Inflation relief checks news summary | 16 November 2022
Headlines: Wednesday, 16 November 2022
- Biden attends G20 summit in Bali, world leaders discuss inflation and steps to control it
- St Louis court issues another block on Student Loan Forgiveness
- White House considering extending student loan moratorium
- USDA warns the price of turkey will be higher for Thanksgiving this year
- Annual pace of consumer price inflation (CPI) in the US was lower than expected in October
- Market boosted by news of Democrats outperforming expectations in 2022 Midterms
- The Fall of Young Billionaire Sam Bankman-Fried: Bankruptcy at 30
- FTX bankruptcy causes cryptocurrency slump affecting Bitcoin and Ethereum
- While Nevada and Nebraska have not sent relief checks to residents, voters have approved ballot measures to increase the state's minimum wage
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Calls for Biden to extend the student loan moratorium
Since the start of the pandemic the federal government has implemented a complete halt on student loan repayments, meaning that borrowers have not had to pay back the loans and their outstanding balance has not accrued interest. Back in August President Biden announced his Student Loan Forgiveness initiative and confirmed that the loan moratorium would end on 31 December 2022.
However his Student Loan Forgiveness has been blocked by legal challenges and there is now a very real chance that it will not be live by the time that the moratorium is lifted. With this in mind, some Democrats are calling for an extension to the moratorium until the legal troubles are resolved.
Why are big tech firms laying off staff?
Last week Elon Musk announced a raft of redundancies at Twitter, insisting that the site would no longer be viable without major alterations. That news was followed by confirmation that Amazon would be laying off roughly 10,000 members of permanent staff as part of a similar 'streamlining' process.
So why are big tech companies feeling the squeeze at the moment and is it a trend that's here to stay? Speaking to Bloomberg, Khosla Ventures Founder Vinod Khosla explains...
During the pandemic the federal government passed three rounds of stimulus checks, designed to offer direct financial relief to Americans. For those who have not yet filed a 2021 tax return, the deadline to submit one and trigger the support has now passed.
However if you have already done so your stimulus check payments should be on the way. Here's what we know about those outstanding payments...
What has Amazon said about the sackings?
We continue to face an unusual and uncertain macroeconomic environment. In light of this, we've been working over the last few months to further prioritize what matters most to our customers and the business.
Amazon worker cull begins
Amazon on Wednesday said it has laid off some employees in its devices group as a person familiar with the company said it still targeted around 10,000 job cuts.
Plans to remove the workers would amount to about a 3% cut in Amazon's roughly 300,000-person corporate workforce as it joins the group of big companies forcing layoffs this winter.
Amazon slashes workforce by 10,000
On Wednesday, Amazon confirmed that it had begun layoffs at the e-commerce giant. The company will reportedly shed 10,000 staff this week. Jobs in device and service teams will be impacted first according to a memo by Dave Limp, senior vice president of devices & services at Amazon.
“After a deep set of reviews, we recently decided to consolidate some teams and programs. One of the consequences of these decisions is that some roles will no longer be required. We notified impacted employees yesterday, and will continue to work closely with each individual to provide support, including assisting in finding new roles,” Limp said.
Social Security benefits are the most widely-available form of financial assistance available in the United States, with 66 million people currently in receipt of the support every month.
The scale of the program is so vast that the Social Security Administration (SSA) send out the monthly payments in three batches.
Here's when recipients can expect to receive their money...
White House Chief of Staff touts student loan forgiveness online portal rollout
President Biden announced that his administration would pardon up to $20,000 in student loan debt in August. Two months later the Education Department open a Beta version of its online portal and in the first weekend around 8 million Americans submitted applications.
Since then almost 26 million have sign up to have their debt canceled, and 16 million of those have been approved. However, borrowers that applied will have to wait until the fate of the program is determined by the courts, with a recent appeals court n St Louis blocking the administration from discharging any debt.
Study finds most small investors in Bitcoin lost money, warns "market could dry up"
A new report from the Bank for International Settlements (BIS) found that the vast majority of retail investors end up losing money on their investments in Bitcoin. The researchers created a database covering the use of crypto exchange apps in 95 countries over a seven year period up to the present.
While cryptocurrencies are touted as an alternative to the traditional banking system and way to store value, their data found that retail investors were adopting the new technology primarily based on the rising price of Bitcoin.
However, as the price rose and smaller investors bought Bitcoin, the largest holders, or the so-called "whales" or "humpbacks" were offlaoding making gains at the small fishes expense. They estimate that somewhere between 73% and 81% of retail investors lost money.
The paper found that "there is the potential for self-reinforcing dynamics” of smaller investors exiting the market as they make loses and global appetite for risk declines with rising interest rates, warning “the overall market could dry up.”
