go to work as usual. “She was all smiles,” her father, Kirni Bhoopani, says. It was only when police reviewed Mounika’s phone and bank statements that they found out she had borrowed from 55 different loan apps. It started with a loan of 10,000 rupees ($120; £100) and spiralled to more than 30 times that. By the time she decided to kill herself, she had paid back more than 300,000 rupees ($3,600; £2,960).

Police reports indicate that Mounika’s ordeal involved incessant calls and vulgar messages from the loan apps, which had escalated to messaging her contacts.

Mounika’s room has now been transformed into a makeshift memorial. Her government ID card hangs near the door, and her mother’s wedding bag remains untouched. What pains her father most is that she never confided in him about her predicament. “We could have easily arranged the money,” he laments, wiping tears from his eyes. His anger is directed toward those responsible for his daughter’s suffering.

As he was accompanying his daughter’s body from the hospital, her phone rang, and he answered to a torrent of obscenities. “They told us she has to pay,” he recalls. “We told them she was dead.” He wondered who these heartless tormentors could be.

Hari, a former employee at a call center tasked with loan recovery for one of the apps Mounika had borrowed from, shares a grim perspective. While he claims not to have personally made abusive calls, he was part of the team responsible for initial, more polite interactions. Hari reveals that managers instructed staff to employ abuse and threats.

Agents routinely sent messages to victims’ contacts, portraying the victims as fraudsters and thieves. Hari emphasizes the importance of maintaining a reputation in front of one’s family, stating, “No one is going to spoil that reputation for the measly sum of 5,000 rupees.” Once a payment was secured, the system signaled “Success!” and they moved on to the next client.

When clients began to threaten self-harm, nobody took these threats seriously until the suicides began. Faced with this grim reality, the staff contacted their boss, Parshuram Takve, to inquire whether they should cease their relentless tactics.

Upon Takve’s appearance at the office, he was notably furious. “He said, ‘Do what you’re told and make recoveries,'” Hari recalls. And so they did.

A few months later, Mounika tragically took her own life. Takve, a ruthless figure, wasn’t the sole mastermind behind this operation. Occasionally, Hari notes, the software interface would inexplicably switch to Chinese.

Takve was married to a Chinese woman named Liang Tian Tian. Together, they established Jiyaliang, a loan recovery business located in Pune, where Hari was employed. In December 2020, Indian authorities arrested Takve and Liang while investigating harassment related to loan apps. However, they were released on bail a few months later.

By April 2022, they faced charges of extortion, intimidation, and abetment of suicide. By the year’s end, they were fugitives from justice.

Takve proved to be a formidable figure, but he did not operate in isolation. At times, the software interface switched to Chinese, suggesting a broader connection. Our investigation led us to a Chinese businessman named Li Xiang, who has little online presence. However, we identified a phone number associated with one of his employees and, posing as investors, arranged a meeting with Li.

During this meeting, Li boasted about his business ventures in India. He disclosed that his companies had been subject to police raids in 2021 in relation to loan apps’ harassment, leading to frozen bank accounts. Li explained that his companies run loan apps in India, Mexico, and Colombia, and he asserted himself as an industry leader in risk control and debt collection services in Southeast Asia. He further revealed plans to expand into Latin America and Africa, employing over 3,000 staff in Pakistan, Bangladesh, and India to provide “post-loan services.”

Li went on to detail his company’s debt recovery methods, explaining, “If you don’t repay, we may add you on WhatsApp, and on the third day, we will call and message you on WhatsApp at the same time, and call your contacts. Then, on the fourth day, if your contacts don’t pay, we have specific detailed procedures. We access his call records and capture a lot of his information. Basically, it’s like he’s naked in front of us.”

For Bhoomi Sinha, the relentless harassment, threats, and abuse were bearable, but the shame of being linked to that pornographic image shattered her. She describes the message as stripping her bare in front of the entire world, causing her to lose her self-respect, morality, and dignity in an instant.

This image was shared with lawyers, architects, government officials, elderly relatives, and friends of her parents – individuals who would never view her the same way again. She explains that it tainted her essence, leaving her with emotional scars akin to mending a broken glass with persistent cracks.

Her community of 40 years has ostracized her, and she reveals that she no longer has friends. However, her daughter’s unwavering support became a source of strength. Bhoomi resolved to fight back, filing a police report, changing her number, and instructing friends, family, and colleagues to ignore calls and messages.

Although her ordeal has been harrowing, Bhoomi found solace in her sisters, her boss, and an online community of others abused by loan apps. Above all, her daughter’s unwavering support has been her greatest source of strength.

The BBC presented these allegations to Asan Loan, Liang Tian Tian, and Parshuram Takve, but neither the company nor the couple responded. Li Xiang asserted that his companies adhere to local laws and regulations, denying any involvement in predatory loan apps and emphasizing their compliance with strict standards for loan recovery call centers. Majesty Legal Services denied the use of customers’ contacts for loan recovery and assured that their agents are instructed to avoid abusive or threatening calls, with violations resulting in dismissal.

Key Takeaways from the IMF and World Bank Annual Meetings

The week-long annual meetings of the International Monetary Fund (IMF) and World Bank concluded in the Moroccan city of Marrakech. Despite being overshadowed by recent Middle East violence and held in a country still recovering from an earthquake, these meetings covered a range of critical topics affecting the global economy. Here are the main points from the meetings:

1.Global Economic Growth: The IMF outlook, approved before the escalation of the Israel-Hamas conflict, predicts a slowdown in global economic growth. It anticipates growth to decrease from 3.5% last year to 3% this year and 2.9% next year, marking a 0.1% downgrade from a previous 2024 estimate. Global inflation is also expected to decrease, from 6.9% this year to 5.8% next year. Central bankers indicated their readiness to halt interest rate hikes if circumstances permit, with the hope that inflation can be controlled without causing a severe economic downturn. The impact of the Middle East conflict on the global economy remains uncertain.

2. Debt Challenges: Discussions frequently revolved around the heavy debt burdens carried by advanced economies, including the United States, China, and Italy. Financial markets recently pushed U.S. bond yields higher, raising concerns. Italian central bank governor Ignazio Visco noted that markets appeared to be reassessing the risks associated with holding longer-term debt. JPMorgan’s Joyce Chang emphasized the return of the “bond vigilantes,” marking the end of the Great Moderation, a period of relative economic stability prior to the 2008/09 financial crisis. This shift could affect policies related to climate change, as escalating subsidies may lead to increased public debt. The IMF suggests that a new approach, with carbon pricing at its core, is needed.

3.Debt Deals and Reforms: Beyond advanced economies, several challenges exist, including higher policy rates, a strong U.S. dollar, and geopolitical uncertainties. Turkey is working on a reform plan, focusing on lowering inflation. Kenya aims to prevent debt distress by planning a buyback of a quarter of its $2 billion international bond maturing in June. Zambia reached a debt rework memorandum of understanding with creditors, including China and France. The situation with Sri Lanka’s debt remains less clear, with an agreement reached with the Export-Import Bank of China but talks with other official creditors stalling.

4.Risks to the Global Economy: The IMF’s Global Financial Stability Report highlights the risks posed by high interest rates. It estimates that approximately 5% of banks worldwide are vulnerable to stress if interest rates remain high for an extended period. Moreover, an additional 30% of banks, including some of the world’s largest, would be at risk if the global economy experiences prolonged low growth and high inflation.

Picture: CNBC

5.Challenges to Consensus-Building: Several factors, including the Ukraine war, growing trade protectionism, and tensions between the United States and China, have made consensus-building more challenging. Notably, no final communique was issued at the end of the meetings. Discussions about restructuring the IMF and World Bank to better represent emerging economies like China and Brazil were held. A U.S. proposal to increase IMF lending power while deferring a review of fund shareholdings gained broad support. However, anti-poverty groups remained skeptical about the outcomes, emphasizing the need for new financial commitments to address poverty and climate change.

The annual meetings of the IMF and World Bank in Marrakech addressed critical global economic issues, including slowing growth, debt challenges, the impact of geopolitical factors, and the need for reforms to address climate change. While these meetings provided insights into these pressing matters, there were concerns about the adequacy of the solutions proposed, particularly in the face of persistent global challenges.

IMF Says Global Economy ‘Limping Along’, Cuts Growth Forecast For China, Euro Zone

The largest Hindu temple in the United States is set to open its doors in New Jersey this Sunday. Located in Robbinsville, the 183-acre BAPS Swaminarayan Akshardham, named after its founding Hindu spiritual organization, rivals major Hindu temples in India.

Yogi Trivedi, a temple volunteer and a scholar of religion at Columbia University, marveled at the temple’s existence, saying, “I wake up every morning and scratch my eyes thinking, ‘Am I still in central New Jersey?’ It’s like being transported to another world, specifically to India.”

The temple is scheduled for official inauguration on October 8, with public access commencing on October 18. For Indian Americans and Hindu Americans, this represents a significant milestone. Trivedi noted, “This is the American Dream. The sacred geography of India and beyond is here in this one place, and you can experience, witness, and admire it all here in New Jersey. I anticipate, as a scholar of religion, that this will become a popular place of pilgrimage for Hindus from across the world.”

Construction of the temple involved 12,500 volunteers from around the world and has been in progress since 2011. However, it gained significant attention a decade later when a group of immigrant laborers filed a lawsuit against the global organization Bochasanwasi Shri Akshar Purushottam Swaminarayan Sanstha (BAPS), which operates temples worldwide. The lawsuit alleged “shocking” conditions, including forced labor, long work hours, inhospitable living conditions, and caste discrimination.

The initial complaint stated, “For these long and difficult hours of work, the workers were paid an astonishing $450 per month, and even less when Defendants took illegal deductions. Their hourly pay rate came to approximately $1.20 per hour.”

BAPS, however, made a distinction between employment and religious volunteer service, known as seva. A spokesperson for BAPS, Ronak Patel, explained, “The artisans who helped to build our mandir came to the U.S. as volunteers, not as employees. We took care of the artisans’ needs in the U.S., including travel, lodging, food, medical care, and internet and prepaid phone cards so they could stay in touch with their families in India. BAPS India also supported the artisans’ families in India, so they did not suffer financial hardship as a result of the artisans’ seva in the U.S.”

Many of the laborers who participated in the temple’s construction arrived in New Jersey from India on religious visas and belonged to the Dalit community, historically marginalized groups in South Asia’s caste system. The lawsuit claimed that temple leadership enforced the caste hierarchy at work.

The lawsuit has been put on hold, with 12 of the original 21 plaintiffs moving to dismiss their claims. BAPS Akshardham spokespeople have assured that the temple will be a place for people of all creeds and castes to gather in community.

The temple’s walls feature carvings of historical figures like Martin Luther King Jr. and Abraham Lincoln, emphasizing inclusivity. Trivedi commented, “When you come to the mandir, you will see people of all genders, all castes, and social backgrounds living, eating, praying, loving, and serving together.”

However, activists argue that the allegations still raise questions about the line between religious service and work exploitation, which particularly affects vulnerable Dalit communities.

Sunita Viswanath, a civil rights activist and co-founder of the civil rights group Hindus for Human Rights, expressed her concerns, saying, “A place of worship, a temple, is such an important space, especially for an immigrant community who’s making a home in a new country. I would want anybody who goes to the temple to really ask themselves, really do some soul searching, about going to a temple where there are such serious allegations of labor and human rights violations.”

The construction of the temple was no small feat, involving the placement of 2 million cubic feet of stone in Robbinsville Township. The temple is a cultural blend, featuring materials sourced from around the world and nods to American history.

The outside of the temple was built with non-traditional Bulgarian limestone to withstand New Jersey’s cold winters. The interior includes stone from various countries, including Greece, Italy, and India. A traditional Indian stepwell contains waters from 300 bodies in India and all 50 U.S. states. Notably, women played key roles in running the project, a rarity in temple construction.

Trivedi sees the temple’s design as representative of the diverse community that will gather there, with inclusivity reflected on the walls. He said, “That kind of inclusivity is not just talked about, it’s actually seen on the walls.”

This landmark Hindu temple in New Jersey, with its rich cultural diversity and complex history, is poised to become a significant focal point for Hindu and Indian American communities across the nation.

How Did Mahatma Gandhi’s Portrait Come On Indian Banknotes

Throughout history, the lens of prominent photographers captured Mahatma Gandhi, but perhaps the most iconic image of him is the one adorning Indian currency notes. As the Father of the Nation, it might seem natural for him to be featured on India’s national currency, but this honor was conferred upon him several decades after India gained independence in 1947. In 1996, Gandhi’s image became a permanent fixture on all denominations of legal banknotes issued by the Reserve Bank of India (RBI), the nation’s central bank entrusted with overseeing India’s banking system. As we approach Gandhi’s birth anniversary, we delve into the origins of this portrait, the symbol it replaced, and the suggestions that have emerged for featuring other iconic figures on Indian banknotes.

The Origins of Gandhi’s Image on Indian Currency

The portrait of Gandhi on Indian banknotes is not a caricature; rather, it is a cut-out of a photograph taken in 1946, where he stands alongside British politician Lord Frederick William Pethick-Lawrence. This particular photograph was chosen because it captured Gandhi with a suitable smile, which was then mirrored to create the iconic portrait. Interestingly, the identities of the photographer behind this image and the person who selected it remain shrouded in mystery.

The responsibility of designing Indian rupee notes lies with the RBI’s Department of Currency Management, which must obtain approval for its designs from the central bank and the Union government. According to Section 25 of the RBI Act, 1934, the central government has the authority to approve the “design, form, and material of banknotes” based on recommendations made by the central board.

When Gandhi First Appeared on INR Notes

Gandhi’s first appearance on Indian currency occurred in 1969 when a special series was issued to commemorate his 100th birth anniversary. These notes, bearing the signature of RBI Governor LK Jha, depicted Gandhi against the backdrop of the Sevagram Ashram.

In October 1987, a series of Rs 500 currency notes featuring Gandhi was introduced.

The Banknotes of Independent India

Following India’s declaration of independence on August 15, 1947, the RBI initially continued to issue notes featuring King George VI from the colonial period. However, this situation changed in 1949 when the government of India introduced a new design for the 1-rupee note. In this new design, King George was replaced with a symbol of the Lion Capital of Ashoka Pillar at Sarnath.

The RBI museum website shares insights from that era, noting that there were deliberations about selecting symbols for independent India. Initially, the idea was to replace the King’s portrait with that of Mahatma Gandhi. Design proposals were even prepared for this purpose. However, the consensus eventually shifted towards choosing the Lion Capital at Sarnath in place of Gandhi’s portrait. The new banknote designs largely followed the earlier patterns.

Consequently, in 1950, the first Republic of India banknotes were issued in denominations of Rs 2, 5, 10, and 100, all bearing the Lion Capital watermark. Over the years, higher denomination legal tenders were introduced, with motifs on the back of the notes evolving to reflect various aspects of new India, from wildlife motifs such as tigers and sambar deer to depictions of agricultural activities like farming and tea leaf plucking in the 1970s. The 1980s saw an emphasis on symbols of scientific and technological advancements as well as Indian art forms, with the Aryabhatta satellite, farm mechanization, and the Konark Wheel featuring on various denominations.

Gandhi’s Portrait Becomes a Permanent Feature

By the 1990s, the RBI recognized the need to enhance the security features of currency notes due to advancements in reprographic techniques such as digital printing, scanning, photography, and xerography. It was believed that inanimate objects would be easier to forge compared to a human face. Consequently, Gandhi was chosen as the new face of Indian currency due to his universal appeal. In 1996, the RBI introduced the ‘Mahatma Gandhi Series’ to replace the former Ashoka Pillar banknotes. This series also incorporated several security features, including a windowed security thread, latent image, and intaglio features designed for the visually impaired.

In 2016, the ‘Mahatma Gandhi New Series’ of banknotes was announced by the RBI, retaining Gandhi’s portrait while adding the Swachh Bharat Abhiyan logo and additional security features on the reverse side.

Demands for Inclusion of Others on Banknotes

In recent years, there have been calls to feature figures other than Gandhi on Indian currency notes. In October 2022, Delhi Chief Minister Arvind Kejriwal appealed to the Prime Minister and the Union government to include the images of Lord Ganesha and goddess Lakshmi on currency notes.

Similarly, in 2014, there were suggestions to include Nobel Laureate Rabindranath Tagore and former President APJ Abdul Kalam on currency notes. However, then Finance Minister Arun Jaitley, addressing the Lok Sabha, revealed that the RBI had rejected these proposals in favor of retaining Gandhi’s portrait. He stated, “The Committee decided that no other personality could better represent the ethos of India than Mahatma Gandhi.”

Furthermore, then RBI Governor Raghuram Rajan emphasized that while India had many great personalities, Gandhi stood out above all others, and other choices could potentially be controversial.

The journey of Mahatma Gandhi’s image on Indian currency is a reflection of India’s evolving identity and the significance attributed to its national icons. While there have been calls to diversify the figures featured on banknotes, Gandhi’s enduring presence continues to symbolize the ethos of India.

The Evolution of the USD to INR Exchange Rate

The United States dollar (USD) stands as one of the world’s most influential currencies, boasting the highest global trade volume. When assessing the strength or weakness of the Indian rupee (INR), the preferred benchmark has consistently been the USD. Remarkably, there was a time when the USD to INR exchange rate was less than 5. However, in 2023, the exchange rate has surged to approximately ₹83 for every 1 US dollar. This article delves into the intriguing history of the USD to INR exchange rate, spanning from pre-independence India to the present day. We’ll explore pivotal economic events that have left an indelible mark on India’s currency landscape.

Here’s the USD to INR history since India’s independence, put concisely for you


Year Exchange Rate [1 USD to 1 INR]
1947 3.30
1949 4.76
1966 7.50
1975 8.39
1980 6.61
1990 17.01
2000 44.31
2005 43.50
2006 46.92
2007 49.32
2008 43.30
2009 48.82
2010 46.02
2011 44.65
2012 53.06
2013 54.78
2014 60.95
2015 66.79
2016 67.63
2017 64.94
2018 70.64
2019 72.15
2020 74.31
2021 75.45
2022 81.62
2023 (as of October 3, 2023) 83.18

Dollar vs. Rupee: A Historical Perspective

The USD to INR exchange rate encapsulates India’s economic journey, with fluctuations mirroring the country’s economic fortunes over the years. By examining the shift from the 1947 rate of 1 US dollar to the Indian rupee, we can gauge the rupee’s strength over time.

Pre-Independence Era – Before 1947

The pre-independence era was characterized by British colonial rule in India, which exerted a profound influence on the nation’s economy, including its currency. Consequently, the value of the rupee was closely tied to economic conditions in Britain. The British Pound, much like other global currencies, had a fixed conversion rate to the USD, with the US dollar itself pegged to gold under the Bretton Woods Agreement.

In the 1930s, the Great Depression sent shockwaves through the global economy, impacting India, a British colony, even more profoundly. Notably, some argue that in 1947, 1 US dollar had a better value compared to later years, possibly due to the British Pound’s higher value relative to the USD. During this period, £1 was equivalent to ₹13.37 Rupees, suggesting that $1 might have been worth ₹4.16 at that time.

Post-Independence – 1947 to 1991

After gaining independence in 1947, India adopted a fixed exchange rate system aimed at stabilizing international trade by managing exchange rate fluctuations through government interventions. While this approach provided stability, it also limited the currency’s ability to respond to changing economic conditions.

The USD to INR exchange rate remained relatively stable, with occasional disruptions caused by wars with Pakistan and China, which strained India’s foreign exchange reserves. Global events like the 1970s oil crisis triggered inflationary pressures, driving up the dollar rate. India’s efforts to balance economic growth, foreign policy, and currency stability played a pivotal role in determining the USD to INR exchange rate during this period.

In response to the Nixon shock in 1971 and the Smithsonian Agreement, both of which had lasting implications for the USD, the Reserve Bank of India and the Indian government implemented various adjustments to the Indian Rupee’s price. By 1975, the INR transitioned from a par value method to a pegged system and eventually to a basket peg.

During Economic Reforms and Liberalisation – 1991 to 2000

The period from 1991 to 2000 marked a turning point in India’s economic history, significantly impacting the USD to INR exchange rate. In 1991, India initiated economic reforms and liberalization measures designed to open its economy to foreign investments and reduce trade barriers. These reforms shifted the country from a fixed exchange rate system to a more flexible one, allowing greater flexibility in exchange rate determination. During this time, 1 USD to INR was approximately 35.

By 2000, the exchange rate had risen, with 1 USD equating to about 45 INR. Factors contributing to this increase included the need to attract foreign capital, address trade imbalances, and global economic events like the late 1990s Asian financial crisis. India’s modernization efforts further shaped the USD to INR exchange rate during this transformative period.

21st Century – 2001 to 2023

In the early 21st century, spanning from 2001 to 2023, the USD to INR exchange rate reflected India’s dynamic economic landscape and global economic conditions. It commenced at approximately 1 USD to 1 INR at 47 in 2001, weakened to around ₹75 in 2020, and further declined to approximately ₹80 in 2023.

While India experienced robust economic growth, attracting foreign investments, the 21st century also witnessed global events with adverse implications for the INR’s value, such as the 2008 financial crisis. The COVID-19 pandemic introduced additional complexities, influencing exchange rates worldwide, including the INR. During this period, domestic economic factors, foreign investments, and global economic developments have collectively shaped the INR’s exchange rate.

Factors Influencing Exchange Rates

Several factors have a bearing on the USD to INR exchange rate:

  1. Trade Balances:A country’s trade balance, reflecting the difference between exports and imports, can impact its currency’s value. A trade surplus (more exports than imports) can strengthen the currency, while a deficit can weaken it.
  2. Inflation:High inflation rates can erode the purchasing power of a currency, leading to depreciation. Central banks often employ interest rates to control inflation, thereby influencing exchange rates.
  3. Interest Rates:Higher interest rates make a country’s economy more attractive to foreign investors, resulting in increased demand for the currency. This heightened demand strengthens the currency’s value relative to others, causing it to appreciate.
  4. Geopolitical Events:Political stability and international relations can affect investor confidence and currency value.
  5. Foreign Direct Investment (FDI):A country’s appeal to foreign investments can impact its currency. Higher rates of FDI can strengthen the currency, while lower rates can weaken it.

From the pre-independence era, marked by British colonial rule, to the post-independence challenges, economic reforms, and the dynamic 21st century, both domestic and international factors have influenced the value of the Indian rupee. The history of the USD to INR exchange rate provides a captivating journey through India’s economic evolution.

US May See Deep Recession, Could Impact India’s Markets, Exports: Economist

The United States could potentially face a significant economic downturn in the near future, and such a scenario would not only impact India’s vital services sector, a key component of the nation’s GDP, but also introduce substantial volatility into both the bond and equity markets, according to a prominent economist.

In an exclusive interview with NDTV, Neelkanth Mishra, the Chief Economist for Axis Bank and part-time chairperson of the Unique Identification Authority of India, expressed his concerns about the United States potentially entering a recession. While initial expectations were that the U.S. would experience a decline in GDP growth, this did not materialize by the end of September, with some believing a “soft landing” was in store.

Mishra offered a counterpoint, highlighting a significant increase in the U.S. fiscal deficit. “Our analysis says, however, that this year, their fiscal deficit has gone up by 4% of their GDP. They had targeted $1 trillion – their fiscal year ends on September 30 – and they ended up with a figure of $2 trillion. If the fiscal deficit is so high, there can’t be a recession,” he explained. However, the challenge lies in maintaining this elevated fiscal deficit to sustain economic growth.

“Even if they manage to keep the fiscal deficit flat next year, which is a problem in itself, the economy will go into a recession. Because of the fiscal deficit being so high, no one is wanting to buy U.S. bonds. Rates are rising because of that, and this is going to lead to a contraction in demand across the world. So, the recession that will happen could be a very deep one,” he cautioned.

Turning his attention to the potential impact on India, Mishra identified four key pathways. Firstly, the services sector, which is already experiencing sluggish growth, could further decelerate, impacting India’s IT services industry and business services exports, which constitute 10% of India’s total exports. This decline could potentially result in a 1% reduction in GDP growth.

The second pathway involves the impact on goods exports, with a drop in demand anticipated. Mishra emphasized that demand for goods is already low in China, Europe, and Japan, and if it also diminishes in the U.S., it could affect India’s goods exports.

The third concern revolves around the risk of product dumping in India. If India remains the sole bastion of demand resilience, manufacturers worldwide may flock to sell their products in India, negatively impacting Indian manufacturers.

