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BUENOS AIRES, Sept 13 (Reuters) - Argentina's annual inflation rate shot up to 124.4% in August and hit its highest level since 1991, stoking a painful cost-of-living crisis in the South American country.
The soaring prices, which rose more than expected, are forcing hard-hit shoppers to run a daily gauntlet to find deals and cheaper options as price hikes leave big differences from one shop to the next, with scattered discounts to lure shoppers.
The August monthly inflation reading of 12.4% - a figure that would be eye-watering even as an annual figure in most countries worldwide - is pushing poverty levels past 40% and stoking anger at the traditional political elite ahead of October elections.
"It's so hard. Each day things costs a little more, it's like always racing against the clock, searching and searching," said Laura Celiz as she shopped for groceries in Tapiales on the outskirts of Buenos Aires. "You buy whatever is cheaper in one place and go to the next place and buy something else."
Her husband, Fernando Cabrera, 59, was doing sums on a calculator to compare fruit and vegetable prices.
"In this way we try to beat inflation or at least compete with it a little," he added.
A central bank analyst poll, released after the data, forecast inflation would end the year above 169%, a sharp hike from its estimate a month earlier of 141%. It predicted monthly inflation of 12% in September and 9.1% in October.
Argentina is caught in a cycle of economic crises, with a major loss of confidence in the peso driving steady depreciation, triple-digit inflation, negative central bank reserves and a flagging economy due to drought hitting farming.
The country is also battling to salvage a $44 billion deal with the International Monetary Fund (IMF) and facing the prospect of a $16 billion legal bill after a U.S. court ruling related to the state takeover of energy firm YPF a decade ago.
'PEOPLE ARE ANGRY'
That's playing into a race towards presidential elections next month, with radical libertarian Javier Milei the shock frontrunner ahead of establishment candidates economy minister Sergio Massa and conservative Patricia Bullrich.
And inflation itself could still get worse amid the election uncertainty, which has revived memories of hyperinflation from the 1980s among those who lived through it.
"Some estimate say it could accelerate to 180%, which is why we are talking about record inflation levels," said local economic analyst Damian Di Pace, adding that other nations in the region were meanwhile seeing inflation cool.
"While the rest of the Latin American countries have single-digit inflation, Argentina is already in triple-digits."
Massa, who has cut taxes to alleviate the impact of inflation on workers, said late on Wednesday that August had been the "hardest" month, pointing the finger at the IMF.
"The 20% devaluation of the currency, imposed by the IMF, we knew it was going to hit the pockets of all Argentine families," he said.
Business owners, who themselves face a tricky cycle of wholesale prices rising before they've shipped merchandise and been able to restock, are also suffering from product shortages due to the uncertainty of inflation.
Butcher Marcelo Capobianco, 53, fears having to close his business and is considering emigrating overseas. He displays meat prices in dollars, the currency that many use as a refuge from the constant devaluation of the peso.
"It's dramatic. We don't know how we're going to pay the rent this month, how we're going to pay the electricity," Capobianco said at his butcher shop in Olivos, on the outskirts of Buenos Aires. "People are angry and have every right to be because they can't afford to buy a kilo of meat."
"We are already thinking about what we are going to do because, in reality, if this continues, I think we are going to have to shut up shop," he said.
Reporting by Miguel Lo Bianco, Jorge Otaola, Claudia Martini, Walter Bianchi and Hernan Nessi; Writing by Lucila Sigal; Editing by Nicolás Misculin, Adam Jourdan, Chizu Nomiyama and Sandra Maler
Our Standards: The Thomson Reuters Trust Principles.
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Inflation
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Days after Tropical Storm Hilary battered the West Coast, flash floods and fierce winds, Californians now face another challenge: Figuring out the costs of repairing their battered homes and replacing valuables.
Climate change has put more Americans in the locus of storms and other extreme weather events that could have devastating consequences on their household finances. In the past year alone, more than 15 natural disasters have hit the U.S., with catastrophes like the Maui wildfires destroying billions of dollars worth of property, according to data from the National Centers for Environmental Information.
As natural disasters become more frequent and severe, having enough insurance coverage is essential. However, not all insurance policies cover every type of extreme weather event.
Here's how to make sure you have the right type of insurance for your home, and how to get additional coverage if you need it.
Know your plan
Standard homeowner policies differ from company to company. Some plans may not cover losses from earthquakes, certain types of water damage, and wind damage caused by tornadoes or hurricanes, according to insurance company Allstate.
To know what your plan covers and how much, check your policy. You can request a digital or hard copy of your homeowners insurance policy directly from your insurance company. In addition, many insurers offer mobile apps that let you view and manage your policy information.
Coverage add-ons
Insurance policy add-ons, also known as endorsements or riders, allow you to personalize your insurance policy to meet your specific coverage needs, according to personal-finance website Bankrate.
You can purchase different types of endorsements to alter or extend existing coverage to protect high-value items in your home that are not insured by a basic policy. This helps ensure that any valuable items destroyed in a natural disaster will be replaced by your insurance at their current market value.
A scheduled personal property endorsement, which extends coverage beyond your basic policy, is one way to insure valuable items such as jewelry. To get this type of endorsement, your insurance company will likely require an appraisal or proof of value for the items you want covered.
Alternatively, you can also insure high-end possessions by purchasing additional blanket coverage which is used to increase coverage limits for an entire class of items. For example, if your standard policy covers up to $2,000 worth of artwork, blanket coverage could increase that coverage limit to $10,000. This option doesn't require an appraisal.
Get flood insurance
Floods are the most common weather-related natural disasters, and they occur in all 50 U.S. states, according to the National Severe Storms Laboratory. Just one inch of flooding can cause nearly $27,000 worth of damage to a one-story, 2,500 square-foot home, data from the Federal Emergency Management Agency shows.
Flood insurance is an insurance policy that protects your home and other property against flood-related damages. As most home insurance companies don't offer this type of coverage as an add-on, you'll most likely have to purchase a standalone flood insurance policy.
The National Flood Insurance Program offers policies that you can purchase through an insurance carrier or private insurance company.
Keep an up-to-date inventory list
Having a list of everything you own can take some of the pain out of filing an insurance claim and help you get the most out of your policy.
Make an inventory list that includes all of the major items in your home with their dates of purchase and how much you paid for them. Then, snap photos of all the items on your list. If you have receipts for your items, store them alongside your inventory list. These documents can help you get more money from your insurance company to replace your damaged possessions after a weather-related disaster.
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Personal Finance & Financial Education
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Mauricio Costa, a software engineer and music composer living in Atlanta, is creating a musical comedy out of the Silicon Valley Bank collapse, called “The Valley.”
Perhaps the wounds are still fresh, but Costa told TechCrunch while reading articles about the bank’s demise and trying to understand what was going on, “I could see the entire hero’s journey and the hero’s lifecycle on this story, so I thought maybe there’s something here and maybe we can tell the story in a way that nobody has ever seen before.”
Tapping into well-known playwright Lin-Manuel Miranda as his inspiration, Costa is giving “The Valley” a gospel and hip-hop feel and described the story as where venture capitalists play the role of “preachers,” startups play the role of “naïve church-goers,” and the Valley Bank CEO “Greg” (obviously a take on former Silicon Valley Bank CEO Greg Becker) has a big role.
The musical is still in its infancy with the first draft taking Costa about four months to complete. He has written six songs so far, with titles including “The Valley is Great,” “Blessing in Disguise” and “We are Gonna Die.” It begins with the “startup” character singing about how great “the valley is,” with lyrics like “the valley is great,” and lift up “Greg” and the bank as “We praise thee o Greg in all its awe and grace.”
Other than reading news articles, Costa said he hasn’t yet approached the parties involved — VCs, startups or the bank itself, but does plan to try to get his draft in front of Beck and some venture capitalists. He did work with some friends in the fintech industry who helped with fact-checking.
“I don’t know if Greg or VCs will find it comedic or if they will find it insulting, but it was never my intention to if they find it insulting,” Costa said.
To give the musical’s story a more personal touch, he took to Twitter, saying “a lot of very reputable people came to me on the SVB situation, and you can see that in the lyrics.”
“I cite some of the tweets verbatim, sharing some of their opinions,” Costa added. “For example, I include lyrics from one person’s tweet who is sarcastically saying ‘thank you’ to all the venture capitalists for destroying or collapsing a very trustworthy and reliable bank.”
Though Costa mentions a “hero’s journey” in all of this, he said that really isn’t a central hero, and that the audience will leave the musical with differing opinions on who is “evil” and who is the “hero.”
Meanwhile, he is currently looking to collaborate with some professional musicians to work on the stage adaptation part. Costa is also talking with potential theaters, including at his alma mater at University of Central Florida.
“It’s my first time writing for gospel and hip-hop, but I love it,” Costa said. “It’s beautiful. I think it has the potential to attract other people who are interested to know about this story.”
If you have a juicy tip or lead about happenings in the venture world, you can reach Christine Hall at chall.techcrunch@gmail.com or Signal at 832-862-1051. Anonymity requests will be respected.
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Banking & Finance
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It will come as no surprise to any landlord who needs lending that the terms and conditions banks impose are onerous – but the situation is getting worse.
Faced with the highest interest rates in 15 years, landlords are at the sharp end of the stick when it comes to the Bank of England hiking rates, with many landlords now trapped on their lender’s standard variable rate (SVR) costing as much as 9.5pc.
But the small print behind these eye-watering rates is even more shocking, with some lenders introducing criteria which make it nigh on impossible for landlords to secure new lending or refinancing deals.
The whole issue hinges on the “interest coverage ratio” (ICR), which is used by banks to calculate how easily a mortgage debt can be repaid.
In recent years this was 125pc for lower-rate taxpayers, and 145pc for higher-rate taxpayers, but these rates have now soared to 130pc and 165pc respectively.
This means if landlords want to remortgage a property, they are now forced to increase the rent to tenants in order to try and meet the bank’s criteria, or else they will be forced to sell.
But it gets worse. With the full introduction of Section 24 and increased mortgage rates, landlords who own property in their personal names – often as part of their pension planning – are unable to deduct the full expense of the mortgage interest from their tax bill.
The freeze on tax thresholds since 2021/22, which is predicted to last until 2028, has resulted in many basic-rate tax paying landlords being dragged into higher-rate tax bands. This so-called “fiscal drag” means landlords have to pay even more tax, just to try and keep a roof over their tenant’s heads.
The sums do not add up.
Landlords are now – in addition to a cost of living crisis – facing a “cost-of-doing-business” crisis.
The banks and their small print are propelling the buy-to-let market, and would-be renters, to a cliff edge.
There are barely any properties available to rent, and those that do become available face deluges of hopefuls vying to find a home. Even those landlords who want to remain in the market, if they have borrowing, are struggling to make ends meet.
One mortgage broker told me: “ICRs are a joke at the moment. We can hardly get anything to fit.”
But landlords don’t just have to battle increased mortgage rates, unfair taxation and tight lenders’ rental coverage criteria – there’s yet more bank small print lurking when it comes to the energy performance, or “EPC grade” of the property.
Michael Gove may be flip flopping around on the whole EPC debacle, and if or when the Government is going to introduce a minimum grade C for rental properties, but the banks are not.
Despite widespread acknowledgement that EPCs are not fit for purpose and the Government proposal to overhaul the entire system, banks are using these ineffective energy certificates to penalise landlords further.
Many lenders are now bringing in this energy performance criteria for their loans and actively charging more for mortgage deals, by an average of 0.25pc, if the property falls below the hallowed “C” grade.
This is an untenable situation. There is no joined-up thinking. The banks are rewriting the rules of buy-to-let according to strict criteria, which makes it barely possible to keep properties already owned, in addition to proposed energy regulations that haven’t even been made law.
If you’re looking for a cause for this housing crisis and surging rents, I’d suggest you take a look at the banks’ small print.
The Secret Landlord is a monthly column by an anonymous buy-to-let investor. Email: secretlandlord@telegraph.co.uk
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Real Estate & Housing
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A graduate earning £35,000 a year pays almost double the average tax of someone with same income from rent on property, according to a study of inequality in the UK tax system.
The combined effect of income tax and national insurance payments forces people in employment to pay much higher rates of tax than those who benefit from lower capital gains tax (CGT) rates on property and shares income, according to the Intergenerational Foundation thinktank.
In a separate example that also emphasises the gap between the mainly older people who generate an income from property and shares and those who rely on employment, a person receiving £60,000 a year in the form of capital gains or dividends pays less tax than someone aged 16 to 64 in a job earning £35,000.
“Earned income, in such cases, is taxed two to four times more heavily than unearned income,” said the foundation, an independent charity that that funds research into issues affecting young people.
Based on analysis of HMRC data, the foundation said increasing CGT rates to the same level as rates on earned income would raise at least £10bn extra a year, allowing the government to cut tax rates at each income tax threshold by at least 1.25 percentage points.
The momentum behind calls for the equalisation of capital and employment tax rates has grown in recent years. Recent polling has shown support across the political spectrum, with 61% overall saying they back reform.
Before it was scrapped, the Office of Tax Simplification said the tax system would be better designed if the rates for CGT and income tax were more closely aligned. It said putting CGT up to the level of income tax would raise £14bn.
Former Conservative chancellor Nigel Lawson set the rates of CGT at the same level as income tax in 1988, saying: “In principle, there is little economic difference between [earned] income and capital gains ... And in so far as there is a difference, it is by no means clear why one should be taxed more heavily than the other.”
Since Lawson’s time in office, capitals gains have risen 16 times from below £5bn a year to an estimated £80bn in the financial year 2020-21, but the amount of tax raised from capital gains has only risen three times to about £15bn.
Higher rate taxpayers earning more than £50,000 a year pay 42% on every extra pound earned from employment, but pay only 20% on gains from shares and 28% from gains on property.
Standard rate taxpayers, which includes most taxpayers over the age of 65, only pay 18% on property gains, 10% on gains from shares and 20% on rental income.
The authors said the current system allowed for significant levels of avoidance by those with income from capital gains who were allowed to smooth the declaration of their income to make sure it fell under the tax threshold over a period of years.
“The wealthy obtain two main advantages from the current system not available to most of the population: first, a large lump of tax-exempt capital gains; secondly, a maximum tax of 20%, which is less than half the top rate of income tax,” the report said.
“Those who can manipulate the tax system in their favour tend to be those with high incomes or high levels of wealth, leaving a larger tax burden on younger people and those on lower incomes, further perpetuating inequalities between and within generations,” it added.
