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Economy Tag

Posted by Mary Chastain on July 02, 2017 38 Comments
I've been blogging about the mess that is my home state of Illinois and just as I thought...it managed to find a way to make things worse. Illinois legislators cannot agree on a budget. It closed the "fiscal year $6 billion in the red." The state also has "unpaid bills to state contractors and vendors that's reached about $14.5 billion and roughly $130 billion in unfunded pension liabilities." S&P downgraded the state's credit rating to a step above junk. Then the state's GOP leader resigned on Friday. A judge has ordered Illinois to pay $293 million towards Medicaid bills just as the state entered its THIRD FISCAL YEAR without a budget.

Posted by Mike LaChance on June 27, 2017 27 Comments
The progressive city of Seattle pushed its minimum wage up to $15 dollars an hour but a new study from economists at the University of Washington suggests the measure is hurting the very people it was intended to help. This is an issue the left often refuses to understand. If you force a higher wage than the market demands, employers are forced to adjust in ways that are less favorable. Ben Casselman and Kathryn Casteel report at FiveThirtyEight:
Seattle’s Minimum Wage Hike May Have Gone Too Far As cities across the country pushed their minimum wages to untested heights in recent years, some economists began to ask: How high is too high?

Posted by Mary Chastain on June 21, 2017 28 Comments
The Illinois lottery may become a victim of the bankrupt state if lawmakers cannot agree and pass a budget. In a last ditch effort, the lawmakers have started a special session on Wednesday that can last for 10 days. From Fox News:
The state lotto requires a payment from the legislature each year. The current appropriation expires June 30, meaning no authority to pay prizes. In anticipation of a budget deadlock, the state already is planning to halt Powerball and Mega Millions sales.

Posted by Mary Chastain on June 16, 2017 23 Comments
Amazon has purchased Whole Foods for $13.7 billion, which will allow the online giant to step into the grocery store sector. Amazon officials have stated in the past they want to expand into groceries. From Bloomberg:
Amazon agreed to pay $42 a share in cash for the organic-food chain, including debt, a roughly 27 percent premium to the stock price at Thursday’s close. John Mackey, Whole Foods’ outspoken co-founder, will continue to run the business -- a victory after a fight with activist investor Jana Partners that threatened to drive him from power.

Posted by Mary Chastain on June 12, 2017 15 Comments
More retailers have decided to close stores while Gymboree has filed for bankruptcy. Ascena Retail Group has decided to close "between 250 and 650 locations over the next two years." This group owns Ann Taylor, Lane Bryant, and Justice stores among others. CEO David Jaffe did not specify which brands the closures will affect. But he guaranteed that 250 stores will close. 400 others will definitely close "unless the company can negotiate lower rents at these locations."

Posted by Vijeta Uniyal on June 01, 2017 12 Comments
With the Greek debt crisis still unresolved and Brexit yet to be negotiated, European Union is rolling out plans to tie up the remaining 27 member states tighter together. In a policy paper released yesterday, the European Commission, the EU's political arm, lays out the roadmap for “completing a genuine financial union” by 2025. The 40-page policy paper calls for "further political integration" as well as a banking union," and a "more integrated Economic and Fiscal Union". Furthermore, the document calls for a unified "Euro Area Treasury" to be headed by a powerful "EU Finance Minister," "who would also be Chair of the Eurogroup." The EU policy paper does not see the need for any national ratification or referenda over this irreversible political-economic union paraded as "reform" -- making it perhaps the biggest ever power garb by an unelected bureaucracy.

Posted by Mary Chastain on May 19, 2017 11 Comments
The Senate Homeland Security and Governmental Affairs Committee has passed Sen. Rand Paul's (R-KY) Regulations from the Executive in Need of Scrutiny (REINS) Act, which means it will finally proceed to the Senate floor. This is a major victory for us who despise too much regulation. From Reason:
Sponsored by Sen. Ran Paul (R-Kentucky), the REINS Act would require every new regulation that costs more than $100 million to be approved by Congress. As it is now, executive branch agencies can pass those rules unilaterally, and even though those major rules account for only 3 percent of annual regulations, they are the ones that cause the most headaches for individuals and businesses.

Posted by Mary Chastain on May 05, 2017 4 Comments
The U.S. economy received a huge boost in April after it added 211,000 jobs and unemployment dropped to 4.4%. That's the lowest unemployment number since May 2007. From Fox News:
In an encouraging sign, the number of part-time workers who'd prefer full-time jobs has reached a nine-year low. That trend suggests that many employers are meeting rising customer demand by shifting part-timers to full-time work. During much of the economic recovery, the number of part-timers remained unusually high, one reason why steady job growth failed to produce sharp gains in pay or consumer spending.

Posted by Mary Chastain on May 05, 2017 16 Comments
Earlier this week, Puerto Rico, an American territory, sought "bankruptcy" protection after years of economic downfalls and facing $123 billion in bond and pension debts. So why did it take over two years for the island to address these problems? First off, it's not exactly bankruptcy since Puerto Rico is only a territory and the island cannot receive the same Chapter 9 protections like the states. Second, it was not until last year that Congress passed the Puerto Rico Debt Relief Bill:
The legislation would create a federal oversight board, appointed by Washington, with power to restructure Puerto Rico's unmanageable debt load.

