...Exercises: 'Fiscal Cliff': Congress Approves Compromise Aimed at Averting Recession Page 1 of 1 2d EN (CBM) January 7, 2013 'Fiscal Cliff': Congress Approves Compromise Aimed at Averting Recession While-reading questions Answer each question as soon as you read the answer in the article – questions are written in the order they are answered in the article. Much of the 2012 presidential campaign was about the redistribution of income (the tax system) in the United States. How does the “Fiscal Cliff” Deal influence the US tax system? The taxes will not be raised for 98 percent of the Americans and 97 percent of small businesses. The deal also change the tax code so it doesn’t benefits the wealthiest. In the United States Congress, any law has to be adopted (voted for) in both the House of Representatives and the Senate. Where did the “Fiscal Cliff” Bill receive the most widespread support (where did the largest part vote in favor of the bill)? There were more democrats, who voted in favor of the bill, than republicans. With the “fiscal cliff” out of the way, another political problem comes up. This problem is not, primarily, about the tax code (the United States’ income), but something else – what? The debt. The fiscal cliff deal will add $3,9 trillion to Americas deficit over the next 10 years. Is the “Fiscal Cliff” Deal, in itself, an economically balanced approach? – Why? No it is not balanced, because it will provide at even large debt for America...
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...Abstract Fiscal cliff” is the popular shorthand term used to describe the challenge that the U.S. government will face at the end of 2012, when the terms of the Budget Control Act of 2011 are scheduled to go into effect. The deficit which is the difference between what the government takes in and what it spends is expected to be reduced by roughly half beginning in the first days of 2013. This sharp decrease in the deficit in such a short period of time is known as the fiscal cliff. 2012 is the year the world is supposed to end, but it won’t happen on December 21st. For Americans it will be on December 31st. We don’t need a Mayan calendar to tell us that we’re heading towards doom; all we have to do is watch the TV or use the internet and read about the fiscal cliff. Almost all Americans will take a financial blow next year and low income families would be among the hardest hit, if the White House and Congress fail to solve the “fiscal cliff” of big tax increases and spending cuts set to start January 2nd. With the rise in payroll-tax increases, Expiration of the Bush tax cuts decreases in the Child Tax Credit, and the Dividend-Tax Increases, a middle-class family would be hit the hardest. According to Matthews, “For instance, if a couple together makes $82,000 and have four children and pay child care and even though money was tight were able to invest in $10,000 worth of blue-chip, dividend-paying stocks, in addition to socking away money in their 401(k)s; their...
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...As of late, if one were to turn on the morning or evening news it is a sure bet that there would be some coverage about the Fiscal Cliff. Varying opinions and concerns about it are heard in passing around campus and probably in most courses regardless of its relevance to the material. However, until thorough research, questions about what it actually is, what led to it, and the partisan positions and implications of it were unclear. The Fiscal Cliff, which is of course not a real cliff and merely an imagery-rich term popularized and exploited by most media, signifies extensive tax hikes and automatic spending cuts that are all scheduled to take place at once in the beginning of 2013. Unless the Obama Administration and the Republicans reach an alternative agreement on deficit reduction, the country will likely face increases equivalent to up to 3-4% of current GDP, which many worry will throw us back into a recession (Calmes, 11/15/12). Tax effects include but are not limited to: the expiration of all Bush tax cuts, (part of which included provisions for lower rates in income, estate, capital gains, and dividend taxes), new taxes related to the health care overhaul, the end of the payroll tax holiday with a return to the 6.2% rate, the expansion of the Alternative Minimum Tax which would increase taxes for middle to upper income citizens, and the elimination of certain corporate tax breaks. Some of the latter business related taxes involve the end of the research and experimentation...