Lastly, a U.S. recession could affect the yield on its government bonds, leading to an increase in the cost of capital for other economies. This could particularly affect Indian borrowers, making it harder to secure dollar loans and introducing volatility into financial markets, including bonds and equities.

Addressing how India can prepare for such potential turbulence, Mishra stressed the importance of macroeconomic stability over risk-taking to navigate these uncertain waters. He asserted that macroeconomic stability provides the foundation for sustained long-term growth.

Responding to a question about a recent Morgan Stanley report, which suggested that India’s stock market could rise by 10% with a stable government after 2024 but might fall by 20-60% if stability is not achieved, Mishra challenged this viewpoint. He argued that the central government’s impact on the economy is typically seen over a medium-term horizon, in the range of 3-5 years. State governments, on the other hand, play a more substantial role in short-term economic momentum, influencing foreign and private investments. Mishra highlighted demographic trends in India, such as falling fertility rates and increasing net savings, as indicators of economic strength that are relatively impervious to changes in the central government.

He underlined that this sensationalist forecasting does not align with the economic realities in India. Housing construction, a significant driver of the Indian economy, is unlikely to be significantly affected by changes in the government.

Regarding advice for the middle class in the face of potential economic turbulence, Mishra recommended caution in the coming year or year-and-a-half, as the global economy could experience significant volatility. However, he also expressed optimism about India’s economic trajectory over the next 5-7 years, suggesting that there is no cause for undue concern.

Neelkanth Mishra, a prominent economist, has voiced concerns about the possibility of a deep recession in the United States and its potential impact on India, emphasizing the importance of macroeconomic stability and challenging sensationalist forecasts about the Indian economy. He advised caution in the short term but expressed optimism about India’s longer-term economic prospects.

American Job Market Thrives in September, Exceeding Expectations

In a clear demonstration of ongoing economic strength, American payrolls experienced a significant increase of 336,000 in September, as reported by the Labor Department on Friday. This growth, nearly double what economists had predicted, reaffirmed the robustness of the labor market and the resilience of the economy, which has been grappling with various challenges.

Remarkably, this marked the 33rd consecutive month of job expansion, with September’s surge being the most substantial since January. Meanwhile, the unemployment rate, based on household surveys, remained stable at 3.8 percent, maintaining a level below 4 percent for nearly two years—an achievement not witnessed since the late 1960s.

Samuel Rines, an economist and managing director at Corbu, a financial research firm, commented, “This is an economy on fire,” reflecting the enthusiasm surrounding the economic performance.

Notably, data revisions also brought good news, with hiring figures for July and August being adjusted upwards, revealing an additional 119,000 jobs compared to previous records. These revisions underscored employers’ confidence in the ongoing economic recovery and their belief that there is ample room for further growth.

Andrew Flowers, a labor economist at Appcast, a firm specializing in online recruiting, pointed out that “Fears of an imminent recession have been easing since the spring, allowing businesses to revisit hiring plans they put on hold.”

The release of these figures drew considerable attention from Federal Reserve policymakers, who have been grappling with the challenge of balancing wage and price control through interest rate adjustments. Robust job growth often triggers a sell-off among investors due to concerns over potential rate hikes, which can negatively impact stock and bond prices.

Surprisingly, the market’s response on Friday was generally positive, primarily because the report indicated that the economy was still expanding while wage growth remained moderate, leading many to believe that the Federal Reserve would maintain steady interest rates. Average hourly earnings for workers showed a 0.2 percent increase from the previous month and a 4.2 percent increase from September 2022. While these figures were solid, they fell slightly short of expectations, with the one-year growth rate being the slowest since March 2020.

David Cervantes, founder of Pine Brook Capital Management, an asset management firm, emphasized, “I don’t think the headline jobs number necessarily means an inflationary impulse because average hourly earnings gains are going down,” providing reassurance for those concerned about the inflationary impact of rising wages.

Officials from the Biden administration hailed the report as unequivocally positive, with Jared Bernstein, chair of the White House Council of Economic Advisers, stating, “Simply put, good news is good news, full stop,” highlighting the persistently strong job market under Bidenomics.

The economy’s resilience, more than three years into the recovery from Covid pandemic shutdowns, is evident in various ways. Inflation-adjusted economic growth has accelerated over the summer, even as overall price increases have slowed compared to a year ago. While spending has moderated since its rapid pace in 2021, demand for travel, hospitality, and event tickets remains high, and jobless claims are at their lowest levels since February 2020.

Furthermore, the accumulated savings of Americans during the pandemic have endured longer than expected. In 2019, U.S. households held approximately $980 billion in “checkable deposits,” including checking, savings, and easily cashable money market accounts. In 2023, this figure has surged to over $4 trillion.

However, there are reasons for caution. The suspension of mandatory federal student loan repayments, a pandemic relief measure, is ending this month. The housing market has been affected by a shortage of supply and rising interest rates, resulting in nearly frozen activity and record high home prices.

Consumer sentiment, as measured by the University of Michigan’s index, has improved significantly compared to the previous year but remains well below late 2010s levels. Additionally, it appears that high interest rates will persist for an extended period, posing challenges not only for households but also for businesses in need of fresh financing.

Nevertheless, for the time being, economic activities continue to progress steadily. The MetLife and U.S. Chamber of Commerce Small Business Index, which gauges confidence among small business owners, reached its highest level this quarter since the beginning of the pandemic. This score is roughly in line with late 2019 levels, with 66 percent of small businesses reporting that business conditions are healthy, and 72 percent expressing comfort with their cash flow, despite increased labor costs.

Tom Sullivan, vice president of small business policy at the U.S. Chamber of Commerce, observed, “Main Street employers are showing remarkable resiliency in the face of high inflation and a shortage of workers,” adding that small business owners are feeling more optimistic compared to a year ago, with recession fears receding and inflation gradually easing.

Throughout this year, there has been an ongoing struggle between an economy delivering greater-than-expected overall growth and the concerns of many American families still grappling with the impact of two years of significant increases in living costs. The reduction of federal aid and tax credits has led to an increase in poverty, and energy prices have experienced unpredictable fluctuations.

Most leading indicators, which aim to identify and predict significant shifts in the business cycle, still exhibit warning signs. However, some argue that these data may be influenced by the peculiarities of an economy returning to normalcy after the shock of the pandemic.

Michael Kantrowitz, chief investment strategist at Piper Sandler & Company, noted, “The reality of the business cycle is that there are only two times when ‘all’ the data are moving in the same direction: a recovery and a recession,” indicating that mixed and less clear data outside of these extreme phases should not be dismissed.

As markets grapple with uncertainty, many workers are advocating for a larger share of the still-expanding economic pie. While nonsupervisory employees have seen recent wage increases, private sector hourly workers are currently averaging approximately $17 per hour this year, according to payroll processor ADP. Nevertheless, many workers continue to feel that their wages do not adequately meet their needs.

Jonathan Quito, a 27-year-old ramp agent at La Guardia Airport, shared his perspective, stating that despite a $1 per hour raise last year, he finds it insufficient to cover the rising costs of living in New York City, including groceries, public transportation, and rent. He emphasized the importance of worker advocacy and unionization efforts to secure better wages and improved living conditions.

He concluded, “Eventually, you know, I want to be able to start my own family and stuff,” highlighting his aspiration for a more secure financial future.

America’s National Debt Hits Record $33 Trillion

In September, the gross national debt of the United States reached a staggering $33 trillion, a new record following its previous milestone of $32 trillion earlier in the year. This alarming figure is accompanied by a concerning trend: the U.S. is currently spending more on paying interest on its national debt than on its national defense, as reported by the Treasury’s monthly statement.

The fiscal year up to August saw the Treasury disbursing $807.84 billion in interest payments on its debt securities, while the Department of Defense’s budget for military programs amounted to only $695.44 billion during the same period. This juxtaposition becomes even more significant when considering that the United States outspends every other nation on defense.

The recent years have been marked by significant government spending, leading to a deficit, which occurs when government expenditures exceed tax revenues in a fiscal year. The COVID-19 pandemic triggered the approval of several substantial bills, including the American Rescue Plan Act, with a price tag of $1.9 trillion. The Congressional Budget Office estimates that the debt ceiling package signed into law in the summer to prevent a national default could reduce the deficit by $1.5 trillion over the next decade. However, the Committee for a Responsible Budget (CRFB), a nonprofit organization specializing in federal budget and fiscal matters, suggests that the actual savings could be closer to $1 trillion, depending on “side deals” outside the agreement.

CRFB President Maya MacGuineas emphasized the necessity of addressing healthcare, Social Security, and the tax code to regain control over the national debt.

The government’s borrowing spree in recent years took place during a period of historically low interest rates. However, as interest rates rise and prices continue to climb, the cost of servicing this debt is set to increase. According to the Peter G. Peterson Foundation, nearly $2 billion is spent daily on interest payments for the national debt.

Furthermore, the government’s substantial debt levels can crowd out other borrowing opportunities in the economy, making it more difficult for corporations to secure loans. As Phillip Braun, a clinical professor of finance at Northwestern University’s Kellogg School of Management, explained, “There’s only so much money in the economy, and so with the government borrowing such large amounts, there’s only so much that people are willing to lend overall in the economy, so it pushes out other types of borrowing.” The government had an opportunity to refinance its debt when interest rates were low, but this opportunity was missed, leading to unnecessarily higher borrowing costs.

Who Owns America’s National Debt?

The national debt in the United States is diverse, similar to having various types of personal debt like credit cards, mortgages, and car payments. The U.S. Department of the Treasury manages the national debt, classifying it into two categories: intragovernmental debt and debt held by the public.

Intragovernmental debt, accounting for approximately $6.8 trillion of the national debt, represents obligations between different government agencies. The larger portion of the debt, around $26.2 trillion, is held by the public. This segment includes ownership by foreign governments, banks, private investors, state and local governments, and the Federal Reserve, primarily in the form of Treasury securities, bills, and bonds.

Foreign governments and private investors are among the most significant holders of public debt, possessing roughly $8 trillion. Approximately 50% of this debt is owned by private and public domestic entities, while the Federal Reserve Bank holds approximately 20%. However, there is a silver lining concerning the debt held by the Federal Reserve.

Phillip Braun explained, “The Federal Reserve owns a lot of government debt. The Treasury does pay interest payments to the Federal Reserve, but then the Federal Reserve turns around and gives it back to the Treasury — that alleviates some of the issues.”

A Warning Signal

Rising interest rates are poised to exacerbate the national debt crisis, complicating the government’s ability to respond to economic slowdowns. Michael A. Peterson, CEO of the Peter G. Peterson Foundation, warned, “As we have seen with recent growth in inflation and interest rates, the cost of debt can mount suddenly and rapidly. With more than $10 trillion of interest costs over the next decade, this compounding fiscal cycle will only continue to do damage to our kids and grandkids.”

Charitable Giving Trends in the United States

Charitable giving is a deeply ingrained tradition in the United States, reflecting a blend of entrepreneurial spirit, social consciousness, and religious values. The Philanthropy Roundtable reports that over 80% of all donations to charities and nonprofit organizations in the US come from individuals, and Americans outpace their European counterparts in giving by a factor of seven. Canadians, often known for their generosity, lag behind, contributing about half as much.

The philanthropic landscape in the US can be attributed to three unique elements:

1.Entrepreneurial Spirit: The American dream is synonymous with achieving success and giving back. Many individuals and corporations consider it a duty to help those less fortunate once they’ve achieved their goals.

2.Social Consciousness: From national organizations like the ACLU to local food banks and disaster relief funds, Americans have a rich tradition of assisting their neighbors in times of need.

3.Religion: The United States remains one of the most religious countries globally, with regular giving to churches, synagogues, mosques, temples, and other religious institutions forming an integral part of many Americans’ lives.

Now, let’s delve into the details of charitable giving in the US.

Percentage of American Households Engaging in Charitable Giving

The Philanthropy Roundtable reports that 60% of American households engage in charitable giving, reflecting the nation’s commitment to helping those in need.

Trends in Charitable Giving

Even amidst the global COVID-19 pandemic in 2020, charitable giving in the US continued to follow an upward trajectory. Charity Navigator, a watchdog for charities and nonprofits, notes that since 1977, Americans have increased their giving every year, with a few exceptions in 1987, 2008, and 2009. In this sense, 2020 simply continued the trend of giving more than the previous year.

Religious Giving

Determining which religious group is the most charitable is a complex task due to the diversity of America’s religious makeup. However, recent studies shed some light:

– Jews and Muslims donate more to public society benefit organizations involved in civil rights and social inequalities compared to their Christian and non-Christian counterparts.

– Among Christian groups, Mormons emerge as the most generous, followed by Evangelicals, Protestants, and American Catholics, particularly in the areas of family, children, and human services and causes.

– Jews stand out for their donations to non-Jewish organizations, showcasing the varied giving habits across different beliefs and traditions.

Average Charitable Contributions

The average annual charity donation for Americans in 2020 stood at $737 according to Giving USA. However, this figure can be misleading due to disparities:

– High net worth families donated an average of $29,269.

– For the general population, the average donation was only $2,514.

– The average online donation amounted to $177.

– Non-profit websites received an average of $1.13 from each visitor.

– Many Americans also contribute in-kind donations, such as goods to organizations like Goodwill, the Salvation Army, and local charities, as well as food pantries, which are often not monetarily quantified.

Thus, the average charitable contribution varies significantly based on income, donation method, and recipient.

Charitable Giving by Month

December is the peak month for charitable giving, maintaining its status as the preferred time for generosity in both 2019 and 2020. However, there are interesting nuances:

– In 2020, during the height of the pandemic, charitable giving experienced significant declines in March, April, and May, as reported by Nonprofit Source.

– Charities with recurring monthly giving programs receive an average of $52 each month per donor, showing the effectiveness of this approach.

– Donors who set up recurring monthly donations give 42% more than one-time givers, according to Nonprofit Source.

The Psychology of Asking for $19 a Month

Charities often request donations of $19 a month for two key reasons:

1.Psychology: Studies on consumer behavior suggest that prices ending in numbers like 4, 7, and 9 are perceived as more affordable and appealing. Thus, $19 appears more manageable than $20 to potential donors.

2.IRS Requirements: Charities and nonprofits must provide receipts for annual donations totaling $250 or more. Requesting $19 monthly ensures that the yearly total ($228) falls below this threshold, saving time and costs associated with sending receipts.

Charitable Giving Demographics

Understanding the demographics of charitable donors provides valuable insights:

Age Group: The average age of US donors is 64, predominantly representing the Baby Boomer generation.

Geographical Distribution: Utah stands out as the most charitable state in the US, with over half of the top ten states for total giving located in the South. This correlates with the generosity of Mormons and Evangelical Christians, who are among the country’s most significant donors.

Motivations for Charitable Giving

Research has identified seven key reasons why people give to charities:

1.Happiness: Giving triggers the release of dopamine, the “feel-good” chemical in the brain, leading to increased happiness.

2.Empowerment: Donors feel empowered when they witness their contributions directly benefiting their chosen causes.

3.Personal Connection: Many donors have personal or emotional ties to specific charitable causes.

4.Trustworthiness: Donors prefer charities and nonprofits with a track record of tangible impact.

5.Community: Being part of a larger community and making a difference motivates donors across various sectors, from animal welfare to the arts.

6.Awareness: Charities that effectively capture donors’ attention through advertising, social media, or community events tend to receive more support.

7.Tax Benefits: Tax deductions for charitable donations motivate a significant portion of donors, including those with modest incomes.

Charitable Giving by Income Group

A closer look at charitable giving by income brackets reveals some unexpected trends:

  1. Those earning less than $50,000 annually donate a higher percentage of their income to charity.
  2. Conversely, those with incomes ranging from $100,000 to $500,000 give the least in terms of total charitable donations relative to their gross income.

Charitable Giving Across Generations

Let’s delve into the fascinating world of charitable giving across different age groups, from the tech-savvy Millennials to the seasoned members of the Silent Generation.

Millennials: The Tech-Savvy Donors

Millennials, often associated with digital innovation, contribute an average of $481 to charitable causes annually, with a remarkable 84% engaging in philanthropy. They have a strong penchant for online giving, frequently opting for recurring donations, with over 40% setting up monthly deductions from their credit or debit cards. Furthermore, Millennials are avid users of mobile devices, employing phones, tablets, and laptops to research charities, make donations, and advocate for various causes.

The causes that resonate most with Millennials are children’s charities, health and medical nonprofits, local places of worship, and human rights and international affairs groups.

Generation X: Balancing Giving and Volunteering

Generation X, with an average donation of $732 per individual per year, boasts a 59% participation rate in charitable giving. While their donations may be fewer in number compared to Millennials, Gen Xers are more inclined to initiate fundraising campaigns and actively volunteer for charitable endeavors. Email outreach stands out as the most influential method for engaging this generation in philanthropy.

Gen Xers’ charitable preferences align with local social and human services organizations, animal-related causes, children’s charities, and local places of worship.

Baby Boomers: Generosity Knows No Bounds

Baby Boomers exhibit remarkable generosity, averaging $1,212 in annual donations per person. An impressive 72% of the Baby Boomer generation contributes to charitable causes, representing a significant 43% of all yearly donations. Many of these Boomers, who were once 1960s activists, continue to support causes related to social justice, world peace, and environmental issues.

Their charitable support primarily gravitates toward local social services nonprofits, animal organizations, children’s charities, human rights and international affairs, and local places of worship.

The Silent Generation: Quiet Yet Impactful Giving

The Silent Generation, born between 1927 and 1946, donates an average of $1,367 annually per person, with a remarkable 88% of them participating in charitable giving. Despite comprising only 11% of the US population, they contribute a significant 26% of all charitable donations. Their giving preferences lean toward organizations that reach out via direct mail and causes featured in the news.

Silent Generation donations predominantly support veterans’ causes, local social services, emergency and disaster relief efforts, and local places of worship.

Generational Giving Trends in 2020

In 2020, amidst the challenges posed by the pandemic, only two sub-sectors of nonprofit organizations witnessed notable growth in donations. Local human and social services organizations experienced a 12% surge in giving, while faith-based giving increased by 3%. Conversely, medical researchers and arts and culture subsectors faced declines in donations.

Medical research may have been affected due to the government’s extensive investments in COVID-19 research, potentially overshadowing other medical causes. Additionally, the dominance of COVID-19 news coverage may have diverted donors’ attention away from other health-related issues. Arts, culture, and humanities groups struggled to raise funds due to the limitations imposed by pandemic-related restrictions.

Religious and Church Charitable Giving

Religious giving holds a significant place in the philanthropic landscape, with all four major generational groups contributing to local places of worship.

Most Charitable Giving by Religion

Jewish individuals top the list, contributing an average of $2,526 annually, followed by Protestants at $1,749, Muslims at $1,178, and Catholics at $1,142. Jewish and Muslim donors often direct their contributions to social and human rights organizations, while Christian giving preferences vary by denomination. Nevertheless, 32% of all donations in the US find their way to local places of worship or faith-based nonprofits.

Average Family Contributions to Local Places of Worship

On average, Americans donate $17 weekly to their local places of worship, but surprisingly, 37% of weekly attendees do not contribute at all. Only 5% of congregants are consistent givers. The average weekly church donation per person has experienced a slight decline, dropping nearly 1% since the Great Depression. During the 1930s, Christians contributed 3.3% of their total income to churches, whereas today’s faithful allocate 2.5%.

An intriguing observation is that 75% of non-religious, non-affiliated Americans engage in charitable giving, with many directing their contributions toward faith-based organizations.

Religious Organizations’ Annual Revenue: A Closer Look

Religious organizations are a significant recipient of monetary donations, with approximately one-third of all annual donations flowing in their direction. In 2020, this amounted to a substantial $128.17 billion, as revealed by an extensive survey of IRS tax returns.

Picture: Giving USA

While religious giving has maintained its stability at around the 30% mark for several years, recent trends suggest potential shifts on the horizon. Religious affiliation and regular attendance have been on a decline, with only 36% of American adults claiming to participate in weekly worship.

Volunteer Fundraising Insights: Statistics, Facts, and Trends

We’ve already established that Baby Boomers tend to be the most active volunteers, but there are other intriguing aspects to consider when it comes to volunteering.

The Volunteer Landscape

In the United States, a remarkable 77.34 million adults, equivalent to 30% of the adult population, engaged in volunteering in 2020. These dedicated individuals collectively contributed over 1.6 billion hours of their time, reflecting the spirit of community service.

Volunteer Time Investment

On average, American volunteers devoted 3.5 hours per week to their chosen causes, resulting in an estimated total value of unpaid labor and services amounting to a staggering $255 billion, as reported by Americorps.

Shifting Volunteer Demographics

Notably, there have been discernible shifts in the demographics of volunteers. In 2020, the typical volunteer was more likely to be:

– Married

– Female

– Aged 35-44

– White

– Possessing higher or secondary education

– A parent with children under 18

However, this trend may not persist, given the influence of the pandemic. The pandemic necessitated adjustments, particularly for working mothers who switched to remote work to accommodate their children’s needs when schools closed. This cohort may have chosen to contribute their available “non-lockdown” time to fulfill community needs and simply to escape their homes. Additionally, older generations of volunteers expressed reduced willingness to volunteer due to COVID-19 health concerns.

Volunteer Fundraising Demographics: Generational Giving Patterns

While Baby Boomers traditionally lead in overall volunteering, in 2020, the younger Gen X and older Millennial mothers emerged as the most active volunteers.

Corporate Giving: A Look into Corporate Generosity

Now, let’s explore corporate philanthropy and what businesses contributed in the previous year.

Average Corporate Contributions

Corporate donations to nonprofit organizations amounted to $24.8 billion in 2020, reflecting a 6% decline, according to Giving USA’s report. Corporate giving closely aligns with pre-tax profits, in contrast to individual giving, which exhibits a stronger correlation with stock market performance. Last year, the stock market thrived while many corporations faced profit reductions due to the pandemic’s economic impact.

Leading Corporate Donors in America

In 2020, Pfizer emerged as the most charitable corporation in the United States, according to the Chronicle of Philanthropy. Completing the list of the top five most generous organizations are:

  1. Pfizer
  2. Gilead Sciences
  3. Merck and Company
  4. Walmart
  5. Google

Corporate Contributions to Religious Organizations

Kroger stands out as Double the Donation Organization’s leading corporation in support of churches and other religious institutions. They generously contribute millions in both monetary funds and products to aid hunger relief, homeless support, and various programs managed by local religious entities.

School Fundraising Statistics: Impact of the Pandemic

In 2020, fundraising for K-12 schools experienced a notable 4.6% decline, as reported by Giving USA. Typically, schools generate approximately $5000 per school each year through fundraising activities. The closure of schools due to the pandemic likely contributed to this decrease in fundraising revenues.

Online Giving Trends: A Digital Perspective on Philanthropy

Online charitable giving experienced substantial growth in 2020, which can largely be attributed to the pandemic’s influence.

Online Charitable Giving Growth

In 2020, every sector witnessed a minimum of a 15% increase in charitable giving compared to previous years, with the overall charitable giving growth rate surging by 20%.

Insights into Giving Tuesday

The popularity of Giving Tuesday has continued to rise since its inception in 2012, with $380 million raised in the most recent year.

Origins of Giving Tuesday

Giving Tuesday was initiated in 2012 by the United Nations Foundation in New York City. It falls on the first Tuesday following the Thanksgiving holiday.

Online Crowdfunding Insights

Online crowdfunding has become an essential tool for nonprofits, with notable campaigns achieving substantial success.

Notable Crowdfunding Campaigns

Two nonprofit crowdfunding campaigns that achieved significant success were conducted by Save the Children and the American Red Cross, raising $20 million and $4.7 million, respectively.

Key Factors Influencing Crowdfunding Success

Success in crowdfunding campaigns largely depends on several factors, including:

– Extensive sharing on social media, with success rates increasing with the number of social media contacts. For instance, having 10 friends share increases success by 9%, while 100 friends lead to a 20% boost.

– Comprehensive campaign descriptions ranging from 300 to 500 words.

– Regular updates to engage and inform supporters; campaigns with updates every 5 days garner three times more donations.

– The inclusion of videos in campaign appeals, resulting in a 150% increase in donations compared to campaigns without video content.

Global Nonprofit Landscape

The world boasts 1.54 million nonprofits registered with the IRS, as documented by the National Center for Charitable Statistics. This expansive array of organizations offers numerous causes to support.

In Conclusion

Even in a year characterized by unprecedented uncertainty and upheaval like 2020, the spirit of giving has endured and, remarkably, flourished. Americans continued to give, and their generosity seemed to grow even amidst adversity, social unrest, and political divisions.