The tax privileges granted to those with unearned income in the UK are also over- generous by European standards, the report said. “For example, in Germany the annual exempt allowance is only €1,000 and all capital gains are taxed at 26.38%, while in France unearned income is taxed at 30-34%.”
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Inflation
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Russia's full-scale invasion of Ukraine on Feb. 24, 2022, has cast a spotlight on the emergent role of cryptocurrencies in a modern war zone. In a time of crisis, where conventional financial systems faltered, crypto has emerged as a critical and unexpected ally for Ukraine.
However, the full-scale invasion in 2022 wasn’t the first time Russia invaded Ukraine. The first invasion occurred in 2014 when Russia invaded and illegally annexed Crimea and waged a war in Ukraine’s Donbas region. Ukraine’s economy took a nosedive and Ukraine’s national currency, the hryvnia, lost 70% of its value by 2015.
The immediate aftermath of Russia's full-scale invasion was marked by a run on the banks, a freezing of the currency market, and a plummeting value for Ukraine's currency.
Amid the chaos, the Ukrainian government turned to cryptocurrencies like Bitcoin, Ethereum, and Tether to meet immediate needs, posting wallet addresses on social media. At present, Ukraine’s Digital Transformation Ministry is able to accept donations in 14 cryptocurrencies.
A year after the all-out invasion began, the Ukrainian government raised $225 million in cryptocurrencies to fund everything from weapons to medical supplies. Ukrainian funds raised around $134 million in crypto for humanitarian needs, while military-oriented campaigns gathered $91 million. Donations peaked in March 2022, when global support for Ukraine was at its strongest.
However, the total sum of donations of aid being sent through cryptocurrencies pales in comparison to standard financial aid being sent to Ukraine. But all forms of donations help in Ukraine’s fight and that includes crypto.
Contrary to traditional forms of aid, crypto donations offered speed, cross-border accessibility, and a low-profile character. These benefits were also acknowledged by Ukrainian newspapers and tech companies, which sought crypto support for various humanitarian causes.
The adoption of cryptocurrencies in Ukraine wasn't merely wartime improvisation. Before the full-scale invasion, Ukraine ranked third in Chainalysis' Global Crypto Adoption Index, while Russia ranked ninth. Factors like high inflation and a lack of trust in local banks fueled this trend, making Ukraine one of the leading adopters of cryptocurrency.
The war only accelerated this movement, leading to the legalization of cryptocurrencies within Ukraine's financial system in March 2022. This removed the barrier for foreign and Ukrainian cryptocurrency exchanges to be able to operate legally and banks are able to open accounts for crypto companies. The subsequent influx of donations demonstrated how cryptocurrencies could strengthen a country's defense effort, offering a new model for rapid financing.
Former U.S. Senator Pat Toomey stated in March 2022 that “While there has been virtually no evidence of Russia meaningfully using crypto to evade sanctions, Ukraine has been actively utilizing crypto to do tremendous good. Crypto donations for Ukraine have reached roughly $100 million, helping Ukrainians defend against Russia’s invasion.”
If Russia did attempt to convert large sums of currency into crypto, it would likely stumble upon liquidity problems. This is because there isn’t enough liquidity in the market to support such large amounts at that scale and digital currencies are scattered across thousands of marketplaces.
However, cryptocurrencies were not entirely absent from the Russian side in its war against Ukraine. Hacker groups, such as NoName057(16), were known to offer cryptocurrency rewards for successful cyberattacks, making cryptocurrencies a tool for incentivizing destructive activities as well.
While El Salvador has received a significant portion of global attention for its state-led involvement in the broader crypto project, heavily investing in the space, it's Ukraine's organic growth in the crypto sector that truly sets it apart.
In El Salvador, a prominent public-private partnership has committed to investing $1 billion to establish one of the world's largest Bitcoin mining farms. In September 2021, El Salvador distinguished itself as the first nation to recognize Bitcoin as legal tender, mandating all businesses to accept the cryptocurrency. To encourage adoption and standardize its usage, the government provided financial incentives to citizens, encouraging them to download a designated cryptocurrency app.
According to a report by Reuters, adoption among El Salvador's residents has been inconsistent, particularly concerning the government's Bitcoin digital wallet, Chivo. A survey conducted by the National Bureau of Economic Research (NBER), a U.S.-based non-governmental organization, discovered that only 20% of Salvadorans who downloaded the Chivo app continued to use it after spending the $30 in free credit provided by the government to promote its use.
In contrast, Ukraine's growth in the crypto sphere has been a more natural and organic process. Digital currency in the country has been addressing vital gaps, such as expediting fundraising needs. Unlike the top-down governmental push witnessed in El Salvador, Ukraine's crypto evolution has been a bottom-up approach. This grassroots-driven adoption has not only secured buy-in from citizens but has also led the government to facilitate the legal standing of cryptocurrencies in Ukraine.
Ukraine’s crypto growth is a natural process where the digital currency has been filling in crucial gaps such as speeding up fundraising needs.
However, one of the leading arguments against cryptocurrencies is the environmental damage that is caused by mining. A report released in 2022 by climate and economics researchers estimated that “Bitcoin mining may be responsible for 65.4 megatonnes of CO2 per year … which is comparable to country-level emissions in Greece (56.6 megatonnes in 2019).”
Ukraine’s case for mining is unique. The country produces almost half of its electricity from 15 nuclear reactors. Recognizing this, Ukraine's Energy Ministry Ministry of Energy champions cryptocurrency mining as an innovative means to utilize this excess, turning potential waste into efficiency.
By partnering with the Bitcoin mining industry, energy surplus from nuclear reactors is channeled into cryptocurrency mining, harmonizing energy requirements with financial inflows to offset the financial losses of needing to keep energy supplies at a stable level.
This not only supports clean and sustainable Bitcoin mining but also presents a market-based remedy to the energy sector's inefficiencies. Given that NAEC Energoatom, the state-operated entity behind Ukraine's nuclear power plants, reported losses exceeding $170 million in 2020, this strategy breathes life into a flagging sector.
The adoption and success of cryptocurrencies in Ukraine's resistance also represent a broader trend in the evolution of digital finance. The implications extend beyond Ukraine's borders. A once-unregulated market is now growing in its importance in Ukraine’s fight against Russia, transcending political boundaries.
Editor’s Note: The opinions expressed in the op-ed section are those of the authors and do not purport to reflect the views of the Kyiv Independent.
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Crypto Trading & Speculation
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There are hundreds of guides on how to scale a startup, but many authors either haven’t done it themselves or are too forward-looking into the millions. So, how does a founder implement a growth framework to scale to the first million dollars in revenue?
After working at hyper-growth companies such as Postmates and Coinbase, I wanted to try my hand at the accelerated growth of my own startup. I’ve been fortunate enough to have co-founded Virtualis, where I have led all marketing efforts as our CMO, from zero to $1 million annual recurring revenue (ARR) in our first year.
I’m here to share the framework that I implemented, which I believe can apply to all startups just entering the market. I do not pretend to have a silver bullet, but I do have a tried-and-true framework you can use to help you achieve your first million.
The core components to my early-stage startup growth framework are finding product market fit (PMF), identifying your ideal customer profiles (ICP), nailing down messaging, pushing users to their “aha moment” and finally optimizing for down-funnel metrics.
Introducing my battle-tested startup framework: First Million Startup Growth Framework.
If you’re either just starting out with your newly created startup or struggling to get to your first million in revenue, this is the early-stage framework for you. Let’s dive in!
Finding product-market fit
PMF is a term used to describe a product or service that has found enough organic demand from consumers. This demand is both sustainable and economically worthwhile for a startup to continue operating. So how can you find PMF in the most efficient and frictionless way possible? I believe that the answer to this question is through paid acquisition.
There are 100s of guides on how to scale a startup, but many authors either haven’t done it themselves or are too forward-looking into the millions.
With a paid acquisition channel like Meta or Google, you can launch a campaign to assess whether consumers are genuinely interested in your startup’s offering in an expeditious manner. It is important to understand that paid campaigns are not the most efficient on day one and take both experience and optimizing to drive costs down.
However, it should be obvious if there is an interest with your startup based on the initial cost per leads (CPL). If you’ve spent $1,000 and have no purchases, or even signups for a waitlist, then the campaign may not be configured correctly or there’s an issue with PMF. Below are some rough gauges to determine PMF, outside of purely looking at metrics:
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Consumer & Retail
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- An analysis of CryptoQuant data from both spot and derivatives exchanges shows the total volume of bitcoin held on all exchanges fell earlier this month to its lowest level since 2019 and has struggled to rebound.
- As of Aug. 26, bitcoin trading volume on all exchanges sat at 129,307 BTC, according to CryptoQuant.
- On Aug. 12, trading volume fell as low as 127,100 BTC, a level not seen since March 31, 2019. It's now off the March high of 3.5 million BTC by about 94%, according to the data provider.
Bitcoin's trading volume is down to its lowest level in four years as investors wait for reasons to jump back into the market.
An analysis of CryptoQuant data from both spot and derivatives exchanges shows the total volume of bitcoin held on all exchanges fell earlier this month to its lowest level since 2019 and has struggled to rebound.
As of Aug. 26, bitcoin trading volume on all exchanges sat at 129,307 BTC, its lowest level since March 31, 2019, according to CryptoQuant. It's now off the March high of 3.5 million BTC by about 94%.
"Trading volumes decrease in bear markets as retail investors leave," Julio Moreno, head of research at CryptoQuant, told CNBC. "This happened during 2022 on most exchanges. As we progress further into a bull market, the trading volume may continue to pick up."
The price of bitcoin is still up 57% for the year and hovering at about $26,100, according to Coin Metrics.
It's been an excruciatingly quiet summer for bitcoin traders, but seasonality only accounts for so much of it. The U.S. regulatory crackdown on crypto combined with the end of the banking crisis in May (which accounted for much of its year-to-date gains) drove market makers and traders away – and they haven't had a reason to return.
Even after bitcoin's violent sell-off on Aug. 17 — the biggest one-day sell-off since the height of the FTX fallout in November — the market quickly became quiet again. Data shows long-term investors haven't been easily shaken by the recent weakness.
"Overall, [the] market remained dull waiting for a new catalyst and the overall market liquidity remained scant," Bernstein analyst Gautam Chhugani said in a note Monday of the last week in crypto trading. "This market is not necessarily bearish, but the participants remain disinterested to trade, as the market waits for catalysts" – specifically, in the form of decisions on any of the spot bitcoin ETF applications in line at the Securities and Exchange Commission.
Chhugani said that whatever ends up bringing some movement back to the market, investors' real opportunity "lies in staying the course into the new market cycle," which tends to coincide with the Bitcoin halving. The next one is expected to take place in spring of 2024. Cantor Fitzgerald echoed that emphasis on the long game.
"Although near-term catalysts may take many forms, we continue to believe in the long-term story of ongoing crypto adoption and bitcoin's staying power as an alternative asset and store of value," Cantor Fitzgerald analyst Josh Siegler said in a note Monday.
—CNBC's Michael Bloom contributed reporting.
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Crypto Trading & Speculation
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JOBS in once-loved British seaside towns have plummeted by 50,000 in just ten years, Labour reveal today.
Holiday homeowners will have to register before letting out seaside properties - or face fines under Labour's mission to save them from ruin.
Ms Reeves promised Sun readers she will crack down on second homeowners who leave properties empty while pretending to rent them out to holidaymakers.
They will bring in a mandatory licencing scheme like in Wales - where owners will have to sign up and pay a fee to rent out their holiday homes - in a bid to help protect communities in rural and coastal areas.
She visited Haven Primrose Valley Caravan Park in Filey where she tried her hand at bingo and making pizzas.
The firm's seaside resorts - with three million visitors every year bringing in hundreds of jobs for locals - are helping to buck the trend of seaside towns in decline.
Ms Reeves told The Sun: "I love our seaside towns.
"I have such happy memories of seaside holidays in Gower as a child - everyone has their own stories too.
"There are no better beaches in the world - and wherever you live, you're never far from one.
"I want to make sure they are thriving again."
And she'll be dragging her kids to Cornwall this summer rather than taking them abroad, she revealed.
New stats show how seaside towns from Falmouth to Scarborough are lagging behind in economic growth as young people flock elsewhere for work.
Almost all seaside towns in England and Wales had a fall in employment levels between 2011 and 2021 - with falls of over 10 per cent for some towns.
Most towns had a lower employment rate than their region.
There was a fall in employment levels of almost 50,000 from 2011 to 2021.
But all of England and Wales saw jobs boosted by 1.1million.
Aberystwyth in Wales saw a staggering 26 per cent drop in jobs, losing 1,600 in a decade.
Cleethorpes saw 2,700 jobs go, 2,600 from Bournemouth, and Blackpool lost 1,800.
Most read in The Sun
On average seaside towns only grew 12 per cent between 2009 and 2019 - compared to the UK as a whole by 20 per cent, the ONS analysis revealed.
The growth per job in real terms (growth value added) increased by, on average, three per cent across 35 seaside towns, compared to five per cent across the UK.
Lytham St Anne’s was the town with the lowest growth, with GVA per job falling by 32 per cent over a decade.
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Workforce / Labor
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Chancellor Jeremy Hunt says "everything is on the table" when it comes to tax cuts in this week's autumn statement.
Speaking to Sky News' Sunday Morning with Trevor Phillips, Mr Hunt said his speech on Wednesday would focus on growth, and pledged to "remove the barriers that stop businesses growing".
But he did not rule out other rumours that have been swirling around Westminster this weekend, including a reduction in inheritance tax and changes to personal taxation.
"I am not going to talk about any individual taxes as that will lead to even more feverish speculation as to what I might do," said the chancellor.
"What I will give you is a general view about tax. It is too high [and] the Conservative government wants to bring it down because we think that lower tax is essential to growth."
He added: "I want to bring down our tax burden. I think it is important for a productive, dynamic, fizzing economy that you motivate people to do the work [and] take the risks that we need."
Can the chancellor lift the gloom? Watch live coverage on Sky News of the autumn statement from 11am on Wednesday.
Under the Tories, tax levels are at their highest since records began, and backbench MPs have been demanding cuts from the government ahead of the next election.
But Mr Hunt and Prime Minister Rishi Sunak have been resisting the calls for the past 12 months, saying their priority was to lower inflation - which also stood at a record high of 11% last autumn.
Earlier this week, the Office for National Statistics confirmed that figure had now dropped to 4.6%, seeing the Conservative pledge to halve inflation by the end of the year met.