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...The US Fiscal Outlook & China’s Role in the US Treasury Market ------------------------------------------------- -Fixed income project key words FISCAL, DEBT CEILING, TREASURY, THE FED, CHINA Written by Gong Li 1155019071 Jiang Peng 1155038183 Yang Mengdi 1155020855 Zhang Yiwen 1155010794 Zheng Qianfei 1155038175 Written by Gong Li 1155019071 Jiang Peng 1155038183 Yang Mengdi 1155020855 Zhang Yiwen 1155010794 Zheng Qianfei 1155038175 CONTENT Executive Summary 1 1, The US Fiscal Outlook 3 -Recent and historical fiscal outlook 3 -The US debt ceiling and recent crises 4 -Financial cliff (2013) and its impacts to the US economy 5 -The US fiscal future 6 2, Fiscal Situation and Treasury Market 9 -The role of US department of the treasury 9 -The role of the Federal Reserve 9 -The US treasury market 10 -The Fed, the interest rates, the QE and the taper 12 -The prediction of the future interest rate 13 -Summary 14 3, China’s involvement in the US Treasury market 15 -China’s Ownership of US Treasury Securities 15 -Reasons of China’s preference for the US Treasuries 16 -The Symbiosis between China and the US in Terms of US Public Debt Holdings 18 -Our Suggestion on China’s Future Position in the US Treasury Market 20 References 22 Executive Summary The state and local governments continue to face fiscal challenges in the short- to medium-term term. According to the Government Accountability Office, the fiscal situation in the US has...
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...market, I will invest in sound companies that pay a decent dividend. Although the stocktrak simulation took place over a relatively short period of time, we still invested with a long-term horizon in mind. That long-term horizon will produce smaller short-term gains. Our portfolio was constructed with a buy and hold mentality. We tried to avoid being swayed by our emotions and the short-term fads of investors. It was hard to avoid investing in accordance with the predictions of the markets gurus, but in the end I believe our investments were safer because of it. The buy and hold mentality allows us to overlook negative short-term returns with the understanding that the returns will normalize in the long-term. We spread our cash out among a variety of investment vehicles. We planned on placing our funds in 15-30 different investments. The diversity of investments allowed us to eliminate some of the idiosyncratic risk of the individual firms. The specific weights we placed on investment types were: 50% in equity, 30% in mutual funds, 5% in ADR’s, 5% in bonds, and the final 10% will be designates as speculation money. We diversified, not only by investment type, but also by industry. We put...
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...affects it will play for those Americans that run small businesses will have no trouble adding expenses to their yearly budgets, further adding otherwise unemployed Americans to the expanding labor force, all this leading to an escalation in the US output ultimately increasing the GDP. As were all-aware we have a looming Fiscal cliff, it seems were all doomed according to the media, are we? Can new and old tax codes make or break a society? “The fiscal cliff is political shorthand for the combination of spending cuts and tax increases scheduled to hit Jan. 1, 2013. It's the result of the expiration of the President Bush-era tax cuts combined with $1.2 trillion in automatic reductions in federal spending made last summer as part of the deal to raise the debt ceiling” ("Money Morning", 2012). To think these tax breaks and spending cuts alone will propel us out of this recession is wrong. Although, investing in the labor markets, creating infrastructures, growing our law enforcement and financing the correct areas of the education will inject both tax dollars and tax revenue from the creation of said jobs. Raising the revenue of the American public will eventually permit the Government to borrow less, thus reducing the swelling debt of the US. Our Recommendations include a balance between government spending and efficiently maneuvering our tax code, through lowering tax breaks and lowering interests rates no...
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...Sign in with Yahoo! or Sign in with Facebook We don't post anything without your permission. Bengals-Steelers Preview There are three teams still in contention to win the AFC North, but the struggles of the division's two perennial powerhouses seem to have left the door wide open for the Cincinnati Bengals. The Associated Press Anthony, 3 others tossed as Bulls beat Knicks NEW YORK (AP) -- Bottled up by the Bulls and baffled by the officials, Carmelo Anthony expected to spend the final minutes of the Knicks' loss alone in the locker room. 16 mins agoThe Associated Press Lives remembered at string of Conn. services The community of Newtown, Conn., is in the thick of funerals and memorial services for the 26 children and adults killed a week ago at an elementary school. A look at services held Friday: Associated Press Exclusive ‘Django Unchained’ trailer, plus Kerry Washington talks tough days on set "More blood!?" Kerry Washington recalled saying on the set of "Django Unchained" in apparent disbelief over Quentin Tarantino's latest vengeance-themed cinematic creation. The new "Django" trailer, seen here first on Yahoo! Movies, features the most we've seen yet of Washington as Broomhilda -- the… Yahoo! Movies Golden Globes Blog NRA offensive exposes deep U.S. divisions on guns WASHINGTON (Reuters) - Any chance for national unity on U.S. gun violence appeared to wane a week after the Connecticut school massacre, as the powerful NRA gun rights lobby called on...
