USA finance and payments summary news: 22 june
Headlines: 22 June 2022
- Biden urges Congress to pass three-month gas tax holiday on Wednesday
- Average price of gasoline edges down to $4.955 - which states have the most expensive gas?
- Democrats introduce bill strengthening Social Security - will this increase benefits?
- Experts, including Fed Chairmen Jerome Powell, expect further interest rate increases in 2022
- Fed outlines reasons for 0.75 percentage point hike for interest rates - why have they increased rates?
- 'Shrinkflation' reduces product sizes for consumers
Helpful links & Information
- When will theSocial Security COLA for 2023 be announced?
- Gas prices in US: which countries have the most expensive gasoline?
- When will President Biden make a decision over student loan forgiveness
- Do I have to pay taxes on Social Security benefits? How much?
- 30-year fixed-rate mortgage interest rates hit 5.78%, the highest level since late 2008. When will home loan rates fall?
Related News from AS USA:
The Social Security Administration (SSA) allows the spouse of a beneficiary to claim partial benefits when their spouse begins to receive their benefits regardless of how much money the spouse has paid into the system.
The spouse claiming the partial benefits must be at least sixty-two years of age or be in the care of a disabled child or one younger than sixteen. The average spousal monthly payout in January 2022 wsa $839.35, around half that paid to retired workers.
Fears of recession continue to grow
Oil prices fell two percent in early trade on Thursday, extending losses from the previous day, as investors are worrying that high US interest rate hikes could trigger a recession. The Federal Reserve increased the rate by 75 basis points last month and hasn't ruled out further hikes.
"Oil markets remained under pressure as investors were concerned that U.S. rate hikes would stall an economic recovery and dampen fuel demand," said Kazuhiko Saito, chief analyst at Fujitomi Securities Co Ltd.
Less than a week ago, we were writing about a sudden rise in the value of Bitcoin. It had risen to $30,000 from around $27,000 in May. However, the fickle nature of cryptocurrency markets has been once again proven. The value has sunk to near $20,000, its lowest value in years, including a staggering 14 percent drop in the last 24 hours.
Calls to suspend federal taxes on fuel not likely to survive Senate
Plans mooted by Biden to cut fuel duty could meet a stumbling block in the Senate as Republican lawmakers are nlikely to back his plans.
At the moment, fuel tax is 18.4 cents per gallon federally, while states levy a tax of an average of 30 cents per gallon.
The move has not been greeted enthusiatically by many Democrats either. Nancy Pelosi has said she is worried the savings would not be passed on to customers and the fuel companies would keep the difference. The UK brought in legislation recently to remove 5 pence of tax per litre of fuel, but that has done little to keep prices down as they approach £2 per litre.
Only 23% of New Yorkers can afford median rent
An average resident In New York City needs to be earning a minimum salary of $110,000 to be able to afford the median rent in the Big Apple - $2,750 per month. That is equivalent to over 30% of the average earner's income going towards housing, according to a recent report by the New York City Department of Housing Preservation and Development. Approximately 23% of full-time workers in New York had six-figure salaries as of 2020.
Dollar falls amind recession fears
The dollar fell on Wednesday as US Treasury yields slid on fears the US economy could slide into recession after Federal Reserve Chair Jerome Powell said higher rates are painful but are the means the US central bank has to slow inflation.
The Fed is not trying to engineer a recession to heel inflation but is fully committed to bringing prices under control even if doing so risks an economic downturn, Powell said at a hearing of the US Senate Banking Committee: "'Higher interest rates are painful, but it's the tool we have to bring down inflation".
"Workers in this country are engaged in struggle against outrageous levels of corporate greed. And the reality is that large corporations and the billionaires who own them want more — they don't care how many workers they crush along the way. Together, we're going to take them on".
AS USA takes a look back over the three federal stimulus checks sent out to qualifying Americans during the covid-19 pandemic.
Jerome Powell comments see Wall St. respond
U.S. stock indexes edged higher in choppy trading on Wednesday, with healthcare shares offsetting losses in the energy sector, after Federal Reserve Chair Jerome Powell said the U.S. central bank is "strongly committed" to bringing down inflation.
In his testimony to the Senate committee, Powell pledged an "overarching focus" on bringing down decades-high inflation and reiterated that ongoing increases in the policy rate would be appropriate, with the exact pace dependent on the economic outlook.
"We are not trying to provoke, and I don't think we will need to provoke, a recession," Powell said.
Powell's comments came a week after the Fed raised interest rate by three-quarters of a percentage point, its largest increase since 1994. Economists expect a similar move next month, followed by a half-percentage-point rise in September, according to a Reuters poll.
IRS confirm standard mileage rate for business travel increase
The Internal Revenue Service recently confirmed an increase in the optional standard mileage rate for the final 6 months of 2022. Taxpayers may use the optional standard mileage rates to calculate the deductible costs of operating an automobile for business and certain other purposes.
President Biden urged Congress to take legislative action to lower the price of gasoline and diesel by suspending the federal gas tax for three months. Additionally, he has asked that states, that haven’t already, to take actions that can give relief to Americans burdened by record high fuel prices by dropping state gas taxes or other measures.
Should it get through Congress and states follow suit, it could give drivers some instant relief at the pump beyond the national average coming down slightly after topping $5 dollars per gallon last week. However, economists warn that the move could be counterproductive.
The Child Tax Credit in 2022 will return to the conditions offered by the IRS before the American Rescue Plan expanded it. The amount of the credit is smaller, and eligibility is more restricted than last year under the rules which were established through the 2017 Tax Cuts and Jobs Act (TCJA). These changes will be in effect through the 2025 fiscal year, if no action is taken by Congress to modify the credit before then.