But it still sits at more than double the Bank of England's target of 2%.
The chancellor reiterated his pledge to not introduce any tax cuts that "fuel inflation", saying: "We have done all this hard work we are not going to throw that away."
But he did not write off the prospect of lowering taxes, saying the Conservatives "need to show there is a path to a lower tax economy", and adding: "We believe lower taxes are essential for a high growth economy, so we do want to bring down the tax burden, but we will only do so responsibly."
Mr Hunt indicated the focus during Wednesday's speech would be on business, calling it "an Autumn Statement for growth... to turn a corner" on the economy.
"If we are going to embrace those opportunities we need to remove the barriers that stop businesses growing and that's why this autumn statement will be focused on growth," he said.
But pushed on whether there would be changes to either National Insurance or income tax, he hinted at a longer wait, saying: "If you want to bring down personal taxes the only way to do that sustainably is to spend public money more efficiently… Rome wasn't built in a day, these things take time."
Sky News understands multiple meetings are taking place this weekend between Mr Hunt and Mr Sunak to finalise the details ahead of Wednesday's announcements.
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Interest Rates
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A number of Friday's papers lead with new figures showing that net migration to the UK stood at 606,000 and hit a record high in 2022.
In its headline, the Daily Mirror says the government's approach to immigration can be summarised as "no control, no compassion". It quotes one opposition MP who says ministers have created a "climate of intolerance amid utter incompetence". The Daily Express says the prime minister has sent an unequivocal message to its readers that his government "must and will" cut the number of people moving to UK.
The Guardian reports that leaked documents show the government has drawn up plans to deport more than 3,000 asylum seekers every month from January under the provisions of the Illegal Migration Bill, which is currently making its way through parliament. The paper says ministers could face "crippling legal action" if they pursue the plans and calls the document the "first detailed glimpse of the scale of the task facing Whitehall if it is to implement" the bill.
A call to cut the number of foreign students being offered places at UK universities is the focus for the Metro. The paper quotes immigration minister Robert Jenrick, who speaking in the House of Commons on Thursday said it "isn't right that universities in some cases are in the immigration business rather than the teaching and education one".
The i says the migration figures mean that the UK population is on course to overtake that of France for the first time. And the Daily Telegraph cartoonist Matt has drawn two people in the Home Office saying: "We have a plan to slow down immigration. We're going to ask Border Staff to go on strike again."
The Dpaper also reports that data published this week showing inflation remains high has thrown bond markets "into chaos" and pushed Britain's borrowing costs to the highest in the G7 for the first time since the 2007 crash. The paper says Nationwide, Lloyds, Virgin Money and Halifax all increased their mortgage rates in response, and quotes the chief investment officer of Legal & General - the country's largest asset manager - saying the company is not currently making long-term investments in the UK debt market because of a "lack of a clearer [economic] narrative".
GPs are to be offered financial incentives to recruit patients for medical trials as part of a £650m package intended to lure pharmaceutical giants to Britain, according to the Times. The paper says it comes after a fall in clinical testing as the NHS struggles with Covid backlogs, and that the country's £94bn life sciences industry is seen by the government as an "engine for growth in a sluggish economy".
And the Mail carries pictures of two protests carried out on Thursday. At the Chelsea Flower Show, environmental protesters from campaign group Just Stop Oil threw orange powder over one of the gardens, while on the King's Sandringham estate a group of animal rights activists took three lambs. The paper's headline asks: "Will anyone stop these eco-clowns?", while veteran Tory MP Peter Bone is quoted saying parliament may have to bring in stronger punishments to discourage such protests.
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Inflation
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⛏️ Startup Boston Metal Works on “Green” Steel 🏭
PLUS: Decentralized Gaming Made Possible with zkEVMs 🎮
Mornin’ miners⛏️,
Happy Wednesday!
Digger Insights is a daily 7-minute tech insight made fun and easy for a quick, advantageous read.
Let’s get to it!
Today’s Highlights:
Startup Boston Metal Works on “Green” Steel 🏭
Decentralized Gaming Made Possible with zkEVMs 🎮
The World Bank Invests on Startup Boston Metal Working on “Green” Steel
Being one of the backbones of construction, steel-making has been around since 1800 BC. The need for steel-making to keep going continues to grow, but it, unfortunately, keeps the earth dirty.
Conventional steel-making is powered by coal, which generates a significant amount of carbon dioxide emissions. This becomes a big issue in our more green-conscious world, and MIT-developed startup Boston Metal is trying to make a difference with its “green” steel.
Boston Metal
Boston Metal is a ten-year-old MIT spin-out startup formed in 2013. Aiming to fight climate change and reduce carbon emissions from its steel production, this 120-person company has raised a total of $250 million to make “green” steel possible.
According to the World Steel Association, steel-making contributes to about 7% to 9% of global carbon dioxide emissions. Boston Metal is currently building a technology that can be used to make clean steel possible and has the World Bank’s support.
Boston Metal has recently signed a $20 million funding deal with the International Finance Corporation (IFC), a private-sector investment arm of the World Bank. This startup has also gained support to make the world greener from investors like ArcelorMittal, Microsoft’s Climate Fund, and Bill Gates’s Breakthrough Energy Ventures.
What Are They Planning?
Leaving the blast furnace steel-making process behind, Boston Metal plans to use an electrochemical decarbonizing process called Molten Oxide Electrolysis (MOE). This process passes electricity through iron oxide mixed with a slew of other oxides.
Photo Courtesy of Boston Metal
The slew contains at least one oxygen atom, and if the electricity is clean, the steel that comes out of the electrolysis cell will be clean, too. Instead of emitting carbon dioxide, this technique will produce oxygen. Boston Metal is in the process of developing commercial-scale technology for this but is confident with its scientific process.
With conventional blast furnace technology, only the best quality iron ore can be used. Boston Metal’s tech will enable the usage of low-grade iron ore in steel production, giving plenty of iron ore-owning markets a chance to make their own steel.
What’s Next?
Although Boston Metal’s main goal is to generate green steel, it has come up with another program to help make the earth a little greener. Utilizing its electrolysis technology, Boston Metal plans to produce essential materials in the metal and electronics industry, which includes tin, niobium, and tantalum metals, using the waste collected from the mining process.
With hopes of raising $300 million in funds, Boston Metal will use one-third of its funding to commercialize this program in its Brazilian subsidiary. This metal-generation business is hoped to generate this company’s first revenue.
Boston Metal will use the rest of its funds to finalize the development of the steel-making process and its components, with plans to license and commercialize green steel in 2026. Boston Metal and IFC will distribute every profit they make for development goals reinvestment.
Boston Metal’s tech and confidence in its scientific process may prove to create a green future and an opportunity for professionals in developing markets. More companies will be able to build their own steel plant and production.
Zero-Knowledge EVMs are Key to Decentralized Gaming
The gaming industry is undeniably a monumental one. Popular web2 games, whether console or mobile, can be such a success by working alongside their in-game economies most of the time.
AAA games like Fortnite, Call of Duty, and Overwatch, enable players to purchase in-game customizations in the form of skins, accessories, frames, and more. In 2022, the skins market alone became a $50 billion industry.
What’s unpleasant about these purchases is that all the things gamers spend money on aren’t actually, truly, theirs. Most, if not all of the time, these virtual in-game assets cannot be transferred, sold, or traded. Funds only flow from gamers to developers and publishers, and that’s that. This irritating truth is what Web3 gaming aims to alter.
Web3 Gaming
There’s no doubt that game developers are always moving and creating. With the abundant amount of games coming out every year, developers have to be innovative and create something new to attract gamers. This notion has intrigued developers to open up to decentralized games and experiment with Web3.
Decentralized gaming invites gamers to truly enjoy and be part of the ecosystem where their digital assets lie, and not by using VR. Web3 gaming lets players transfer their digital assets between different games.
This may sound unfathomable, with there being a massive amount of in-game assets across the world. To make this possible, Web3 games have to possess the ability to process tens of thousands of transactions simultaneously, and it seems they can, with zero-knowledge EVMs.
Zero-Knowledge EVMs’ Utilization
Zero-knowledge technology involves digital protocols that allow two parties to share data with each other without associating any information with the transaction. With zero-knowledge Ethereum Virtual Machines (zkEVM), bundles of safe and secure transactions can be done on a global scale.
Using zkEVMs in the gaming industry gives players the ability to transfer between different games as well. All assets, avatars, and profiles can be moved across platforms and games. This gives gamers more access with just one or two clicks away, which seems impossible to achieve with traditional web2 games. In addition to that, gamers won’t feel so bad for spending money in just one place since assets are transferable.
Involving smart contracts in the gaming process can possibly unlock gameplay mechanics within the Ethereum ecosystem itself, and the items gamers own can be of actual value, turning them into tradeable and transferable NFTs.
Benefits for Developers
Enabling the trade and transfer of digital assets across games can perhaps be an opportunity for professionals in the business to create a certain game universe, setting themselves apart.
With there being a couple of games in one universe for players to transfer assets from one to another, they might be intrigued to try all of them out.
What you’ve read may sound too good to be true, but it is delightfully not. zkEVMS and all the web3 tools gaming studios need to create web3 games are already being developed by Immutable, and entrepreneurs interested in this industry can make the game of their dreams.
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Renewable Energy
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- The U.S. Department of Justice has brought criminal charges against Binance and its billionaire founder and CEO, Changpeng Zhao.
Binance chief Changpeng Zhao will plead guilty to criminal charges and step down as the company's CEO as part of a $4 billion settlement with the Department of Justice, according to court documents. The plea arrangement with the government resolves a multi-year investigation into the world's largest crypto exchange.
Zhao and others are charged with violating the Bank Secrecy Act by failing to implement an effective anti-money laundering program and for willfully violating U.S. economic sanctions "in a deliberate and calculated effort to profit from the U.S. market without implementing controls required by U.S. law," according to the Justice Department.
The charges follow civil suits brought earlier this year by both the Securities and Exchange Commission and the Commodity Futures Trading Commission.
Binance has been the center of intense regulatory scrutiny over how it operates, with officials in multiple jurisdictions flagging concerns with the company's gung-ho attitude to launching in certain markets even when it lacks the authority to do so, and allegations of involvement in illicit dealings such as money laundering and securities fraud.
The Securities and Exchange Commission targeted the company with an expansive lawsuit in June, alleging that Binance was running an illegal securities exchange and mishandling customer funds. The SEC hit rival exchange Coinbase with a similar lawsuit shortly after, alleging it is operating as an unauthorized securities exchange, broker and clearing agency. And just this week, the SEC sued Kraken, claiming that the exchange commingled $33 billion in customer crypto assets with its own company assets, creating the potential for a significant risk of loss to its users.
In the 13 charges brought against Binance by the SEC, the agency accused Binance of commingling billions of dollars in customer money with Binance's own funds, similar to allegations made against the now-bankrupt crypto exchange FTX. SEC Chair Gary Gensler added, "Zhao and Binance entities engaged in an extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law."
Started by Chinese-born entrepreneur in 2017, Binance went from a relatively obscure name to a major force in crypto in a matter of weeks. To this day, Binance remains the world's largest crypto exchange globally, processing billions of dollars in trading volume every year.The exchange took an aggressive approach to growth, rapidly expanding its reach globally often without gaining permission first.
While its holding company is based in the Cayman Islands, Binance doesn't have a single global headquarters and Zhao has frequently resisted calls to do so, saying he wants the platform to run on a "decentralized" operating model.
In 2021, the U.K.'s Financial Conduct Authority barred Binance's U.K. unit from operating in the country, saying it wasn't authorized to carry out regulated activities. More recently, Binance scrapped plans to pursue a full U.K. license after the regulator said its know-your-customer and anti-money laundering controls didn't meet its requirements.
In the CFTC's complaint, the regulator alleged that Binance, Zhao, and the company's ex-chief compliance officer, Samuel Lim, operated an "illegal" exchange, ran a "sham" compliance program, and allegedly violated the Commodity Exchange Act including laws "designed to prevent and detect money laundering and terrorism financing."
Binance and Zhao filed a motion in July to dismiss the CFTC's suit. The U.S. arm of the exchange is also pushing back on the SEC's lawsuit, filing a protective order against what they call the SEC's "fishing expedition."
Of particular concern for the crypto industry are the implications of the agency's crackdown on crypto for myriad tokens and blockchains — not just the exchanges. The SEC maintains that several of the tokens Binance and Coinbase offer on their platforms — such as Solana's sol, Cardano's ada, and Polygon's matic — are securities that should have been registered with the agency.
This is breaking news. Please check back for updates.
— CNBC's Kevin Breuninger contributed to this report.
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Crypto Trading & Speculation
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One lucky lotto winner grabbed a share of a massive £53,413 jackpot prize without paying a penny for the ticket.
Sarah Kendell walked away with a slice of the massive winnings and now looks set for her dream garden makeover.
The 47-year-old, from Waterlooville, Hampshire, had been trying for six years to try and bag some money through the Pick My Postcode lottery.
She had checked her numbers everyday in vain without winning until now when she realised she won £1,263.85 in the draw.
Over the moon, she now plans to redo her garden. She also bagged an extra £63.85 worth of bonuses.
Pick My Postcode is an online lotto which is entirely free for member players as it is funded by market research and advert revenue and market research, making it completely free for members.
The bonus builds up every time you visit the site and Sarah, who checked her numbers daily, had built up quite the total.
But Sarah didn’t fork out a penny for her winning ticket as the online lottery draw is funded by ad revenue and market research, making it free for members.
The biggest ever winner of the prize was mum-of-three Diane, from Shepton Mallet.
She pocketed a cool £3,345 in the Stackpot draw and now plans to buy her family home new windows.
She told the Somerset County Gazette: “I would have loved to have donated my winnings to one or more local charities but unfortunately, in the current economic climate I would like to keep some money for myself and my grown-up family, three beautiful adult daughters.
“However, as things stand, a chunk will be put towards my necessary new windows, some will go to my daughters and I will support two local charities.
“If there is any left, I might consider turning the central heating above 15C for a week or two in the depths of the coming winter.”
Meanwhile in Nottingham, Sylvia Ross, another lucky winner, raked in £814.02 and the 60-year-old used the winnings to cover Christmas and household bills.
The Sun reported she said: "I was in total shock when my postcode came up, couldn’t quite take it in. But very pleased when it did finally sink in.
"Winning this money will help with Christmas and paying general bills. To everyone else, I would just say keep checking because the next draw could be you."
