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USA finance and payments news summary | 6 July 2022

US finance: latest updates

Headlines: 6 July 2022

- Voyager Digital, a cryptocurrency brokerage firm, files for Chapter 11 bankruptcy protection

- Markets down 20% in the first six months of 2022, the worst half year open in decades

- Is the inflated housing market creating a bubble?

- Federal Reserve provides "no guarantee" that increasing interest rates will not increase unemployment 

- Bitcoin has lost half of its value since January, now trading at $20,177.60

- New proposal to increase Social Security benefits by $2,400 a year circulates on Capitol Hill

Helpful links & Information 

- Residents in which states and cities are going to receive a stimulus check

- Where are home pricesexpected to drop in the US over the next year?

Check out some of AS USA's related news articles:

Will Social Security recipients in the US receive an extra $200 a month?


Will Social Security recipients in the US receive an extra $200 a month?

Inflation not seen in four decades is taking a bite out of American household finances. None feel this more acutely than those who receive Social Security benefits. The shortfall, however, is not new and has been growing over several decades.

At the same time though, if nothing is done in Congress, Social Security beneficiaries could see their monthly payments cut thirteen years from now. A proposal by Democrats would address the issue for the recipients of Social Security benefits with a $200 monthly boost, while shoring up the program for the next 75 years.

Full details

What will the Social Security COLA be for 2023? Predictions and estimates

Social Security

What will the Social Security COLA be for 2023? Predictions and estimates

Those who depend on Social Security benefits are being hit especially hard by inflation. While, the historic 5.9 percent COLA increase announced last year has helped, four-decade high inflation has continued to undermine the boost in payments that began in January.

The Senior Citizens League (SCL) has released a new report that shows purchasing power for seniors has fall by thirty percent between March 2021 and March 2022.

So what could the COLA for 2023 be,here's a look

Las Vegas Loop built by Elon Musk's Boring Company accepts Dogecoin

A little over a year ago, the first Loop, Elon Musk's answer to LA traffic jams, opened in Las Vegas. Built and operated by the Boring Company, currently rides are free but there are plans to begin charging in the future. A payment option has been set up where customers will be able to use Dogecoin, hyped by Musk in the past and presently in the doldrums, as well as a credit card or cash.

Contagion from 3AC brings down crypto brokerage Voyager Digital

The crypto winter claims another victim with Voyager Digital, a crypto brokerage firm, declaring bankruptcy days after freezing trading, deposits and withdrawals. This comes about a week after crypto hedge fund Three Arrows Capital (3AC) failed to repay a roughly $675 million loan to the brokerage. 3AC was ordered to be liquidated by a British Virgin Islands court.

Advice to prepare for a recession

High inflation has been battering economies worldwide as lingering disruptions from the covid-19 pandemic continue to push up prices around the world, exacerbated by the Russian invasion of Ukraine. In response central banks around the world have begun or announced plans to raise interest rates to put a halt on rising prices but at the risk of throwing their economies into recession.

So what should you do to prepare for a potential recession to keep your household afloat? CNBC in partnership with Acorns provide some tips.

Is Bitcoin a long-term or short-term investment according to experts?


Is Bitcoin a long-term or short-term investment according to experts?

The US major indexes have entered bear market territory as inflation soars and the Federal Reserve aggressively raises interest rates to stomp it down. The drop in valuations has hit the cryptocurrency market especially hard as investors flee to the safety of less volatile assets.

After peaking at $2.9 trillion in November 2021, the global cryptocurrency market has collapsed, hemorrhaging $1 trillion in value in the last two months alone. 

As investors grapple with falling markets, what do the experts say about investing in cryptocurrency?

What is the relationship between inflation and unemployment?

Latest News

What is the relationship between inflation and unemployment?

In the first sixth months of this year, the stock market lost a fifth of its value, and inflation increased by three percent. This comes despite price rises across the board that are causing real pain for countless American households across the country and threatening the economic recovery. 

Gas prices remain high, the remaining impacts of the covid-19 pandemic on global supply chains, and increasing interests rates have created a tense economic environment.

Read more

Lots of government spending, lots of monetary support — all combined together to support extraordinarily high levels of demand. Supply couldn’t keep up, so prices rose.”

Jason Furman, Harvard University

“It’s very natural for consumers to see prices rising and get angry about it and then look for someone to blame."

I find it helpful to think about competition like diet and exercise. More competition is a good thing. But, like diet and exercise, the payoffs are long term."