This enduring generosity reflects a remarkable facet of American society.

New York Is Rebounding for the Rich. Nearly Everyone Else Is Struggling

As New York City approaches a gradual recovery from the economic setbacks caused by the pandemic, Manhattan, the city’s financial hub, has reached a sobering milestone. It now boasts the most substantial income inequality of any large county in the United States.

In a city already renowned for its stark contrasts between opulent living and severe poverty, this widening income gap is particularly striking. According to 2022 census data, recently released this month and analyzed by demographic data firm Social Explorer, the top 20 percent of Manhattan residents had an average household income of $545,549. This is over 53 times the average income of the bottom 20 percent, who earned an average of $10,259.

Andrew Beveridge, President of Social Explorer, commented on this staggering inequality, noting, “It’s amazingly unequal.” He likened it to disparities seen in many developing countries. This income gap is the widest in the United States since 2006, when such data was first reported. Notably, the Bronx and Brooklyn also rank among the top 10 counties in the nation concerning income inequality.

This latest data reinforces the uneven nature of New York City’s recovery from the pandemic. While wages have risen across the city, the benefits have primarily accrued to the affluent. Jobs have returned, but many of these are low-paying positions. While unemployment has decreased, it remains significantly higher among Black and Hispanic residents. This dichotomy underscores a growing divide: the city is rebounding, but many of its residents are not.

James Parrott, Director of Economic and Fiscal Policy at the Center for New York City Affairs at the New School, stated, “We’re still much worse off than we were in 2019.”

The Department of Housing and Urban Development reports that nearly 20 percent of public housing residents in New York City earn less than $10,000.

Middle-income New Yorkers are also feeling the pinch. Roger Gunning, a 50-year-old sanitation worker and resident of public housing in the South Bronx, shared his struggles, saying, “I make $22 an hour, and I still can’t survive on my own in New York.” He noted that some of his co-workers are forced to live in temporary shelters.

Dr. Parrott explained that middle-income New Yorkers have been hit hard by stagnant wage growth in service jobs and the slow recovery of key industries, particularly retail, which experienced a more severe contraction in New York compared to most other parts of the country.

When adjusting for inflation, the median household income in New York City dropped to less than $75,000 between 2019 and 2022, marking nearly a 7 percent decrease. This decline is four times the national rate and represents the most significant income drop among major U.S. cities. For comparison, San Antonio experienced just over a 5 percent drop, with median household income falling below $59,000. Phoenix, on the other hand, saw a significant improvement with an almost 8 percent increase in median household income, reaching nearly $76,000.

Chino Zeno, a 21-year-old construction worker earning $23 per hour installing solar panels, expressed his frustration with the impact of inflation on his finances. To cover rising costs of food and gas and help with expenses at his family’s apartment in East New York, Brooklyn, he also works as a freelance photographer. Despite a recent pay increase, which followed his transition from a part-time warehouse job earning $16 per hour in 2021, he still finds it necessary to hold down a second job.

Zeno summed up the challenge many New Yorkers face, stating, “One hundred is the new $20 bill. It’s hard for people right now.”

The already affluent have benefited the most from rising wages, according to labor data analyzed by the Center for New York City Affairs. Low-paid workers, like restaurant servers and child care professionals, who made an average of $40,000 last year, saw their salary increase by just $186 every year from 2019 to 2022, when adjusted for inflation. But highly paid earners, who made an average of $217,000 in fields like technology and finance, received an average pay bump of $5,100 in each of those years, or 27 times more, in extra income, than low-wage earners.

Picture: NYT

A recent analysis of labor data by the Center for New York City Affairs reveals a stark contrast in wage growth between the already well-off and low-paid workers. While highly paid earners in fields such as technology and finance, who averaged $217,000 annually, enjoyed an average pay increase of $5,100 each year from 2019 to 2022, their low-wage counterparts, including restaurant servers and child care professionals with an average income of $40,000, saw a meager salary rise of just $186 annually when adjusted for inflation.

The city has made significant strides. In August, the labor force participation rate was at a record high, and the unemployment rate was 5.3 percent, down from a pandemic peak of over 21 percent in May 2020. But New York has yet to fully recoup the jobs lost since the pandemic, while much of the nation already has, in part because the virus struck the city sooner and businesses, including those tied to hospitality and tourism, remained closed longer, Dr. Parrott said. Other popular entry-level jobs like couriers and home health aides have seen their wages lose ground to inflation.

Despite notable progress in New York City, including a record-high labor force participation rate and a decreased unemployment rate of 5.3 percent in August, down from its pandemic peak of over 21 percent in May 2020, the city has not completely recovered the jobs lost during the pandemic. This lag in recovery is attributed in part to the city being hit by the virus earlier than other areas and the extended closures of businesses tied to the hospitality and tourism sectors. Additionally, wages for popular entry-level jobs like couriers and home health aides have failed to keep pace with inflation.

Charles Lutvak, a spokesman for the mayor’s office, credited the job growth to initiatives like the expansion of youth employment and apprenticeship programs. “But we have more work to do, and we won’t stop until every New Yorker has access to a quality, family-sustaining job,” he said in a statement.

Charles Lutvak, spokesperson for the mayor’s office, attributed the city’s job growth to various initiatives, including the expansion of youth employment and apprenticeship programs. He emphasized their commitment to continue working toward ensuring that all New Yorkers have access to quality, family-sustaining employment opportunities.

Wage growth has been stunted for many New Yorkers in part because the minimum wage, set at $15 an hour, has not increased since 2019, Dr. Parrott said. Among the 10 largest American cities, five have raised their minimum pay in that period by an average of 25 percent, and four of them have higher minimum wages than New York City.

Wage growth in New York City has been hampered, in part, by the stagnant minimum wage, which has remained at $15 per hour since 2019, according to Dr. Parrott. In contrast, five of the ten largest American cities have increased their minimum wages by an average of 25 percent during the same period, with four of them now surpassing New York City’s minimum wage.

Many labor groups are pushing for a $21-an-hour minimum wage, which itself could fall short of the cost of living, because the city does not scale pay to inflation, said Gregory Morris, the chief executive of the New York City Employment and Training Coalition, an association of work force development groups. Next year, New York State will raise the minimum to $16 an hour in the greater New York City area and $15 statewide. In 2027, the minimum wage will be pegged to inflation.

Several labor organizations are advocating for a $21-per-hour minimum wage, although this amount may still not adequately cover the cost of living, as the city does not adjust wages for inflation, according to Gregory Morris, CEO of the New York City Employment and Training Coalition, a consortium of workforce development organizations. In the upcoming year, New York State plans to increase the minimum wage to $16 per hour in the greater New York City area and $15 statewide, with provisions to peg it to inflation in 2027.

“This is a working people’s city, as the mayor points out, but I think the question now is, which working people?” Morris asked.

Gregory Morris posed a crucial question, noting that New York City has long been characterized as a city of working people. However, he raised concerns about which segments of the working population are truly benefitting from the city’s economic growth.

For Khadijah Bethea, 42, a single mother raising three children on the Lower East Side of Manhattan, finding work is not the problem. It’s the hours.

Khadijah Bethea, a 42-year-old single mother raising three children in Manhattan’s Lower East Side, doesn’t struggle to find work; rather, her challenge lies in the demanding hours associated with her employment.

After losing her job as a security guard at a bank in 2020, she started working as a server for catering events around the city — up to 70 hours a week, seven days a week.

Following her job loss as a bank security guard in 2020, Khadijah Bethea transitioned to working as a server at various catering events across the city. Her new role required her to put in long hours, often up to 70 hours per week, working every day.

At over $25 an hour, the jobs were worthwhile, but all-consuming, she said. “I caught a bad anxiety attack one day. You worry about not spending enough time with your children, so I said, ‘I need to find something else to do.’”

While the pay for her server role exceeded $25 per hour, Khadijah found the job to be all-consuming and stressful. She experienced a severe anxiety attack, leading her to reflect on the importance of spending time with her children and prompting her to seek alternative employment.

Ms. Bethea enrolled earlier this year in a 14-week career training program run by Henry Street Settlement and Stacks + Joules, two nonprofit organizations. The free program helps lower-income job seekers find work in heating and ventilation system management for large buildings.

Earlier this year, Khadijah Bethea enrolled in a 14-week career training program offered by two nonprofit organizations, Henry Street Settlement and Stacks + Joules. This program, which is free of charge, assists individuals with lower incomes in securing employment related to heating and ventilation system management for large buildings.

She graduated in May and is now enrolled in another training program that pays $20 an hour — less than she made waiting tables — but has the opportunity for career growth and the possibility of working remotely some days. For now, she still works about four catering gigs a week.

Khadijah successfully completed the program in May and has since joined another training program that offers a wage of $20 per hour. Although this is less than what she earned as a server, the position presents opportunities for career advancement and the potential to work remotely on certain days. Currently, she continues to work approximately four catering jobs each week.

A significant dilemma for job seekers is that taking the time to learn new skills can be costly, especially in an expensive city like New York, said Anisee Alves-Willis, a program director for YouthBuild, a six-month employment program through St. Nicks Alliance, a nonprofit community services group.

One significant challenge faced by job seekers is the expense associated with acquiring new skills, particularly in a costly city like New York. Anisee Alves-Willis, a program director for YouthBuild, a six-month employment program offered by the nonprofit community services group St. Nicks Alliance, highlighted this dilemma.

The time commitment is a luxury many low- and middle-income workers can’t afford, even when stipends are included.

Even when stipends are provided, the time commitment required for skill development can be a luxury that many low- and middle-income workers cannot afford.

Angelita Mendez, 35, a beautician who moved to Washington Heights in Manhattan from the Dominican Republic in 2021, began taking free English lessons last year with a nonprofit service provider.

Angelita Mendez, a 35-year-old beautician who relocated from the Dominican Republic to Washington Heights in Manhattan in 2021, initiated free English lessons with a nonprofit service provider in the previous year.

She only made it about halfway through the course before bills started to pile up — the $1,600 a month rent she splits with her mother, the $1,100 a month she pays to lease a booth in a salon and the rising cost of groceries for her two children. She makes about $600 a week, or around $31,000 a year.

Angelita Mendez was unable to complete the English course as financial pressures began mounting. She shares a monthly rent of $1,600 with her mother, incurs a monthly expense of $1,100 for leasing a booth in a salon, and faces increasing grocery costs for her two children. Her weekly income amounts to roughly $600, equivalent to an annual income of around $31,000.

“I don’t have the time to do it, honestly,” she said in Spanish, but hopes to one day return to the class, become proficient in English and use her skills to study cosmetology.

Expressing her circumstances in Spanish, Angelita Mendez revealed that she currently lacks the time to continue her English lessons. Nevertheless, she aspires to return to the course at some point, attain proficiency in English, and leverage her language skills to pursue studies in cosmetology.

Where would her newfound skills take her?

Probably New Jersey, she said — where it’s cheaper.

Angelita Mendez anticipates that her newly acquired skills could lead her to opportunities in New Jersey, where the cost of living is more affordable.

The analysis of labor data in New York City reveals significant disparities in wage growth, with higher-income earners experiencing substantial pay increases while low-wage workers struggle to keep up with inflation. Although the city has made progress in terms of employment rates, the recovery of lost jobs from the pandemic remains a challenge, particularly for certain industries. Calls for a higher minimum wage and concerns about the affordability of skill development programs highlight the difficulties faced by many low- and middle-income workers in the city. Despite these challenges, individuals like Khadijah Bethea and Angelita Mendez are taking steps to improve their career prospects and financial stability, emphasizing the importance of accessible training programs and affordable living conditions in the city.

Mortgage Borrowing Costs Surge, Hitting 23-Year High

In another setback for aspiring homebuyers grappling with an increasingly unaffordable housing market, home loan borrowing costs have once again surged this week, propelling the average long-term U.S. mortgage rate to its highest point in nearly 23 years.

According to Freddie Mac, the average rate on the benchmark 30-year home loan has risen to 7.31%, up from 7.19% just last week. For comparison, a year ago, this rate averaged 6.70%.

For those looking at 15-year fixed-rate mortgages, which are favored by homeowners seeking to refinance, the news isn’t any better. The average rate for these mortgages has climbed to 6.72% from 6.54% last week, and a year ago, it was at 5.96%.

Freddie Mac’s Chief Economist, Sam Khater, commented on this trend, saying, “The 30-year fixed-rate mortgage has hit the highest level since the year 2000. However, unlike the turn of the millennium, house prices today are rising alongside mortgage rates, primarily due to low inventory. These headwinds are causing both buyers and sellers to hold out for better circumstances.”

Picture: BNN Breaking

These rising rates are adding significant financial pressure on borrowers, increasing their monthly costs and further limiting their ability to afford homes in a market that’s already unattainable for many Americans. Additionally, these elevated rates are discouraging homeowners who locked in historically low rates two years ago from selling. To put things in perspective, the average rate on a 30-year mortgage has now more than doubled since two years ago when it stood at just 3.01%.

The combination of soaring rates and limited home inventory is exacerbating the affordability crisis, keeping home prices at near all-time highs. This is occurring even as sales of previously owned homes in the U.S. have dropped by 21% during the first eight months of this year compared to the same period in 2022.

This marks the third consecutive week of rising mortgage rates. The weekly average rate on a 30-year mortgage has been above 7% since mid-August and has now reached levels not seen since mid-December 2000, when it averaged 7.42%.

The surge in mortgage rates is closely tied to the increase in the 10-year Treasury yield, which serves as a reference point for lenders when determining loan pricing. Over the past few weeks, the yield on the 10-year Treasury has risen significantly, driven by concerns that the Federal Reserve will maintain higher short-term interest rates for an extended period to combat inflation.

The Federal Reserve has already elevated its main interest rate to levels not seen since 2001 in an effort to tame surging inflation. In addition, it recently indicated that any future rate cuts may be less substantial than previously anticipated.

The prospect of higher interest rates in the long term has led to Treasury yields reaching levels not seen in more than a decade. The yield on the 10-year Treasury, for example, was at 4.61% during midday trading on Wednesday. In contrast, it stood at around 3.50% in May and was a mere 0.50% during the early stages of the pandemic.

It’s important to note that while mortgage rates don’t directly mirror the Federal Reserve’s rate increases, they are strongly influenced by the yield on the 10-year Treasury note. Factors such as investor expectations regarding future inflation, global demand for U.S. Treasuries, and the Federal Reserve’s actions on interest rates all play a role in determining rates for home loans.

India’s ‘Massive Expansion’ Set To Be A Key Driver Of Global Economic Growth

India’s impressive economic performance, coupled with strong growth projections for select Southeast Asian nations, is poised to serve as a significant catalyst for global economic expansion, according to insights from S&P Global.

During the annual energy APPEC conference, Rajiv Biswas, S&P Global’s Chief Economist for the Asia-Pacific region, underscored the pivotal role of the Asia-Pacific in driving global economic growth, both in the short term and the foreseeable future. He emphasized that over the next decade, the Asia-Pacific is expected to outpace other regions in terms of economic growth.

“When we look over the next decade, we do expect Asia-Pacific to be the fastest growing region of the world economy,” Biswas remarked. He specifically highlighted several bright spots in the region, including India, Indonesia, the Philippines, and Vietnam.

Biswas articulated, “A massive expansion is underway in the Indian economy, and there is also a very favorable outlook in Southeast Asia — where we anticipate robust growth, particularly in countries such as Indonesia, the Philippines, and Vietnam, which are poised to be among the world’s fastest-growing emerging markets in the coming decade.”

Vietnam, for instance, recorded a second-quarter GDP growth rate of 4.14%, outpacing the 3.28% growth rate observed in the first quarter. Meanwhile, Indonesia, Southeast Asia’s largest economy, expanded by 5.17% year-on-year in the June quarter. In contrast, the Philippine economy grew at a rate of 4.3%, slightly below Reuters’ expectations of a 6% increase.

India, on the other hand, experienced robust economic growth, with a remarkable 7.8% expansion in the June quarter, marking its fastest pace of growth in a year. Biswas expressed optimism about India’s economic momentum, affirming S&P Global’s forecast that India will surpass Japan to become the world’s third-largest economy by 2030. The projection envisions India’s GDP climbing from $3.5 trillion in 2022 to a substantial $7.3 trillion by 2030.

In the broader context of the Asia-Pacific region, S&P Global anticipates growth to strengthen from 3.3% in the previous year to 4.2% in the current year, according to their projections. Biswas further elucidated, “Over the next decade, we expect that about 55% of the total increase in the world’s GDP will come from the Asia-Pacific region.”

The Implications for the U.S. and China:

Despite the impressive growth trajectory of the Asia-Pacific region, Rajiv Biswas emphasized that the United States will continue to play a pivotal role in driving global economic growth, contributing to approximately 15% of the world’s growth over the next decade.

Picture: CNBC

Likewise, China, despite experiencing a somewhat weaker recovery than anticipated and a slowdown in growth momentum, will remain a significant contributor to global economic expansion. China is expected to account for approximately one-third of the total increase in global GDP over the same period.

Biswas acknowledged that China has faced challenges, as a slew of economic data has fallen short of expectations. This has led to concerns about the sustainability of its growth trajectory.

In the broader global context, S&P Global’s outlook indicates that the global economy is poised for modest growth, with a projected growth rate of 2.5% for both the current year and the following year.

The Asia-Pacific region, led by India and select Southeast Asian economies, is expected to serve as a critical driver of global economic growth in the coming decade. While the United States and China will continue to play essential roles in this global economic landscape, the dynamism and growth potential of the Asia-Pacific region make it a focal point for economic opportunities and investment in the years ahead. S&P Global’s projections highlight the importance of monitoring these evolving economic dynamics for businesses and policymakers worldwide.

India’s consumer market set to become the world’s third largest by 2027, behind the U.S. and China

India’s consumer market is on track to become the world’s third-largest by 2027, driven by a rising number of middle to high-income households, according to a report from BMI. Currently ranking fifth globally, Fitch Solutions predicts that a substantial 29% increase in real household spending will propel India up two positions in the global consumer market hierarchy.

In fact, the report anticipates that India’s per capita household spending growth will outpace that of other developing Asian economies like Indonesia, the Philippines, and Thailand, with a year-on-year increase of 7.8%. This robust growth is expected to significantly widen the gap between total household spending in the ASEAN region and India.

BMI’s estimates suggest that India’s household spending will surpass the $3 trillion mark, driven by a compounded annual growth rate of 14.6% in disposable income until 2027. By this time, approximately 25.8% of Indian households are projected to reach an annual disposable income of $10,000 or more. BMI noted that a significant portion of these households will be concentrated in major economic centers like New Delhi, Mumbai, and Bengaluru, with wealthier households primarily located in urban areas, providing an attractive target market for retailers.

India’s substantial youth demographic is another key driver behind the anticipated surge in consumer spending. Approximately 33% of the country’s population falls within the age bracket of 20 to 33 years old. BMI expects this demographic to contribute significantly to the consumer electronics sector, with communication spending projected to grow at an average annual rate of 11.1% to reach $76.2 billion by 2027. This growth is attributed to a technology-savvy urban middle class with increasing disposable income, which encourages expenditure on aspirational products like consumer electronics.

Additionally, India’s ongoing urbanization process is expected to further bolster consumer spending. As more people move to urban areas, companies find it easier to access consumers and establish physical retail stores to cater to their needs. Major global brands like Apple and Samsung have already capitalized on this trend. Apple, for instance, opened two retail stores in Delhi and Mumbai in April, while Samsung announced plans to establish 15 premium experience stores across India by the end of the year, targeting major cities like Delhi, Mumbai, and Chennai.

Furthermore, BMI pointed out that global investors, including the Blackstone Group and APG Asset Management, have shown increased interest in India’s shopping mall business, recognizing the growth potential in consumer spending. They have injected additional investments into the country’s shopping mall sector to capitalize on the anticipated expansion in consumer spending.

India’s consumer market is poised for significant growth, with the country expected to climb to the third position in the global consumer market rankings by 2027. This ascent is attributed to the expected increase in real household spending, which will outpace other developing Asian economies, as well as the influence of India’s large youth population and ongoing urbanization. As global investors and major retailers continue to recognize this potential, India’s consumer market is becoming an increasingly attractive destination for business and investment.

Chinese Exporters Use Currency Swaps To Hedge Against Falling Yuan

Chinese exporters have adopted a sophisticated currency swap strategy to avoid converting their dollar earnings into yuan due to concerns about potential losses in the weakening local currency, as revealed by official data and discussions with industry insiders.

China’s state-owned banks are involved in some of these swap transactions, allowing exporters to convert their dollar earnings into yuan through contractual agreements, indicating a level of comfort from the country’s currency regulator. This practice persists even as authorities attempt to alleviate the mounting pressure on the yuan in the spot markets.

Ding, a Shanghai-based businessman dealing in electronics and toys, is among those exporters who are holding onto their dollar earnings, hesitating to convert them into yuan. The recent depreciation of the yuan, which has hit nine-month lows, has raised concerns among exporters like Ding. He expressed this apprehension, saying, “The key concern is that the price of the dollar keeps going up.”

The yuan has experienced a depreciation of over 5% against the U.S. dollar so far this year, with a 2% drop recorded in just the past month. This decline is exacerbated by foreign capital fleeing from China’s weakening economy.

Picture: South China Morning Post

These swaps enable exporters to deposit their dollars with banks and receive yuan in return, but with a contractual agreement that will eventually reverse the transaction, returning their dollars. However, despite the impact of these swaps on the supply of dollars in the spot yuan markets, analysts believe that Chinese monetary authorities cannot compel exporters to convert their dollars.

In July alone, Chinese companies engaged in a record $31.5 billion worth of dollar-yuan swaps with commercial banks in the onshore forwards market. This year, the total figure stands at $157 billion, according to data from China’s currency regulator.

Initially, Ding had plans to convert his dollar holdings when the yuan weakened beyond 7 yuan per dollar, a threshold the local currency had breached only three times since the 2008 Global Financial Crisis. However, his decision shifted as expectations grew regarding the Federal Reserve’s intent to maintain higher U.S. interest rates for an extended period and the continued weakness of the yuan, which is seeing its yields decline as China adopts a more lenient monetary policy to support its struggling economy.

“The growing monetary policy divergence is the key reason behind the trend,” explained Gary Ng, Senior Economist for Asia Pacific at Natixis. “As it is unlikely to see any fundamental change in the short run, the gravity of yield differentials will drag the yuan and prompt exporters to bet on the dollar.”

The increasing gap between rising U.S. yields and Chinese rates has reversed rates in the currency forwards market. This means that exporters have no incentive to lock in a forward rate to sell their dollars, with the one-year yuan being quoted at 7.02 per dollar, compared to a spot rate of 7.29.

Traders have noted that the State Administration of Foreign Exchange allows sell-buy dollar-yuan swaps as long as companies use their own funds. When exporters swap higher-yielding dollars for the cheaper yuan, even for a short period of three months, they acquire the local currency for business needs and also earn an annualized 3.5% on the swap deal.

Becky Liu, Head of China Macro Strategy at Standard Chartered Bank, elaborated, “By trading FX swaps, exporters can postpone their settlements while meeting their yuan demand.”

An alternative option, albeit less lucrative, is for exporters to deposit their dollars at 2.8% interest and use these deposits as collateral for yuan loans, resulting in net gains of approximately 2%.

Despite Chinese lenders reducing their dollar deposit rates twice this year to discourage hoarding and encourage exporters to convert dollars into yuan, more exporters are turning to swaps. Even China Merchants Bank, which is partially state-owned, promotes the use of swaps. The bank stated, “If companies want to retain their dollar deposits, they can sign up for foreign exchange swap products to increase the returns on dollar deposits.”

Meanwhile, China’s central bank has intensified its efforts to support the yuan by consistently setting stronger-than-expected yuan mid-point benchmarks over several months. It has also urged domestic banks to reduce their overseas investments.

In contrast, exporters’ swaps provide state banks with a reservoir of dollars to utilize in their yuan operations. This includes engaging in swaps to acquire dollars from the onshore forwards market and selling them in the spot market to curb rapid declines in the yuan’s value.

Hindenburg 2.0 Accuses Adani Group Of Manipulating Finances

At a time when the Supreme Court is hearing the Adani Group-Hindenburg case, the business conglomerate was on Thursday hit by fresh allegations that it used family associates to secretly invest hundreds of millions of dollars through “opaque” Mauritius-based investment funds to fuel the spectacular rise in group stocks.