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Consumer & Retail
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Years of family handouts are finally starting to weigh on the Bank of Mum and Dad, as couples grapple with the reality that their retirement plans won’t be as cushy as they had hoped.
Robert Crowley, 75, and his wife gifted hundreds of thousands of pounds to not one, but two, younger Crowley generations over the years.
The couple is just one of millions of Bank of Mum and Dads who informally transfer a collective £14bn each year to their successors, according to the Institute for Fiscal Studies.
But years of generous handouts have left the pair, who expect to live well into their 80s, fearing they won’t have enough cash to cover their costs and care in retirement.
Dean Butler, managing director at Standard Life, said the rising cost of living has only increased younger people’s dependence on the “Bank of Mum and Dad”, and that the later life impact for parents won’t go unnoticed.
“The consequences for parents and grandparents in retirement could be considerable – people in their late 50s and early 60s might be faced with a choice between a less desirable standard of living or working longer,” he said.
The Crowleys have three children in their 40s, as well as three grandchildren – two have just graduated while the youngest is 11 and still attends an £18,000-a-year school.
They say “eye-watering” private school fees, 25pc house deposits and the facilitation of rent-free living have significantly eaten into their readily available reserves.
“Now, we have no accessible cash to spend on my wife’s passion, travelling. We’re asset rich, but cash poor. How do we move on?”
The couple, who live in Colchester, Essex, converted their house into a care home back in the early 1980s following the financial meltdown of their haulage business.
In the 1990s, their then teenagers moved to North London for university so they decided to buy a three-bed property in Wood Green to save them paying rent.
“It was an extremely viable alternative to a rental flat in Highgate, our previous choice for Tube access. But the rent was extortionate.”
A decade later, Mr Crowley and his wife sold the care home and retired with a comfortable profit. The original property cost £19,000, and a lot of extensions later they sold it to a local operator for £2m.
They invested this into annuities, a top slice bond and some more buy-to-lets. They then moved into a bungalow which they converted into another care home and live in today.
Mr Crowley said: “We haven’t really moved on from that situation financially since. In the words of a certain chancellor, ‘there is no money left’ in the Bank of Mum and Dad.”
The couple are now having to cut back in retirement.
First up for the chop will have to be Mrs Crowley’s trips across the Indian Ocean, and Mr Crowley’s few hours here or there behind the wheels of old antique cars – one of his favourite pastimes, alongside his 60-year-old-strong love for Tottenham Hotspur.
“My wife likes travelling, I like cars. But we have to stop it. It’s time to think about it seriously and cut down on what’s going out. ”
The two are trying to raise capital to keep running the house, which they are reluctant to sell in part because it feels too late to downsize, and in part because it would mean booting out long-serving, loyal tenants.
They built their house from scratch, and surrounding it are a number of rental homes they have been letting out to the same tenants – and staff of the care home – for the past decade.
Mr Crowley says his wife thinks they should be able to sell the rented houses, but he is reluctant to deprive people of their homes in the current financial climate.
The house has also served as a good stomping ground for their grandchildren. “There’s no way that current generations could survive without child minding. You have to have somebody reliable. If grandparents didn’t exist, the modern generation couldn’t exist.
“We were the golden generation and everybody knows that. We went to university for nothing. It’s a different world now.”
There are signs that the Bank of Mum and Dad is starting to dry up across the country.
Canada Life told The Telegraph it has noticed “a small, but noticeable decline” in the number of instances where parents have released equity from their homes in order to gift cash to family members.
Last year, this reason accounted for 11pc of all lifetime loans it issued, down from 13pc in 2021, and down from 15pc in 2020.
Some parents are already worrying that gifting now will leave them worse off in the future.
Wealth manager M&G surveyed 2,000 adults and found over a fifth (22pc) were concerned they might regret gifting if they need it themselves in years to come.
M&G also found that gifting to support the cost of university has risen, as students wrestle with fees, the increasing cost of utility bills and student accommodation.
The survey showed gifting to help with school and university fees has risen from 19pc to 23pc year-on-year.
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Real Estate & Housing
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I am in a quandary about how to invest $750,000 that’s in my 401(k). I’m 67 years old, retired and I have not started taking Social Security yet. What is the best way to preserve this money for the rest of my life that doesn’t have high fees?
-Terry
As you know, the big challenge in your situation is choosing from the many investment options that are at your disposal given your 401(k) asset base and desire to remain fee-conscious. Of course, the optimal solution ultimately depends on your personal situation and goals in retirement, and possibly beyond. We will begin by outlining a framework you can follow to evaluate your current situation and then share some considerations to inform your actions. (And if you need more help with your finances in retirement, consider speaking to a financial advisor.)
Assess Your Personal Situation and Goals
Before you select an investment strategy, it is imperative that you have a complete understanding of your personal situation and goals for retirement. Knowing that you want to preserve the assets for the remainder of your life is a helpful start. But go a few steps deeper by asking yourself these questions:
Do you anticipate any significant purchases, such as a second home?
What type of lifestyle do you want to live in retirement and how much will it cost annually to maintain this lifestyle?
Beyond Social Security and your 401(k), do you have any other assets (brokerage accounts, IRAs, etc.) that can further support your retirement and provide additional income streams?
Do you have any large, ongoing medical expenses that could require you to draw from the funds?
Do you want to preserve these funds for even longer than your own lifetime, perhaps to pass them on to heirs?
There are many other questions you could ask yourself. However, the important point is that in answering questions such as these, you should be able to gain a better understanding of how the capital should be invested to support your needs and goals while preserving the funds throughout your retirement. (And if you need help assessing your personal situation or setting goals, a financial advisor can help.)
Consider Asset Location, Not Just Asset Allocation
In evaluating the costs of investing, you may find that asset location is just as important as asset allocation. “Asset location” refers to the account that your money is actually sitting in. Since the $750,000 that you’re asking about is currently in a 401(k), you’d want to first review the particulars of your plan. Does your plan give you the option of taking partial withdrawals, allowing you to use your savings as needed, or does it limit your withdrawal options to required minimum distributions (RMDs) and lump sums? If you’re not sure, refer to your plan’s summary plan description or reach out to the plan administrator.
If your plan does not allow partial withdrawals, your options are to roll the money into an IRA, convert it to a Roth IRA or withdraw the money outright. Please remember that the Roth IRA and outright withdrawal will be taxable events, but the rollover to an IRA is not taxable.
If your plan allows you to take partial withdrawals, you may want to evaluate whether to leave your assets there.
The positives of leaving assets in the 401(k) after retirement may be that you have lower-cost investment options than are typically available to retail investors. Some of these options may include target date funds, annuity contracts with pre-negotiated fees and institutional pricing on mutual funds. Furthermore, if your former employer works with a competent investment consultant who was specifically hired to advise the company on the plan’s investment lineup, the menu of options will be limited to a few closely monitored options that are believed to be the best-in-class based on factors such as fund manager tenure, returns, risk and investment expenses.
The advantages of moving your assets out of the 401(k) may be to consolidate your funds with other retirement savings, access a broader range of investment options than the plan offers and avoid administrative account fees that may or may not apply to you. (And if you need help with your plan for retirement, consider matching with a financial advisor.)
Consider the Risks You Face
A prudent approach to investing for and through retirement is to prioritize proper risk management. Your stated desire to preserve your money for the rest of your life succinctly identified the most common broad risks that retirees such as yourself will need to balance: longevity risk and investment risk.
Longevity risk is the risk that you will outlive your money. With Americans living longer and with inflation being an ever-present threat to the dollar’s purchasing power, this is an unfortunate reality many will face. Allocating some of your portfolio to equities will be your best defense against longevity risk. Many retirement-age investors shy away from equities, nervous about short-term market swings. However, the truth is that retirement is a long time (think 19 to 30+ years). Your equity allocation has a long time horizon to withstand short-term market fluctuations in favor of long-term growth.
Investment risk is the risk that your investments will lose value. As we just mentioned, you will want to have some allocation toward equities, but you’ll also want to include fixed-income investments, including bonds and cash equivalents that have characteristics of price stability and relative safety of principal. Today’s higher interest rate environment has even made modest investment income realistic from some of the safest fixed-income vehicles such as Treasurys, money market funds and certificates of deposit (CDs). (And if you need help picking the right mix of investments, let a financial advisor guide you through the process.)
How to Manage Risk
In order to further minimize disproportionate exposure to other types of risk such as interest rate risk, credit risk, exchange rate risk, market risk and business risk to name a few, you’ll want to diversify within your equity and fixed income allocations.
My suggestion here would be to utilize pooled investment vehicles such as mutual funds or exchange-traded funds (ETFs) which give you the ability to hold large baskets of underlying investments. Mutual funds and ETFs are generally available as either index (passive) strategies or as active strategies.
The index options will give you exposure to large segments of financial markets at a low cost. An S&P 500 index fund, for example, is a popular type of equity index fund. Active funds strive to beat their respective indices by seeking better investment returns and/or better managing downside risk. Of course, the active funds generally have higher expenses than index alternatives, and you as the investor will have to decide whether the additional expense justifies the active approach.
Finally, you will need to adjust your asset allocation to align with the risk/return profile you deem most appropriate given your personal situation and goals. Remember, more equity generally means more risk of investment loss, but without at least some, you run into greater longevity risk. (A financial advisor can help you navigate the various risks you’ll potentially face in retirement.)
Bottom Line
There is unfortunately no one-size-fits-all approach to investing with an eye towards capital preservation and cost minimization. However, there are many options to consider. The optimal solution will depend on your unique situation and goals for retirement, as these inform your risk tolerance and return requirements. Once you understand these components, it will be easier to decide where and how to invest your hard-earned savings.
Tips for Finding a Financial Advisor
Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have free introductory calls with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
When talking with prospective financial advisors, it’s important to ask the right questions. As you consider your options, these are the questions you should ask an advisor to ensure you make the right choice.
Loraine Montanye, CFP®, AIF® is a SmartAsset financial planning columnist and answers reader questions on personal finance topics. Got a question you’d like answered? Email AskAnAdvisor@smartasset.com and your question may be answered in a future column.
Loraine is a senior retirement plan advisor at DBR & CO. She has been compensated for this article. Additional resources from the author can be found at dbroot.com.
Photo credit: ©iStock.com/simonkr, ©iStock.com/tdub303
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Personal Finance & Financial Education
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An image from security camera footage shows alleged thieves breaking into a P.C. Richard & Son appliance store in Philadelphia in late September.
Philadelphia Police Department
The dramatic video footage often appears on TV news and social media: A large group of people storm into a store, smashing display cases and snatching loose merchandise before escaping in minutes before the police have had time to respond.
Authorities say these so-called "flash mob" thefts are sometimes organized on social media and often target high-end goods that can be resold. The thieves occasionally use violence to carry out their crimes and aren't hampered by traditional techniques to prevent shoplifting, such as security tags and alarms.
California has seen a number of large-scale smash-and-grabs in recent months. Last month in Philadelphia, thieves looted stores across the city over the course of several nights, with prosecutors charging more than 70 people.
It's unclear from the data whether these specific incidents are actually on the rise, but retailers, law enforcement authorities and elected officials are raising the alarm about a trend they say is worsening across the U.S.
"First and foremost, these are very traumatic events. They also have the biggest potential for violence," said David Johnston, vice president for asset protection and retail operations at the National Retail Federation.
"The disruption to the consumer and the disruption to the retailer is [also] much greater, because the store has to close, the store has to repair, merchandise has to be replenished," he added.
Combating "flash mob" thefts is a challenge, but retailers are trying
People steal goods from stores in a number of ways, from simple shoplifting to organized retail crime, in which coordinated groups boost merchandise to resell on the black market.
Another category — "flash mob" thefts or smash-and-grabs — can prove especially tricky to stop.
The thieves strike in such large numbers that an individual store employee or security guard may not intervene. Thefts occur so quickly that they're usually over before law enforcement arrives. And the perpetrators, who aren't hiding the fact that they're committing a crime, are typically unbothered by security alarms and other traditional anti-theft measures.
"Whether there's an increase [in "flash mob" thefts] or not, retailers are becoming much more aware of it, and especially those in higher-risk locations," said Drew Neckar, president of Security Advisors Consulting Group.
Companies have resorted to new strategies to try to reduce their chances of being targeted by a flash mob and stop the crimes once they begin.
They're hiring more security officers, locking up merchandise including everyday essentials like pain medicine and baby formula and reverting to early pandemic-era strategies of reducing the amount of access points and limiting the number of customers allowed in at once, Johnston said.
Some northern California retailers have sought out smoke bombs and air horns to repel crowds of thieves, LAist reported. In 2021, Home Depot rearranged its entrances to help prevent theft, adding gates that only allowed traffic to flow in one direction, The Wall Street Journal found.
Neckar says other strategies stores can adopt include shining bright lights at the entrance so employees can see when a group is arriving, installing lockable doors with break-resistant glass and displaying high-value merchandise in different parts of a store to make it harder for thieves to grab in a hurry.
Incidents may feel like they're on the rise, but it's an open question
Still, it's unclear if the seemingly common "flash mob" thefts are actually increasing — or if they're simply getting more attention in the press and on social media.
Depending on the jurisdiction and the circumstances of a specific incident, people arrested for participating in "flash mob" thefts can face different charges — from burglary to disorderly conduct and others — making it hard to show a trend. Many cities also don't report their crime data to the FBI's national database.
According to UC Berkeley law professor Jonathan Simon, images of the large-group thefts can provoke a strong reaction from the public, whether the numbers are up or not.
"These things are really powerful events in terms of their grasp on our imagination," he said.
"You don't have to be a Hollywood screenwriter to figure out that that would be a really alarming scenario in terms of the kinds of things that in our culture we fear — young people, groups, masked and disguised people," Simon added.
While the National Retail Federation doesn't specifically track "flash mob" thefts, the group says all forms of theft are up.
Businesses worry it's part of a trend of rising thefts
An NRF survey released last month estimated that "shrink" — the term for losses in the retail sector — amounted to $112.1 billion in 2022, up nearly 20% from the year before.
External theft — which includes things like "flash mob" thefts, shoplifting and organized retail crime — accounted for 36% of losses. Twenty-nine percent of losses occurred due to employee theft, while another 27% was due to things like cashier errors and incorrect pricing.
According to Johnston of the National Retail Federation, the increase in thefts comes alongside an even more worrying trend: an uptick in violence in retail settings.
"This has truly, truly become a safety issue out there," he said. "I hear time and time again from the retailers that even though there is a financial impact to the retailers' profitability, hands down they're talking about the safety."
