economist

4Dec

By THEIRL1ADMIN01No Comments

POLITICS

Jobs Are Up! Wages Are Up! So Why Is George The Economist So Gloomy?

In any other time, the jobs news that came down on Dec. 2, 2022, would be reason for cheer. The U.S. added 263,000 nonfarm jobs in November, leaving the unemployment rate at a low 3.7%. Moreover, wages are up – with average hourly pay jumping 5.1% compared with a year earlier. So why am I not celebrating? Oh, yes: inflation. The rosy employment figures come despite repeated efforts by the Federal Reserve to tame the job market and the wider economy in general in its fight against the worst inflation in decades. The Fed has now increased the base interest rate six times in 2022, going from a historic low of about zero to a range of 3.75% to 4% today. Another hike is expected on Dec. 13. Yet inflation remains stubbornly high, and currently sits at an annual rate of 7.7%. The economic rat...

An Economist Answers 3 Questions – Who Benefits From A Break On Federal Student Loan Payments?

12Jan

By THEIRL1ADMIN01No Comments

EDUCATION, Journalism

An Economist Answers 3 Questions – Who Benefits From A Break On Federal Student Loan Payments?

Although President Joe Biden has extended the pause on federal student loan payments from February 1 to May 1 – a move that includes a suspension of interest on the loans – some advocates want the president to cancel student loan debt altogether. Here, economist William Chittenden illuminates who benefits and who pays when borrowers get a break on paying back their federal student loans. 1. How helpful is this pause to individual borrowers? It depends. 18.1 million borrowers – out of 43.4 million borrowers – were making federal student loan payments prior to the current loan pause. Now, these borrowers will continue to get a break on making payments until May 1, 2022. With an average monthly payment of US$393, the collective direct benefits to these 18.1 million borrowers have been over $...

An Economist Explains What Is The Fed Taper And How The Federal Reserve Withdraws Stimulus From The Economy

16Dec

By THEIRL1ADMIN01No Comments

BUSINESS

An Economist Explains What Is The Fed Taper And How The Federal Reserve Withdraws Stimulus From The Economy

What is the Fed taper? An economist explains how the Federal Reserve withdraws stimulus from the economy. Tapering refers to the Federal Reserve policy of unwinding the massive purchases of Treasury bonds and mortgage-backed securities it’s been making to shore up the economy during the pandemic. The unconventional monetary policy of buying assets is commonly known as quantitative easing. The Fed first adopted this policy during the 2008 financial crisis. Normally, when a central bank wants to reduce the cost of borrowing for companies and consumers, it lowers its target short-term interest rate. But with its target rate at zero during the 2008 crisis – at the same time that there was no inflation and the economy was still hurting – the Fed was no longer able to cut rates further. And so...

An Economist Explains – What’s The Charitable Deduction?

18Jun

By THEIRL1ADMIN01No Comments

EDUCATION

An Economist Explains – What’s The Charitable Deduction?

Patrick Rooney, IUPUI The charitable deduction is a dollar-for-dollar reduction in taxable income that lowers what someone owes the Internal Revenue Service. Only donations to tax-exempt charities count. This giving incentive is available only for the 10% of American taxpayers who itemize their tax returns. Taxpayers who itemize can sum up certain expenses, such as the interest they pay to for a home mortgage, and then subtract that money from their taxable income. Here’s a hypothetical example: Clara Doe, a veterinarian, pays a 32% marginal tax rate on her US$200,000 income as a single filer. Because she itemizes, her $100 annual donation to a local food pantry costs her $68 after taxes. Uncle Sam essentially pays the rest by giving her a tax break. Most Americans instead use the stan...

An Economist Explains, Can A Future Ban On Gas-Powered Cars Work?

6Jan

By THEIRL1ADMIN01No Comments

BUSINESS

An Economist Explains, Can A Future Ban On Gas-Powered Cars Work?

The U.S. transportation sector is one of the largest contributors of carbon dioxide, the potent driver of climate change. A ‘green’ symbol for electric vehicle charging stations. Photo by Michael Marais for Unsplash, CC BY-ND Transportation accounts for about 28% of total U.S. greenhouse gas emissions and, since 1990, emissions in this sector have increased more than in any other area. Reducing greenhouse gas emissions by encouraging the use of electric vehicles promises to be an effective strategy to address climate change. That’s because the electric grid is powered by diverse sources, including an increasing amount of renewable energy such as wind and solar. But with more than 270 million motor vehicles registered in the U.S. and a long tradition of powering cars and trucks with foss...