 Citing a review of files from tax havens and internal Adani Group emails, the Organised Crime and Corruption Reporting Project (OCCRP) said two individual investors with “longtime business ties” to the Adani family used such offshore structures to buy and sell Adani shares between 2013 and 2018 — a period during which the ports-to-energy conglomerate saw meteoric rise to become India’s largest and most powerful businesses.

OCCRP is a non-profit global network of investigative journalists funded by Hungarian-American billionaire and philanthropist George Soros.

Picture : Eligibility

 OCCRP said Nasser Ali Shaban Ahli from the UAE and Chang Chung-Ling from Taiwan spent years trading Adani group stock worth hundreds of millions of dollars through two Mauritius-based funds that were overseen by a Dubai-based company run by a known employee of Vinod Adani.

 Market regulator SEBI had been handed evidence in early 2014 of alleged suspicious stock market activity by the Adani Group, OCCRP said citing a letter.

U K Sinha, who was then heading SEBI, is now a director and chairperson of an Adani-owned news channel.

The fresh broadside, which comes months after US short-selling firm Hindenburg Research published an explosive report in January that accused Adani Group of running the “largest con in corporate history”, sent all 10 listed Adani stocks down.

 Shares of nine out of 10 Adani group companies closed in the red on Thursday, taking a combined hit of Rs 35,708 crore in market valuation after the OCCRP report. More here

 On the OCCRP allegations, the Group on Thursday termed them as “recycled allegations” and called them “yet another concerted bid by (George) Soros-funded interests supported by a section of the foreign media to revive the meritless Hindenburg report”.

 Opposition parties, which stalled proceedings in Parliament for nearly one full session when the Hindenburg allegations first came out, were quick to latch on to the OCCRP to attack the government and Adani Group.

Maintaining that India’s reputation is at stake ahead of the G20 Summit, Congress leader Rahul Gandhi asked why PM Modi was silent on the allegations and demanded a probe by a joint parliamentary committee (JPC).

Will BRICS Create A New Balance In The Global Order?

If BRICS can truly identify issues of larger common interest and move forward on the basis of consensus, it can become the new leader of the post-Western world order where the NDB will be the primary competitor of the World Bank and IMF.

The collapse of the Soviet Union brought about a dramatic social and economic restructuring that had numerous long-lasting impacts on both the global economy and the population. At that time, the nations that held the titles of “Great Power” and “Super Power” used different tricks to establish their own Shadow Governance over the undeveloped, least-developed, and developing nations. Radical institutionalism supported this neo-colonialism as well. Some international organizations have, by their policies and actions, used developing countries as pawns in imperialist geopolitics, where the sovereignty of weak governments was in jeopardy and their freedom of statehood was constrained.

Picture : China Daily

The BRICS ((Brazil, Russia, India, China and South Africa) – which is having its 15th summit August 22-24 in Johannesburg – has emerged in this context with the goal of establishing a new global balance through leadership in a world torn apart by geopolitical conflict, inequality, and insecurity. The grouping’s primary and secondary goals are to create a sustainable and alternative financial lending system, with the potential to coalesce into a platform that echoes the concerns of the Global South. In the distant future, it might take on the role of promoting and regulating a more balanced world order.

Particularly impressive are the bloc’s integrated fiscal policies and strategies in the fields of trade and investment. The New Development Bank (NDB), which was established with an initial capital of $100 billion, heralds the financial potential of the BRICS. In 2021, the group contributed 31.5 per cent of the global GDP, amounting to $26.03 trillion, surpassing that of the G7 (30.7per cent). The bloc is expected to contribute more than 50% of the world’s GDP by 2030, and the bloc’s intended expansion will likely accelerate this trend.

The use of unilateral economic coercive measures like boycotts, embargos, and sanctions as well as the global economic depression brought on by the COVID pandemic and the Russia-Ukraine war have increased the relevance of the BRICS, particularly for emerging economies. It is quite likely that the New Development Bank (NDB) will weaken the monopolistic dominance of the World Bank and the IMF as it finances infrastructure projects, regional connectivity initiatives, and sustainable development programs in member countries.

Economic decentralisation strategy

The bank’s smartest innovation, in my opinion, is the Contingent Reserve Arrangement (CRA), whose main function is to protect member countries from global liquidity stress and to provide liquidity support during challenging economic times.

Apart from the financial safety net, it is important to examine the member nations’ interconnected populations, vast territories, rapidly expanding economies, and capacity for strategic autonomy when evaluating the geopolitical possibilities of the BRICS. Anil Sooklal, South Africa’s top diplomat to the bloc, said more than 40 countries have expressed their interest in joining BRICS, including all the major Global South nations. If the new members are accepted, the total population of the BRICS countries—which currently stands at 3.42 billion, or 42 per cent of the world’s population—will increase to over 3.95 billion, or over 50 per cent of the world’s population.

The economic decentralization strategy to create a multipolar world has given BRICS salience and popularity. The alliance is understood to respect the economic independence of the member countries, as stated in the leaders’ initial statement and action plan. Additionally, the NDB will release at least 30 per cent of loans in the member states’ own currencies as opposed to US dollars, which will play a crucial role in safeguarding the countries’ reserves.

The BRICS members have access to the biggest market thanks to China, a crucial partner of this bloc. For instance, as consumer goods exporting countries, Russia and Brazil would sell their products to China, a consumer goods importing nation. A new BRICS-centered market system will emerge from this commercial interaction, and the adoption of its own currency will lessen the influence of the dollar in the global financial system.

In addition to their economic activity, the BRICS countries are working together on coordinated projects in the areas of climate change, defense, education, energy, and health security. Currently, BRICS countries are emphasizing the clean energy transition. The International Energy Agency reports that China and India are aggressively investing in solar and wind energy. As a result, they are able to simultaneously safeguard their international climate pledges while also reducing their reliance on imports and energy costs.

A new leader of post-Western world?

The collective aim is to create a more just and equitable global order, according to BRICS leaders. It is obvious that if member nations view one another as allies, they have a bright possibility of sharing expertise and mutual assistance in a variety of disciplines, including defense, education, health, and climate.

However, BRICS is facing certain challenges along the way, which could prove to be significant roadblocks to their success. Western scholars believe that the diverse financial and governance systems of the group’s members, historical geopolitical rivalry, and India’s perceived West-centric policies may create an unfavorable atmosphere for the alliance’s future cohesion and growth.

If BRICS can truly identify issues of larger common interest and move forward on the basis of consensus, it can become the new leader of the post-Western world order where the NDB will be the primary competitor of the World Bank and IMF. As a result, a balanced, autonomous, and libertarian global order can truly emerge.

Read more at: (The author is a strategic affairs analyst in Dhaka, Bangladesh. Views are personal. He can be contacted at [email protected])

China Slides Into Deflation as Consumer and Factory Prices Drop

China entered a period of deflation in July, intensifying the pressure on policymakers to enhance both monetary and fiscal support. This imperative arises despite indications that the decline in prices may be transitory, potentially limiting the effectiveness of any stimulus measures.

According to the National Bureau of Statistics, the consumer price index experienced a 0.3% decrease last month compared to the previous year, marking its first descent since February 2021. The forecast by economists surveyed by Bloomberg had anticipated a 0.4% drop in prices. In parallel, producer prices continued to decline for the tenth consecutive month, contracting by 4.4% in July year-on-year, slightly worse than anticipated. This is the initial occurrence since November 2020 in which both consumer and producer prices have experienced contractions.

The National Bureau of Statistics attributed the decrease in consumer prices to a high base of comparison with the previous year, emphasizing that this contraction is expected to be temporary, and consumer demand improved during July. Dong Lijuan, the chief statistician at the NBS, stated, “With the impact of a high base from last year gradually fading, the CPI is likely to rebound gradually.” However, these comments are noteworthy as Chinese authorities have recently discouraged economists from discussing deflation to bolster positive narratives about the economy.

China, which initially experienced an upsurge in consumer and business demand following the lifting of pandemic restrictions, is now grappling with an unusual period of declining prices. Factors such as a prolonged downturn in the property market, diminished export demand, and subdued consumer spending are impeding the nation’s economic recovery. Robin Xing, the chief China economist at Morgan Stanley, commented, “China is in deflation for sure… The question is how long. It’s up to the policymakers — will they react with coordinated fiscal and monetary easing.”

Picture : Reuters

In response to the weak inflation data, the Hang Seng China Enterprises Index and the onshore benchmark CSI 300 Index experienced slight declines. Investors are anticipating that the People’s Bank of China may increase monetary stimulus, including interest rate cuts. However, the central bank faces several constraints, including a weaker yuan and elevated levels of debt in the economy. Fiscal support has been relatively restrained due to financial pressures confronting local governments.

To overcome these challenges, Xing emphasized the necessity of accelerating government spending, increasing government debt, and implementing coordinated monetary and fiscal easing measures. However, concerns persist about the effectiveness of releasing money into the banking system, as some companies appear hesitant to expand production amid softening profit expectations.

Chinese regulators have attempted to downplay deflation risks, instructing analysts and companies not to publicly discuss the matter. PBOC officials have asserted that China will steer clear of deflation in the second half of the year, with consumer price growth anticipated to approach 1% by year-end.

The decline in prices also implies a rise in real financing costs within the economy, a factor that some economists argue should intensify the urgency for the PBOC to take action to prevent further weakening of growth momentum. Bruce Pang, head of research and chief economist for greater China at Jones Lang LaSalle Inc., indicated that addressing reserve requirements (RRR) might be more necessary than reducing interest rates in the short term, as various structural monetary policy tools and policy bank financing tools remain available.

The core inflation measure, which excludes volatile food and energy costs, saw an increase to 0.8% from 0.4%, indicating underlying albeit subdued demand in the economy. Within the consumer inflation data, prices for household goods, food, and transportation experienced contractions, while prices for service spending, such as recreation and education, climbed.

“We expect CPI will be negative only for the short term, like for one to two months,” said Ding Shuang, chief economist for Greater China and North Asia at Standard Chartered Plc. “Food and energy prices are more likely to go up instead of going down in the second half of the year. That means the drag on CPI seen in the first half from food and fuel will like ease.”

While PPI has likely bottomed out, “it will be rather hard to emerge from deflation in the rest of the year,” he said.

More Americans Say They Can Never Retire

A developing portion of working Americans don’t figure they will at any point resign, ongoing studies recommend. Retirement is a respected life stage and a close widespread assumption in working America. However, an agreeable retirement requires reserve funds, and numerous laborers dread they need something more.

In a July survey directed mutually by Axios and Ipsos, 29% of laborers under 55 addressed a retirement question with, “I don’t figure I will at any point resign.”

Inquired as to why not, 3/4 of the never-resign bunch said they couldn’t bear to quit working. A more modest offer said they would have rather not.

“Instructions to make the dollars and pennies of retirement work is a steady difficult exercise for the individuals who are resigned and Americans wanting to arrive at that achievement one day,” said Clifford Youthful,president of Ipsos Public Affairs.

Another overview, from the Employee Benefit Research Institute (EBRI), found that 33% of laborers presently hope to resign at 70 or later, or never.

A third report, from the Transamerica Community for Retirement Studies, discovered that 40% of Age X specialists, and almost 50% of boomers, hope to resign after 70, or not by any stretch.

Picture : NYSSCA

Retirement fears appear to be rising. In the EBRI study, the portion of laborers wanting to defer retirement rose to 33 percent in 2023 from 29 percent in 2022 and 26 percent in 2021.

The late spring of 2023 could appear to be an odd second for Americans to feel shy of retirement reserves. Almost 3/4 of all 401(k) cash sits in stocks, and the financial exchange is blasting, albeit this week has been rough.

Yet, the full story of American retirement arranging is more convoluted.

One main explanation laborers are stressing over retirement is expansion, which flooded in 2021 and 2022 after numerous long periods of somewhat level costs.

Another component is reduced retirement investment funds. The normal 401(k) lost around 20% of its worth in 2022, as per speculation house information.

The two stocks and bonds plunged in 2022. That shouldn’t occur: At the point when stocks fall, bonds typically rise, as well as the other way around. Last year was a strange exception, set off by the expansion emergency and the remedial mission of government loan fee climbs.

The country’s retirement accounts are recuperating, however they are not completely mended. The typical IRA held $109,000 in the main quarter of this current year, down from $127,000 simultaneously last year, as per Devotion Speculations.

More than two-fifths of children of post war America in the 55-64 age bunch have no retirement reserve funds, Evaluation information show. Many work for little organizations that don’t offer retirement reserve funds, or work independently, or miss the mark on pay to take care of cash.

The middle retirement bank account in that age range has a surplus of $71,168, as per a NerdWallet examination.

Normal insight proposes that is not anywhere close to enough. Laborers accept they will require about $1.8 million for an agreeable retirement, as indicated by another Charles Schwab review.

As anyone might expect, numerous Americans don’t figure they will have adequate cash to live serenely in retirement. In the 2023 EBRI review, 36% of respondents said they don’t trust monetary security after retirement.

That data of interest, as well, is crawling up. A year prior, 27% of laborers needed retirement certainty.

Transamerica research observed that main 17% of Age X laborers are “extremely certain” of an agreeable retirement. The most seasoned individuals in that associate are approaching age 60.

New Research Paints Richer Picture Of Physician Earnings

University of Chicago researchers, led by health economist Joshua Gottlieb, PhD, have embarked on a project to better understand the earnings of physicians in the top 1 percent of income earners. Although physicians are among the most common high-income occupation, accurately measuring their earnings has proven challenging.

The researchers sought to address this issue by creating a comprehensive dataset that links administrative data on physicians to tax records from 2005 to 2017. This dataset allows them to measure physician earnings and explore the impact of healthcare policies on their incomes, labor supply, and talent distribution.

“Combining the administrative registry of U.S. physicians with tax data, Medicare billing records, and survey responses, we find that physicians’ annual earnings average $350,000 and comprise 8.6 percent of national healthcare spending,” the authors wrote in their working paper.

In their working paper titled “Who Values Human Capitalists’ Human Capital? The Earnings and Labor Supply of U.S. Physicians,” the team presents key findings derived from the new dataset:

  1. On average, a physician’s annual earnings amount to $350,000, representing 8.6 percent of the nation’s healthcare spending. In 2017, the average physician earned $243,400 in wages and $350,000 in total individual income. The median total individual income was $265,000 per year. Notably, more than 25 percent of physicians earned over $425,000, and the top 1 percent earned more than $1.7 million.
  2. Physician earnings vary significantly across different specialties. Primary care physicians have the lowest average income at $201,200, while procedural specialists and surgeons are the highest earners, making on average 2.3 times more than primary care physicians.
  3. Age plays a role in the variation of physician earnings, accounting for 14 percent of the difference. Physicians typically earn around $60,000 on average during their late 20s while still in training. This increases to an average of more than $185,000 in their early 30s and approximately $425,000 at age 50.
  4. Gender disparities persist among physicians, with female physicians earning 30 percent less than their male counterparts. This pay gap has significant long-term implications, potentially resulting in $900,000 to $2.5 million less in career earnings for women, depending on their medical specialty.
  5. The geographic location significantly impacts physicians’ income, with 70 percent of the income disparity across areas being attributed to local market factors rather than the individual characteristics of the physicians.
  6. Physicians in parts of the Great Plains enjoy the highest incomes, contrary to the broader economy, where high incomes are typically concentrated on the coasts.

The researchers then delved into the effects of government policies on physician earnings, using income tax, Medicare billing, and specialty choice data. They focused on two types of insurance policy changes: changes in coverage and changes in payment rates.


Their analysis revealed that short-term reimbursement changes led to 25 percent of marginal Medicare reimbursement dollars flowing into physician earnings. For permanent changes in demand resulting from the public insurance expansions under the Affordable Care Act, the authors observed a 6 percent pass-through of public spending to physician incomes.

Furthermore, the study found that higher earnings in a particular medical specialty attract physicians with higher test scores while displacing those with lower scores and less choice. For instance, a 5 percent increase in primary care earnings, while keeping the number of available slots and earnings of other specialties constant, led to a 4.8 percent increase in the probability of top-five medical school graduates entering primary care.

“The upshot is that government payment rules play a key role in valuing and allocating one of society’s most expensive assets: physicians’ human capital,” the researchers conclude. “Taken together, the results here suggest that policies subsidizing surgery will increase surgeons’ incomes and allocate more top talent to surgical specialties, improving surgery for a generation. Subsidizing primary care will instead increase these physicians’ incomes and

The University of Chicago’s research provides valuable insights into physician earnings and the factors influencing them. By linking administrative data with tax records, the researchers have shed light on the complexities of physician income determination and the impact of healthcare policies on this essential group of high-income earners. Understanding these dynamics can aid in formulating policies to better support healthcare professionals and optimize talent allocation within the medical field.

Indian Companies Can Now Apply For Overseas Listing: Finance Minister

Finance Minister Nirmala Sitharaman said today that Indian companies can now go in for direct listing on foreign exchanges as well as on the International Financial Services Centre (IFSC) bourse in Ahmedabad.

The approval, which came after three years of announcement as part of the Covid relief package, will enable domestic companies to access foreign funds by listing their shares on various exchanges overseas.

A proposal regarding this was first floated as part of the liquidity package announced during the pandemic in May 2020.

Picture : Rise of Indian Americans 2

“A direct listing of securities by domestic companies will now be permissible in foreign jurisdictions. I’m also pleased to announce that the government has taken a decision to enable direct listing of listed and unlisted companies on the IFSC exchange. So, this is a major step forward. This will facilitate access to global capital and better valuation,” Ms Sitharmanan said.

The minister was speaking at an event to launch AMC Repo Clearing and a corporate debt market development fund to help deepen the corporate bond market.

Further, she called for a regulatory impact assessment so that regulated entities in particular and the markets in general can better understand the fallout of their decisions.

She also asked financial market regulators to focus on the quality, proportionality and the effectiveness of their decisions so that companies find further ease in doing their business.

Urging large municipal bodies to tap the debt market for their funding needs, Sitharaman said the government has been and will continue to incentivise cities to improve their credit ratings so that they get better pricing for their bonds.

Foreigners, Nris Travelling To India Can Use UPI For Payments

RBI enables UPI access for foreign nationals and NRIs in India to promote cashless payments, with provisions for G-20 travelers and NRI mobile numbers linked to NRE/NRO accounts.

The Reserve Bank of India (RBI) announced that foreign nationals and Non-Resident Indians (NRIs) visiting India can access digital transactions by using Unified Payments Interface (UPI). Union Minister for State for Finance, Dr Bhagwat Kisanrao Karad, made the announcement, aiming to promote cashless payments and enhance the ease of financial transactions. The announcement came in the form of a written reply to a question in the Lok Sabha on July 31.

Picture : YouTube

To enable the growth of India’s digital payment ecosystem and enhance the experience of travelers and NRIs during their stay in the country, a circular dated February 10, 2023, issued by the Reserve Bank of India enabled foreign nationals and NRIs to use UPI.

In addition to this, RBI has also implemented the provision to grant UPI access to travelers from G-20 countries at select international airports, including Bengaluru, Mumbai, and New Delhi, specifically for merchant payments.

Furthermore, the RBI has also made provisions to provide UPI access to NRIs who have international mobile numbers linked to their NRE (Non-Residential External) and NRO (Non-Resident Ordinary) accounts.

The National Payments Corporation of India (NPCI) has further informed that the UPI facility for foreign nationals and NRIs is currently available for travellers from ten countries. These countries include Singapore, Australia, Canada, Hong Kong, Oman, Qatar, USA, Saudi Arabia, UAE, and the United Kingdom.

The UPI transaction numbers have soared from 3746.3 million users in 2018 to 7403.9 million in 2022.

How India’s Economy Will Overtake U.S. Economy?

Angus Maddison, the esteemed economic historian, estimated that India held the position of the world’s largest economy for an astonishing period of one and a half millennia. However, by 1820, China surpassed India, and the two countries continued to dominate the global economy until 1870 when the Industrial Revolution in the West and European colonization began to take effect. Consequently, Britain emerged as the leading economic power, but by 1900, the United States took over this mantle. Nevertheless, with the growing discussion about Asia’s rise, there is speculation that the world economy might be returning to its historical norm.

The potential for such a shift cannot be underestimated. China, with an economy already at 70% of the U.S. and a growth rate more than double that of the latter, is poised to become the world’s largest economy between 2035 and 2040. Yet, the focus now shifts to whether India’s economy will also surpass that of the U.S. and when this might occur.

Several factors work in favor of India. To begin with, its GDP per capita is currently less than 20% of China’s and merely 5% of the U.S.’s. However, this productivity gap presents significant opportunities for India to catch up. By accumulating capital and imparting skills to its workforce, the country can achieve substantial productivity increases simply by deploying existing superior technologies.

Picture : India CSR

India’s young and sizable population provides a dual advantage. Firstly, a larger workforce translates into potentially higher output per capita. Secondly, as the young tend to save for old age, this leads to higher savings and consequently increased investment. These factors not only contribute directly to output but also facilitate the adoption of advanced technology. Additionally, a younger population injects more energy and dynamism into the nation, fostering innovation.

To fully leverage its young population, India must focus on raising its labor participation rate, particularly among women. Currently, less than one-quarter of women aged 15 and above are part of India’s workforce, whereas in China and the U.S., three-fifths of women participate. Improving education at all levels will play a crucial role in achieving this objective.

Population size is another advantage for India, which likely surpassed China to become the world’s most populous country. This population advantage leads to economies of scale in the provision of public goods. For instance, India’s digital payments infrastructure built on the Aadhaar biometric identity system and the UPI platform benefits from a larger user base, reducing the per-capita cost of building the infrastructure. The same principle applies to other sectors like transportation, electricity, and water supply.

The larger population also aids in creating supply chains, allowing for agglomeration and cost efficiencies. With increasing risks in China, multinational corporations are adopting the “China+1” strategy, seeking an alternative, less risky, and cost-effective location for investments. India stands out as a strong contender for this strategy due to its substantial single market size, enabling smoother movement of components without customs barriers. Moreover, the large internal labor market enhances the potential for a better match between required skills and available workforce.

To realize its potential, India needs to reduce trade protectionism, which remains relatively high. Sustaining growth rates of at least 8% to overtake the U.S. economy requires embracing globalization. Lowering tariffs, engaging in more free trade agreements with major economies and trade blocs, and reducing the use of anti-dumping measures are crucial steps.

Additionally, India must address certain areas of concern. Swift privatization of public sector enterprises, particularly banks with a history of low or negative returns, is essential. Tax reform is another priority, as businesses, especially small- and medium-sized ones, have voiced complaints about overzealous tax authorities and a complex system.

Ultimately, India should hark back to the spirit of its economic reforms in 1991, which emphasized liberalization, privatization, and globalization, and have already contributed to accelerated growth. If India aims to regain its position among the world’s top two economies in the next 50 years, it must deepen and broaden the reforms initiated three decades ago.

Silicon Valley Venture Capitalist Invests In America’s New Pro Cricket League

Anand Rajaraman left India to study abroad at Stanford University three decades before he invested in a T20 professional league in the hopes of finally igniting cricket in the United States. He wondered if he was leaving behind his beloved sport permanently.

Rajaraman, who was born in Chennai and grew up with many of his older brothers and sisters, fell in love with cricket after India, the underdog team, won the World Cup in 1983, a historic victory that changed cricket forever.

However, progression in innovation, with famous cricket site Cricinfo being one of the main well known sports locales on the web, guaranteed this maturing tech wizard had his fix in landscape where the well known English bat and ball game was scarcely noticeable.

Just at the right time, too, as a new generation of flamboyant cricket players, led by the legendary Sachin Tendulkar, began to make a mark for India, a rising powerhouse.

In an interview, Rajaraman, co-owner of the groundbreaking San Francisco Unicorns in Major League Cricket, told me, “People from previous generations who moved from India to the U.S. or wherever couldn’t follow the sport anymore because there was no internet.”

“Yet, I moved when the web was simply starting and that permitted me to follow the game and stay in contact with it despite the fact that I wasn’t in India.

“We additionally had interestingly the capacity to utilize satellite dishes to observe live broadcast of games in the U.S.”

Rajaraman played cricket with a tennis ball socially during his school years, frequently prompting confounded looks from those strolling by considering what was happening.

In those days Rajaraman would never have forecasted that a very long time down the track he would be a main piece of a juvenile cricket association in his took on country, tricking top players from stalwart cricket countries with solid compensation.

“I never envisioned that the chance would emerge despite the fact that I’ve forever been a gigantic fan,” he said.

After school, Rajaraman put his focus on Silicon Valley and left on an exceptionally fruitful profession as a business person. Alongside Venky Harinarayan, co-proprietor of the Unicorns, he was an establishing accomplice of early online business organization Junglee, which was procured by AmazonAMZN – 0.9% in 1998 for $250 million.

