US financial news summary | 12 september 2023
US Financial News: Latest Updates
Headlines: Tuesday 12 September 2023
- Inflation has increased 1.9 percent in 2023, pushing up against the Fed's annual benchmarks
- Another government shutdown looms large over Washington
- Be aware of possible scams as the student loan moratoriumcomes to an end
- Home-sale prices rise 4.5% as supply as mortgage applications slump
- Social Security payment increase due to COLA projected to be 3%
- Minimum wage in California and Illinois to go up in 2024
- New requirements to receive SNAP benefits in 2024 to take effect soon
AI quietly reshapes Apple iPhones, Watches
Unlike other companies that are attempting significant transformations with artificial intelligence, Apple is using the emerging technology to improve basic functions in its new gadgets.
Without using the words "artificial intelligence" to describe the emerging technology, Apple showcased a new line of iPhones and a new watch that included improved semiconductor designs that power the new AI features. The features largely improve basic functions like taking a call or snapping better images.
Thanks to an agreement reached on Monday, September 11 between the unions and the fast-food industry, fast food franchise workers in California will see a considerable increase in their paychecks starting next year.
Under the agreement, the minimum wage for workers in the industry will increase to $20 per hour. The rise in the minimum wage will come into force on April 1, 2024 and workers will have annual increases until 2029.
The Social Security Administration average salary index in the US in 2021 was $60,000, and if you want to earn a wage that is way above this number, you could look into certain fields where there are many jobs that offer a six-figure income.
If you’re looking for work with strong prospects that pays $100,000 or more, you could try to seek employment in the technology or healthcare industry.
The US has becomethe world’s largest exporter of liquified natural gas, with exports increasing over 300% over the last five years. The US Energy Information Adminstration reported the news early this week, citing data from data from CEDIGAZ, an organization dedicated to data analysis on the production and trade of natural gas internationally.
Australia clocked in as the second-largest global exporter and is also expected to become an importer of LNG by the end of 2024. Exactly how importing a product readily available in the country will be cost-effective is a reminder that the environmental toll of these energy resource trade remains disconnected from the price of these commodities.
McDonald's to drop self-serve beverage stations in US by 2032
Self-serving soda machines inside McDonald's restaurants won't exist within a decade.
The slow transition away from beverage stations in dining rooms across the country will be completed by 2032, McDonald's announced. Customers will be required to ask for refills at the counter.
Inflation expected to rise in August as oil prices surge
On Wednesday, one of the most important data points the Federal Reserve will consider in its next interest rate decision will be released: August's Consumer Price Index.
The report, set for release at 8:30 a.m. ET, is expected to show headline inflation of 3.6%, an acceleration from July's 3.2% annual gain in prices, according to estimates from Bloomberg. Over the prior month, consumer prices are expected to have risen 0.6% in August, a higher rate than July's 0.2% monthly increase.
Wells Fargo likely to see more layoffs
Wells Fargo could see its headcount decline further as it aims to improve efficiency, according to Chief Financial Officer Mike Santomassimo.
The bank has been trimming its workforce since the third quarter of 2020. It has already reduced its employee base by nearly 40,000 and cuts are likely to continue, Santomassimo said.
"I do think that there's more to do, and you'll see that through the headcount number," he added.
After numerous extensions under two administrations over the last three years, the student loan moratorium has ended.
As borrowers make payments again, the Federal Trade Commission (FTC) has warned that scammers may attempt to exploit the confusion. Loan servicers have decreased communication during the moratorium. Scammers may pose as them to extract financial data from borrowers.
To avoid falling for these scams, we offer three tips that can ensure your financial and personal data remains protected.
Households report that they facing food insecurity as SNAP benefit cuts kick in
A food bank in the Washington DC area has reported that nearly a third of households surveyed that saw their SNAP benefits cut earlier this year have skipped or cut down on the size of their meals. More than forty percent have turned to food banks and other free options to receive their groceries, while others are using credit cards or borrowing money to cover the added costs. The fact that inflation continues to increase the cost of food has made the situation very difficult for many households receiving assistance. From July 2022 to July 2023, grocery prices have risen by an average of 3.5 percent nationally. The Capital Area Food Bank also noted that 76 percent of the food-insecure surveyed were employed.