Posted by Mary Chastain on April 26, 2017 27 Comments
Online shopping has led to many American retailers to file for bankruptcy at a fast pace, which could possibly set records for 2017. Fourteen chains alone have filed in the first three months of this year. Turns out no retailer is safe when it comes to shopping online. S&P found that "discount shoe-sellers, outdoor goods shops, and consumer electronics retailers have all found themselves headed for reorganization." Bloomberg reported:
Meanwhile, America’s retailers are closing stores faster than ever as they try to eliminate a glut of space and shift more business to the web. S&P blamed retailer financial struggles on their inability to adapt to rising pressure from e-commerce.

Posted by Mike LaChance on April 21, 2017 22 Comments
You'll be shocked to learn that Millennials are having a tough time growing up. They're struggling with the economy and putting off major life decisions. Mind you, this is the same generation which helped put Obama in the White House. Twice. NBC News reports:
Most Millennials Are Finding It Hard to Transition Into Adulthood: Report By his twenties, Kyle Kaylor imagined he would be living on his own, nearing a college degree, and on his way to a job that fulfilled him. Instead, at 21, he found himself out of school, living with his parents, and "stuck" working as a manager at a fast food restaurant scraping to make hand-to-mouth. Launching into adulthood has been tricky, he said.

Posted by Vijeta Uniyal on April 04, 2017 18 Comments
President Donald Trump's latest executive orders on foreign trade have irked Chancellor Angela Merkel's government, prompting tough talk from Berlin. On Friday, President Trump signed two orders seeking to identify trade abuse and other malpractices carried out by foreign governments in order to lower the U.S. trade deficit. Merkel's second-in-command, German Vice Chancellor Sigmar Gabriel, described Trump's moves as unlawful, claiming that he wants to "favour American companies, even if it contradicts international law." Germany's Economy Minister Brigitte Zypries said that President Trump was taking the U.S. in  "completely the wrong direction" and "moving away from free trade" by signing those executive orders. Minister Zypries had previously threatened to take the U.S. to court if the Trump administration were to impose import duties on German products.

Posted by Mary Chastain on March 14, 2017 3 Comments
President Donald Trump's promises to overhaul regulations and the tax codes along with positive sale outlooks have raised optimism among U.S. CEOs. The Business Roundtable conducted its CEO Economic Outlook Index, "a measure of expectations for revenue, capital spending and employment," found that the optimism jumped to 93.3. That's a jump of 19.1 points and the most since 2009.

Posted by Mary Chastain on March 10, 2017 3 Comments
The Labor Department has reported that the U.S. economy added 235,000 jobs in February. This stat has lowered the unemployment rate to 4.7% while wages went up "2.8 percent from February 2016." From Bloomberg:
“We’re getting closer and closer to full employment,” said Ryan Sweet, an economist at Moody’s Analytics Inc. in West Chester, Pennsylvania. “Wages had been the one sore spot in the labor market data, and I think that’s coming through here. With inflation accelerating I think we’re going to start to see even stronger wage growth down the road.” The prospect of a Fed rate increase at its meeting next week is “pretty much a slam dunk,” he said.

Posted by Mary Chastain on March 08, 2017 4 Comments
The news has lately shown steady and growing markets, pushing optimism to new heights. But is it worth it? Central banks around the world have gone into self preservation mode. While the subject is not sexy, everyone should have information on the financial market. It's another reminder how fragile the global economy remains:
These central banks are showing crisis-like behavior to protect their currencies even in the absence of obvious trouble. This exposes them to losses if their currencies fail to weaken on their own. It also raises doubts as to how long they can keep this up in an era when economic and political uncertainties appear to be a lasting feature of the world economy.

Posted by Fuzzy Slippers on March 06, 2017 16 Comments
Having worked their destructive magic in Detroit, the United Auto Workers union (UAW) has set its greedy sights on the South.  Roundly rejected by Tennessee workers at a Volkswagen auto plant in 2014, the UAW picked itself up, dusted itself off, and redoubled its thirteen-year efforts at a Nissan plant in Canton, Mississippi. The South has long rejected unions, including the International Association of Machinists and Aerospace Workers union who tried and failed to unionize Boeing workers in South Carolina last month.  But the UAW is undeterred, even dragging avowed socialist and failed presidential candidate for the 2016 Democratic nomination down from Vermont to try to convince Mississippians that he—and the UAW—knows what is in their best interests.

Posted by Mary Chastain on March 01, 2017 22 Comments
Fast food giant McDonald's has lost a few customers and wants to win them back. Executives plan to expand the company's "delivery, mobile and kiosk-ordering options as it looks to cut costs." From CNBC:
"Through enhanced technology to elevate and modernize the customer experience, a focus on the quality and value of our food and redefined convenience through delivery, we have a bold vision for the future and the urgency to act on it," said Easterbrook. "We are moving with velocity to drive profitable growth and becoming an even better McDonald's serving more customers delicious food each day around the world."

Posted by Leslie Eastman on February 25, 2017 10 Comments
President Trump has been meeting with business leaders regularly since his inauguration, including a meeting this week. These sessions cover a wide array of topics and grew out of Trump's December announcement of an advisory panel on manufacturing.
“Today we have 24 CEOs from the largest manufacturing companies in the country and even in the world. They represent--people in this room--nearly $1 trillion of sales and two million employees, large majorities of which are in the United States. They share our commitment to bring manufacturing back and to create jobs in this country,” Trump said.
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