They additionally later established Kosmix, which was gained by WalmartWMT 0.0%, and were early financial backers in Facebook.

Indeed, even in the midst of a feverish vocation, Rajaraman’s energy for cricket never faltered and he was perceptibly mixed in 2008 by the coming of the Indian Chief Association – the breathtaking expert T20 association which has progressively turned into a juggernaut throughout recent years.

“It was the start of cricket moving from a game that was being played between public groups and turning into an establishment model,” he said. ” That alongside the T20 design which required a five-day sport and bundled it into a three-hour design.

“Both these developments I believed were the right things expected to carry cricket into the U.S, which is an establishment sports country.”

After useful examples, most quite in 2004 when an eight-group T20 proficient association called Ace Cricket collapsed after only one season, improvement for MLC began toward the end of last decade.

Rajaraman was inevitably approached early about owning a franchise due to his background and natural enthusiasm for cricket. Naturally, he was captivated by the extravagant plans. Obviously, as a quick financial speculator, he needed to assess the proposition completely.

He stated, “Clearly I wanted to evaluate it not only as a passionate cricket fan but also as a business opportunity because I invest in start-ups for a living.”

“The large scale factors are extremely, positive. We have the largest sports market in the world and the second most popular sport in the world. In the United States, there are sufficient cricket devotees who stay up late to watch games.

“So that shows the potential in the event that you can make a nearby establishment association, where games are being played at early evening for the neighborhood crowd. That potential is enormous,” he continued.

Rajaraman was persuaded, and he and Harinarayan began constructing a franchise from the ground up.

The six establishments – San Francisco, Los Angeles, New York, Seattle, Texas and Washington – are in key business sectors with a solid number of ostracizes from South Asia.

Having lived in the Sound Region city of Palo Alto for north of thirty years, Rajaraman was the conspicuous contender to assume control over the San Francisco establishment.

The Golden State Warriors, the NBA’s most powerful team and the seventh most profitable sports franchise in the world, are now part of the Bay Area’s sports scene, and the pressure to establish an identity has begun with a name.

“We needed to pick a name for the group that mirrors the district, in addition to a dull name that is normal for a games group,” he said about the decision for the San Francisco establishment to be called Unicorns.

“San Francisco Inlet Region is about innovation and Silicon Valley, that is individuals’ opinion on San Francisco.

“In Silicon Valley, an organization that is massively fruitful is known as a unicorn. That term has grown over time, now referring to extremely successful athletes as unicorns.

The unmistakable name, notwithstanding, was at first welcomed with some suspicion.

“Many individuals, incorporating individuals engaged with the association, saw it to be an extremely dangerous name since it isn’t utilized for sports groups,” Rajaraman said.

“Yet, Silicon Valley is tied in with facing challenge and succeeding. It’s not necessary to focus on doing the anticipated move.”

The Unicorns’ playing unit and logo will be orange, light blue and naval force blue tones addressing the Brilliant Entryway Scaffold, San Francisco Sound and the Pacific Sea.

The new group drove by previous Australia captain Aaron Finch, be that as it may, will not be playing at home in the debut season beginning on July 13 with all games in the 18-day competition to be played in Dallas and Morrisville, North Carolina.

An arena in St Nick Clara is in progress and set to have global cricket in spite of the fact that won’t be prepared for the following year’s T20 World Cup in the U.S. furthermore, Caribbean. ” It won’t be an immense arena, I’m thinking around 10,000 (swarm limit),” Rajaraman said.

“Something like the little grounds in New Zealand, where you have a couple of stands however really lush banks for families. That is the energy we are going for with an American feel to it.”

“We needed to pick a name for the group that mirrors the district, in addition to a dull name that is normal for a games group,” he said about the decision for the San Francisco establishment to be called Unicorns.

“San Francisco Inlet Region is about innovation and Silicon Valley, that is individuals’ opinion on San Francisco.

“In Silicon Valley, an organization that is massively fruitful is known as a unicorn. That term has grown over time, now referring to extremely successful athletes as unicorns.

The unmistakable name, notwithstanding, was at first welcomed with some suspicion.

“Many individuals, incorporating individuals engaged with the association, saw it to be an extremely dangerous name since it isn’t utilized for sports groups,” Rajaraman said.

“Yet, Silicon Valley is tied in with facing challenge and succeeding. It’s not necessary to focus on doing the anticipated move.”

The Unicorns’ playing unit and logo will be orange, light blue and naval force blue tones addressing the Brilliant Entryway Scaffold, San Francisco Sound and the Pacific Sea.

The new group drove by previous Australia captain Aaron Finch, be that as it may, will not be playing at home in the debut season beginning on July 13 with all games in the 18-day competition to be played in Dallas and Morrisville, North Carolina.

An arena in St Nick Clara is in progress and set to have global cricket in spite of the fact that won’t be prepared for the following year’s T20 World Cup in the U.S. furthermore, Caribbean. ” It won’t be an immense arena, I’m thinking around 10,000 (swarm limit),” Rajaraman said.

“Something like the little grounds in New Zealand, where you have a couple of stands however really lush banks for families. That is the energy we are going for with an American feel to it.”

In the volatile American cricket scene, after years of disappointment and false dawns, anticipation is growing for a tournament that is expected to spread throughout the United States and beyond.

“For what reason we’re ready to get top players into the MLC is because of the great compensation cap, which is vital,” Rajaraman said. ” In the next five to ten years, I believe MLC has a chance of becoming one of the top three cricket tournaments in the world.

“Being a part of it is very exciting. I had no assumption this would occur, all my vocation has been about innovation.

“It’s amazing to combine the things I love, and we’re really looking forward to creating a long-term, successful franchise with devoted Bay Area fans,”

Biden’s Plan Cuts Student Loan Payments for Millions to $0

The Biden administration calls it a “student loan safety net.” Opponents call it a backdoor attempt to make college free. And it could be the next battleground in the legal fight over student loan relief.

Starting this summer, millions of Americans with student loans will be able to enroll in a new repayment plan that offers some of the most lenient terms ever. Interest won’t pile up as long as borrowers make regular payments. Millions of people will have monthly payments reduced to $0. And in as little as 10 years, any remaining debt will be canceled.

It’s known as the SAVE Plan, and although it was announced last year, it has mostly been overshadowed by President Joe Biden’s proposal for mass student loan cancellation. But now, after the Supreme Court struck down Biden’s forgiveness plan, the repayment option is taking center stage.

Since the ruling Biden has proposed an alternate approach to cancel debt and also shifted attention to the lesser-known initiative, calling it “the most affordable repayment plan ever.” The typical borrower who enrolls in the plan will save $1,000 a month, he said.

Republicans have fought against the plan, saying it oversteps the president’s authority. Sen. Bill Cassidy, the ranking Republican on the Health, Education, Labor, and Pensions Committee, called it “deeply unfair” to the 87% of Americans who don’t have student loans.

The Congressional Budget Office previously estimated over the next decade the plan would cost $230 billion, which would be even higher now that the forgiveness plan has been struck down. Estimates from researchers at the University of Pennsylvania put the cost at up to $361 billion.

Emboldened by the Supreme Court’s decision on cancellation, some opponents say it’s a matter of time before the repayment plan also faces a legal challenge.

Here’s what to know about the SAVE Plan:

What is an income-driven repayment plan?

The U.S. Education Department offers several plans for repaying federal student loans. Under the standard plan, borrowers are charged a fixed monthly amount that ensures all their debt will be repaid after 10 years. But if borrowers have difficulty paying that amount, they can enroll in one of four plans that offer lower monthly payments based on income and family size. Those are known as income-driven repayment plans.

Income-driven options have been offered for years and generally cap monthly payments at 10% of a borrower’s discretionary income. If a borrower’s earnings are low enough, their bill is reduced to $0. And after 20 or 25 years, any remaining debt gets erased.

How is Biden’s plan different?

As part of his debt relief plan announced last year, Biden said his Education Department would create a new income-driven repayment plan that lowers payments even further. It became known as the SAVE Plan, and it’s generally intended to replace existing income-driven plans.

Borrowers will be able to apply later this summer, but some of the changes will be phased in over time.

Right away, more people will be eligible for $0 payments. The new plan won’t require borrowers to make payments if they earn less than 225% of the federal poverty line — $32,800 a year for a single person. The cutoff for current plans, by contrast, is 150% of the poverty line, or $22,000 a year for a single person.

Another immediate change aims to prevent interest from snowballing.

As long as borrowers make their monthly payments, their overall balance won’t increase. Once they cover their adjusted monthly payment — even if it’s $0 — any remaining interest will be waived.

Other major changes will take effect in July 2024.

Most notably, payments on undergraduate loans will be capped at 5% of discretionary income, down from 10% now. Those with graduate and undergraduate loans will pay between 5% and 10%, depending on their original loan balance. For millions of Americans, monthly payments could be reduced by half.

Next July will also bring a quicker road to loan forgiveness. Starting then, borrowers with initial balances of $12,000 or less will get the remainder of their loans canceled after 10 years of payments. For each $1,000 borrowed beyond that, the cancellation will come after an additional year of payments.

For example, a borrower with an original balance of $14,000 would get all remaining debt cleared after 12 years. Payments made before 2024 will count toward forgiveness.

How do I apply?

The Education Department says it will notify borrowers when the new application process launches this summer. Those enrolled in an existing plan known as REPAYE will automatically be moved into the SAVE plan. Borrowers will also be able to sign up by contacting their loan servicers directly.

It will be available to all borrowers in the Direct Loan Program who are in good standing on their loans.

What about borrowers who missed out on earlier programs?

The administration announced last year it would make fixes to correct mistakes in tracking payments that qualify toward forgiveness under income-driven repayment plans. As a result, the education department said Friday, it will wipe out $39 billion in debt held by more than 800,000 borrowers

Officials said eligible borrowers will be informed starting Friday that they qualify for forgiveness without further action on their part.

“For far too long, borrowers fell through the cracks of a broken system that failed to keep accurate track of their progress towards forgiveness,” Education Secretary Miguel Cardona said.

What are the pros and cons?

Supporters say Biden’s plan will simplify repayment options and offer relief to millions of borrowers. The Biden administration has argued that ballooning student debt puts college out of reach for too many Americans and holds borrowers back financially.

Opponents call it an unfair perk for those who don’t need it, saying it passes a heavy cost onto taxpayers who already repaid student loans or didn’t go to college. Some worry that it will give colleges incentive to raise tuition prices higher since they know many students will get their loans canceled later.

Voices across the political spectrum have said it amounts to a form of free college. Biden campaigned on a promise to make community college free, but it failed to gain support from Congress. Critics say the new plan is an attempt to do something similar without Congress’ approval.

Is it legal?

That depends on who you ask, but the question hasn’t been taken up by a federal court.

Instead of creating a new payment plan from scratch, the Biden administration proposed changes to an existing plan. It cemented those changes by going through a negotiated rulemaking process that allows the Education Department to develop federal regulations without Congress.

It’s a process that’s commonly used by administrations from both political parties. But critics question whether the new plan goes further than the law allows.

More than 60 Republicans lawmakers urged Cardona to withdraw the plan in February, calling it “reckless, fiscally irresponsible, and blatantly illegal.”

Supporters argue that the Obama administration similarly used its authority to create a repayment plan that was more generous than any others at the time.

The Biden administration formally finalized the rule this month. Conservatives believe it’s vulnerable to a legal challenge, and some say it’s just a matter of finding a plaintiff with the legal right — or standing — to sue.

Time for the US to Hold China Accountable for Sovereign Debt

Every nation ought to settle its sovereign debt. We are informed that default is not an option. Yet, has anybody told China? The People’s Republic of China owes the United States approximately $850 billion in interest. However, American bondholders hold China’s sovereign debt, which is currently in default.

This fact has been ignored by subsequent administrations in the United States, allowing normal trade and business with China to continue. Policymakers ought to reconsider this appalling failure of justice now that the relationship with China has soured and the People’s Republic of China has emerged as the greatest adversarial threat to Western and American security.

It’s time for some history. Prior to 1949, the Republic of China (ROC) issued a large quantity of long-term sovereign gold-denominated bonds to private investors and governments for the construction of infrastructure and financing of governmental activities. These bonds were secured by Chinese tax revenues. Set forth plainly, the China we realize today could never have been conceivable missing these bond contributions.

The ROC defaulted on its sovereign debt in 1938, during the conflict it was having with Japan. The ROC government fled to Taiwan after the communists won their military victory. In the end, the People’s Republic of China gained international recognition as China’s new government. The “successor government” doctrine holds that the current Chinese government, led by the Chinese Communist Party, is responsible for repaying the defaulted bonds in accordance with established international law.

These gold-denominated bonds are held by a small group of private Americans. The American Bondholders Foundation (ABF), a group led by citizens, is the trustee with power of attorney for around 20,000 bondholders whose bonds are worth well over $1 trillion.

A British settlement agreement on the same Chinese bonds was reached in 1987 as a result of Margaret Thatcher, the then-prime minister of the United Kingdom,’s tough negotiation stance regarding the return of Hong Kong to China. Thatcher stated that China needed to honor the Chinese sovereign debt held by British subjects that had defaulted in order to gain access to the capital markets in the United Kingdom. China agreed when presented with that stark choice.

Sadly, the United States did not adopt such a sensible stance. Despite publicly rejecting its sovereign debt obligations to American bondholders, China continues to have access to U.S. capital markets today.

It doesn’t matter how old these bonds are, just in case anyone is curious. The fact that this is a sovereign obligation is what matters. In 2015, Great Britain made payments on bonds issued in the 18th century, and the German government made its final payment for World War I reparations in 2010.

The Biden administration and the Congress of the United States have a one-of-a-kind opportunity to uphold the internationally recognized principle that governments must pay their debts. The United States must view the repayment of China’s sovereign debt as essential to its interests in national security, just as the United Kingdom did in 1987. The United States government ought to take one, both, or neither of the two actions that are currently being discussed by members of Congress.

The first would be to acquire the Chinese bonds held by the ABF and use them to offset (partially or completely) China’s ownership of more than $850 billion in U.S. Treasury securities, thereby lowering the amount of daily interest paid to China by up to $95 million. The national debt would be reduced, and the United States’ financial situation would improve globally.

The second is pass regulation that expects China to keep worldwide standards and rules of money, exchange and business. This would include adhering to the rules governing capital markets and exchanges’ transparency, ending its practices of exclusionary settlement, discriminatory payments, selective default, and rejecting the doctrine of settled international law that the successor government has adopted. All U.S. dollar-denominated bond markets and exchanges would be closed to China and its state-controlled entities if those obligations are not met.

Again, this is just common sense, and the Chinese government would do exactly this if the situation were reversed. Throughout the course of recent many years, there has been repetitive bipartisan help in Congress for bondholders to address China’s default with a few legislative goals. Notwithstanding this, progressive U.S. organizations have been quiet on this issue, deciding to put the issue off indefinitely, expecting that China would ultimately change and embrace Western standards and values.

This inaction must end immediately.

This issue can finally be addressed by both Congress and the Biden administration due to the deterioration of relations with China and the consensus among both parties regarding the threat posed by China. Not only is it right and just for bondholders to get a settlement for this defaulted debt, but if done correctly, it could also be a huge win for the taxpayers of the United States.

Is Rupee Going to be Internationalized?

An Inter-Departmental Group (IDG), constituted by the Reserve Bank of India (RBI), has suggested that India must continue exploring alternatives to both the USD and the Euro to defend itself against economic sanctions. The group has recommended a host of measures to increase the acceptance of Indian rupee (INR) outside the country’s borders.

The group has recommended a host of measures to increase the acceptance of Indian rupee (INR) outside the country’s borders.

Among the short-term recommendations, the group has asked the bank to encourage opening of INR accounts for non-residents both in India and outside India as well as integrating Indian payment systems with other countries for cross-border transactions.

“An account in the currency of a resident country in the non-residents’ own jurisdiction allows them to leverage their existing financial relationships and provides them the flexibility to move funds and execute financial transactions in their time zone,” the working group chaired by Radha Shyam Ratho said in the report.

Additional recommendations include allowing banking services in INR outside India through off-shore branches of Indian banks and achieve higher level of trade linkages with other countries so that INR becomes preferred as a “vehicle currency” by other economies.

“The higher usage of INR in invoicing and settlement of international trade, as well as in capital account transactions, will give INR a progressively international presence,” the group emphasized adding that the internationalization will reduce the cost of doing business and reduce need for holding foreign exchange reserves.

Impending Recession Fears, Contradicting Federal Reserve’s Projections

Roger Altman, a market veteran, claims that the United States is headed for a recession that is even more severe than what Federal Reserve Chair Jerome Powell has predicted.

In a meeting with CNBC on Wednesday, the Evercore organizer and senior executive highlighted remarks from the main national broker, who said a downturn wasn’t the most probable likelihood for the US economy.

However, Altman believes that a downturn is the most likely outcome by the end of the year, and that is in contrast to the plethora of economic indicators that point to the contrary.

First, the yield on the 2-year Treasury has surpassed the 10-year yield by more than a full percentage point last week, marking the steepest inversion of the 2-10 Treasury yield curve in over 40 years. When inverted, the yield curve is a well-known indicator of a forthcoming recession.

As the Federal Reserve has aggressively increased interest rates to combat inflation, experts have been warning of increased recession risks for the past year. Due to the fact that the full tightening effect of rate hikes takes months to fully manifest in the economy, rates are currently at their highest range since 2007. This level has the potential to easily overtighten the economy and plunge it into recession.

As long as inflationary pressures continue to be a concern, Fed officials have also hinted that interest rates could rise this year. Markets are at present estimating in a 87% opportunity the Fed will climb rates another 25 premise focuses at its next strategy meeting, a move that would lift the fed supports rate to scope of 5.25-5.50%.

“Monetary policy was raised at the highest rate in 40 or more years. What’s more, once more, taking a gander at history, it would be too early for them to have their full impact now. a half year, different story,” Altman said.

Biden Announces New Plans for Student Loan Forgiveness Under the Higher Education Act

President Biden on Friday reported new activities to offer understudy loan borrowers some pardoning, once again introducing his absolution plan grounded in the Advanced education Act (HEA).

For years, prominent Democrats and advocates for student loans have advocated for using the HEA to alleviate student debt. Proponents of the HEA argue that it grants the education secretary the authority to “compromise, waive, or release” student loans. Before this route can take effect, there will be a period of public comment and notice.

In remarks delivered at the White House on Friday afternoon, he stated, “We need to find a new way, and we’re moving as quickly as we can.”

The organization had tied the understudy obligation alleviation plan — struck somewhere around the High Court — to the public crisis laid out during the Coronavirus general wellbeing emergency, refering to the Advanced education Help Open doors for Understudies (Legends) Act. In the majority opinion that the court issued on Friday morning, Chief Justice John Roberts stated that the HEROES Act does not grant the authority.

Biden said Education Secretary Miguel Cardona has taken steps to start the rulemaking process, but he didn’t say who would qualify or how much debt relief borrowers would get under his new plan to use the HEA.

Friday marked the beginning of the “negotiated rulemaking” procedure, with the department sending out a notice. The main formal review with regards to this issue will happen July 18 to get input from partners. Although the administration stated that it would make every effort to move “as quickly as possible,” the procedure may proceed smoothly until the end of 2023.

“This understudy obligation help isn’t being carried out consequently. This is a disaster. Debt Collective’s press secretary, Braxton Brewington, stated in response to the announcement, “This will be a bureaucratic nightmare.”

In addition, the president said that the administration will start an “on-ramp” repayment program for borrowers who might miss payments when payments start again this fall. The Education Department will not refer borrowers who miss payments to collection agencies or credit bureaus for a year, so there would be no risk of default or harm to credit ratings.

“In the event that you can take care of your month to month bills you ought to, however in the event that you can’t, assuming you miss installments, this entrance briefly eliminates the danger of default or having your credit hurt,” Biden said.

Understudy obligation installments have been stopped since the pandemic, yet in an arrangement with Speaker of the House Kevin McCarthy (R-Calif.) to get an obligation roof understanding, Biden permanently set up the resumption of reimbursements starting in October. At the beginning of September, interest will begin to accrue once more.

More than 40 million borrowers were prevented from receiving loan forgiveness as a result of the Supreme Court’s decision on Friday, which marked a significant setback for one of the president’s most important campaign promises. Biden’s options for keeping that promise are limited by the decision.

If an individual’s income was less than $125,000, the program, which was announced in August, would have canceled up to $20,000 in loans for Pell Grant recipients and $10,000 for other borrowers.

Not long after the High Court struck down the president’s understudy loan pardoning plan, the White House said it was ready and that Biden had another activity to carry out.

The White House has been avoiding discussing its “Plan B” for months as student debt relief has been held up in court, prompting this announcement.

Student Loan Forgiveness Program Deemed Not Legal By Conservative SOTUS Justices

The Biden administration’s student loan debt handout program cannot proceed, the Supreme Court ruled on Friday, June 3oth, 2023.

The court decided, with a vote of 6-3, that the secretary of education cannot cancel more than $430 billion in student loan debt under federal law.

“The Secretary’s arrangement dropped generally $430 billion of government understudy loan adjusts, totally deleting the obligations of 20 million borrowers and bringing down the middle sum owed by the other 23 million from $29,400 to $13,600,” Boss Equity John Roberts composed for the larger part. ” Six States sued, contending that the Legends Act doesn’t approve the advance dropping arrangement. We concur.”

President Biden firmly couldn’t help contradicting the court’s choice and will make a declaration Friday at 3:30 p.m. enumerating new activities to safeguard understudy loan borrowers, the White House said.

In a statement, Biden stated, “I will stop at nothing to find other ways to deliver relief to hard-working middle-class families.”

According to a source at the White House, Biden intends to blame Republicans for failing to provide student loan borrowers with the relief he promised.

Biden’s understudy loan drive, which had been waiting forthcoming case, involved the central government giving up to $10,000 in the red help — and up to $20,000 for Pell Award beneficiaries — for individuals who make under $125,000 every year. It was anticipated that the program would cost the government more than $400 billion.

Biden made the phenomenal push for obligation cancelation in August 2022, and his organization acknowledged about 16 million applications before conservatives protested and the program was required to be postponed.

Republicans argued that Biden did not have the authority to forgive student loans on his own. Gauges from the Legislative Financial plan Office said Biden’s arrangement would cost citizens generally $400 billion. Conservatives were offended at the aggregate, contending the absolution would be out of line to the people who either paid their direction through school, reimbursed their credits or never went to school in any case.

Two distinct legal challenges were presented to the justices. The court ruled that two private borrowers who wanted to challenge the loan forgiveness plan lacked standing to sue in one case, Department of Education v. Brown.

Biden v. Nebraska, in which six states sued to challenge the loan forgiveness program, is the second and more significant case. Because the program would open a state-established nonprofit government corporation called MOHELA, which would face an estimated $44 million in annual fees, the court determined that Missouri at least had standing to sue.

The HEROES Act, according to Biden’s administration, gave the secretary of education authority to “waive or modify any statutory or regulatory provision applicable to the student financial assistance programs… as the secretary deems necessary in connection with a war or other military national emergency.” The law was used to enact the plan.

That argument was rejected by the majority of the court. The position to ‘change’ rules and guidelines permits the Secretary to make unassuming changes and increases to existing guidelines,” Roberts expressed, “not change them.”

Roberts proceeded to say the Branch of Training’s “changes” to the law “made a novel and in a general sense different credit pardoning program” than what Congress expected in the Legends Act. This program successfully conceded advance absolution “to virtually every borrower in the country,” Roberts said.

The chief justice wrote, “The Secretary’s comprehensive debt cancelation plan cannot fairly be called a waiver because it not only nullifies existing provisions, but also significantly augments and expands them.” It can’t be just a change because it’s “effectively the introduction of a whole new regime.” It also can’t be a combination of the two because when the Secretary wants to add to existing law, the fact that he’s “waived” some provisions doesn’t give him a free pass to avoid the limitations of the power to “modify.”

“That language cannot authorize the kind of extensive rewriting of the statute that has been done here, regardless of how broad the meaning of “waive or modify” may be.”

The three liberal justices on the court disagreed. 43 million Americans will no longer be eligible for loan forgiveness as a result of the majority’s decision, which overrules the collective judgment of the Legislative and Executive branches. “With respect, I respectfully disapprove of that decision,” wrote Justice Elena Kagan.

In the event of a ruling in the administration’s favor, Biden’s Education Department had already begun investigating alternate methods for providing handouts.