Target announced last month that it was closing nine stores in four states, because theft had become a safety issue. But in January, Walgreens Chief Financial Officer James Kehoe said "maybe we cried too much last year" about a rise in thefts, noting the company responded by adding too much security.
Nevertheless, elected officials have responded to complaints about growing retail crime.
California law enforcement officials announced last month that they would spend $267 million to tamp down on smash-and-grabs, and Los Angeles Mayor Karen Bass recently launched a task force targeting organized retail theft.
A federal law that took effect in June, called the INFORM Consumers Act, addresses the problem in another way, by requiring online marketplaces like Facebook Marketplace and eBay to verify the identities of high-volume sellers.
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Consumer & Retail
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RBI's Returns From Investments Set To Jump By $6-8 Billion In FY24
For the week to July 7, the forex reserves rose by $1.23 billion to $596.3 billion.
The globally elevated interest rates are set to buoy the returns from the Reserve Bank's foreign investments to the tune of $6-8 billion this fiscal, which will help the monetary authority pay higher dividend to the government and also buffer up the forex reserves a la the FY21 fashion, says an overseas brokerage report.
Traditionally the RBI parks more than 70% of the assets overseas, mostly in the U.S. treasury bill, where the interest rates have been on northward ho for a long now. Similar is the case in the EU and elsewhere along with the domestic rates.
For the week to July 7, the forex reserves rose by $1.23 billion to $596.3 billion, but still vastly down from the $645 billion peak in October 2021.
The reserves have been declining as RBI deploys the kitty to defend the rupee amid pressures caused majorly by global developments. Of the total, the major component of foreign currency assets increased by $989 million to $528.97 billion.
The RBI returns have typically been higher on domestic assets due to yield differentials. But now both foreign as well as domestic assets should now be generating higher returns, with the gap between domestic and foreign interest rates shrinking, says Rahul Bajoria of Barclays Securities.
In FY20 the RBI balance sheet was Rs 53,34,792 crore or 5.50% of current revaluation balance and made a provisioning of Rs 73,615 crore and yet transferred Rs 57,128 crore to the government in dividend/surplus transfer.
The numbers stood at Rs 57,07,669 crore and 5.50% and Rs 20,710 crore and Rs 99,122 crore respectively in FY21 and at Rs 61,90,303 crore 5.50 per cent and Rs 1,14,667 crore and Rs 30,307 crore respectively in FY22 and at Rs 63,44,756 crore 6 per cent, Rs 1,30,876 crore and Rs 87,416 crore in FY23.
He further says additionally, the current account position should also see a boost through the primary income channel. Indeed, net primary income from reserve assets nearly doubled from Q3 of 2022 to Q1 of 2023 and since 1 bps increase in returns adds $3-4 billion in income, the incremental increase can be to the tune of $6-8 billion for FY24, which should put a lid on the widening in the primary income deficit.
Another enabler is the health of the domestic banking sector which has improved significantly since the asset quality review taking the gross NPA ratio to 3.9% in FY23, a 10-year low, and down from a peak of 11.2 per cent in FY18.
Another is the FY23 contingency risk buffer of the RBI at 6 per cent is much higher compared with the GNPA ratio, which implies it can be reduced without endangering financial system safety.
On the back of improving external conditions, the RBI's balance sheet expanded to the tune of 8% in the past eight months, led by revaluation gains as the central bank bought back dollars. Most of this gain has come from foreign assets, with domestic assets contracting over the same period.
And the RBI balance sheet is expected to grow by 1 per cent in FY24 and by 7% in FY25, he said, adding however the monetary authority will have to keep the dollar-rupee level above 78.9 by end of FY24 to maintain both the contingency and revaluation buffer requirements under the prevailing economic capital framework, based on the size of the balance sheet. And in a similar fashion, the currency rate will have to be maintained above 80.6 by the end of FY25.
The ECF is up for its maiden review in FY25 after its introduction in FY18 as proposed by the Bimal Jalan committee, which had set the RBI's contingency buffer norms at 5.5-6.5%.
In FY23, for the first time since the ECF came into effect, the RBI increased the contingency risk buffer to 6%, from the minimum 5.5% stipulated in the ECF. Given its large balance sheet size, a 6% buffer implies that the absolute amount of realised equity RBI will need to put aside in FY23 was Rs 3.8 lakh crore.
The present CRB value of Rs 3.8 lakh crore means that an expansion of the balance sheet up to Rs 5,700 crore in FY24 will need no new realised equity to be put aside to meet the minimum CRB norm of 5.5% of balance sheet under the ECF.
Similarly, RBI ended FY23 with a revaluation buffer of 17.8%, well above the 15.3% minimum requirement. The current revaluation balances mean, that all else equal, even at an exchange rate of 79.13 at FY23 close, the ECF conditions would have been met, relative to the actual end-FY23 rate of 82.2 to the dollar.
The above indicates that the RBI started FY24 with higher levels than needed for both buffers. This reduces the potential need for any large capital injections for now and also most likely for next year, if its balance sheet were to grow rapidly while its profitability fell. This will seem an unlikely scenario at the moment, given the likely increase in income from the RBI's assets.
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Banking & Finance
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Prime Minister Rishi Sunak has told the BBC he wanted to cut taxes but declined to say whether he would before the next general election.
Mr Sunak said his priority was easing living costs, as he faced calls to slash taxes on the first day the Conservative Party conference.
There is unrest among Tory MPs over tax and HS2 as they gather in Manchester.
And Cabinet Minister Michael Gove has told Sky News he would like to see taxes reduced before the next election.
This week, the Institute for Fiscal Studies (IFS) said tax levels in the UK were at their highest since records began 70 years ago - and were unlikely to come down soon.
In the days leading up to the conference, there have been calls for tax cuts from some Tory MPs, including former Prime Minister Liz Truss and her allies.
But Chancellor Jeremy Hunt - who will set out his economic plans in his Autumn Statement in November - said last week that tax cuts were "virtually impossible" at present.
In an interview with the BBC's Sunday with Laura Kuenssberg, Mr Sunak was asked three times whether he would commit to lowering taxes before the next election, which is expected next year.
Mr Sunak - at his first conference as party leader - said as a Conservative, he wanted to cut taxes, but gave no detail on when he would do so.
The prime minister said he thought halving inflation by the end of this year, which is one of his five pledges for government, was the "best tax cut" he could deliver.
Inflation - the rate at which prices are rising - was 10.7% in the three-month period between October and December 2022, which means the government aims to reduce inflation to 5.3%.
In August, the inflation rate was 6.7%.
Curbing inflation, Mr Sunak said, was his biggest priority.
"Change may be difficult, but I believe the country wants change and I'm going to do things differently to bring about that change," he said.
The government has limited tools to reduce inflation. The Bank of England says raising interest rates, which it controls, is the best way to make sure inflation comes down.
On the eve of the conference, the boss of Iceland supermarkets, Richard Walker, announced he was quitting the Conservative Party and accused the Tories of being "out of touch".
But facing questions about discontent within his party over tax, green policies and the future of the HS2 rail line, Mr Sunak rejected claims the Tories were "drifting out of touch" with voters, as his party trails Labour in the polls.
The prime minister told Laura Kuenssberg that Mr Walker had talked about net zero and prioritising working people, adding: "Change may be uncomfortable for people. People may be critical of it, but I believe on doing the right thing for the country.
"I'm not going to shy away from that."
He declined to comment on speculation about the government potentially scrapping the Birmingham-to-Manchester leg of HS2, following suggestions the cost of the project could exceed £100bn.
Mr Sunak said his focus was on "long-term things that make people's lives better".
Labour and some Tory MPs have said scaling back HS2 would be a mistake, with two former Conservative prime ministers - Theresa May and Boris Johnson - among them.
Until recently, Mr Sunak had played it pretty safe since becoming Conservative leader and prime minister a year ago this month.
He took over from Mr Truss in October last year without one vote being cast by Tory members in a leadership content, or voters in a general election.
In the interview, Laura Kuenssberg asked Mr Sunak if he was relaxed with holding office without anyone voting for the changes he had made.
"Yes, because I'm doing what I believe is right," Mr Sunak.
Mr Sunak appears be leaning into controversial decisions.
After almost a year of prioritising calm - both economic and political - the prime minister has moved on to a new period where he is doing more to set out his vision for the future.
Last month, he watered down green policies designed to reduce planet-warming carbon emissions to net zero by 2050, and in recent days, has touted measures to help motorists.
Some opinion polls have showed a modest Conservative recovery, but the party still lags far behind Labour.
"The mood among Conservative MPs is really bleak," one Conservative backbencher who had reluctantly travelled up to Manchester for their party conference told the BBC. "Most of us can see the polls and realise we are doomed."
It was clear from this morning's interview that Mr Sunak does not agree.
At times, the interview was spiky, with Mr Sunak staunchly defending controversial decisions on net zero and motorists, and repeatedly talking up himself as a "change" prime minister.
Expect more of that at his party's conference this week: attempts to draw clear dividing lines with Labour and spell out more of what Mr Sunak would do with a full term as prime minister.
Each of those new policies is also an attempt to prove wrong fatalistic Conservative MPs who think the election result is already a done deal.
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Inflation
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RBI Clears Resolution Plan For Debt-Ridden Reliance Capital
The move paves the way for IndusInd International Holdings Ltd., the Hinduja Group firm, to acquire the company.
The Reserve Bank on Friday approved the resolution plan for debt-ridden Reliance Capital.
The move paves the way for IndusInd International Holdings Ltd., the Hinduja Group firm, to acquire the company.
This is to inform you that the Administrator of Reliance Capital Ltd. is in receipt of "no objection" vide letter dated Nov. 17, 2023, from the Reserve Bank of India, the company said in a regulatory filing.
IIHL had emerged as the highest bidder with an offer of Rs 9,650 crore to take over debt-ridden Reliance Capital in the second round of auction concluded in April.
The Reserve Bank of India (RBI) on Nov. 29, 2021, superseded the board of Reliance Capital in view of payment defaults and serious governance issues.
The RBI appointed Nageswara Rao Y as the administrator in relation to the Corporate Insolvency Resolution Process (CIRP) of the firm.
Reliance Capital is the third large non-banking financial company (NBFC) against which the central bank has initiated bankruptcy proceedings under the Insolvency and Bankruptcy Code (IBC). The other two were SERI Group NBFC and Dewan Housing Finance Corporation (DHFL).
The central bank subsequently filed an application for initiation of CIRP against the company at the Mumbai bench of the National Company Law Tribunal.
In February last year, the RBI-appointed administrator invited expressions of interest for the sale of Reliance Capital.
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Banking & Finance
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Arrowhead Seperation Engineering IPO Allotment: Where And How To Check
Arrowhead Seperation Engineering IPO was subscribed 94.79 times on the final day of its subscription.
Arrowhead Separation Engineering recently concluded its Initial Public Offering (IPO), where investors had the opportunity to subscribe to new shares. The IPO, which began on November 16, and closed on November 20, garnered significant interest from both retail and other investors. On the final day of subscription, the offering witnessed robust demand, with the total subscription reaching 94.79 times the available shares. This reflects a strong vote of confidence from the investors in Arrowhead Separation Engineering. The IPO, with a fixed price issue of Rs 13.00 crores, is set to list on BSE SME.
Arrowhead Seperation Engineering IPO Allotment Date:
The allotment of shares for Arrowhead Seperation Engineering Limited is expected to be finalised on Thursday, November 23.
*This is a tentative date and is subject to change.
Arrowhead Seperation Engineering IPO Listing Date:
Shares of Arrowhead Seperation Engineering Limited will be listed on BSE SME on Wednesday, November 29.
*This is a tentative date and is subject to change.
Where to check Arrowhead Seperation Engineering IPO allotment status?
Investors can easily check the allotment status on the official registrar website of Cameo Corporate Services Limited.
How to check Arrowhead Seperation Engineering IPO allotment status on Cameo Corporate Services Limited?
Visit the Cameo Corporate Services Limited IPO website: https://ipo.cameoindia.com/
Select "Arrowhead Seperation Engineering Limited" from the drop-down list on the IPO Allotment Status page.
Choose one of the options: PAN number, DP Client ID, or Application Number, and enter the respective number in the provided field.
Fill in the captcha code as shown.
Click on the "Submit" button.
Your IPO allotment status will be displayed on the screen.
How to check Arrowhead Seperation Engineering IPO allotment status on BSE Website?
Go to the official BSE website: https://www.bseindia.com/investors/appli_check.aspx
Select the issue type as 'Equity.'
Choose "Arrowhead Seperation Engineering Limited" from the dropdown menu.
Enter your application number or PAN (Permanent Account Number).
Complete the 'Captcha' for verification.
Click on the "Search" button to view your allotment status.
Download or print the allotment status for your records.
Arrowhead Seperation Engineering IPO Timeline (Tentative Schedule):
IPO Open Date: Thursday, November 16
IPO Close Date: Monday, November 20
Basis of Allotment: Thursday, November 23
Initiation of Refunds: Friday, November 24
Credit of Shares to Demat: Tuesday, November 28
Listing Date: Wednesday, November 29
Arrowhead Seperation Engineering IPO Issue Details:
Total Issue Size: 558,000 shares
Face Value: Rs 10 per share
Fresh Issue Size: 558,000 shares
Shares for Fresh Issue: 558,000 shares
Price Band: Rs 233 per share
Lot Size: 600 Shares
About Arrowhead Seperation Engineering Limited:
Arrowhead Separation Engineering Limited, established in 1991, specializes in making, trading, and exporting various dryers like Vacuum Double Drum Dryer, Rotary Dryers, Single Drum Dryer, Paddle Dryer, and more. Their main goal is to satisfy customers by delivering top-notch products. The company values ethical business practices and transparency in all transactions, aiming to foster strong customer relationships. Currently employing 54 people as of June 2023, they also hire industry professionals for specific projects. The company's strengths include tailored products for each client, skilled Executive Directors, and a diverse range of high-quality offerings.
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Stocks Trading & Speculation
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A multibillion-pound investment plan which promises to create more than 12,000 new jobs in the UK is expected to be announced by the prime minister on Monday.
Rishi Sunak will be joined by some of the world's biggest business leaders and investors at a summit at Hampton Court Palace, London.
The prime minister will say investment of £29.6bn is a step forward in the government's ambition to level up parts of Britain and will secure projects in tech, life sciences, housing and renewable energy.
