US financial news summary | 10 August 2023
Headlines: Thursday 10 August 2023
- Consumer Price Index report with latest inflation numbers to come out today
- Inflation in the US was at 3% in June, as Fed bids to cut rate to 2%
- Gas prices are up this summer as extreme heat hampers oil refinery operations
- 187,000 jobs added in July, unemployment falls to 3.5%
- Treasury Secretary Yellen calls US credit rating downgrade "entirely unwarranted"
- Biden administration launches new student debt repayment plan
Take a look at related AS USA news articles:
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Employer-sponsored retirement plans like 401(k)s and pensions are becoming more and more common. There are many differences between the three main options: 401(k), IRA and pensions. So what are the distinctions between these pension programmes?
Flash your college ID to cut costs
Back-to-school shopping isn't usually much fun and, on top of that, has become more expensive this year due to inflation (like most things). If you happen to be a college student, however, then don't forget about one powerful weapon you have at your disposal - your college ID card.
There's a fair chance that you're not aware of the discount potential of flashing said card at various different places. This handy guide will help you out, pointing you in the direction of discounts on electronics, restaurants, software, furniture and home goods, and clothes.
There's even some advice on the best credit cards for college students.
Free Taco Bell Tuesdays in August: Where and how to get your free Doritos Locos Tacos
Eating out has become an expensive habit for many of us. However, if you're feeling lethargic and you don't fancy cooking, specifically on a Tuesday, then one fast food chain has got your covered.
Taco Bell have revealed that "Taco Tuesday" is a phrase that no longer belongs to Taco John's. To celebrate the momentous event and to thank everyone who supported their “Free Taco Tuesday” campaign, Taco Bell is giving away a free Nacho Cheese Doritos Locos Taco to their customers every Tuesday from Aug. 15 to Sept. 5.
How and where can you get them? Gidget explains.
Just as a follow-up to that lost post, a reminder of the dangers of using self-service checkouts in stores. If you're a regular user, they can save you time and the need to actually speak to someone (for some people, that's a good thing). But there are also drawbacks, as we have seen at Walmart.
Perhaps one day, all shop assistants will be replaced by machines but, until that day comes, you have the option to choose. And many people refuse to go solo.
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Accidentally registered for the Walmart+ rewards scheme? Suffered unwanted charges at their self-service checkouts? Well, it turns out you're not alone, as a whole host of people inadvertently signed up in July during Walmart+ Week.
At self-service checkouts in Walmart stores across the US, the promotion appeared on screen in a single-click prompt that presented customers with the options “Not interested” or “Add membership to cart”. Many people accidentally selected “Add membership to cart”.
If you are one of those people, you've got the chance to get your money back. Corina explains how.
When you quit your job, you have several options regarding what you can do with your 401(k) retirement account. The most obvious ones are transferring your 401(k) to your new job and converting it to a traditional Individual Retirement Account (IRA).
There is another option but few people advise it.
In an effort to moderate the economy and alleviate the factors contributing to price increases, the Federal Reserve has been consistently its benchmark interest rate to over 5.25 percent, marking the highest point reached in 22 years.
Next month will have the Federal Reserve meeting again. Will it be raised?
Inflation increases in July
The Labor Department reported that inflation climbed to 3.2% over the one-year period leading up to July. This increase was propelled by elevated expenses in housing, car insurance, and food. This marked an increase from the 3% recorded in June, a figure that had represented the lowest rate seen in over twenty-four months.
Experts had anticipated this rise in the overall rate, considering the relatively subdued price inflation observed in the previous July.
Refinancing your mortgage can be particularly beneficial if you want to lock in a stable interest rate and monthly payment, especially if you’re concerned about potential interest rate hikes in the future. With continued rate hikes expected until at least the end of the year, homeowners may be looking to secure their property amidst rising prices.
One option to achieve this could be switching from an adjustable-rate mortgage to a fixed-rate mortgage.
What is an adjustable-rate mortgage?
An adjustable-rate mortgage (ARM) is a type of home loan where the interest rate is not fixed for the entire duration of the loan, unlike a fixed-rate mortgage. Instead, the interest rate on an ARM can change periodically, typically after an initial fixed-rate period. At the beginning of the loan term, usually 5, 7, or 10 years, the interest rate is fixed and remains constant.
Medical debt is a serious problem in the US, a country without socialised medicine. According to research from the Kaiser Family Foundation, 41% of adults in the country face healthcare debt - 100 million people.
Get the wrong insurance or make a mistake in a filing and you could be staring down the barrel of a life-ruining bill that could throw you out of your house.
Why does the US have such large medical debt?
Widespread medical debt is a uniquely American problem, with medical debt totaling at least $195 billion in 2019. It was once thought that the problem was that Americans were largely uninsured, but even those with health coverage can run into problems.
For a start, medical debt rarely exists in countries with socialised healthcare, that is everyone's care is paid for by taxes instead of personally. There are few to no charges for taking an ambulance or having surgery.
A “soft landing” refers to a scenario in economics where a country’s economy transitions from a period of rapid economic growth or expansion to a more sustainable and stable growth rate, without experiencing a sharp downturn or recession.
The goal of a soft landing is to avoid the negative consequences of an abrupt economic slowdown, such as rising unemployment, falling consumer spending, and declining business activity.
Wall St. ends lower after bank rating cuts spark wider sell-off
All three major Wall Street benchmarks finished lower on Tuesday in a broad sell-off after the downgrading of several lenders by credit rating agency Moody's reignited fears about the health of US banks and the economy.
After a five-month rally pushed the benchmark S&P 500 and Nasdaq Composite within 5% of their lifetime highs, August has now recorded five losing sessions out of six. The S&P is down 2% this month, with the Nasdaq dropping 3.2%.
The decline was triggered after the agency cut ratings on 10 small- to mid-sized lenders by one notch and placed six banking giants, including Bank of New York Mellon, US Bancorp, State Street and Truist Financial, on review for potential downgrades.
Moody's also warned that the sector's credit strength would likely be tested by funding risks and weaker profitability.
(REUTERS)
If you have a child who is about to enter college in the fall and you want to help them out financially so they don’t have be burdened by student debt for most of their adult life, you may want to take out a loan for them.
Student loans are not the only way to finance a college education; there are also parent student loans available to those who are willing and able to help their children.
Federal parent loans are known as Parent PLUS loans, which are designed to help parents or legal guardians of dependent undergraduate students pay for their child’s education.
Good morning and welcome to AS USA's live financial blog!
We are awaiting the Consumer Price Index report that will come out on Thursday for the latest inflation update.
Latest figures from the Labor Department show that 187,000 jobs were added in July, while the unemployment rate went down to 3.5%.