Conservatives disclosed their own arrangement to address understudy loans and high school costs in June, presenting a progression of five bills. The arrangement from Senate conservatives upholds programs pointed toward ensuring understudies grasp the genuine expense of school and furthermore stop credits for programs that don’t bring about compensations that are sufficiently high to legitimize those advances.

“This would forestall a portion of the most horrendously terrible instances of understudies being taken advantage of for benefit. It would drive schools to cut down cost and to vie for understudies. What an idea,” said Alabama senator Tommy Tuberville, said of the bill. ” Additionally, it would prevent students from becoming entangled in debt they will never be able to repay.”

USIBC Plans 2023 India Ideas Summit In Washington

The summit will explore the U.S.-India economic partnership across sectors.
The United States India Business Council (USIBC) announced that its 2023 India Ideas Summit will be held on June 12-13, 2023 on the sidelines of its 48th Annual General Meeting at the U.S. Chamber of Commerce headquarters in Washington D.C.
In a statement, USIBC shared the summit themed ‘Trust, Resilience, and Growth’ – will focus on how these three organizing principles underpin the U.S.-India economic partnership across sectors. “As the Summit is the flagship event of USIBC, and the premier convention of government, industry, and thought leaders in the U.S.-India Corridor, USIBC’s annual India Ideas Summit has become an institution,”it said.
This year’s summit carries an additional significance as it will take place about ten days in advance of PM Modi’s state visit to the US scheduled to begin from June 22, 2023, in an effort to strengthen bilateral relations.
Every year, the bilateral trade council hosts conversations that explore important technological developments, chart an agenda for the trade relationship, and highlight how India-US commercial ties serve shared strategic and economic interests.\
Formed in 1975 at the request of the U.S. and Indian governments, the U.S.-India Business Council is the premier business advocacy organization in the U.S.-India corridor, composed of more than 200 top-tier U.S. and Indian companies advancing U.S.-India commercial ties. The Council aims to create an inclusive bilateral trade environment between India and the United States by serving as the voice of industry, linking governments to businesses, and supporting long-term commercial partnerships that will nurture the spirit of entrepreneurship, create jobs, and successfully contribute to the global economy.

 ‘Mild Recession’ In 2023 Predicted

Bank of America CEO Brian Moynihan has stated that he’s expecting a “mild recession” in 2023, sounding a more positive note about the state of the economy than many in the financial world have been broadcasting amid 40-year-high inflation, as per media reports here.

Doom speak about the possibility of a recession has been coming out of the financial sector since the summer when JP Morgan Chase & Co. CEO Jamie Dimon said he saw a “hurricane” gathering on the economic horizon as the Federal Reserve began a program of quantitative tightening, sending equity markets into a freefall.

Contractions in gross domestic product (GDP) in both the first and second quarters of 2022 added weight to the warning, leading many Americans to believe that a recession had already begun. But economists cautioned that a strong job market and healthy levels of consumption were pushing in the opposite direction of a general downturn in the economy.

“Hurricane season is now closed,” Moynihan quipped on CNN Tuesday morning, referring to the actual Atlantic hurricane season but also not shying away from comparisons to Dimon’s remarks from earlier in the year.

“At the end of the day, the consumer has held in well,” he said. “The consumer has stayed reasonably strong because they’re employed.”

Recessions are designated retroactively by the Business Cycle Dating Committee of the National Bureau of Economic Research (NBER), a think tank in Cambridge, Mass.

To make its recession calls, the committee looks at factors that include nonfarm payroll employment, personal consumption, wholesale and retail sales, industrial production and personal income.

While all these measurements play a role, the committee says that “there is no fixed rule about what measures contribute information to the process or how they are weighted in our decisions.”

While public sentiment about the economy can have a real effect on overall economic performance, economists say that it’s important to distinguish sentiment from underlying realities.

“Part of the disconnect for the general public or even a lot of economic journalists [is], a recession might be defined broadly as, you know, when some economic things are bad. Inflation is really bad now, for example. But economists tend to look more at questions of production, employment, real incomes. And on those measures, we’re not seeing the declines we would normally see in a recession yet,” Jeremy Horpedahl, an economist at the University of Central Arkansas, said in an interview.

India A Bright Spot On Otherwise Dark Horizon: IMF Chief

International Monetary Fund (IMF) Managing Director Kristalina Georgieva on Thursday said that India deserves to be called a bright spot “on this otherwise dark horizon because it has been a fast-growing economy, even during these difficult times, but most importantly, this growth is underpinned by structural reforms”.

She was speaking on the fourth day of the IMF and World Bank Annual Meetings at the IMF headquarters here.

“Most importantly, this growth is underpinned by structural reforms,” Georgieva told reporters after the meeting.

She was replying to a question on her expectations from India just days before it takes over the presidency of G20. She also praised India’s digitization process.

Earlier even Paolo Mauro, Deputy Director of the Fiscal Affairs Department at the IMF, had praised India’s direct benefit transfer scheme.

“From India, there is a lot to learn. There is a lot to learn from some other examples around the world. We have examples from pretty much every continent and every level of income. If I look at the case of India, it is actually quite impressive,” he told reporters. (IANS)

The International Monetary Fund has once again downgraded its forecast for the global economy with a sharp warning: “The worst is yet to come, and for many people 2023 will feel like a recession.” The agency said Tuesday that it expects global growth to slump to 2.7% next year. That compares with projected growth of 3.2% this year. 

The prospects for the global economy as outlined by the IMF are the third weakest since 2001, behind only the 2008 financial crisis and the worst phase of the coronavirus pandemic. According to a new CNN poll, just 22% of Americans rate economic conditions in the country as good, with 78% calling conditions somewhat poor or very poor. President Biden told CNN on Tuesday that the prospect of a “slight recession” is possible but that he doesn’t anticipate it — even as experts are sounding the alarm about the future of the American and global economies.

Strong Dollar, Rising Interest Rates Loom Over World Bank And IMF Meetings

A strong dollar and rising U.S. interest rates are looming over this week’s International Monetary Fund (IMF) and World Bank meetings in Washington, D.C. where the Federal Reserve is likely to come under some criticism over how its policies are impacting the rest of the world.  Treasury and Federal Reserve officials say they’re sticking to their guns in their battle against inflation despite a chorus of international voices cautioning against the risk of a global recession.

“If monetary tightening in the advanced economies continues over the coming year … a global recession is more likely,” the United Nations Conference on Trade and Development wrote in a sharply worded report released last week. “It will almost unavoidably harm potential growth rate in the developing economies.”

Senior Treasury officials said Monday they were sensitive to “potential spillovers” and “issues that develop around the world” but that “the U.S. economy remains quite resilient, even in the face of some significant global headwinds.”

A Treasury official said that during meetings this week, Treasury Secretary Janet Yellen would speak with “key counterparts” to discuss how to take on global economic challenges.  

“This involves taking strong actions at home to deal with our priorities but also communicating about those policies, working with the IMF and our allies to monitor spillovers,” the official said.

These spillovers are the losses that many smaller and midsize economies are increasingly expected to endure due to higher U.S. interest rates, which are designed to stop domestic inflation by slowing demand.  

But the hikes also attract investors into the U.S. from abroad, looking to take advantage of higher returns. This strengthens the dollar relative to other currencies, which has the knock-on effect of diminishing export revenues in countries that don’t use the dollar and is all bad news for developing economies.

Federal Reserve Vice Chair Lael Brainard echoed the Treasury’s sentiments, saying in a Monday speech that “monetary policy will be restrictive for some time to ensure that inflation moves back to target” while nodding to “elevated global economic and financial uncertainty.”

“The Federal Reserve takes into account the spillovers of higher interest rates, a stronger dollar and weaker demand from foreign economies,” she said.

Such remarks provide little comfort for lower-income countries hoping for debt relief in the run-up to what could be a prolonged period of economic stagnation brought on by the pandemic and the decade of near-zero interest rates that preceded it.

The United Nations Development Program (UNDP) released a paper Tuesday warning that 54 developing economies, accounting for more than half of the world’s poorest people, need debt relief now to avert a major crisis.

“The debt crisis is intensifying,” the UNDP paper found. “Debt is trading in distressed territory for more than one third of developing economies issuing dollar debt in international markets, with 19 countries paying more than 1,000 basis points over US Treasury bonds. Similarly, of all developing economies with a sovereign credit rating, 26 — close to one third — are now rated either ‘substantial risk, extremely speculative or default.’ ”

The largest geographical subgroup of the 54 countries noted by the U.N. is sub-Saharan Africa, which accounts for nearly half.

A representative for African Development Bank Group President Akinwumi Adesina, who is attending the World Bank and IMF meetings, told The Hill that securing assets for African economies from advanced economies like the U.S. is a top priority.

A key concern for the bank is “the re-allocation of IMF Special Drawing Rights from willing advanced economies to Africa to leverage the resources to provide greater financing to African economies,” the representative said in an email, referring to a type of foreign exchange reserve asset used by development banks.

But U.S. Treasury officials said they weren’t expecting any major breakthroughs on funding for Africa or emerging markets despite some progress on the cases of a few individual countries.

“We have been making some incremental progress on Chad and Zambia, as you know, and we will certainly be calling for rapid progress on those two cases, but I’m not anticipating that we’ll get there in the next few days,” a Treasury official said.

Complicating efforts to fund developing countries is competition from China, which is now by far the largest bilateral creditor in the world. China now services more debt to foreign countries than the combined financing of the U.S., France and the 20 other countries that make up the “Paris Club” of traditional lenders.

“China’s enormous scale as a lender means its participation is essential,” Brent Neiman, counselor to the Treasury secretary, said in September at the Peterson Institute for International Economics. “Estimates of the total stock of outstanding Chinese official loans range widely from roughly $500 billion to $1 trillion, concentrated in low- and middle-income countries.”

“A recent study estimates that as many as 44 countries now owe debt equivalent to more than 10 percent of their GDP to Chinese lenders after factoring in both on- and off-balance sheet liabilities,” he said.

Despite competition from China, a report released by the Group of 20 over the summer found that development banks could be lending hundreds of billions of dollars more than they currently are during a perilous time for the global economy, helping to keep people out of poverty.

“The expected potential scale of the increase is substantial, likely to be several hundreds of billions of dollars over the medium term,” the report found.

The price for that additional lending would be an increased risk tolerance. The report argues that increased levels of risk could be acceptable but says that banks’ use of credit rating agencies gets in the way.

The authors of the report recognize “the great importance for the business models of [development banks] of maintaining superior financial strength as reflected in AAA ratings, and, to that end, make use of an enhanced dialogue with [credit ratings agencies] and clear public statements of shareholder support.”

“Moreover, specific numeric leveraging targets should be removed from [development bank] statutes and integrated into capital adequacy frameworks,” the report said.

Other voices in the global economy have also taken issue with continued interest rate hikes and monetary tightening policies from the Federal Reserve — notably OPEC, which last week announced a production cut in global crude oil of 2 million barrels per day.

The move is expected to drive up energy prices ahead of U.S. midterm elections and add further upward pressure on inflation.

“With this severity that you see, you run a big risk that you lose growth,” Saudi Arabia’s energy minister, Prince Abdulaziz bin Salman, said last week. “Growth is coming down and there is a potential with more aggressive rate hikes that this growth will come even lower.”

Ben Bernanke Awarded Nobel Prize In Economics

On October 10th, The Royal Swedish Academy of Sciences awarded the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2022 to Ben Bernanke for his groundbreaking research on banks and financial crises. Bernanke shares the prize with Douglas Diamond of the University of Chicago and Philip Dybvig of Washington University in St. Louis.

“This year’s laureates in the Economic Sciences, Ben Bernanke, Douglas Diamond and Philip Dybvig, have significantly improved our understanding of the role of banks in the economy, particularly during financial crises. An important finding in their research is why avoiding bank collapses is vital,” a statement issued by the Awards Committee stated. 

Modern banking research clarifies why we have banks, how to make them less vulnerable in crises and how bank collapses exacerbate financial crises. The foundations of this research were laid by Ben Bernanke, Douglas Diamond and Philip Dybvig in the early 1980s. Their analyses have been of great practical importance in regulating financial markets and dealing with financial crises.

For the economy to function, savings must be channelled to investments. However, there is a conflict here: savers want instant access to their money in case of unexpected outlays, while businesses and homeowners need to know they will not be forced to repay their loans prematurely. In their theory, Diamond and Dybvig show how banks offer an optimal solution to this problem. By acting as intermediaries that accept deposits from many savers, banks can allow depositors to access their money when they wish, while also offering long-term loans to borrowers.

However, their analysis also showed how the combination of these two activities makes banks vulnerable to rumours about their imminent collapse. If a large number of savers simultaneously run to the bank to withdraw their money, the rumour may become a self-fulfilling prophecy – a bank run occurs and the bank collapses. These dangerous dynamics can be prevented through the government providing deposit insurance and acting as a lender of last resort to banks.

Diamond demonstrated how banks perform another societally important function. As intermediaries between many savers and borrowers, banks are better suited to assessing borrowers’ creditworthiness and ensuring that loans are used for good investments.

Ben Bernanke analysed the Great Depression of the 1930s, the worst economic crisis in modern history. Among other things, he showed how bank runs were a decisive factor in the crisis becoming so deep and prolonged. When the banks collapsed, valuable information about borrowers was lost and could not be recreated quickly. Society’s ability to channel savings to Educationproductive investments was thus severely diminished.

“The laureates’ insights have improved our ability to avoid both serious crises and expensive bailouts,” says Tore Ellingsen, Chair of the Committee for the Prize in Economic Sciences.

Repel The Recession With These 5 Tips

It doesn’t hurt your bottom line to take a step back and self-evaluate. Learn how you’ll be able to repel the recession with these 5 tips.

While the professional pundits debate when or if an economic recession is imminent, it may be a good idea to ensure you’re prepared, nonetheless. It doesn’t hurt your bottom line to take a step back and self-evaluate. Learn how you’ll be able to repel the recession with these 5 tips.

Live Your Life Within Your Means

Many of you may already live your everyday lives with this money-management strategy and if you do, then you’re ahead of the curve. But let’s be honest, we all know people who do not live within their means. Saying ‘no’ when deciding on an unneeded purchase is a skill that sometimes needs to be learned.

It’s important to carefully weigh all decisions about money, especially if a recession is looming. Don’t get caught in the trap of thinking the recession may not last long. The more conscious you are about spending habits, the more you can avoid going into debt with credit cards and loans. It’s better to save now and put off making big purchases, then to build up your debt and struggle to get out from under it later in life. Speaking of saving…

Look For Ways to Save

It’s always a good idea to audit your own finances. Most people are aware of their paycheck, but they are often fuzzy about the money that leaves their account. Re-evaluate your monthly subscriptions. Do you need every single streaming service? How often do you make coffee runs to your local café? It might be time to brew a cup from home.

Divide your monthly expenses into wants and needs. Make sure you’re not overpaying for those wants. Cut down on the trips to the restaurants. If you had any planned vacations or renovations, it might be in your best interest to postpone. Perhaps we learned all those money-saving tricks during the 2020 quarantine for a reason. It might be time to revisit those lessons.

Have an Emergency Fund

You may call it a rainy-day fund. If so, the skies are getting cloudy. If you haven’t already put money aside in a secured FDIC account for emergencies, it may be time to start. In the event of a lost job or your forced to take a pay cut, you want the flexibility to cover expenses while you engage in a plan of action. This fund is designed for necessary expenses. Be diligent with how you use the money. Again, you don’t know how long a potential recession could last.

Obtain Additional Income

A smart tactic — and one that’s been popularized in recent years — is finding other streams of revenue outside of your job. We live in a gig economy and the skills you’ve honed at your current employer may prove valuable in a consulting capacity. You could replace any lost income from a job loss or salary reduction by uncovering potential freelancing opportunities in your specialty. It doesn’t hurt to add more skills to your resume. The more you know how to do, the more attractive you become to your current or future employer.

Anticipate the Worst

No one expects to lose their job, but don’t be unprepared if it happens. It would be appropriate for you to consider your options in the event of the unthinkable. Update your resume. Update your LinkedIn profile. All those professional relationships you developed, both online and in-person, could become leads to new positions. Prepare for the worst, expect the best.


Two gold nuggets worth $350,000 found in Australia

Two gold nuggets worth around $350,000 (£190,000; US$250,000) have been discovered by a pair of diggers in southern Australia. Brent Shannon and Ethan West found the nuggets near goldmining town Tarnagulla in Victoria state.

Their lucky find was shown on TV show Aussie Gold Hunters, which aired on Thursday. The men dug up the ground and used metal detectors to detect gold in the area.

“These are definitely one of the most significant finds,” Ethan West said, according to CNN. “To have two large chunks in one day is quite amazing.”

They found the nuggets, which have a combined weight of 3.5kg (7.7lb), in a number of hours with the help of Mr West’s father, according to the Discovery Channel which airs the program.

The show, which is also broadcast in the UK, follows teams of gold prospectors who dig in goldfields in remote parts of Australia.

“I reckoned we were in for a chance,” Mr Shannon told Australian TV show Sunrise. “It was in a bit of virgin ground, which means it’s untouched and hasn’t been mined.”

West said that during four years of mining for gold, he is picked up “probably thousands” of pieces. The Discovery Channel also said collectors could pay up to 30% more for the nuggets than their estimated value.

In 2019 an Australian man unearthed a 1.4kg (49oz) gold nugget worth an estimated A$100,000 (£54,000; $69,000) using a metal detector.

Gold mining in Australia began in the 1850s, and remains a significant industry in the country.

The town of Tarnagulla itself was founded during the Victoria Gold Rush and became very wealthy for a period of time when keen prospectors moved there to make their fortune, according to a local website.

Oil Prices Likely To Tumble By Year End, Even If Economies Avoid A Recession

Goldman Sachs reckons crude oil prices are going to $140 in the coming months. JPMorgan said they could even surge to $380 in a worst-case scenario. UBS reckons they’ll hit $130 in September.

But Citi is bucking the trend. The investment bank’s strategists predict oil will fall sharply by the end of the year, from prices of around $100 a barrel on Friday.

Francesco Martoccia, the bank’s head of European commodities strategy, warned in note to clients Tuesday that oil prices could even slump to $65 a barrel by December, if a nasty recession hits.

The same day, oil prices tumbled, with US benchmark WTI crude dropping below $100, as investors worried that central banks’ interest-rate hikes would trigger sharp slowdowns in economic growth. “The timing was exquisite,” Martoccia told Insider this week.

Yet Martoccia and his colleagues expect oil to drop even if there’s no drastic slowdown. Their so-called base case is that the price of global benchmark Brent crude tumbles to $85 a barrel by the end of the year — that’s around 18% lower than Friday’s price of $104.

At the heart of Citi’s contrarian view is its expectation that Russia will keep exporting and producing crude, even as the US and its allies batter the country with sanctions.

Many analysts expect Russian energy exports to fall sharply by the end of the year as the European Union gradually bans purchases from the country. The G7 is also exploring how to cap Russian oil prices — which could cause exports to drop further.

The logic is simple. Unable to sell its oil, Russia will shut down production. Buyers will then be competing for the remaining global supplies, driving up oil prices.

But Citi takes a different view. Its strategists believe India and China will ramp up purchases, keeping Russian oil pumping and alleviating the pressure on the market. “We actually don’t see a supply crunch in the making,” Martoccia said.

Crude oil exports to European countries in the OECD will drop from 2.5 million barrels a day in the first quarter of the year to 970,000 in the fourth, Citi predicts.

Yet it thinks China will step up its imports from 1.4 million to 2.3 million barrels a day, and India from 110,000 to 950,000 a day. Other developing economies will lift their purchases slightly, meaning Russia will be exporting more crude by the end of the year than at the start.

“I’m skeptical that the governments wouldn’t listen to their own energy needs, because we have seen already protests and riots around the world because of the increase in food prices and energy prices,” Martoccia said.

The other key ingredient in oil prices is demand. Citi thinks the world’s appetite for oil is going to slow over the coming months as the global economy cools.

Martoccia said Europe in particular is likely to cut back on its energy consumption. Many economists expect the eurozone to fall into a recession as a result of soaring inflation driven by rocketing natural gas prices. Germany has already started to dim its streetlights to save energy.

“When you look at the gas demand, for instance, from the industrial complex in Italy, or even the orders of one of the biggest industrial facilities, it’s going down,” he said. “And eventually you have to see spillover effects elsewhere.”

Oil-price prediction is a difficult game. Many analysts say the opposite to Citi, arguing Russian production will fall, and a Chinese economic recovery and the return of global tourism will boost demand.

Citi is hedging its bets. It thinks there’s a 30% chance oil jumps back up to around $120 by the end of the year. “This year, it’s very difficult to have a high conviction,” Martoccia said.

Canada To Provide Work Permits For Some International Graduates

Canada is offering work permit extension to international students who no longer have it or are set to have it expired between September 20, 2021 and December 31, 2022. According to Sean Fraser, Canada’s minister of immigration, these students will be granted an additional 18-month open work permit under the Post-Graduation Work Permit Program (PGWPP).

Sean Fraser, Canada’s minister of immigration, said the students would be granted an additional 18-month open work permit under the Post-Graduation Work Permit Program (PGWPP).

More graduates will be able to settle in Canada due to this special provision, which he said indicates economic growth potential. An extension of post-graduate employment permits for some international graduates has been announced by Canada.

Students from abroad whose visas have expired or will expire between September 20, 2021, and December 31, 2022 are eligible for the new extension. The second open work permit for these students will be valid for 18 months.

As Canada’s economy continues to recover, “there remain hundreds of thousands of jobs waiting to be filled,” Canada’s immigration minister Sean Fraser tweeted. “Hard-working international graduates make enormous contributions to their communities and our economy.”

“We’re now extending post-graduate work permits to international graduates whose permits expired or will expire between September 20th, 2021 and December 31, 2022.”

Fewer Homes, High Prices, Rising Interest Rates Impede Home Buyers Across USA

Shortly after moving to South Florida for a new job with the U.S. military, Shannon Kaufman and his wife, Wendy, signed up for a whole other mission: buying a home.

For months, they scoured listings, strategizing late into the night on which homes to target and working out how much they could afford, even if it meant using some of their retirement savings.

After visiting 200 listings and making offers on 15 homes that ultimately didn’t pan out, the Kaufmans finally found a home that fits at least some of their needs. They’ll be renting it, however.

“We found a place that’s smaller than we want, but it’ll work until we have something built or until the market cools off,” said Shannon Kaufman, 47.

America’s housing market has grown increasingly frenzied, and prices are out of reach for many buyers, especially first-timers. This spring, traditionally the busiest season for home sales, is more likely to deliver frustration and disappointment for aspiring homebuyers than it is homeownership.

The number of homes for sale nationally remains near record lows, fueling fierce competition among buyers vying for fewer homes. From Los Angeles to Raleigh, North Carolina, when a house does hit the market, it typically sells within days.

Bidding wars are common, often driving the sale price well above what the owner was asking. And would-be buyers planning to finance their purchase with a home loan are often losing out to investors and others able to buy a home with cash.

A quarter of all homes sold in February were purchased with cash, up from 22% a year ago, according to the National Association of Realtors. Real estate investors accounted for 19% of transactions in February, up from 17% a year ago.

Nichol Khan, a project manager, and her husband Ed moved to Mesa, Arizona, from Phoenix two years ago to shorten their commute to work. Home prices in the Phoenix area have jumped 20% from a year ago to $500,000, according to “The prices just keep going up and up,” Khan said.

The couple has lost out on more than a dozen homes they bid on. Some of the homes ended up selling for less in cash than the couple had offered. “We don’t have $500,000 in cash,” said Khan, 42. “We just could not be competitive with that.”

Fewer homes on the market and high prices have been the hallmark of the housing market for the past 10 years or so. Now, rising mortgage rates further complicate the homebuying equation. Higher rates could limit the pool of buyers and cool the rate of home price growth — good news for buyers. But higher rates also weaken their buying power.

Interest rates for loan has climbed to around 4.7%. A year ago, average rates hovered just above 3%, according to mortgage buyer Freddie Mac. The increase follows a sharp move up in 10-year Treasury yields, reflecting expectations of higher interest rates overall as the Federal Reserve moves to hike short-term rates in order to combat surging inflation.

Would-be buyers who applied for a home loan in February faced a median monthly mortgage payment of $1,653, including principal and interest, an increase of 8.3% from a year ago, according to the Mortgage Bankers Association.

“It’s hard to believe, but I do think it’s going to be tougher this year, in some respects, than it was in previous years,” said Danielle Hale,’s chief economist. “So far, at least, we have seen the number of homes for sale continue to decline and prices continue to rise. Those two factors combined suggest that the competitive market is going to keep buyers on their toes.”