Free speech for Twitter platform but not for employees, Musk sacks those that speak up
It has been a tumultuous few weeks at Twitter since Elon Musk completed his $44 billion take over of the social media platform. No sooner had the ink dried on the deal that several top executives were given a pink slip, including CEO Parag Agrawal, CFO Ned Segal and Chief Legal Officer Vijaya Gadde. That was followed a week later with around fifty percent of the company’s 7,500 workforce getting sacked including from key departments that help monitor and control content.
Now reports have emerged that the billionaire who bought Twitter to restore free speech is exacting revenge on those that speak their mind and are critical of the new owner either on internal Slack channels or in tweets. The exact number isn’t clear but there are reports of dozens being informed by email that they no longer work at Twitter because their “recent behavior has violated company policy.”
White House mulls idea of extending student loan moratorium
Soon after the Biden administration launch its online portal for student borrowers to apply for student loan forgiveness the program was put on pause. A federal judge blocked the Education Department from processing applications until further arguements could be heard.
Then last week, another judge declared the debt forgiveness program illegal forcing the suspension of collecting any new submission. That was followed by another ruling by the 8th Circuit Court of Appeals placing an injunction on discharging debt.
While the White House has vowed to defend the program in the courts, the process will take time and the student loan moratorium is set to expire 31 December. This has led top aides to consider yet another extension of the freeze on repayments and interest accruing on student loan debt which has been in place since March 2020 when the US locked down due to the covid-19 pandemic.
“The extension we’re likely to see is meant to make sure borrowers don’t have the rug pulled out from under them," a person familiar with the matter told the Washington Post. "Rather than an indefinite replacement for loan forgiveness.”
G20 leaders vow to fight inflation help thoe vulnerable to rising prices
The G20 summit in Bali, Indonesia wrapped up on Thursday with the leaders agreeing to closely monitor the "impact of price pressures on inflation expectations," and "appropriately calibrate the pace of monetary policy tightening ."
The statement from the two day get-together of world leaders from 20 of the world’s largest economies as well as a number of other invitees also called for "temporary and targeted" fiscal spending to aid those who are particularly affected by rising prices.
Meeting for the first time since the Russian invasion of Ukraine, the G20 has a lot on its plate. It has never been a geopolitical vessel but the impact of the war on the world economy does fall underits remit.
Host nation Indonesia has been keen to divert attention away from the war in Ukraine so that members may find some agreement. A document is usually signed with a number of pledges and directives for nations to work towards though this may be unlikely to be negotiated this year.
It is expected the document this year, if signed, will include a commitment from central banks across the globes to coordinate measures to tackling inflation.
When a flight gets canceled, passengers seeking refunds should be paid back promptly. Whenever that doesn’t happen, we will act to hold airlines accountable on behalf of American travelers and get passengers their money back. A flight cancellation is frustrating enough, and you shouldn’t also have to haggle or wait months to get your refund.
Money to recover from airlines?
The US Department of Transportation (DOT) announced historic enforcement actions against six airlines, which collectively paid more than half a billion dollars to people who were owed a refund due to a canceled or significantly changed flight.
In addition to the more than $600 million in refunds airlines have paid back, the Department announced that it is assessing over $7.25 million in civil penalties against six airlines for extreme delays in providing refunds.
More Americans may be exposed to crypto crash than realized
The collapse of the FTX exchange last week has sent new shockwaves throughout the cryptocurenncy industry. The two biggest digital coins by market cap, Bitcoin and Ethereum, have seen their values drop over 18% and 20% respectively since Monday last week.
The bankruptcy of FTX could affect people who don't even buy cryptocurrency, or at least didn't think it was part of their investment portfolio. In recent years pension funds have been increasing their portfolio's share of riskier investments to fill the gap between the money they have on hand and the obligations that they need to pay out.
Since 2001 the share has risen from around 8% to about one-quarter of assets managed by US public pension funds betting on risky alternative vehicles including cryptocurrencies.
Social Security benefits got a major boost to combat rising prices over the past year. Monthly payments will rise by 8.7%once the 2023 COLA takes effect.
In the US, each state has the power to determine how it will generate revenue through taxation. Some states opt to forgo the collection of income or sales tax. The elimination of income tax, at the state level, motivates some to move. However, governments must collect revenue one way or another, and if it is not through income taxes, it may be through higher sales or property tax.
The Fed has been aggressively raising interest rates to curb inflation but there are worries it could spark a recession. What will that do to house prices?
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Good morning and welcome to AS USA, where we'll be bringing you all the latest news and information on inflation, relief payments, Student Loan Forgiveness and more.