It comes as Chancellor Jeremy Hunt unveiled around £20bn of business and personal tax cuts in the government's autumn statement last week, which he dubbed a "statement for growth".
Mr Sunak said: "Today's investments, worth more than £29bn, will create thousands of new jobs and are a huge vote of confidence in the future of the UK economy.
"Attracting global investment is at the heart of my plan for growing the economy. With new funding pouring into key industries like clean energy, life sciences and advanced technology, inward investment is creating high-quality new jobs and driving growth right across the country."
But there are still stark warnings from the UK's independent spending watchdog that the country is still poised to face the highest tax burden since the Second World War.
And Britons are still on track to see a further fall in living standards, the Office for Budget Responsibility has warned.
Business and Trade Secretary Kemi Badenoch said: "Today is yet another huge vote of confidence in our dynamic, pro-business and highly innovative economy and proves that our plan for growth is working."
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But Labour said the government's investment policy had been a "total failure".
Jonathan Reynolds, Labour's Shadow Business and Trade Secretary, responding to the government's announcement on the Global Investment Summit, said: "The past 13 years of Conservative government been a total failure on growth and business investment marked by a complete lack of stability, consistency and ambition which has turned potential investors away from Britain.
"Only Labour has the plans to create the step change needed, working in partnership with business and investors, through our Industrial Strategy, Green Prosperity Plan and commitment to get Britain building again."
Economic activity returned to expansion in November as an improvement in the services sector helped lift the UK economy, but experts warned recession remained a real possibility.
The pause in interest rate hikes, which have been left on hold for two consecutive meetings, offered some relief to firms.
Mr Sunak earlier hailed Nissan's decision to invest more than £1bn to build electric cars in Sunderland as a "massive vote of confidence" in Britain.
The Japanese carmaker confirmed it will make its latest electric Qashqai and Juke models at its factory in the North East alongside the next generation of the electric Leaf, which is already produced there.
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United Kingdom Business & Economics
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FTX seems to be the story that keeps on giving as more and more information gets revealed following the downfall of what was one of the world’s largest crypto empires.
Now, a new report indicates that a number of cryptocurrencies that were traded by Alameda Research saw their price pumped by bots.
An Army of Bots Pumping Crypto Prices
Outlined in a report from the Network Contagion Research Institute (NCRI) and reported by Forbes, researchers found out that an army of Twitter bots was pumping prices of numerous cryptocurrencies.
The bots were supposedly used to help pump the price of numerous coins traded by insiders at Alameda Research, Forbes reports. Recall that this is the hedge fund and the sister firm of Sam Bankman-Fried’s former crypto empire – FTX.
The researchers pointed out that following promotional tweets by the official account of FTX, the activity for the coins grew massively inauthentic over time – speaking of 18 different cryptocurrencies.
It’s worth noting that this study didn’t link FTX or Alameda directly as being the operators or in any way responsible for the bot accounts.
Recall that FTX turned out to be a massively mismanaged operation that failed to honor the withdrawal requests of users and revealed a multi-billion hole in its balance sheet.
Which Coins Were Pumped?
BOBA, GALA, IMX, RNDR, and SPELL are some of the tokens that saw a tremendous increase in social chatter, according to the report.
Fake tweets regarding these coins increase tremendously – in some cases by more than 30% – after the official listing on the FTX trading platform.
Per the report:
The pattern of account creations and bot-like activities paints a picture of an orchestrated effort, possibly aiming to artificially manipulate market sentiment and trading behavior around these tokens.
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Crypto Trading & Speculation
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As enrollment in the Affordable Care Act reaches a record high this year, more Americans need doctors — but getting an appointment can be hard.
Nevada ranked 48th in the nation for the availability of primary care doctors, as cited in a July 2023 study by the University of Nevada, Las Vegas (UNLV), with all 17 counties in the state facing doctor shortages.
Kenny Do is a second-year medical student at UNLV, born and raised in Las Vegas.
He wants to complete his residency in his hometown, but there’s no guarantee that will happen.
"Although we do have a lot of medical schools here in the state, we do not have enough residency positions," Do told Fox News.
"So in the end, a lot of times, we go to school here, and we end up doing residency elsewhere. And as a result, a lot of these physicians stay where they do residency."
In addition to facing a lack of available residency positions, many primary care doctors earn less than specialists.
"A lot of students finish med school with a lot of debt," Do noted.
"Salary is a consideration for a lot of them, too … Primary care physicians are typically paid less than the average specialist, so that is maybe one factor [as to] why you see students being reluctant to choose primary care."
Nevada is having a hard time not only recruiting doctors, but also retaining them.
"Most of our physicians are over 50, and many of them are approaching retirement age," said University Medical Center CEO Mason Van Houweling in Las Vegas.
"So, you [have] physician burnout and then also the backlog of supply and demand."
A shortage of primary care doctors has put a strain on patients and the medical community, Van Houweling told Fox News.
"Patients seek out care in the emergency rooms, which is kind of the last place you want to seek out primary care," he noted.
"They miss out on preventative health and medications that they need."
UMC is aiming to fill the primary care gap by having nurse practitioners and physician assistants care for patients.
Van Houweling and Do agree that increasing the number of residency positions and offering debt relief to medical students may encourage more of them to pursue a profession in primary care.
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Workforce / Labor
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An enormous medical bill can trigger a wave of panic, but try to resist.
That startling invoice that arrived in the mail may not be what you wind up paying. Errors or slow insurance payments may have inflated the total. Even if it’s accurate, financial aid or other assistance might help pare it.
Sometimes a simple phone call clears up a problem. Other times, reinforcements are necessary.
Debt experts say patients should attack medical bills with a plan. Here are key steps to take.
CHECK THE NUMBERS
Don’t stash the bill in a pile of mail and hope it goes away, but don’t rush to pay it without first understanding the amount.
“Especially if it’s a really high bill, consider it like an opening offer,” says Caitlin Donovan, a spokesperson for the nonprofit Patient Advocate Foundation, which helps critically or chronically ill patients deal with debt and insurance problems.
Medical bills can be rife with errors. They also may have been sent before insurance coverage was sorted out.
Donovan recommends comparing the bill with your insurer’s explanation of benefits. That’s a document the insurer sends that explains how your coverage will apply to the care you received. It can give you a sense for what you may still owe based on your deductible or the plan’s out-of-pocket maximum.
If something looks weird, call both the insurer and hospital for an explanation.
Someone at the hospital may have mistakenly entered the wrong code for the care you received or duplicated it. Request an itemized bill from the hospital to see if that happened.
But be aware that those bills also can be hard to interpret or contain errors that have little to do with the charge, Donovan said.
KNOW THE LAW
The No Surprises Act debuted last year and offers a layer of protection. Patients should check to make sure their care provider is following that law.
It prevents doctors or hospitals in many situations from billing insured patients higher rates when the care providers are not in their insurer’s coverage network.
The law offers protection for most emergency care by basically requiring that patients receive in-network coverage with no additional billing from the provider. It also protects patients from huge bills for lab work or an out-of-network anesthesiologist when the patient was treated at an in-network hospital.
The Centers for Medicare and Medicaid Services has established a “No Surprises Help Desk” for people who have questions about whether their bill complies with the law. They can call (800) 985-3059 or submit a complaint online.
SEEK OUTSIDE HELP
There are a host of for-profit and nonprofit organizations that can help people navigate medical bills.
The Patient Advocate Foundation helped David White recoup more than $2,000 he paid for routine lab work after his kidney transplant.
A case manager told White that a government database was causing complications with the claim, and this sort of thing had happened before to people with his condition. She also helped him file paperwork to correct the mistake.
“Every single penny that I paid out was refunded,” said the 61-year-old White, a volunteer foundation board member. “There’s just no way I could figure this out on my own.”
The foundation offers an online directory of potential resources for medical or prescription bill help.
Outside help might also include a state attorney general’s office, which may have a health advocacy unit or a consumer protection division.
Be very wary of any sort of medical credit card a provider may offer, said John McNamara, a principal assistant director with the federal Consumer Financial Protection Bureau. Those cards may come with high interest rates or terms that can hurt the patient financially if the debt isn’t fully paid in a certain time frame.
Plus patients who jump at that offer may miss out on other financial assistance, or their insurer may not be billed, McNamara noted.
FINANCIAL ASSISTANCE
Once you have checked for errors, ask for financial assistance. Some hospital systems may provide help for people with income levels as high as six figures.
“People a lot of times assume they won’t qualify,” Donovan said.
Patients should be persistent in asking for help or finding out why an application was denied. That may have happened due to a mistake. Applications can ask for a lot of supporting documentation.
Many hospitals don’t do a great job letting patients know about available help, said Marceline White, executive director of Economic Action Maryland, a non-profit that helps people in that state apply for financial assistance.
“The onus is on the patient to apply for the assistance and do the work,” she said.
Ask for a discount if no financial assistance is available.
BARGAIN AND BUDGET
You’ve checked for errors and asked about discounts and financial assistance. Now you may have to confront a final invoice.
Ask about a payment plan. Many hospitals will offer options with no interest or a very low rate.
But before committing to that, go over your budget to get a sense for what sort of payment you can handle. Consider looking for income-based programs that may be able to help with rent or utility bills.
Donovan noted that people who agree to a monthly bill that turns out to be too high may wind up having that debt land in collections if they can’t make payments.
“Then you’re in a whole new problem,” she said.
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The Associated Press Health and Science Department receives support from the Howard Hughes Medical Institute’s Science and Educational Media Group. The AP is solely responsible for all content.
Tom Murphy, The Associated Press
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Consumer & Retail
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InCred Financial Raises Rs 500 Crore Via Equity, Turns Unicorn
The equity fundraise round received interest from a global private equity fund, corporate treasuries, family offices and UHNIs.
InCred Financial Services Ltd. became a unicorn after it raised Rs 500 crore via equity in its latest round of Series D funding.
The equity fundraise round received interest from a global private equity fund, corporate treasuries, family offices and UHNIs, according to the company statement.
The company plans to deploy these funds across InCred's core business verticals. These include consumer loans, student loans and MSME lending.
This comes after the Oct. 13 announcement, when the company planned to raise up to Rs 300 crore through the public issue of non-convertible debentures.
InCred Finance is the holding company of InCred Holdings Ltd., founded in 2016.
In six years, the company has built a loan book of approximately Rs 7,500 crore. Over the last three years, it has built a growth CAGR of approximately 50%. The pre-tax return on assets in H1FY24 was at 5+%, and the profit before tax was at approx. Rs 170 crore, according to the statement.
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Banking & Finance
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The IRS said Friday it is ramping up a crackdown on wealthy taxpayers who owe back taxes, noting that the effort springs from billions inthrough the Inflation Reduction Act partially designed to help it track down millionaire tax cheats.
The agency will begin by pursuing 1,600 millionaires who owe at least $250,000 each in overdue taxes, the IRS said in a statement. The agency announced it will have "dozens of revenue officers" focusing on high-end collections cases in fiscal-year 2024, which starts in October and ends in September 2024.
The 2022 Inflation Reduction Actto the IRS, with more than half of that earmarked for more enforcement agents. The idea is to generate more tax revenue for the nation's coffers by zeroing in on wealthy taxpayers who hide or underreport their income. Because of their legal complexity and costs, such tactics are far less common among people who are less well off because their income is reported to the IRS on W2s and other tax forms.
"If you pay your taxes on time it should be particularly frustrating when you see that wealthy filers are not," IRS Commissioner Danny Werfel told reporters in a call previewing the announcement.
The IRS will also heighten its scrutiny of 75 large business partnerships that have assets of at least $10 billion on average. In addition the dedicated agents, the agency said it plans to use artificial intelligence to track tax cheats.
Audit rates and underfunding
At the same time, the IRS reiterated that it doesn't intend to increase audit rates for people earning less than $400,000 a year. Some Republican lawmakers and right-leaning policy expertsthat the new IRS funding would be used to go after middle-income workers.
Audit rates have dropped precipitously in recent decades due to the IRS' shrinking workforce. The agency employed 82,000 workers in fiscal-year 2021, down from 94,000 workers in 2010, even as the U.S. population and number of taxpayers has grown over the same period.
The number of people with incomes of $1 million has jumped 50% over the last decade, but the number of audits on million-dollar tax returns has.
"The years of underfunding that predated the Inflation Reduction Act led to the lowest audit rate of wealthy filers in our history," Werfel said Friday in a statement.
A team of academic economists and IRS researchers in 2021 found that the top 1% of U.S. income earners fail to report more than 20% of their earnings to the IRS.
—With reporting by the Associated Press.
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Inflation
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From October 4 the Home Office will charge between 15 and 35 per cent more for visas to visit, live, study and work in the UK.
This increase is despite an immigration expert saying that the country is already struggling to regain its pre-Brexit workforce.
British businesses will also take a “massive hit” in paying extra for “the brightest and the best” when an “unjustifiable” 66 per cent increase in a migrant healthcare payment is introduced later this year, they warned.
Overseas student visa fees are rising by 35 per cent from £363 to almost £500, while workers applying to live indefinitely in the UK - including doctors and their families and spouses of British citizens - face a 20 per cent increase, with a visa fee of roughly £3,000 per person.
Some families will have to fork out £28,000 to move to the UK as a result of the changes, and it’s feared migrants already working in the UK may end up undocumented if they cannot afford their next visa.
“It feels really heartbreaking because the UK is my home and I’ve invested so much into this country and into being here,” a senior university researcher living in the South West with her husband, who works for the Government, said.
The researcher, 30, who the Standard has agreed not to name, said she is already looking for jobs in other countries.
“We worked out it would cost us over £10,000 over the next couple of years to stay here.
“Although we have good salaries for UK standards, it’s just really not affordable for us,” the woman said.
She said it would cost the couple around £3,000 more under the fee changes next month.
“Supposedly my husband and I are both the types of migrants that the UK wants. The extra £3,000 is becoming unrealistic.”
British mother Raquel Roberts Dos Santos, who lives in Portsmouth with her two sons, said it will take her years to save more than £8,000 to bring her Brazilian husband and stepdaughter to the UK under the new fees.
“They don’t see the damage that is being done to children, little boys and single mothers who then have to try and deal with everything. It’s just nonsensical.”
It’s the first significant increase in visa fees in many years, with the Home Office claiming the extra revenue will “pay for vital services and allow more funding to be prioritised for public sector pay rises”.
But immigration lawyer Rose Carey, Partner and Head of Immigration at Charles Russell Speechlys, said the spike in fees is “short sighted” and even “counterproductive”.