Buyers should set their sights on homes that are listed well within what they can afford, experts say.

“You should be looking 15%-20% below their limit; that gives them room for appraisal gaps, it gives them room for negotiating,” said Tracy Hutton, a broker with Century 21 in Indianapolis.

Being well prepared sometimes isn’t enough when a homeowner prefers to accept an all-cash offer, rather than sell to a buyer with financing.

Wendy Kaufman in South Florida couldn’t even get into an open house for a property on the market after she revealed the couple had a mortgage backed by the Veterans Administration.

“When they saw I had a VA preapproval they said, ‘Sorry we don’t want to work with you.’” she said.

Sometimes, buyers don’t have a chance to make an offer before a home is snapped up, sight unseen. In the Miami area, so-called “blind offers” have become common as a way to get around other buyers, said Rafael Corrales, a Redfin agent.

One reason is the ultra-low level of homes for sale, which for the greater Miami metropolitan area, was down 55% in February from a year ago, according to

While every market is unique, there is one common hurdle across the U.S.: affordability. The median U.S. home price jumped 15% in February from a year earlier to $357,300, according to the National Association of Realtors.

The San Jose, California, metro area had 40% fewer homes for sale in February than a year ago, according to Buyers there have to navigate some of the most expensive home prices in the nation. The median home listing price climbed 13.3% to about $1.36 million in February from a year earlier.

The market trends are a bit more welcoming for buyers in the Midwest, including the Indianapolis metropolitan area, where the number of homes for sale was down about 23% from a year ago. The median home price there stood at $287,000 in February, up 8.5% from a year earlier.

In Raleigh, home listings were down a whopping 55% in February from a year earlier. Competition for fewer homes helped push the median home price to $430,000, a 9% increase from February 2021.

Those trends made for a more competitive market for first-time buyers like Lisa Piercey and her husband, Alex Berardo. First-time buyers made up 29% of all homes sold nationally last month. That share has averaged 31% annually over the past 10 years.

The couple began looking in December for homes at $350,000 or below. They offered $5,000 over the asking price on two properties but lost out to rival bidders.

“That was all we could afford,” said Lisa Piercey, a 32-year old project manager. “It’s really defeating, really disappointing.”

In the end, the couple bought a townhome in a new construction community, though they see it as a stepping stone to a more spacious house with a big yard.

“Its big enough that we can still start our family and then move when the market hopefully dies down in a couple of years,” she said.

Money, EconomyIndia’s Rupee Continues To Fall Due To Inflationary Pressures

Inflationary concerns over elevated commodity prices are expected to maintain pressure on the Indian rupee during the upcoming week.

Accordingly, high crude oil as well as other raw material prices are expected to unleash a domestic inflationary wave.This trend, said senior analysts, will dent growth prospects along with leading to an eventual rise in interest rates.However, fiscal end dollar selling by software majors will arrest any sharp downfall in rupee value against the USD. Consequently, the Spot USDINR is expected to settle in the range of 76 to 76.50 for the next week.

“Crude and rising US yields kept the rupee weak amid Ukraine war concerns,” said Sajal Gupta Head Fx & Rates Edelweiss. “Rising inflation is a concern across the globe and does not see a immediate solutiona which shall keep the currency weaker.”

Last week, the rupee depreciated by half a per cent amidst a strong US dollar, higher crude oil and weaker risk sentiments. The rupee closed at 76.20 to a greenback after swinging between 75.80 and 76.50 to a USD. “Biggest driver remains crude oil prices and sentiment towards equity markets,” said Devarsh Vakil, Deputy Head of Retail Research, HDFC Securities.

“We expect RBI to keep utilising its large forex reserves to keep the INR stable at around current levels. The bias for USDINR remains skewed to the upside following continued geopolitical worries and broad-based selling by foreign institutions.” The RBI is known to enter the markets via intermediaries to either sell or buy US dollars to keep the rupee in a stable orbit.

Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services, said: “Next week, on the domestic front, market participants will continue to monitor how crude prices will be moving and at the same time, FIIs participation will be important to watch. “Fiscal deficit and trade balance number will also be released next week and will be influencing the rupee.”

A New Monetary World Order As Russia Reels Under Sanctions

As US President Joe Biden unveiled new sanctions on Friday against Russia, he made it clear that the totality of the sanctions and export controls is “crushing the Russian economy”.

“The ruble has lost more than half its value. They tell me it takes about 200 rubles to equal 1 dollar these days. The Moscow stock exchange has been closed fully for two weeks because they know the moment it opens, it will probably collapse,” Biden said.

Credit rating agencies have downgraded Russia to ‘junk’ status.

The list of businesses and international corporations leaving Russia is growing by the day, Biden said while listing the stark consequences for Russia and its economy that have unfolded since the Ukraine war.

“We will not fight a war against Russia in Ukraine. Direct confrontation between NATO and Russia is World War III, something we must strive to prevent,” Biden said on not sending troops to Ukraine.

“And we’re going to continue to squeeze (Vladimir) Putin. The G7 will seek to deny Russia the ability to borrow from leading multinational institutions, such as the International Monetary Fund and the World Bank. Putin is an aggressor… And Putin must pay the price,” Biden said.

Zoltan Pozsar of Credit Suisse said in a report, “We are witnessing the birth of Bretton Woods III – a new world (monetary) order centred around commodity-based currencies in the East that will likely weaken the Eurodollar system and also contribute to inflationary forces in the West.”

“A crisis is unfolding. A crisis of commodities. Commodities are collateral, and collateral is money, and this crisis is about the rising allure of outside money over inside money. Bretton Woods II was built on inside money, and its foundations crumbled a week ago when the G7 seized Russia’s FX reserves,” Credit Suisse said.

Pozsar said it is a perfect storm but that’s precisely what happens when the West sanctions the single-largest commodity producer of the world, which sells virtually everything.

“What we are seeing at the 50-year anniversary of the 1973 OPEC supply shock is something similar but substantially worse — the 2022 Russia supply shock, which isn’t driven by the supplier but the consumer.

“The aggressor in the geopolitical arena is being punished by sanctions, and sanctions-driven commodity price moves threaten financial stability in the West. The commodities market is much more financialised and leveraged today than it was during the 1973 OPEC supply crisis, and today’s Russian supply crisis is much bigger, much more broad-based, and much more correlated. It’s scarier,” Pozsar said.

There are Russian commodities that are collapsing in price and there are non-Russian commodities that are rallying — this rally is due to the 2022 Russia supply shock.

“It’s a buyers’ strike. Not a seller’s strike, to make things all the more absurd… Russian commodities today are like subprime CDOs were in 2008. Conversely, non-Russian commodities are like what US Treasury securities were back in 2008. One collapsing in price, and the other surging in price, with margin calls on both regardless of which side you are on,” he added.

The ban on technology exports to Russia, in response to the war in Ukraine, could backfire on global manufacturers of computer processors and semiconductors, as many crucial components for their production are made exclusively in Russia, an industry expert warned.

“The ban on finished products for Russia will result in a retaliatory ban on the supply of production components and will cause an acute shortage of microprocessors for the whole world. By comparison, the end-of-2021 supply disruption situation will appear relatively light,” Oleg Izumrudov, head of the Consortium of Russian Developers of Data Storage Systems (RosSHD), said, RT reported.

Following the sanctions, Russia may default on sovereign bonds for the first time since the Bolshevik revolution in 1917.

A leading ratings agency has warned that Russia is soon likely to default on its debts, as it downgraded the country’s bonds further into ‘junk’ territory, BBC reported.

Fitch Ratings slashed its assessment of Russia to almost the bottom of its scale, just days after downgrading it from investment status.

If Russia does fail to make payments on its debt, it raises the possibility of the first major default on the country’s sovereign bonds since the wake of the 1917 Bolshevik revolution, BBC reported.

It is the latest blow to the country’s creditworthiness in the wake of its invasion of Ukraine. This week, Moscow said its bond payments may be affected by sanctions.

“The further ratcheting up of sanctions, and proposals that could limit trade in energy, increase the probability of a policy response by Russia that includes at least selective non-payment of its sovereign debt obligations,” Fitch said, BBC reported.

Removing Russian oil from the market would make energy prices skyrocket to over $300 per barrel of oil, Russia’s Deputy PM Aleksandr Novak said, adding that Russia is not dependent on the West and can “reroute” its supplies elsewhere.

The European officials are “once again seeking to put all the blame for their own recent energy policy shortfalls on Russia”, Novak told journalists, adding that “Russia has nothing to do with the current price hike on market volatility”, RT reported.

There are grave implications for food prices also. Energy and commodity prices-including wheat and other grains-have surged due to the war in Ukraine, adding to inflationary pressures from supply chain disruptions and the rebound from the Covid-19 pandemic, the IMF said.

Price shocks will have an impact worldwide, especially on poor households for whom food and fuel are a higher proportion of expenses.

Should the conflict escalate, the economic damage would be all the more devastating. The sanctions on Russia will also have a substantial impact on the global economy and financial markets, with significant spillovers to other countries, the IMF said.

In many countries, the crisis is creating an adverse shock for both inflation and activity, amid already elevated price pressures.

Added to that is the tensions around nuclear plants. Ukrainian intelligence has information that the Russian aggressors are preparing a terrorist attack on the “exclusion zone” in Chornobyl and plan to blame Ukraine.

Ukraine’s Ministry of Defence officials said, “According to information available, Vladimir Putin has ordered the preparation of a terrorist attack on the Chernobyl nuclear power plant.”

The Russia-controlled Chornobyl nuclear power plant plans to create a man-made catastrophe, for which the occupiers will try to shift responsibility on Ukraine, Ukrayinska Pravda reported.

To make matters worse, Russia has accused US of backing biological laboratories on the territory of Ukraine, experiments were carried out with samples of coronavirus from bats, said the official representative of the Russian Ministry of Defense, Major General Igor Konashenkov.

“In the biolaboratories created and funded in Ukraine, as the documents show, experiments were carried out with samples of bat coronavirus,” he said, RT reported.

Konashenkov said the department would soon publish another package of documents on secret military biological activities of the United States on the territory of Ukraine and present the results of their examination.

Social Security: Offices will reopen after 2 years this month

Social Security Administration offices have remained closed since March of 2020, and now, two years later, they will finally be reopening this month.

The agency is currently facing major backlog issues, similar to the IRS, due to the pandemic and staffing issues. Many are hoping that reopening the physical offices will resolve many of these issues. Despite the offices closing, the SSA did not stop functioning.

Is it possible I won’t get Social Security benefits?

In person appointments have been available for people in critical situations in need of assistance. If someone found themselves with no food or shelter, they could make an appointment to get help immediately.

Social Security’s backlogs and reopening of offices

Most of the work done by the Social Security Administration for the last two years has been by phone, email, or mail.

Bump in benefits may get them taxed

This means administrative issues have come about. Only 51% of calls were answered in 2021, according to Forbes and The Sun. After an investigation was completed by the Office of the Inspector General, it was found policies were not in place.

Social Security: Only claim if you know these answers

This was because there were not strong policies surround the tracking and returning original documents, which they themselves require. Documents being mishandled included passports, driver’s licenses, and birth certificates. The hope is that Congress gives funding to not only reopen the offices, but provide better service to the public.

India To Launch Its Own Digital Currency In 2022-2023

India’s central bank will launch a digital version of the rupee in the next financial year, the country’s finance minister said on Tuesday.

“Introduction of a central bank digital currency will give a boost, a big boost to the digital economy,” Nirmala Sitharaman said as she delivered the country’s annual budget. “Digital currency will also lead to a more efficient and cheaper currency management system.”

The Reserve Bank of India will introduce the digital rupee in the 2022-2023 financial year which begins on Apr. 1.

Sitharaman gave no details about how the digital rupee would work or what it would look like, but said it would be introduced “using blockchain and other technologies.”

Blockchain refers to the technology that was originally created alongside bitcoin, but the definition has since evolved as its applications have moved beyond cryptocurrencies.

India would be one of the world’s largest economies to introduce a so-called central bank digital currency (CBDC) if it sticks to its plans.

China has been working on a digital version of its yuan since 2014 and is furthest ahead when it comes to launching CBDCs globally.

Over the past two years, the People’s Bank of China has been carrying out trials in the form of lotteries, where digital yuan is handed out to citizens in certain cities for them to spend. More recently, the central bank has looked to expand the use of the digital yuan. China has not launched its digital currency nationwide yet and has no timeline to do so, however.

Elsewhere, Japan is looking into its own CBDC, and the U.S. Federal Reserve last month released a study into a digital dollar, but did not take a firm position on whether it would issue one.

While India is pushing forward with a digital rupee, it has tried to take a tougher stance on cryptocurrencies like bitcoin and is currently working on regulation for the sector.

On Tuesday, Sitharaman said income from the transfer of virtual digital assets should be taxed at rate of 30%.

India Slips To 101st Spot In Global Hunger Index 2021

India slipped to 101st position in the Global Hunger Index (GHI) 2021 of 116 countries and is behind neighbors Pakistan, Bangladesh and Nepal. In 2020, India was ranked 94th out of 107 countries.

The report, prepared jointly by Irish aid agency Concern Worldwide and German organization Welt Hunger Hilfe, termed the level of hunger in India “alarming”. India’s GHI score has also decelerated — from 38.8 in 2000 to the range of 28.8 – 27.5 between 2012 and 2021.

The GHI score is calculated on four indicators — undernourishment; child wasting (the share of children under the age of five who low weight for their height); child stunting (children under the age of five who have low height for their age) and child mortality (the mortality rate of children under the age of five).

The share of wasting among children in India rose from 17.1% between 1998-2002 to 17.3% between 2016-2020, according to the report. “People have been severely hit by COVID-19 and by pandemic related restrictions in India, the country with highest child wasting rate worldwide,” the report said.

However, India has shown improvement in other indicators such as the under-5 mortality rate, prevalence of stunting among children and prevalence of undernourishment owing to inadequate food, the report said.

A total of only 15 countries — Papua New Guinea (102), Afghanistan (103), Nigeria (103), Congo (105), Mozambique (106), Sierra Leone (106), Timor-Leste (108), Haiti (109), Liberia (110), Madagascar (111), Democratic Republic of Congo (112), Chad (113), Central African Republic (114), Yemen (115) and Somalia (116) — fared worse than India this year.

A total of 18 countries, including China, Kuwait and Brazil, shared the top rank with GHI score of less than five, the GHI website that tracks hunger and malnutrition across countries reported last week.

According to the report, the share of wasting among children in India rose from 17.1 per cent between 1998-2002 to 17.3 per cent between 2016-2020, “People have been severely hit by COVID-19 and by pandemic related restrictions in India, the country with highest child wasting rate worldwide,” the report said.

Neighboring countries like Nepal (76), Bangladesh (76), Myanmar (71) and Pakistan (92), which are still ahead of India at feeding its citizens, are also in the ‘alarming’ hunger category.

However, India has shown improvement in indicators like the under-5 mortality rate, prevalence of stunting among children and prevalence of undernourishment owing to inadequate food, the report said.

Stating that the fight against hunger is dangerously off track, the report said based on the current GHI projections, the world as a whole — and 47 countries in particular — will fail to achieve even a low level of hunger by 2030.

“Although GHI scores show that global hunger has been on the decline since 2000, progress is slowing. While the GHI score for the world fell 4.7 points, from 25.1 to 20.4, between 2006 and 2012, it has fallen just 2.5 points since 2012. After decades of decline, the global prevalence of undernourishment — one of the four indicators used to calculate GHI scores — is increasing. This shift may be a harbinger of reversals in other measures of hunger,” the report said.

Food security is under assault on multiple fronts, the report said, adding that worsening conflict, weather extremes associated with global climate change, and the economic and health challenges associated with Covid-19 are all driving hunger.

“Inequality — between regions, countries, districts, and communities — is pervasive and, (if) left unchecked, will keep the world from achieving the Sustainable Development Goal (SDG) mandate to “leave no one behind,” it said.

India’s wholesale price index (WPI)-based inflation remained in double-digits for the sixth consecutive month in September, though at 10.66% it was lower than 11.39% in August.

Food inflation contracted 4.69% in September compared with a 1.29% fall a month ago, while that of manufactured products rose to 11.41% from 11.39% in August.

The sharp contraction in food prices was mainly due to easing vegetable prices though price of pulses continued to spike at 9.42%. Retail inflation in September also slowed to a five-month low of 4.4% due to moderating food prices.

Fuel’s a concern

The inflation in the fuel and power basket was 24.91% in September, against 26.09% in the previous month. The rise in crude petroleum and natural gas prices was 43.92% in September over 40.03% in the previous month.

Fuel is likely to keep pinching in the days ahead. After two days of lull, petrol and diesel prices were again hiked by 35 paise per litre on Thursday, sending retail pump prices to their highest ever level across the country.  This is the 13th time that petrol price has been hiked in two weeks while diesel rates have gone up 16 times in three weeks.

‘Pandora Papers’ Indicts At Least 380 Indians

A massive investigation from more than 600 journalists across the globe sheds new light into the shadowy world of offshore banking and the high-powered elites who use the system to their benefit.

The exposé, dubbed the “Pandora Papers,” shows how the world’s wealthy hide their money and assets from authorities, their creditors and the public by using a network of lawyers and financial institutions that promise secrecy. It’s built on a trove of 11.9 million records leaked to the International Consortium of Investigative Journalists (ICIJ), which in turn shared them with partner media outlets such as The Washington Post and The Guardian for help conducting the large-scale investigation.

“These are secretive, confidential documents from offshore tax havens and offshore specialists who work to help rich, powerful and sometimes criminal individuals create shell companies or trusts in a way that often helps either obscure assets or in some cases even help avoid paying taxes,” senior ICIJ reporter Will Fitzgibbon told NPR’s Weekend All Things Considered. Pandora Papers, the most voluminous leak of offshore financial records ever, reveal how individuals and businesses set up complex multi-layered trust structures for estate planning, in jurisdictions that are loosely regulated for tax purposes, but characterized by air-tight secrecy laws.

King Abdullah II, who rules Jordan, spent more than $100 million on lavish properties in the U.S. and Europe while his country fell deeper into political turmoil, The Washington Post reported. A woman suspected of being in a years-long relationship with Russian President Vladimir Putin became the owner of a pricey Monaco apartment days after reportedly giving birth to his child, the paper also found.

Those are two of more than 300 current or former politicians who appear in the Pandora Papers, the journalists said. Among them are 14 sitting country leaders, including President Luis Abinader of the Dominican Republic, Kenyan President Uhuru Kenyatta, Czech Prime Minister Andrej Babis and Ukrainian President Volodymyr Zelensky. According to reports, there are at least 380 persons of Indian nationality in the Pandora Papers. Of these, The Indian Express has so far verified and corroborated documents related to about 60 prominent individuals and companies. These will be revealed in the coming days.

In February 2020, following a dispute with three Chinese state-controlled banks, Anil Ambani told a London court that his net worth was zero. Records in the Pandora Papers investigated by The Indian Express reveal that the chairman of Reliance ADA Group and his representatives own at least 18 offshore companies. Set up between 2007 and 2010, seven of these companies have borrowed and invested at least $1.3 billion.

A financial advisor and his company were barred by SEBI from trading in the stock market for a year and fined for insider trading in Biocon Ltd shares. What the marker regulator did not know is that the same advisor is the ‘Protector’ of a trust set up by a company owned by Biocon Executive Chairperson’s husband.  Indian cricket superstar Sachin Tendulkar, along with members of his family, figures in the Pandora Papers as Beneficial Owners of an offshore entity in the British Virgin Islands which was liquidated in 2016. Sachin, with wife Anjali Tendulkar and father-in-law Anand Mehta are named as BOs and Directors of a BVI-based company.

Captain Satish Sharma, Congress leader, friend of the Gandhi family, and a former Union Minister who passed away in February this year, had offshore entities and properties abroad, the Pandora Papers show. At least 10 members of Sharma’s family including his wife Sterre, children and grandchildren are among the beneficiaries of a trust, the Jan Zegers Trust — a declaration Sharma never made to the Election Commission while filing poll nomination papers.

A month before fugitive diamond jeweller Nirav Modi fled India in January 2018, his sister Purvi Modi set up a firm in the British Virgin Islands to act as a corporate protector of a trust formed through the Trident Trust Company, Singapore. Records investigated by The Indian Express show that the firm, Brookton Management Ltd, was set up in December 2017 to act as the corporate protector of The Deposit Trust. These documents of the new firm and the trust set up by Purvi are part of the Pandora Papers.

Bollywood actor Jackie Shroff was the prime beneficiary of a trust set up in New Zealand by his mother-in-law, records in the Pandora Papers investigated by The Indian Express reveal. He also made “substantial contributions” to this trust, which had a Swiss bank account and owned an offshore company registered in the British Virgin Islands, records show. According to the memorandum concerning the trust, Shroff’s son Jai Shroff (Tiger Shroff) and daughter Krishna Shroff were the beneficiaries, besides Claudia Dutt, the mother of Shroff’s wife Ayesha

Senate Republicans Block Bill, Possibly Shutting Down US Economy

The US Senate voted 48-50 to begin the debate on the measure the House already passed, which wasn’t enough to overcome a Republican filibuster, requiring 60 votes

Senate Republicans blocked a House-passed bill to suspend the debt limit and avert a government shutdown from advancing in the Senate on Monday, September 27, 2021. The move comes after Republicans had insisted that Democrats act alone to address the debt limit and leaves Congress without a clear plan to keep the government open with the threat of a potential shutdown looming by the end of the week.

Government funding is set to expire on September 30, and the stopgap bill the House approved last week would extend funding and keep the government open through December 3. In addition, the measure includes a debt limit suspension through December 16, 2022. The clock is ticking to address the debt limit and Congress may only have until mid-October to act before the federal government can no longer pay its bills.

The Senate voted on a procedural motion to advance the legislation, which needed 60 votes to succeed. Since Democrats control only 50 seats in the chamber, they would have needed 10 Senate Republicans to vote in favor.

The Senate voted 48-50 to begin debate on the measure the House already passed, which wasn’t enough to overcome a Republican filibuster. The bill would have extended government funding to Dec. 3 and suspended the debt limit until Dec. 16, 2022. The measure also would have provided $28.6 billion for disaster assistance and $6.3 billion for Afghan refugees.

But 60 votes were needed to overcome a Republican filibuster. Republicans have insisted that Democrats deal with the debt limit on their own to avoid supporting the broader taxing and spending priorities of Democrats. But Democrats argue both parties should support raising the debt limit, as happened three times during the Trump administration, because a default could spark a worldwide economic crisis.

“It’s an unhinged position to take,” said Senate Majority Leader Chuck Schumer, D-N.Y. “There is no scenario in God’s green earth where it should be worth risking millions of jobs, trillions in household wealth, people’s Social Security checks, veterans’ benefits and another recession just to score short-term, meaningless political points.”

But Senate Minority Leader Mitch McConnell, R-Ky., said Democrats should separate the government funding extension from the debt limit – and then raise the debt limit themselves.

“Democrats want to use this temporary pandemic as a Trojan horse for permanent socialism,” McConnell said. “Republicans aren’t rooting for a shutdown or debt limit breach.”

Democrats must now find another way to keep the government operating and the country borrowing. Without a funding extension, the federal government will shut down Friday. Treasury Secretary Janet Yellen projected the country will reach its limit on borrowing in mid-October.

Democrats do have options to raise the debt limit on their own to prevent the US from defaulting on its debts, but they argue that the vote should be a bipartisan shared responsibility.

Schumer criticized Republicans ahead of the vote, saying, “After today there will be no doubt about which party in this chamber is working to solve the problems that face our country, and which party is accelerating us towards unnecessary, avoidable disaster.”

House starts debate on bipartisan infrastructure bill

The House began an hour of debate Monday on an infrastructure bill, but isn’t expected to vote until Thursday as lawmakers haggle over the rest of President Joe Biden’s agenda. The $1.2 trillion infrastructure bill, which includes $550 billion in new funding, has already been approved by a bipartisan majority in the Senate.

A group of nine moderate Democrats negotiated for a vote by Monday in exchange for their support for a $3.5 trillion framework for Biden’s social welfare priorities. The deadline slipped to what moderates said would be “no later than Thursday,” when federal highway legislation expires.

