Daily Digest 12/19 - NY Budget Balanced With Gimmicks, Over 1 Million Homeless Students Is New Record
“Retirement obligations and health care are outdistancing revenues at an ever-increasing pace, and it’s hard to believe New York finances will remain sustainable unless there’s dramatic economic recovery at a 7 to 8 percent rate,” Ravitch said in an interview. That’s not likely to happen, he said.
Nearly half of all households in Britain are worried about their debts as the squeeze on family finances intensifies, the Bank of England warns today. A toxic combination of runaway inflation and low wage growth has left millions struggling to make ends meet in the run up to Christmas.
The average household is now £22 a month worse off than they were a year ago, according to a study from the Bank, blowing a £264 hole in annual family budgets.
In the past year, ratings companies have been criticized for issuing sovereign-debt downgrades that countries including Portugal, Greece and Ireland say triggered their need for bailouts from the European Union and the International Monetary Fund.
Meanwhile, the US public debt has tripled over the last decade, hitting $16 trillion by the end of September, according to US treasury data.
What's worse, if the US plunges off the rapidly-approaching "fiscal cliff", the US government will have to initiate a series of tax increases and spending cuts which will drag down the anemic US economy and diminish the country's repayment abilities.
In order to prevent the US economy from imploding under the weight of its mounting fiscal problems, the country will likely pass on its burden to the rest of the world, particularly holders of its debts, in the form of loose monetary policy and runaway borrowing.
The number of homeless students in America topped one million for the first time last year as a result of the economic recession, a number that has risen 57 percent since 2007.
A host of Tesco’s cheapest Everyday Value products have seen inflation-busting increases. For example, an Everyday Value pack of apples is up from 71p to 82p, which is 15.5 per cent hike, while a cauliflower is up 20 per cent to 90p.
An Everyday Value round lettuce is up 14 per cent to 57p, while there is a 15 per cent increase on tomatoes and a 25 per cent rise on a 200g pack of soft cheese.
PRICES of repossessed homes sold by banks in Spain have fallen 65% this year, according to a report by ratings agency Fitch.
The drop represents the sharpest decline in prices since the financial crisis began and suggests prices have fallen more than twice as much as government figures show.
The most direct problem facing retirees, however, is how to generate income from retirement savings. The traditional reliance on low-risk bonds and certificates of deposit just does not work in this rate environment, and higher-yielding products come with unattractive levels of risk.
However, now that we know the "new normal" is here to stay for at least a few more years, there are several low-risk options for retirees, and people who expect to retire soon, and a low-risk option is by far the best approach one can take in uncertain times.
Abe has vowed to pressure the BoJ for more action, calling for "unlimited" easing and said he would make the bank participate in his bond-buying scheme -- effectively printing money to generate inflation.
The FHA, which faces a projected $16.3 billion shortfall because of failing loans made during the housing crash, is preparing to sell more than 40,000 delinquent mortgages next year to fortify its insurance fund after disclosing it may need a Treasury Department subsidy for the first time in its 78-year history. The FHA doesn’t have the legal authority to use some workout tactics investors employ, such as principal forgiveness.
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