Payroll continued to increase in August
The Bureau of Labor Statistics has reported that payroll increased by 187,000 in the US in August. Although the unemployment rate has risen from 3.4 percent to 3.8 percent this year, labor force participation has grown over the same period. The private education and health services (+102,000), leisure and hospitality (+40,000), and construction (+17,000) sectors all saw significant gains last month. However, employment and participation remain below pre-pandemic levels in the leisure and hospitality sector. Business owners unwilling to offer higher wages in the industry have limited the interest of workers employed there, some of whom have moved on to other higher-paying industries.
Taking into account the SSA payment schedule, the beneficiaries who will receive an average check of $1,827 next Wednesday, September 13, are those who were born between the 1st and 10th of the month.
Child poverty sees huge rise in 2022
In the latest report from the US Census Bureau, it was revealed that poverty in the United States increased in the past year, with child poverty more than doubling
The data released on Tuesday provides the initial glimpse into how the country is being transformed by the reduction of the covid-18 pandemic support programmes.
The Supplemental Security Income (SSI) program provides monthly payments to adults and children with disabilities or blindness who meet income and resource requirements.
SSI payments are also provided to persons age 65 and older without disabilities who meet the financial requirements established by SSA.
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The Supplemental Security Income program provides monthly payments to seniors, as well as people with disabilities, including children.
This year, thanks to the 8.7% cost-of-living adjustment (COLA) increase, average monthly SSI payments are about $550 a month. The maximum monthly benefit is up to $914 for an individual and $1,371 for a married couple where both spouses are eligible for the program.
This reports explains in more detailwho qualifies to receive the monthly payments.
Smucker to buy Twinkies maker Hostess in $5.6 billion deal
J.M. Smucker has agreed to buy Twinkies maker Hostess Brands for $5.6 billion including debt in a deal that unites two major American snack makers.
The deal was worth about $4.6 billion excluding debt, with Jif peanut butter maker Smucker paying Hostess shareholders $34.25 per share. The cash-and-stock offer represents a premium of 54% on the stock since the day Reuters reported the company was exploring a sale.
Hostess shares have surged 27% since the report about the sale process and were up 19% at $33.49 in early trading on Monday, while Smucker's shares were down 7% as investors viewed the deal as too expensive.
Smucker said the deal, which is expected to close in the third quarter of its current fiscal year, represents adjusted earnings before interest, taxes, depreciation, and amortization of about 17.2 times based on its estimate of Hostess Brands' 2023 results.
(REUTERS)
Many people rely on Social Security benefits to finance their lifestyle after retirement. So, they make regular contributions while they are still working, expecting or hoping to receive checks that will be able to cover their monthly expenses when they finally decide to retire.
Although Social Security payments are taxable, the District of Columbia and 39 states do not tax these benefits. Find out in which areas your retirement income will have no tax deductions.
Meta developing new, more powerful AI system
Meta Platforms is working on a new artificial-intelligence system intended to be as powerful as the most advanced model offered by OpenAI, the Wall Street Journal reported, citing people familiar with the matter.
The Facebook parent is aiming for its new AI model to be ready next year, the Journal said, adding it will be several times more powerful than its commercial version dubbed Llama 2.
The Senate is in session after the summer recess, and it is facing a new fight over government funding. If the House and Senate are unable to agree on any of the 12 spending measures that are on the table in a couple of weeks, a government shutdown could take place as federal agencies run out of cash at the end of this month.
When is the deadline and how can a shutdown be prevented?
IRS uses AI to crack down on rich tax evaders
The Internal Revenue Service will be using artificial intelligence to go after wealthy tax evaders. They will be prioritizing high-income cases including over 1,600 millionaires in the country.
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We'll be reporting on other financial news affecting US consumers as the job market cools, consumer spending slows, and the Federal Reserve prepares to decide if interest rates will be increased once again at their next meeting.