A Comparative Study of India’s Inflation during UPA Vs NDA Government (Dr. ManMohan Singh Government Vs. of Modi Government)

Dr. ManMohan Singh became Prime Minister on 22 May 2004, and he remained in office until 26 May 2014. After that Narendra Modi government has been continuously in power. This article dwells into how both governments faired on controlling inflation in India. We first took the CPI (Consumer Price Index) published by Government of India as a measure of inflation. However, this index represents just a fraction (includes only the goods that consumers consumed) of the total economic activity and ignores the substitution effect that arises from price changes. To have a comprehensive measure of inflation for the economy as a whole and incorporating the substitution effect on net inflation we calculated GDP Deflator where inflation is measured by (GDP at Current prices / GDP at constant prices) -1 and converted into percentage. Finally, we tried to verify the accuracy/consistency of inflation data published by Government of India with the international monetary theory which predicts long run inflation differentials between two countries. For this we used US dollar as the base currency and compared depreciation of rupee as the differential inflation.

This differential inflation between two countries talks about inflation of traded goods and investible assets including stocks and bonds. It also indicates how international investors perceive the overall health of the Indian economy i.e. if they see low inflation of a period as the strength of the economy or the weakness of the economy.  Remember during recession, inflation is low and during deflation inflation is negative, and both the situations are undesirable. The third situation is that of stagflation when real GDP stagnates or declines like we have since Indian Lockdown on account of Covid, while nominal GDP and stock market booms.

Taking historical data from the Economic Survey of India and trading economics for the recent months, we found that during the era of UPA Government (from May 22, 2004m to May 26 2014) headed by Dr. ManMohan Singh, inflation for the entire ten years was 8.48% per annum as per CPI measure, while as per GDP deflator it was 6.81% and as per US inflation differential it was 2.84% and since US inflation has been around 2%, this tells Indian inflation has been around 5% (2.84+2) for traded goods and investible assets. These figures look consistent.

However, Modi government has completed only 7 years, hence it would be fair to compare the inflation figures for the first 7 years of UPA government. During that period (May 2004 Until May 2011), as per CPI measure the annual average inflation rate had been 7.57%, as per GDP Deflator it had been 6.81% and as per US inflation differential it had been negative 0.17%. Rupee actually became stronger vs. US dollar. On 28th May, 2004, the exchange rate was $1 = 45.29 rupees and on May 26, 2011 this rate was $1= 44.75. These exchange rate figures were not much different from average values of the month. This means international investors saw Indian domestic inflation as a mark of strength and demanded more rupee for investments in India because trade deficit and total current account deficit was still there. Huge foreign investments in India (surplus on capital account) made rupee stronger and boosted foreign exchange reserves.

Compared to this, we now see the inflation scenario during NDA (Modi Government) era. As per CPI measure, inflation has remained lower at 5.11% while it was 7.57% under UPA. We then we compare the GDP deflator figures, which we find from our calculation to be equal to 3.19%. The main reason for this low inflation for the entire seven years was the period of demonetization as during the demonetization period, the inflation rate was very low, just 1% during 2016 and 2.8% during 2017. Since this inflation rate was slightly lower than US inflation rate of 2% for the entire two years, rupee became slightly stronger. The principles of economics are working. But after March 2018, the weakness of lower inflation became visible to international investors and rupee sharply depreciated.

On March 31st, 2018, the exchange rate was $1 = 65.01 and within one year it depreciated to 69.30 (a depreciation by 6.6%) giving international inflation figure of 8.6% (6.6+2% US inflation) for the year 2018-19. For the overall seven-year period until May 26, 2021, relative international inflation rate of India has been 3.14% seen by depreciation of rupee measure. This is sharply worse when compared with the relative international inflation figure of (-0.17%) of UPA government for their first seven years. This means that foreigners are either seeing low inflation of India as a weakness of the Indian economy or they are simply not believing the Indian inflation data, otherwise rupee would not have depreciated against dollar. According to International Investors, inflation in India for traded goods and investments should be 3.14%+2% = 5.14% while for Dr. ManMohan Singh’s first seven years period, this figure was just 1.83% (-0.17+2%).

To conclude, we can say that Dr.Manmohan Singh has performed far better in tacking inflation and having a better economic performance when compared to Narender Modi Government. The inflation number achieved by Modi government has been because of negative growth of entire GDP by 9.2% since pandemic, otherwise the performance of Modi Government would have been visibly more worse. People have become so poor that they don’t have enough purchasing power to buy goods. Manufacturing, trade, transport, communication and social-person services all have been in decline. Modi government has failed tremendrously in tacking Inflation when compared with UPA government domestically.

Internationally also, Dr. Manmohan Singh Government had performed much better when compared to the Modi Government in attracting economic investments. Even though the Modi Government has altered the domestic calculation index for GDP and Inflation to show a better picture, international figures are completely reliable as they can not be manipulated by the domestic governments since exchange rates are traded daily. India has seen better economic performance and perception during the Manmohan Singh Government in almost all aspects when compared to the Modi Government.



Asia Will Represent Half Of The World’s Consumer Spending By 2032

Despite COVID-19, the global consumer class—those who are middle class or rich—is rising fast. In an earlier post, we showed that we are experiencing a truly secular shift in the size of this global consumer class. COVID-19 is a transitory setback of one or two years in this long-term shift. Since 2000, the global consumer class grew by more than 4 percent each year, reaching a new milestone of 4 billion people—for the first time—in 2020 or 2021. At the beginning of this century, the middle class was mostly a Western phenomenon. Consumer companies were selling their goods in OECD countries, especially the USA and Europe. Today, the consumer class is global and increasingly Asian. Spending by the Asian middle class exceeds that in Europe and North America combined.

We define the global consumer class as anyone living in a household spending at least $11 per day per person, of which the global middle class ($11-$110 per day) represents the lion’s share with 3.75 billion people. It is very important to define the global consumer class correctly and allow for comparability across countries and over time. Incorrect definitions could cost companies billions, as Nestle experienced painfully in Africa. The company based its decision to expand on announcements of a rapid rise of Africa’s middle class. While Africa’s middle class has indeed been rising rapidly, the threshold of $3 per day in consumer spending was too low to gain traction with products that are enjoyed by American or European consumers.

Cornel Krummenacher, then chief executive for Nestle’s equatorial Africa region, noted that we thought this would be the next Asia, but we have realized the middle class here in the region is extremely small.” Even today, Africa’s consumer class is only 283 million people strong according to projections by World Data Lab, growing at 4.1 percent per year. However, there is an untapped potential in Africa below the middle-class threshold. If companies want to benefit from Africa’s growth in this decade, a focus closer to the bottom of the pyramid would yield more success.

Under current projections, Asia will represent half of the world’s consumer spending by 2032. By contrast, Asia’s consumer class is advancing strongly. Since 2016, half of the global consumer class has been Asian. Today, out of the 4 billion global middle-class consumers, 2.2 billion live in Asia. However, while Asia has more than half of the world’s consumers, they only represent approximately 41 percent of consumer spending ($26 trillion out of $63 trillion in 2011 purchasing power parity, see Table 1). Under current projections, Asia will represent half of the world’s consumer spending by 2032.

Table 1. Asia’s consumer class power

  Asia Rest of the world TOTAL Asia’s share
Consumer class (billion) 2.2 1.8 4.0 55%
Spending of the consumer class (trillion $) 26 37 63 41%

Source: World Data Lab’s MarketPro; 2021 projections.

Today, there are 13 Asian economies in the top 30. The composition of these top 30 countries will not change until 2030. However, there are big shifts within the top 30: Only 7 countries are expected to keep their position; 14 countries will lose position while 9 countries gain positions (see Figure 1). To assess which countries will move up in the consumer class tally, we used our unique modeling capacity to project the change of the consumer class between 2020 and 2030.

Figure 1. The top 30 consumer markets of this decade
Daily spending of more than $11 (2011 PPP)

Everyone is familiar with consumer class growth in China and India. In Europe and North America, the numbers in the consumer class will stagnate and growth will come about only because households will become richer.But there are other countries, too, growing under the radar, which are forecast to have very large increases, in the tens of millions, in the numbers in the consumer class in 2030.

Here is an overview of the five top movers:

  1. Bangladesh (+17 positions), from place 28 to 11; future consumer class: 85 million (+50 million)
    Global share of consumer class: 0.8 percent (2020), 1.6 percent (2030).
    Bangladesh’s consumer class is projected to more than double by 2030: Today, 35 million people in Bangladesh spend more than $11 a day. By 2030, it will be 85 million!
  2. Pakistan (+8 positions), from place 15 to 7; future consumer class: 121 million (+56 million)
    Global share of consumer class: 6 percent (2020), 2.3 percent (2030).
    Pakistan will add 56 million new consumers by 2030, for a total of 121 million. This means that in 2030, for the first time, every other Pakistani will be able to spend more than $11 per day.
  3. Vietnam (+7 positions), from place 26 to 19; future consumer class: 56 million (+21 million)
    Global share of consumer class: 9 percent (2020), 1.1 percent (2030).
    Vietnam’s consumer class will grow from 35 million to 56 million within this decade, which is a success story particularly of the middle-aged generation: Consumers between 45 and 65 years of age will contribute nearly 25 percent of Vietnam’s spending, as opposed to 20 percent today.
  4. Philippines (+6 positions), from place 20 to 14; future consumer class: 79 million (+38 million)
    Global share of consumer class: 1 percent (2020), 1.5 percent (2030)
    . The Filipino consumer class is projected to grow steadily, from 41 million today to 79 million in 2030. By then, more than two-thirds of the Filipino population will spend more than $11 per day.
  5. Indonesia (+2 positions), from place 6 to 4; future consumer class: 199 million (+76 million)
    Global share of consumer class: 2 percent (2020), 3.8 percent (2030).
    While Indonesia is only moving up two places, it is experiencing a large gain of consumer class growth. Starting from an already large base of 123 million, Indonesia will have almost 200 million consumers in 2030, making it the fourth-largest consumer market in the world.

The big message of this analysis is that the consumer class is spreading across the world, and that many emerging markets will have large consumer markets where supply-chain-scale economies, digital platforms, and local preferences will need to be better understood and developed.

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.

Take Advantage of This ‘Fantastic Opportunity’ To Pay Off Student Loans

If you have federal student loan debt, you now have approximately six months to prepare for payments on that debt to restart. Last week, President Joe Biden’s administration announced it is stretching out the moratorium on federal student loan payments until Jan. 31, 2022. This means that payments will not resume until next year and interest rates will remain at 0%. The latest extension comes shortly after two-thirds of borrowers said it would be difficult for them to afford payments if they resumed the following month, according to a recent survey by The Pew Charitable Trusts.

“What a fantastic opportunity for borrowers to take more control of their finances,” says Laurel Taylor, CEO and founder of, a student debt repayment platform. “It will be near two years of payment suspension as we look to January 31. I would really encourage borrowers to maximize this opportunity — whatever that means to them.” The freeze on federal student loan payments was originally set to expire at the end of September. This latest extension will be the “final” one, according to a statement from the U.S. Department of Education.

Pro Tip

Make sure your address and email are up-to-date with your loan servicer, so you don’t miss any important information about your student loans and the temporary extension. That means any student loan debt you had before the COVID-19 pandemic will be waiting for you when repayment begins at the end of the forbearance period, unless the policy changes again. Experts say you shouldn’t count on any of your debt disappearing in the meantime, because it’s unlikely that there will be broad student loan forgiveness —not even the $10,000 that Biden promised during the campaign, that is.

“I don’t see $10,000 in student loan forgiveness coming. I just don’t think he legally can without Congress,” says Robert Farrington, founder and CEO of The College Investor, a site providing advice on student loan debt. “But I do think he’s able to do a lot of good with the powers he has, such as reforming programs that already exist.”

What to Do in Light of Biden’s Extension of Student Loan Relief

Given this latest update, now may be a good time to rethink your student loan repayment strategy. Keep in mind that everyone’s situation is different, but here’s what you should do in light of the extension of the student loan payment freeze, according to experts we spoke to.

If You’ve Experienced Job Loss or Decrease in Income

Use this time to give yourself breathing room to address other financial priorities. If you’re unemployed or your income has decreased over the last year, continue to focus on covering your necessary expenses, such as rent or mortgage payments, utilities, groceries, transportation, and the like. “This relief is targeted toward people who have experienced a job loss or a decrease in income. I advise them to focus on necessary living expenses and try not to have that guilt or worry about setting money aside for student loans because this time is for you,” says Cindy Zuniga-Sanchez, personal finance coach and founder of Zero-Based Budget, a financial education platform on Instagram.

Another thing you can do to lower your monthly payment when it’s due is apply for income-driven repayment. An income-driven repayment plan is a monthly payment based on your family size and a percentage of discretionary income. If you earn less than 150% of the federal poverty line, your payments could be as low as $0.  To sign up, go to this federal student aid page, and click on “log in” at the top to start an application. If you are already enrolled in an income-driven plan and your income has changed, ask your lender to recertify your income before payments restart. If you make all your payments on time, an IDR plan allows your loans to be forgiven at the end of the repayment period — even if they aren’t fully repaid.

If you’re unsure what the best repayment option is for you, reach out to your loan servicer for help or go to  “Be mindful that your payments may not actually cover the interest that’s accumulating on your loan, which means you could end up paying a significant amount in interest,” says Zuniga-Sanchez. “I want to put that caution out there because it’s very important to be informed when we are making these changes to our student loan repayment strategies.”

If You Still Have a Job or Income

You can use these extra months to help divert some money toward building an emergency fund or pay more pressing high-interest debt, such as credit cards or private student loans.  “Nobody should be paying extra payments toward their loans at this time. Even if you’re able to, you should save that money and eliminate other debts,” says Farrington.

If you haven’t already, prioritize building an emergency fund first. Try to set aside three to six months’ of expenses, but don’t feel overwhelmed if saving that much feels like an unattainable goal right now. Start small, and go from there. Next, focus on paying down high-interest debt — these strategies can help you do that. You can also use extra funds to invest in retirement accounts, such as a 401(k), IRA, or Roth IRA, or pay down any lower-interest debt you may have, such as medical debt or a car loan.  If you want to pay down your student loans during this 0% interest period, Farrington suggests putting that money in a savings account and then making a lump sum payment right before payments start up again. “That way, you keep that money as long as you can,” he says.

If You Are Behind on Student Loan Payments

Because all collection activities will resume once the extension ends, try to rehabilitate your loans as soon as possible. Default on federal loans happens when a payment is 270 days past due, sending your loans to collections and exposing you to damaged credit, garnished wages, and seized tax refunds. “Get out of default so that as payments and collection activity resume, you’re not left getting your wages or taxes garnished,” says Farrington.

To rehabilitate your student loans and get out of default, you’ll need to contact your loan servicer, fill out an application, and follow a specific process. If your application is approved and you make nine on-time payments, even during this forbearance period, your loans will typically transfer to a new loan servicer, and you’ll be out of default.

If loan rehabilitation isn’t possible for you at this time, there is additional deferment and forbearance outside of COVID-19 relief that can give you more time to get back on your feet. For example, there’s unemployment deferment and economic hardship deferment, which both temporarily suspend payments on your student loans. But these options should be your last resort.

The Bottom Line

If you’re part of the majority, you likely haven’t made student loan payments in almost two years. Even though the forbearance period has been extended, now is an excellent opportunity to review your finances and make a plan for resuming payments come next year.  For example, you may need to trim or readjust certain spending areas now, so you have room in your budget in 2022 when payment is due. Based on the most recent announcement, it’s safe to assume student loan payments will restart in 2022 and it’s better to get ahead of the curve while you can. “Two years of suspension on student loan payments is unprecedented,” says Laurel, “and it is an opportunity for borrowers to get ahead.”

Janet Yellen Warns, US Could Default On National Debt In October

Treasury Secretary Janet Yellen has warned congressional leaders that the U.S. is on track to default on the national debt in October if the White House and Congress are unable to raise the debt limit. In a letter, Yellen said that the Treasury Department would likely run out of cash and exhaust “extraordinary” measures to keep the federal government within its legal borrowing limit at some point next month.

“Once all available measures and cash on hand are fully exhausted, the United States of America would be unable to meet its obligations for the first time in our history,” Yellen said. “Given this uncertainty, the Treasury Department is not able to provide a specific estimate of how long the extraordinary measures will last. However, based on our best and most recent information, the most likely outcome is that cash and extraordinary measures will be exhausted during the month of October,” she continued. Yellen wrote the letter to Speaker Nancy Pelosi (D-Calif.), House Minority Leader Kevin McCarthy (R-Calif.), Senate Majority Leader Charles Schumer (D-N.Y.) and Senate Minority Leader Mitch McConnell (R-Ky.).

The Treasury Department has taken so-called extraordinary measures to prevent the U.S. from defaulting on the national debt since the federal debt limit was reimposed on Aug. 1. If the Treasury Department runs out of ways to stave off a default without borrowing more money, the inability of the U.S. to pay its debts could send debilitating shockwaves through the financial system. Yellen urged lawmakers for months to raise the debt limit before it was reimposed in August, warning that a delay could “cause irreparable damage to the U.S. economy and global financial markets.” She has since pleaded with Congress to give Treasury the ability to pay debts already approved by previous presidents and congressional majorities.

“Waiting until the last minute to suspend or increase the debt limit can cause serious harm to business and consumer confidence, raise short-term borrowing costs for taxpayers, and negatively impact the credit rating of the United States,” Yellen wrote. “At a time when American families, communities, and businesses are still suffering from the effects of the ongoing global pandemic, it would be particularly irresponsible to put the full faith and credit of the United States at risk.” Even so, Democrats and Republicans are locked in a stalemate over who bears responsibility for protecting the full faith and credit of the U.S. The White House and Democratic leaders are planning to tie a debt limit increase to another must-pass government funding bill, daring Republicans to trigger both a government shutdown and a default by opposing the measure.

“We fully expect Congress to act promptly to suspend the debt limit and protect the full faith and credit of the United States and we expect them to do that in a bipartisan way just as they did three times during the prior administration,” said a White House official. But Republicans have refused to raise the debt ceiling unless spending cuts and debt reduction programs are attached.

$400-Billion New City In The American Desert Planned

The cleanliness of Tokyo, the diversity of New York and the social services of Stockholm: Billionaire Marc Lore has outlined his vision for a 5-million-person “new city in America” and appointed a world-famous architect to design it. Now, he just needs somewhere to build it — and $400 billion in funding. The former Walmart executive last week unveiled plans for Telosa, a sustainable metropolis that he hopes to create, from scratch, in the American desert. The ambitious 150,000-acre proposal promises eco-friendly architecture, sustainable energy production and a purportedly drought-resistant water system. A so-called “15-minute city design” will allow residents to access their workplaces, schools and amenities within a quarter-hour commute of their homes.

Although planners are still scouting for locations, possible targets include Nevada, Utah, Idaho, Arizona, Texas and the Appalachian region, according to the project’s official website. The announcement was accompanied by a series of digital renderings by Bjarke Ingels Group (BIG), the architecture firm hired to bring Lore’s utopian dream to life. The images show residential buildings covered with greenery and imagined residents enjoying abundant open space. With fossil-fuel-powered vehicles banned in the city, autonomous vehicles are pictured traveling down sun-lit streets alongside scooters and pedestrians.

Another image depicts a proposed skyscraper, dubbed Equitism Tower, which is described as “a beacon for the city.” The building features elevated water storage, aeroponic farms and an energy-producing photovoltaic roof that allow it to “share and distribute all it produces.” The first phase of construction, which would accommodate 50,000 residents across 1,500 acres, comes with an estimated cost of $25 billion. The whole project would be expected to exceed $400 billion, with the city reaching its target population of 5 million within 40 years. Funding will come from “various sources,” project organizers said, including private investors, philanthropists, federal and state grants, and economic development subsidies. Planners hope to approach state officials “very soon,” with a view to welcoming the first residents by 2030.

A new urban model In addition to innovative urban design, the project also promises transparent governance and what it calls a “new model for society.” Taking its name from the ancient Greek word “telos” (a term used by the philosopher Aristotle to describe an inherent or higher purpose), the city would allow residents to “participate in the decision-making and budgeting process.” A community endowment will meanwhile offer residents shared ownership of the land. In a promotional video, Lore described his proposal as the “most open, most fair and most inclusive city in the world.” Lore founded before selling it to Walmart and joining the retail giant as head of US e-commerce in 2016. He left the company earlier this year, saying that his retirement plans included working on a reality TV show, advising startups and building a “city of the future.”

On Telosa’s official website, Lore explains that he was inspired by American economist and social theorist Henry George. The investor cites capitalism’s “significant flaws,” attributing many of them to “the land ownership model that America was built on.” “Cities that have been built to date from scratch are more like real estate projects,” Lore said in a promotional video for the project. “They don’t start with people at the center. Because if you started with people at the center, you would immediately think, ‘OK, what’s the mission and what are the values?’

BIG’s founder, Danish architect Bjarke Ingels, is meanwhile quoted as saying that Telosa “embodies the social and environmental care of Scandinavian culture, and the freedom and opportunity of a more American culture.” It is not the first new city being planned by Ingels’ firm, which famously installed a ski slope on top of a Copenhagen power plant and has co-designed Google’s new headquarters in London and California. In January 2020, Japanese carmaker Toyota revealed that it had commissioned BIG to create a master plan for a new 2,000-person city in the foothills of Mount Fuji. Although significantly smaller than Telosa, the project, dubbed Woven City, promises autonomous vehicle testing, smart technology and robot-assisted living.

Bitcoin Is Now Official Currency In This Country

El Salvador has become the first country to adopt bitcoin as legal tender on September 7th, a real-world experiment proponents say will lower commission costs for billions of dollars sent from abroad but which critics warned may fuel money laundering.  The change means businesses should accept payment in bitcoin alongside the U.S. dollar, which has been El Salvador’s official currency since 2001 and will remain legal tender.  President Nayib Bukele, who has pushed for adopting the cryptocurrency, says it will help Salvadorans save about $400 million the government calculates is spent annually on commissions for remittances, while giving access to financial services to the unbanked.

The 40-year-old president is popular with the public but has been accused of eroding democracy, including by the administration of U.S. President Joe Biden.  Doubters say bitcoin could increase regulatory and financial risks for the Central American nation, and polls show Salvadorans are wary of the volatility of the cryptocurrency, which can shed hundreds of dollars in value in a day.  To warm up a skeptical public, Bukele has promised every citizen $30 in bitcoin if they sign up for a government digital wallet. Ahead of the launch, El Salvador bought 400 bitcoins, Bukele said, helping drive the currency price above $52,000 for the first time since May.

Underscoring the risks, bitcoin weakened about 4% to $50,516 hours later. In the early hours of Tuesday, El Salvador’s wallet had not appeared on Apple Inc, Google and Huawei’s app download platforms, however, prompting a series of tweets from Bukele, including one with a red-faced “angry” emoticon.  “Release him! @Apple @Google and @Huawei,” Bukele said. The wallet was later available from Huawei.  Some citizens were optimistic. “It’s going to be beneficial … we have family in the United States and they can send money at no cost, whereas banks charge,” said Reina Isabel Aguilar, a store owner in El Zonte Beach, some 49 km (30 m) southwest of capital San Salvador.  Known as Bitcoin Beach, the town of El Zonte aims to become one of the world’s first bitcoin economies. However, uptake may be slowed by low internet penetration across the country. It remains unclear whether businesses will be sanctioned if they do not adopt the new currency.

In the run-up to the launch, the government installed ATMs that will allow bitcoin to be converted into dollars and withdrawn without commission from the digital wallet, called Chivo.  Bukele on Monday asked for patience.  “Like all innovations, El Salvador’s bitcoin process has a learning curve,” he said on Twitter. “Not everything will be achieved in a day, or in a month.”  In barely two years in office, Bukele has taken control of almost all levers of power. Last week, top judges appointed by his lawmakers ruled he could serve a second term. Bukele has promised to clean up graft, but the Biden administration recently put some of his close allies on a corruption blacklist.  Analysts fear adopting the cryptocurrency could fuel money laundering.. After the bitcoin law was approved, rating agency Moody’s downgraded El Salvador’s creditworthiness, while the country’s dollar-denominated bonds have also come under pressure.

The move has muddied the outlook for El Salvador’s quest for more than $1 billion in financing from the International Monetary Fund (IMF).  But Bukele, who does not shy away from controversy, on Monday retweeted a video that showed his face superimposed on actor Jaime Foxx’s in a scene from Django Unchained, a Quentin Tarantino film about American slavery. The video portrayed Bukele whipping a slave trader who had the IMF emblem emblazoned on his face.  Bukele later deleted the retweet.  In his own tweet, Bukele said: “We must break the paradigms of the past. El Salvador has the right to advance towards the first world.”