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...global economy depend mainly on events in the US and eurozone, writes Chris Giles Meeting of minds: logo for the IMFWorld bank events beginning in Tokyo today Bloomberg Inside » Growth glitches FT specialists report from the eurozone, China, the US and the UK Pages 2, 3 If Obama wins . . . or Romney Some differences seem more symbolic than real Page 4 Cash conundrum The IMF and World Bank have plenty of money but face new challenges Page 5 A threat of double-dip recession is stalking the world economy. Advanced economies are struggling to raise insipid growth rates, while the fast-growing emerging economies cannot maintain their previous momentum. If anything goes wrong – and there are known potential shocks in the coming months – the risk is rising of a dangerous economic slide. The Brookings Institution-Financial Times Tracking Indices for the Global Economic Recovery shows a steep drop in 2012 so far, leading professor Eswar Prasad of Brookings to describe the global economy as “on the ropes”. In the International Monetary Fund’s twice-yearly World Economic Outlook, published this week, Olivier Blanchard, the fund’s chief economist, said the world economy was hamstrung by uncertainty, which was pre- venting companies from investing and households from spending. “Worries about the ability of European policymakers to control the euro crisis and worries about the failure to date of US policymakers to agree on a fiscal plan surely play an important role, but...
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...With the recent government shutdown and the fiscal cliff debate over, many Americans are stepping back and asking “what is the current state of the economy?” Although the nation has been experiencing growth and a decrease in unemployment for the past three years, the national annual deficit of $1.1 trillion and the recent fiscal cliff debate along with the government shutdown reflect the nation’s struggle with furthering our economic growth and stability. According to the Bureau of Economic Analysis and the Bureau of Labor Statistics, GDP increased 1.1% in the first quarter of 2013 and 2.5% in the second quarter mainly due to an increase in business investments and goods exports and imports. What we can expect in the next few years is a slow and steady increase in the growth rate. However, many seem skeptical if the increase will be notable to say the least. Like GDP, unemployment has been on a steady decline for the past three years. The unemployment rate dropped from 7.8% in December 2012 to 7.3% in August 2013. This reports that there is an increase in job creations. However, what is more notable is that there is a higher increase in part-time jobs as opposed to full-time jobs, which leaves a bad taste for many because there is no certainty and sense of security. Household debt continues to decline in most categories like credit card debt. Yet consumers continue to remain cautious with a slowdown in consumer spending and spending for goods and services. If this trend continues...
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...to review a legal challenge to the Voting Rights Act, a landmark law adopted in 1965 to protect African-American voters who had faced decades of discrimination at the polls. CONTINUE READING TOP NEWS TOP VIDEOS MARKETS US Indices Exclusive: Ally near $4 billion unit sale, GM seen in lead NEW YORK - Ally Financial Inc is nearing a deal to sell its auto financing operations in Europe and Latin America for around $4 billion, with General Motors Co emerging as the lead bidder if the company decides to sell those operations as a whole, two sources familiar with the situation said. Incoming Lockheed CEO fired after admitting to affair Citigroup to pay former executives more than $15 million each » More Top News DOW 4.07 12,815.39 +0.03% NASDAQ Wall St. up but Washington wary Apple falls from the tree » More Top Videos 9.29 2,904.87 +0.32% S&P 500 2.34 1,379.85 +0.17% MOST POPULAR Obama insists on tax hike for rich as part of fiscal deal | After Obama win, U.S. backs new U.N. arms treaty talks Iran says repelled unidentified plane from its airspace Boehner: "Obamacare is law of the land" Ancient Thracian gold hoard unearthed in Bulgaria Chavez to Obama: forget global wars, fix domestic woes TODAY IN PICTURES TR US INDEX 0.21 124.83 +0.16% Int'l Indices NIKKEI 8,757.60 Editor's Choice Our best photos from the last 24 hours. View Slideshow HANG SENG 21,384.38 » Markets EDITION: U.S. Back to top...
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...influences consumption (where consumption is a large part of the Gross Domestic Product (GDP)). According to the text, Principles of Economics, “if consumers expect good economic conditions and are optimistic about their economic prospects, they are more likely to but major items such as cars or furniture.”1 While Apple products may not be considered major items, the company (Apple Inc.) could use the current consumer confidence index as a gauge on how well its products could do in the market in a particular period.(Appendix Personal consumption form freelunch.com) Unfortunately, consumer confidence here in the United States (US) has dropped (from 71.5 to 65.1) in the last two months (November and December 2012)2. This drop has been attributed to the uncertainty surrounding the fiscal cliff debate3. If consumer confidence continue to drop here in the US, Apple Inc. may have to look to overseas to make up any sales deficit. 2. What are the international economic factors that impact Apple’s product sales and cost? APPLE’s operations and financial performance depends significantly on worldwide economic conditions. The various economic factors that come into play are: a) Personal disposable income of consumers b) Currency exchange rates c) GDP in terms of Purchasing Parity d) Market openness e) Infrastructure and networks (telephone and Internet connectivity) to use APPLE products e) stable political environment f) unemployment numbers f) Stable financial environment and finally...