“At a time when the UK economy is struggling…we need to be doing things to open the UK for business.
”By increasing visa fees, it’s going to make it even harder for people to come to the UK to set up businesses and move their workers into the UK easily.
“We have to be very careful about a time when the UK economy is struggling, about keeping the UK attractive. Putting fees up is problematic.”
Charity Migrant Voice said migrants are not “an unlimited magic money tree for [the Home Office] to continue to exploit”.
“We have seen families forced into destitution and having to choose between food or paying for their visas,” director Nazek Ramadan told the Standard.
Fizza Qureshi, CEO of the Migrants’ Rights Network, said the fee increase “will force thousands further into poverty and debt during a cost of living crisis, or to leave the country”.
Spokesperson for refugee and migrant charity RAMFEL, Nick Beales, said: “There is actually a real risk that these extortionate fees…will see students and medical professionals decide to take their skills to countries where they feel valued and appreciated.”
An NHS recruiter and father of two, who the Standard has agreed to keep anonymous, has lived in the UK for 23 years.
The Nigerian national, 49, said his children were born in the UK but do not yet qualify for citizenship, nor he or his partner.
He estimates the cost to keep his family in the UK under the new visa fees will be around £15,000 - £1,000 more than before the fee hike.
“I’m already getting really stressed and worried about the situation because right now I haven’t even got a grand left in the account to try and prepare for this,” he told the Standard.
“People have got British kids here, they’ve been here for years, they’ve been paying their dues. Why are we being treated different?”
A Home Office spokesperson said: “It is right and fair to increase visa application fees so we can fund vital public services and allow wider funding to contribute to public sector pay.”
Income generated from visa fees can only be used to fund the migration and borders system, the Home Office said.
The healthcare surcharge has not increased since 2020 but the cost of providing healthcare has increased, it said, adding that there is little evidence that fee increases have significantly affected demand on work, study and tourism routes.
If you are impacted by the visa fee increases and want to share your story please email miriam.burrell@standard.co.uk.
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United Kingdom Business & Economics
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Twelve million people could receive a smaller increase in their state pension than expected next year, as the Government considers changing its approach to the triple lock.
The triple lock is a key Conservative Party pledge that ensures the state pension rises by the highest of three metrics: average earnings, inflation or 2.5 per cent.
In the past, average earnings have always been calculated using the figure for wages plus bonuses. However, The Telegraph understands that the Treasury is now considering stripping out the impact of bonuses.
Scores of NHS workers and civil servants have been given one-off bonuses in the last year as part of pay settlements after widespread strikes over salaries and conditions.
That could mean the state pension rising by 7.8 per cent from April rather than 8.5 per cent, according to figures released by the Office for National Statistics (ONS) on Tuesday.
Such a move would mean pensioners being as much as £74 out of pocket next year, compared with the previous approach.
Officials in the Treasury and Work and Pensions Department are understood to have become interested in the change because of the unexpectedly large increase in bonuses.
Ministers are expected to argue that an unusually high jump in public sector bonuses should be stripped out of the average wage figure used to calculate the increase in state pensions.
But the move is likely to be scrutinised by Tory supporters of the triple lock who have long argued that it is a critical tool in reducing pensioner poverty.
Mel Stride, the Work and Pensions Secretary, repeatedly declined to rule out such a change during an interview on BBC Radio Four’s World at One on Tuesday.
It is expected the move would save the Treasury a figure in the high hundreds of millions of pounds. However, the financial benefit will have to be weighed against the potential political risk.
This year, economists expect that the average earnings figure will be used to determine the state pension because it is expected to be higher than either the inflation or 2.5 per cent metrics.
Usually the figures in September are used to make the decision. The announcement is then unveiled in the Autumn Statement, which this year takes place on Nov 22 , with the change then being introduced from the following April.
In total, around 12.6 million people received some form of state pension, according to the latest government figures.
It remains to be seen what exact figures will be selected. If the Treasury wants to strip out the effect of only public sector bonuses, a higher figure than 7.8 per cent could be used, since that number is generated by removing both public and private sector bonuses from the calculation.
There is also a final round of revisions on the estimates before they are locked in, meaning exact earnings figures could yet change a little.
The move comes amid wider doubt abouts whether the Conservative Party and the Labour Party will be committed to the pensions triple lock at the next general election and beyond.
Critics argue that it has become too costly and that more of the state’s financial focus should be put on supporting young people who are struggling.
Both Rishi Sunak and Angela Rayner, the deputy Labour leader, have refused to promise their parties will commit to the pensions triple lock at the next election.
Mr Stride admitted that the triple lock was “unaffordable” in the very long term when pressed on his party’s past and future support for the policy on World at One.
Asked about the long-term affordability, Mr Stride said: “Well, this argument has been around for a long time and understandably so, because the Office for Budget Responsibility, the main independent forecaster, comes forward with something called the fiscal sustainability report on an annual basis and it casts out 50 years and it looks at the impact of the increase in the state pension, the triple lock, amongst other issues and what that does to the public finances.
“So we have known for a long time that in the very, very long term you are absolutely right, it is not sustainable. But, of course, what I am dealing with is now and where we stand at the moment is: we remain committed to the triple lock and that is the path that we will be taking.
“But as to the future and after future general elections and so on and so forth, who knows. But that is the position we are in at present.”
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Inflation
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Ever since the ill-fated crypto exchange FTX imploded last year, evidence has been building of rampant criminal activity on the part of the firm’s top executives. A new report on the company’s finances published Monday does nothing to dispel that notion, revealing instead new allegations about how the failed exchange misspent billions in customer funds, splurging on everything from personal property to illegal political contributions.
The report, put together by the exchange’s new CEO and top restructuring officer, John J. Ray III, alleges widespread illegality and criminal behavior on behalf of the company’s former head honcho, Sam Bankman-Fried, as well as FTX’s other top executives. It also reveals new details about how SBF allegedly worked with a company lawyer in an attempt to hide evidence of the firm’s financial misdoings. Here are some of the key takeaways from the new report.
The newest report focuses on FTX’s “commingling of funds”—a fancy term for the fact that exchange executives don’t seem to have meaningfully distinguished between money deposited by customers and their own money. To hear investigators tell it, SBF and his top lieutenants treated the company like their own personal piggybank, pilfering customer accounts for their own various expenditures and personal investments. This apparently went on until billions and billions of dollars had been misappropriated—approximately $8.7 billion, according to the report.
Part of the reason that FTX was able to get away with this for so long is that, until its collapse, the exchange was considered quite trustworthy. And the reason that it was considered trustworthy is because exchange executives convincingly leveraged ongoing PR efforts to make themselves seem like they were careful stewards of customers’ finances (instead of craven crypto bandits with the scruples of Caligula). Per the report...
The FTX Group portrayed itself as the vanguard of customer protection efforts in the crypto industry. Its co-founder and CEO, Sam Bankman-Fried, claimed to support federal legislation to safeguard consumers’ digital assets, and touted the FTX exchanges’ purported procedures to protect fiat currency and crypto deposits, including in testimony he provided to the U.S. Senate...
...The image that the FTX Group sought to portray as the customer-focused leader of the digital age was a mirage. In fact, as set forth in this report, from the inception of the FTX.com exchange, the FTX Group commingled customer deposits and corporate funds, and misused them with abandon.
What were FTX execs using customers’ money for? According to the report, the answer is: pretty much anything and everything. The report notes that “speculative trading, venture investments, and the purchase of luxury properties, as well as for political and other donations designed to enhance their own power and influence” were all things that FTX execs appear to have splurged on. In the meantime, company insiders kept telling anyone who would listen that they were really a paragon of fiscal ethics. Some of the excerpts from this section are laugh out loud funny. One particular anecdote reveals that as the floor started to drop out from under the crypto exchange, SBF apparently kept telling the public that everything was fine. The report notes...
On November 7, 2022—months after discussing internally that over $8 billion in fiat currency alone was missing from the FTX exchanges, and four days before the FTX Group filed its bankruptcy petition—Bankman-Fried tweeted that “[w]e have a long history of safeguarding client assets, and that remains true today.”
Christ, can we get Adam McKay and some of his hilarious colleagues together for a comedic but incisive adaptation of this whole thing already?
The report notes that it extremely difficult to figure out just what the fuck happened to FTX customers’ money because of how ridiculous the exchange’s financial practices were. Indeed, the report notes that...
Notwithstanding extensive work by experts in forensic accounting, asset tracing and recovery, and blockchain analytics, among other areas, it is extremely challenging to trace substantial assets of the Debtors to any particular source of funding, or to differentiate between the FTX Group’s operating funds and deposits made by its customers.
In essence, what the report is saying is that because there was no functional distinction between customers’ money and the money that FTX executives spent on themselves, it’s pretty hard to tell what got spent on what.
One of the biggest bombshells in the new report is the accusation that Sam Bankman-Fried and an unnamed company lawyer created “sham documents” as part of a plot to hide irregular financial dealings between FTX and one of its sister hedge funds, Alameda. According to the report, the documents were then shown to an outside auditor, which wrote up a financial audit that “inaccurately and misleadingly characterized FTX Trading Ltd.’s relationship with Alameda, and did not record any fiat currency of FTX.com customers.” FTX then reportedly showed the fake financial documents to investors during a series C fundraising round, which helped the company raise some $400 million dollars.
Because of all this alleged monkey business, Bankman-Fried is currently facing a long, long, long list of federal charges and, thus, a substantial stint in prison. Given the circumstances, it makes sense that the former crypto mogul recently tried to get his criminal case thrown out. Indeed, in May, attorneys representing SBF filed a motion to dismiss all but three of the criminal charges levied against him, on the basis of some serious legal gymnastics. However, on Tuesday a federal judge declared the SBF team’s motion “moot or without merit,” allowing the criminal case against the former executive to proceed.
“Dismissal of charges ‘is an “extraordinary remedy” reserved only for extremely limited circumstances implicating fundamental rights,‘” wrote Judge Lewis Kaplan in a memo issued Tuesday in U.S. District Court for the Southern District of New York. “The Second Circuit has deemed dismissal an ‘extreme sanction’ that has been upheld ‘only in very limited and extreme circumstances,’ and should be ‘reserved for the truly extreme cases,’ ‘especially where serious criminal conduct is involved.’”
So it appears as if ol’ Sam is going to remain in the U.S. criminal justice system for the time being. What will financial investigators dig up next? Tune in next time for more financial misadventures in FTX’s bankruptcy proceedings...
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Crypto Trading & Speculation
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- Levi Strauss cut its full-year sales forecast, citing weak sales of its denim at department stores and big-box retailers.
- The denim retailer said momentum at its own stores and website was not enough to offset weaker wholesale trends in the U.S.
- The company has put more emphasis on its direct-to-consumer business to help control its own destiny.
Levi Strauss on Thursday cut its full-year sales forecast, as it missed Wall Street's quarterly revenue expectations and was dragged down by weaker shopping trends at department stores and big-box retailers across the U.S.
Shares fell more than 5% in after-hours trading.
The company's more cautious outlook comes just three months after it already slashed its full-year profit outlook. It said it now expects net revenues to be flat to up 1% year-over-year compared with a prior range of between 1.5% to 2.5% growth. It said it anticipates adjusted earnings per share to be on the low-end of the previously shared range of $1.10 to $1.20.
In an interview with CNBC, CEO Chip Bergh said shoppers – pinched by inflation, rising mortgage rates and gas prices – have bought fewer items from retailers that carry Levi's apparel.
"All the things that are impacting that middle-income consumer are impacting our wholesale business," he said.
Here's how the denim retailer did in its fiscal third quarter compared with what Wall Street was anticipating, based on a survey of analysts by LSEG, formerly known as Refinitiv:
- Earnings per share: 28 cents, adjusted, vs. 27 cents expected
- Revenue: $1.51 billion vs. $1.54 billion expected
Net income for the three-month period that ended Aug. 27 was $10 million, or 2 cents per share, compared with $173 million, or 43 cents per share a year earlier. On an adjusted basis, earnings per share were 28 cents.
Sales were roughly in line from the $1.52 billion in revenue that the company reported in the year-ago period.
Like other retailers, Levi — which also makes Dockers and Beyond Yoga — has coped with a tougher sales backdrop in the U.S. Levi sells its items directly on its website and in its own stores across the globe, but also sells many items through chains retailers like Macy's, Kohl's and Target. Those retailers, which buy wholesale items from Levi to carry on their stores and websites, have seen weaker discretionary sales.
Bergh said its value-based denim lines, Signature by Levi Strauss and Denizen, have especially been softer. In the third quarter, he said sales of those brands, which are carried by Walmart and Target, were down double digits, he said.
"Clearly, that's an indication that that value consumer is under pressure," he said.
For Levi, direct sales and international sales have been the stronger parts of its business. Like Nike, Levi has tried to control its own destiny by driving more of its overall sales through its own stores and website.
In the fiscal third quarter, net revenues from Levi's direct-to-consumer business increased 14% compared with the year-ago period. E-commerce revenuer shot up by 19% year over year, as the company posted double-digit growth across all of its brands.
Direct-to-consumer drove 40% of total net revenues in the fiscal third quarter. It has pledged to get that up to 55% by fiscal 2027.
Net revenue from wholesale dropped 8% year-over-year, as sales gains in Asia and Latin American weren't enough to offset declines in North America and Europe.
Bergh said unseasonably warm weather in the U.S. and Europe likely played a role in worse wholesale trends, too.
"It's hard to sell blue jeans when it's 110 degrees outside," he said.
At its own stores, he said, Levi can has a wider range of clothing, such as tank tops, skirts and shorts it can swap out based on customer trends — and the temperature. Plus, he said, it draws shoppers who have higher incomes and are willing to pay more for fashion-forward premium denim.
Levi made an unusual move in recent months: Cutting prices of some items to try to jumpstart sales of about a half dozen of its more price-sensitive items. Bergh said in July that Levi would lower the price of select pairs of jeans from $79.50 to $69.50. That price is still higher than its pre-pandemic price of $59.50, Bergh said.
Retailers had control over when to cut those prices, but some took effect in early August — the final month of the third quarter, Bergh said.
"As retailers have reflected price reductions to the consumer on those particular fits, the trends have improved," he said.
He said the company is "cautiously optimistic" that as new styles debut and the holiday season approaches, customers may be more willing to open their wallets.
Shares of Levi have fallen about 14% so far this year, underperforming the 11% gains of the S&P 500. The company's stock closed on Thursday at $13.21, down nearly 2%.