Christopher Conlon, New York University’s Stern School of Business

Bezos v Biden: Gasoline price inflation dispute

The former Richest Man in the World and current Leader of the Free World have gone head to head on Twitter after Jeff Bezos responded to claims made on President Biden's account. The President had pointed to the fact that the price consumers are being charged for gasoline is not going down at the same rate of wholesale gas prices, with have fallen dramatically in recent weeks. 

However Bezos argued that this was not a fair comparison and even hit out at Biden's understanding of how the economy works. Here, Yahoo Finance’s Rick Newman explains the situation...

What is the relationship between inflation and unemployment?

Latest News

What is the relationship between inflation and unemployment?

The US Federal Reserve has increased interest rates by 75 base points in the last month, corresponding with a 0.75 percent increase in rates. The hope is that the bump in rates will increase price of borrowing which could slow business investment to decrease demand and meet supply.

A few weeks back, economist Larry Summers came under fire for arguing thatunemployment needs to increase to five percent to get inflation back under control. While visiting with his counterparts in Europe, Chairmen Jerome Powell made “no guarantee that interest rate increase.

Read more

Gas prices decrease as demand falls

For weeks, experts had been suggesting that the busy Fourth of July travel period could represent a peak moment in demand for gasoline. After two years of largely socially distant celebrations, Americans were able to return to their normal festivities this year and engaged in long journeys to see friends and families. 

However on Sunday 3 July, once the vast majority of people had reached their destinations, the demand for gasoline fell sharply and appears to have brought about a sizeable drop in gasoline price averages across the country. 

What are gas prices in the US and each state? Today 6 July 2022

Latest News

What are gas prices in the US and each state? Today 6 July 2022

While prices continue to edge down in nearly every state, reductions in prices for many are so minimal that they won’t be felt in these relatively expensive times. Fuel in Europe is currently much more expensive compared to the US, for example.

The President sent a warning to oil companies to stop gouging consumers but it does not appear to be making any real impact. It is hoped that prices will continue to fall, but the busy summer travel period could make that unlikely. 

Read more

Recession fears drive Euro to twenty year low against the dollar

European economies have been battered by high inflation, hitting 8.6 percent in June, driven, in addition to covid-19 disruptions, by the rising price of gas since Russia's invasion of Ukraine. Further pain could be on the way with Norwegian workers on offshore gas rigs planning to protest.

This has increased the fears that the euro zone will enter recession, with some saying it is "inevitable." The economic slowdown could tie the hands of the European Central Bank's capacity to tighten monetary policy.

This has led investors to flee to safer harbors in the US pushing up the dollar now at its strongest against the euro since 2002. The two may reach parity in the near future, which would be a boon to American travelers to Europe making their holiday expenses cheaper.

Jeff Bezos tweets response to White House's gas price claims

Jeff Bezos, the founder and owner of Amazon, has responded to a tweet from President Biden which called on oil executives to reduce gasoline prices. Biden's criticism focused on the companies running gas stations and setting prices for consumers, although the average cost of the fuel is actually declining fairly swiftly now. 

Elon Musk's Tesla is no longer the world's largest EV producer

Tesla has had to contend with a number of speed bumps this year with covid-19 outbreaks in China shuttering its gigafactory in Shanghai and limiting the supply of necessary semiconductor chips. The supply shortages have also affected production at it two new gigafactories in Austin and Berlin.

All of which saw the electric vehicle maker see production drop for the first time in two years. Meanwhile Chinese EV makers BYD, back by Warren Buffett, has ramped up production 325 percent year-on-year to surpass Tesla as the world's largest electric vehicle manufacturer.

The race will be on, Tesla expects to produce 2 million EVs once its gigafactories are up to scale which would dwarf BYD's current output of 638,157 cars.

Pounds continues to struggle vs dollar as UK cabinet ministers resign

Two senior UK cabinet officials offered their resignations to  Boris Johnson on Tuesday along with other members of the embattled Prime Minister's government. The lose of his Health Secretary Sajid Javid and Finance Minister Rishi Sunak could spell the end of Johnson's scandal riddled premiership.

The news added downward pressure on the Sterling along with inflation and recession fears as gas prices soar in the UK and across Europe. The pound hit a two-year low against the surging dollar.

Gas prices continue to fall after surpassing $5 per gallon last month

Gasoline prices peaked in mid-June hitting a record high of $5.016 on average across the United States. Drivers still won't be happy when they fill up their cars though with the price still almost 35 percent higher than a year ago. Prices have now fallen to $4.779 per gallon on average across the country. 

Hello and welcome to AS USA!

Good morning, we will be bringing you all of the latest financial news from the United States on Wednesday, 6 July 2022. 


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