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...ECON 515 MACROECONOMIC POLICY FALL 2012 Monday & Wednesday 8:00AM-9:30AM 9:50PM-11:20PM 1:10PM-2:40PM Rawls 3082 INSTRUCTOR: DR. GERALD J. LYNCH Office: Rawls 4039 Phone 494-4388 lynch@purdue.edu Secretary: Sherry Fisher 496-7227 Office Hours: Monday and Wednesday 3:00-4:00 and by appointment Introduction to the topic: As recent turmoil in the financial markets has demonstrated, macroeconomic fluctuations in the economy can create a difficult operating environment for the firm. This situation is further complicated by the fact that it is an environment over which the firm has little control. Even though the firm cannot control the environment, it can still react to economic conditions in ways that minimize its uncertainty as long as it understands the constraints it is facing. The purpose of this course is to help in an understanding of the macroeconomy. Macroeconomics is that branch of economics that seeks to understand and explain changes in output, general prices, employment, interest rates, foreign exchange rates, the balance of payments, and other related phenomena. Emphasis is given in this course to analyzing financial markets where interest rates are determined. We will spend more time than usual on the financial markets this year in response to the uncertainty in that environment today. Also, since the macroeconomic environment in this country is increasingly influenced by international conditions, the factors underlying trade and exchange...
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...principles of economics that need to be addressed can be broken down into three stages of the decision making process. The first step is to examine how the decision is made by incorporating the first four principles of economics which include, the trade off that comes with every financial decision, the real cost of any item or service is what is given up to get the item or service, rational people think at the margin, and people respond to incentives. Once it is clear how the decision is made, the next three principles of economics address how people interact with economics and include factors such as, trade is beneficial to everyone, markets are a good way to organize economic activity, and the government can improve the markets with fiscal policy and all three will have an impact on the decision to purchase a home. The final leg of the decision making process includes taking into consideration the last three economic principles which speak to how the economy works as a whole and include economic principles such as, a country's...
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...Auriemma Lawsuit, Road Rage & More Coach wants case dismissedEx-OSU star jailed in shootingInjuries end season for White, Hart Get Your Home Ready for Winter in a Snap With colder weather on the way for many in the US, it's time to winterize at home. These quick fixes can keep your home warmer & even lower your bills. Home efficiency: What's good, what's best Winter-prep essentials you shouldn't skip Wood Boards a Real Pain for Karate MasterVideo: Usually wood boards are no match for karate pros -- but not so for this poor guy. Despite his perseverance, he just doesn't cut it. Hockey player's goal celebration goes awry How not to launch a yacht Police: Scary Intruder Tweet Was HoaxA NJ teen was still missing Monday after tweeting about someone in her house, but police no longer suspect foul play. The post caused a Twitter uproar. On Facebook: Tell us what you think about this story More US news from NBCNews.com PreviousPauseNext6 of 7EDITORS' PICKSArrest voided in Lohan disputeHackers hit major US banksNew Navy jet fuel: Seawater?Skull stored in woman's bellyAmEx to refund users $85MScary risk with getting highPeanut butter recall spreadsIsrael may have ally vs. IranWorking with a disabilityNEWS Big tax hit looms because of 'fiscal cliff' Wins,...
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...Devine then posed the question, does the running mate deliver? He threw out reasons why a candidate actually selects a particular running mate. These ranged from delivering party unity through different ideology, a demographic group like race or religion, or even the coveted home state of that running mate. He then asked how could the running mate’s home state be measured in terms of increased approval or votes. The interaction effect is the best way to measure this. It works by multiplying the VP candidate’s years of political experience by the percentage of US population in that state but only works if that state has smaller than 1% of the total US population. He proved it by showing that Paul Ryan had no advantage in 2012 in his home state of Wisconsin. Dr. Devine ended his presentation by saying that as a matter of electoral strategy and good governance, a candidate should select the person best qualified because they will be delivering competent service, not the...
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