State and local pensions across the U.S. have $1.8 trillion less than needed to cover all the benefits owed in the decades ahead, according to Federal Reserve Board data. The need to make up for such shortfalls has contributed to credit-rating cuts to Illinois, New Jersey and Chicago. Such financial pressure has also been acute in California, where it helped bankrupt the cities of Stockton, San Bernardino and Vallejo.
Many Chinese pension funds are under renewed pressure to break even as local governments race to increase pension payments to meet central government requirements, state news agency Xinhua said in a commentary on Tuesday.
Employees pay into the state pension plan and expect a return once they retire. However, the money owed that the state does not have grows by billions each year. Right now, there’s about $20 billion that legislators must figure out how to pay.
The world’s biggest oil exporter is taking unprecedented steps to rein in a budget shortfall that ballooned to 16 percent of gross domestic product last year, curtailing fuel and utility subsidies as well as cutting billions of dollars in spending. The International Monetary Fund expects the shortfall to drop to below 10 percent of GDP in 2017.
The Michigan League for Public Policy said tuition has more than doubled at most of the state’s 15 public universities since 2003. Increases in the cost of a four-year degree range from 91 percent at the University of Michigan-Ann Arbor to 158 percent at Michigan Technological University.
Sanofi and Henkel AG are poised to become the first non-financial private companies to sell debt that yields below zero as the busiest year for investment-grade corporate bond issuance resumes.
Shadow loans had already reached 12.6 trillion yuan at the end of last year, according to calculations by UBS, about a fifth of China's entire annual economic output. And credit rating agency Fitch said in July that around a third of system credit resides outside bank loan books, undermining asset quality data.
Tax Office data shows that unpaid tax obligations are expected to reach 7.618 billion euros from January to July. Each month, foreclosures increase while more tax payers are crushing under the burden as they enter the state’s “black” list.
Pressured by a year-and-a-half of weakening profits and splurges on buybacks and dividends, the once-towering piles of money at American companies have started to topple. Cash and equivalents slipped to a median $860 million at S&P 500 Index members last quarter, touching levels not seen for three years, according to data compiled by Bloomberg.
The requests for the general account budget for the year that will start next April 1 were bigger than the initial budget for fiscal 2016 of ¥96.72 trillion, with social security costs soaring due to the aging population.
With euro-area inflation stuck near zero for almost two years and Brexit now threatening to undercut the region’s recovery, economists see European Central Bank President Mario Draghi as highly likely to lengthen quantitative easing for a second time. That would take the asset-buying program beyond its current end-date of March 2017 and above the target of 1.7 trillion euros ($1.9 trillion).
There is a growing conviction in the markets that for the world’s hardest pressed central banks there is no alternative to a helicopter money drop.
Equity valuations between Japanese and European banks will converge with quantitative easing (QE) programs and negative interest rate policies set to continue for the long term, according to a team at JPMorgan.
“Maybe this one of those cases where you can’t go home again,” Bernanke said in his latest blog post.
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