A big change that helped many families last year, instead of receiving monthly installments on the credit as they did from July to December in 2021, the money will be distributed in the form of a single tax credit which will either reduce the size of the recipient’s tax bill or increase their tax refund.
Jerome Powell says Fed will tamp down inflation "expeditiously"
Federal Reserve Chair Jerome Powell is testifying to the Senate Banking Committee a week after policymakers raised rates three-quarters of a percent, the fastest rate hike in 28 years. The move it is hoped will slam the brakes on inflation which hit a four-decade high in May.
In his opening statements, Powell told senators "It is essential that we bring inflation down if we are to have a sustained period of strong labor market conditions that benefit all." He said that policymakers at the central bank are "strongly committed" to bringing down inflation and will move "expeditiously to do so."
The price of prescription drugs over time has been outpacing inflation, in 2020 half of drugs covered by Medicare saw faster-than-inflation price increases. A new study found that inefficiencies in supply chains are responsible for a majority of the price consumers pay for generic drugs.
When comparing the simplified model used by billionaire Mark Cuban’s new drug company, Cost Plus Drugs, the researchers found that Medicare could have saved up to $3.6 billion on generic drugs had the service existed then. That represents almost 40 percent of what Medicare spent on the 89 drugs examined in the study.
A potential solution to the EV infrastructure problem
One of the problems with electric vehicles is finding a place to charge them when away from home. Although new charging stations are being installed across the US, some places put in the infrastructure needed is impractical.
A new device, ZiGGY robot chargers, that is scheduled to enter production in 2023 could kill two birds with one stone. Drivers can call ahead to a parking garage with the ZiGGYs to reserve a spot. And then once there can get thier EV battery topped up with 30 miles of range. Additionally, the charging robots can be installed in places where placing fixed EV chargers isn't feasible.
Bident to call on Congress to declare a three-month gas tax holiday
President Biden will deliver remarks on gas prices and what he has termed "Putin’s Price Hike" on Wednesday afternoon. To help bring do the price of gasoline, which went over $5 on average across the US last week, he will call on Congress to declare a three-month gas tax holiday.
At the same time he is asking states to do the same and pressuring oil and gas companies to boost production and pass savings onto customers. White House officials claim the measures could bring the fuel prices, which have risen by over 40 percent since Russia invaded Ukraine, down by around $1 per gallon.
Twitter board recommends shareholds take Elon Musk's $44bn bid
On Tuesday, Twitter’s board of directors unanimously recommended stockholders approve Elon Musk’s $44 billion offer to buy the social media company. In filings with the Securities and Exchange Commission, they deemed the Tesla CEO's bid to be fair and in the best interests of the company and its shareholders.
However, Musk says that there are still some “unresolved matters” before the deal can be completed. Speaking at the Qatar Economic Forum he again raised concerns about the number of bots on the platform casting doubt that they make up fewer than 5 percent of users.
Wall Street rallied on Tuesday, but investor anxiously await Fed chair testimony
Wall Street's major indexes gained two percent on Tuesday as investors took advantage of lower prices after the market's biggest drop in two years last week. Megacap and energy companies were scooped up while all 11 major sectors of the S&P 500 saw major gains.
However there could still be a rough ride ahead. "Do I think we have hit bottom? No. I think we are going to see more volatility, I think the bottoming process will likely take some time," said Kristina Hooper, chief global market strategist at Invesco.
Investor will be anxiously awaiting Federal Reserve Chair Jerome Powell's testimony to the US Senate Banking Committee on Wednesday to read the tea leaves of how aggressive the central bank will be to tackle four-decade high inflation. Last week policymakers voted to raise interest rates by three-quarters of a percent, the biggest such hike in over a quarter of a century.
How high could gas prices go?
The price of gasoline has been around the $5-mark for much of the last week, the first time in US history that fuel prices have got that high. Fuel companies are being blamed, in part, for the sudden rise with many of the sector's biggest producers announcing record profits in the first quarter of this year. President Biden has written to a group of the biggest US oil companies demanding answers, as experts predict that the price could go far higher in the coming months.
Will there be a federal holiday on gasoline taxes?
President Biden is expected to come to announce his decision Wednesday on the prospect of a federal gasoline tax holiday to address the high price of motor fuel. It is thought that a suspension of the tax could save consumers a little over 18 cents per gallon on gasoline and 24 cents per gallon on diesel.
“Yes, I’m considering it,” Biden told reporters on Monday. “I hope to have a decision based on the data — I’m looking for by the end of the week.”
However some economists aren't convinced this move will translate into savings for consumers and may just line the pockets of oil companies.
How much is gasoline today? The price of motor fuel has been rising for much of the past six months, reaching the record national average high over $5 per gallon. In recent days the national average has dipped slightly but there is still real concern for motorists ahead of the Fourth of July, a time when millions of Americans are expected to travel long distances to visit friends and family.
We take a look at gas prices across the country on Wednesday, 22 June...
Homebuyers have been struck by expensive house prices since the covid-19 pandemic had its first let up in July 2020, especially in the last year. The year-on-year price increase is more than 18 percent, pricing out many people from getting into the housing market.
One group that has been disproportionately affected has been the LGBTQ+ community. This is due to a confluence of factors, but with such an expensive market a big problem has been acquiring the capital to pay for their first house.
The Cost-of-living-adjustment, or COLA is a percent increase applied to Social Security benefits each year based on price increases in the market. The Consumer Price Index, which measures inflation across a wide variety of goods and services, is used to calculate the COLA.
Hello and welcome to AS USA
Good morning, and welcome to AS USA! We'll be bringing you all the latest financial news and information from the United States on Wednesday, 22 June.