This story is developing. Please check back for updates.
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Consumer & Retail
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BAY CITY, Mich. (WJRT) - Questions continue to swirl around a well-known Bay City tax service that is leaving several customers in the dark and possibly in trouble with the IRS.
ABC12 reported on Tuesday that the company hasn't filed taxes for many of its clients.
Since our story aired, we've been getting more calls and emails from people in the same boat.
Their taxes are not filed as the extension deadline passed on Oct. 16.
They can't get their tax papers back to file them on their own, so for many customers, this is becoming very taxing.
"What's going on,” says Brian Guinther of Bay City. “I just haven't heard anything.”
The Falasz Tax and Accounting building on Broadway in Bay City remains closed.
A sign remains on the door, saying the company has been cyberattacked.
Customer James Yager tells us one of the tax preparers told him they had moved their equipment to a safe room in Flint, and the FBI and IRS were investigating.
"We've used them probably for seven years," says Guinther.
He says there have been no problems until now.
"It's really frustrating for me and my wife,” he says. “We always delay, so that is kind of our fault for not getting them done early in the year."
But they got their tax information to Falasz before the April deadline and didn't mind that the company filed an extension for them.
"In September, I called back,” says Guinther. “It was ready, so I went in and paid for it.”
He paid $150 for the tax work.
However, a check of the IRS website shows his taxes have not been filed. This joins a long list of people who are now in limbo. And what if that cyber attack did happen?
"I think they owe everybody some sort of an explanation as to what happened to our data, and are we going to get a refund," he says.
A busy signal is all you get when you call the company.
An IRS spokesperson says taxpayers experiencing any sort of fraud or misconduct by their tax preparer need to fill out Form 14157-A, along with a complaint form.
It's not clear if Guinther and the others can avoid fees and fines for filing late.
"Should I go and file? Are they (Falasz) still going to file,” he says. “I can't get in touch with anybody.”
ABC12 reached out to the company's president's cell phone number with a phone call and a text, but we did not hear back.
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Consumer & Retail
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Fentanyl has long been one of the most dangerous wares of the underworld cryptocurrency economy—so dangerous, in fact, that even many dark web markets have banned it. But new research shows how cryptocurrency is playing a different role in that deadly opioid's supply chain: Chinese chemical producers are accepting cryptocurrency as payment for fentanyl ingredients they're selling to drug operations that mass-produce the narcotic in countries around the world. And they're offering it not on the dark web, but in full public view.Cryptocurrency-tracing firm Elliptic today released new findings that offer a glimpse of an underreported role of cryptocurrency in the global fentanyl trade: the wholesale supply of ingredients to fentanyl producers around the world. Researchers at Elliptic found more than 90 Chinese chemical companies that sold fentanyl "precursor" chemicals and advertised their products on the open web, fully 90 percent of which offered to accept payment in cryptocurrencies like Bitcoin and Tether.Monthly cryptocurrency transactions to the Chinese firms selling fentanyl ingredients that Elliptic identified.
Courtesy of EllipticElliptic researchers conducted blockchain analysis of some of the cryptocurrency addresses those companies shared with prospective customers. The researchers estimate that they had received just over $27 million in transactions over the last five years, mostly since 2021, given that transactions have in the last year increased 450 percent. But the company warns that's likely just a fraction of a larger crypto-fueled fentanyl supply chain—and the retail value of fentanyl produced with those precursors is probably thousands of times higher, in the tens of billions of dollars.“It’s under-appreciated how much crypto is accepted by Chinese companies for materials that are used to manufacture these narcotics,” says Tom Robinson, who co-founded Elliptic and leads its research team. (Robinson declined to name any of the companies, though he said Elliptic has shared their names with law enforcement.) "The number of crypto transactions is significant, and you only need a small amount of these materials to produce fentanyl and other narcotics in quantities that both have an extremely high street value and could potentially lead to huge numbers of overdoses." The Elliptic report notes that the tens of millions of dollars worth of precursor sales it tracked on blockchains would likely be enough to manufacture enough fentanyl to, if distributed efficiently, kill every person on Earth.The sale of dangerous opioids like fentanyl on dark web markets like Silk Road and its successors like AlphaBay and Hydra has been notorious for well over a decade. But in recent years, dark web markets have begun instituting bans on the drug, which can be 50 times stronger than heroin. Though they're sometimes only loosely enforced, the bans aim to prevent the harm the substance brings to customers and the accompanying law enforcement attention. “I knew it was very dangerous,” one dark web administrator who goes by the name DeSnake told WIRED in a 2021 interview, explaining the fentanyl ban on the AlphaBay dark web market he'd relaunched at the time. “In a place where no one knows no one, it would be a very, very big mess.”Despite that trend away from dark web fentanyl sales, four members of the US Congress this week reintroduced a bill called the Dark Web Interdiction Act to increase the sentences for dark web drug dealers, focusing specifically on fentanyl. The bill would also strengthen and make permanent the Joint Criminal Opioid and Darknet Enforcement task force that's helped to coordinate law enforcement takedowns of hundreds of alleged dark web drug sellers and administrators in recent years.But even as the dark web retail cryptocurrency trade in fentanyl has been restricted, and as law enforcement cracks down on what of it remains, Elliptic's research shows that cryptocurrency-based wholesaling of fentanyl ingredients to drug cartels—who then manufacture the synthetic opioid and smuggle it into the US and other countries to be sold in the physical world—continues. In its study of precursor-selling chemical labs, Elliptic notes that several of the websites it surveyed specifically mentioned that they shipped to customers in Mexico, and 17 of the labs also sold finished fentanyl and other even more powerful opioids.Those Chinese chemical firms do in some cases sell products other than fentanyl precursors, Elliptic's Robinson notes, and he concedes that blockchain analysis can't tell the difference between those sales and the sales of fentanyl ingredients. Some also sold precursors for amphetamines, methamphetamines, and other opioids. But Elliptic's researchers in some cases saw the companies advertise that fentanyl precursors were their best-selling product. Robinson also notes that Elliptic isn't claiming to have measured the entire crypto-based fentanyl supply chain, but only a "snapshot" of transactions it could identify, suggesting that its $27 million estimate is in fact likely lower than the total amount of fentanyl precursor sales over the last half-decade.The US government may be increasingly aware of the role of fentanyl precursor sellers in China and cryptocurrency's part it in, but it has so far acted against the industry on a scale far smaller than the industry Elliptic has uncovered. The US Treasury Department last month levied sanctions against four Chinese men and two chemical labs, Wuhan Shuokang Biological Technology and Suzhou Xiaoli Pharmatech, for selling fentanyl precursors to drug cartels in Mexico. Three of the men were also indicted in absentia. The fourth, according to Treasury's announcement, was an associate who had accepted cryptocurrency payments on behalf of one of the two companies.Exactly why the Chinese chemical firms accept cryptocurrency for their fentanyl ingredient sales may seem counterintuitive, given the ability of companies like Elliptic and other cryptocurrency tracing firms to track their sales of dangerous and potentially illegal products across blockchains. But Robinson says the Chinese firms are likely using crypto because it's hard to seize or block—and they may not particularly care that the money can be traced by Western companies and law enforcement so long as they can still find a cryptocurrency exchange willing to cash it out. “If a company in China wants to accept crypto payments, no one can prevent that from occurring,” Robinson says.But that traceability also means there's an opportunity to pressure cryptocurrency exchanges to cut off the accounts of fentanyl precursor sellers that Elliptic has identified. Elliptic, in fact, notified exchanges of hundreds of addresses it linked to the Chinese chemical companies. "There’s definitely a role for those services to clamp down on this," Robinson says. And exploiting that crypto chokepoint could perhaps cut off at least a fraction of the lethal flow of fentanyl worldwide—not at its destination, but at its source.
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Crypto Trading & Speculation
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Uber Technologies (UBER), Jabil (JBL) and Builders FirstSource (BLDR) will join the S&P 500 index as part of a quarterly rebalance, S&P Dow Jones Indices announced Friday night. Uber stock and the other two entrants rallied in late trade.X
Sealed Air, Alaska Air, and SolarEdge will replace Orthofix Medical (OFIX), Rambus, and Comfort Systems in the S&P SmallCap
600.
Houlihan Lokey (HLI) and Equitable Holdings (EQH) will replace Topgolf Callaway Brands (MODG) and Vestis (VSTS) in the S&P MidCap400. Topgolf Callaway Brands and Vestis will replace Clearfield (CLFD) and OneSpan (OSPN) respectively in the S&P SmallCap 600.
Alkermes (ALKS), Armstrong World Industries (AWI), National HealthCare (NHC) and PJT Partners (PJT) will replace Community Health Systems (CYH), Invesco Mortgage Capital (IVR), Avid Bioservices (CDMO) and James River Group Holdings (JRVR) in the S&P SmallCap 600.
S&P 500 Stock Moves Late
Uber stock jumped 5.5% in after-hours trading. There had been widespread speculation that Uber would be added to the S&P 500.
Meanwhile, JBL stock gained 3% Friday night, while BLDR stock climbed nearly 3%.
SEDG stock, Alaska Air and Sealed Air retreated 1%.
RMBS stock and Comfort Systems gave up about 2%, despite moving up to the MidCap 400 from the SmallCap 600. More mutual funds and ETFs track the small-cap index than the mid-cap gauge.
Houlihan Lockey and Equitable Holdings were strong gainers late, while TopGolf Callaway and Vestis rose slightly. CLFD stock decreased 3.4% and OneSpan fell 5.4%.
Among new S&P SmallCap 600 members, ALKS stock jumped 7%, Armstrong World and PJT gained 6% while NHC added 4%.
CYH and James River Group fell solidly. Invesco and Avid edged lower.
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Stocks Trading & Speculation
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John Lewis has axed its staff bonus for a second time after losses grew during a "very tough year".
The department store firm, which also owns Waitrose supermarkets, reported a £234m pre-tax loss.
Dame Sharon White, chair of the company, said that while it attracted more customers, they had spent less.
She said the higher loss meant the firm could not hand out a bonus this year for the second time since it began the scheme in 1953.
Dame Sharon also hinted that the firm may have to reduce staff numbers, or "partners" as they are known at the company.
"As we need to become more efficient and productive, that will have an impact on our number of partners," she said.
The company said it faced with a "more challenging environment" and was tripling its target to make savings from £300m to £900m by January 2026.
'Inflation pain'
It said customers had "felt the pain from inflation".
Despite Waitrose reporting 800,000 more shoppers in the year to 28 January, customers spent less. It said the size of the average basket fell by 15% and people were buying cheaper items.
Consequently, full-year sales at Waitrose fell by 3% to £7.31bn.
"The big online growth of the pandemic years was partly reversed," said Dame Sharon, adding: "Shoppers shifted some of their grocery spending to the discounters."
Across its John Lewis department stores, revenue edged up 0.2% to £4.94bn. For the partnership as a whole, sales fell to £12.2bn from £12.4bn in the previous year.
It is the third year of pre-tax losses for John Lewis. Last year, it reported a £27m loss, far below this most recent result.
Dame Sharon said even as inflation starts to fall the partnership is still seeing costs rise. The rate of price rises - or inflation - has been slowing but at 10.1% remains close to a 40-year high.
During the Budget announcement on Wednesday, the Office for Budget Responsibility said it expected inflation to fall to 2.9% by the end of the year.
Last year the company revealed details of its plans to move into the residential property market in a bid to address address the national housing shortage.
John Lewis said the move was part of its long-term plan, with 40% of profits to come from outside of retail by 2030.
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Consumer & Retail
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‘The hardest thing I’ve had to do.” That was the heartbreaking confession of a British dairy farmer after selling his herd of cows, bringing to an end a family business that had been in existence for nearly 200 years.
The reason for this fateful decision? A 14p-a-litre drop in the price he was getting for his milk, within a few months, despite facing continued high bills for electricity, animal feed and fertiliser. “I can’t understand why anyone would want to carry it on,” he said.
The milk producer, who has chosen to remain nameless, told his story to David Exwood, a Sussex farmer, who shared the comments on Twitter. His situation is far from unique. Dairy farmers and other food producers have been struggling with spiralling costs since the outbreak of war in Ukraine last February pushed energy bills skywards – also affecting the cost of fertiliser, which needs gas for its production.
Financial pressures were further exacerbated by last summer’s drought, as farmers had to buy more animal feed because of a lack of grass.
Milk shortages after the disruption of the pandemic eventually saw the wholesale price rise to record levels by late 2022, peaking at 51.6p per litre last December. This, finally, covered farmers’ costs and allowed them to breathe a sigh of relief. But the respite was short-lived.
The average farm-gate price for milk has been on a downward trajectory in recent months, sliding to 37.6p per litre in May, according to government figures. This represented an almost 5% drop in the space of a month, and a near-8% decrease on the same month a year earlier.
Paul Rowbottom, a farmer who also sells animal feed, says he can see the impact of financial pressures every day at the farms he visits across Staffordshire, Derbyshire and Cheshire. “Trying to get money in is a nightmare,” he says. “They can’t pay their bills.” He says the dairy farmers and other food producers he supplies are facing the worst challenges he has seen during 30 years in the job: “I don’t think I have seen so many people so fed up as now.”
Recent falls in the milk price have partly been attributed to the “spring flush” – when cows naturally produce more milk as they are let out into fields – leading to oversupply. Yet dairy farmers clearly feel that they take the financial hit when milk processors and retailers reduce the price paid for their product.
Cheaper milk, along with lower prices for butter and bread, has been among the price cuts advertised recently by supermarkets as they battle to win over price-conscious shoppers during the cost of living crisis and a period of stubbornly high food inflation. A four-pint bottle now costs £1.45 at grocers including Tesco and Sainsbury’s, about 20p cheaper than in early April, and the lowest price since before the pandemic.
Now food producers are warning that a continued exodus of dairy farmers could jeopardise the UK’s current self-sufficiency in liquid milk. Almost 5% of them left the industry last year, according to the National Farmers’ Union (NFU).
The Dorset Dairy Company has become one of the latest farms to decide to sell off its milking cows after the crash in prices. Dan Miller, the company’s head of operations, is the third generation of his family to oversee a herd at Stalbridge. He now intends to sell their 180 cows in September, after which the company plans to buy in milk from elsewhere to continue making its yoghurt, butter and cream.
Miller says he made the decision as a result of the volatility in the milk price, where the “happy days” of the wholesale highs in late 2022 prompted many dairy farmers to expand, just as consumers reined in their spending. People are also gradually changing their milk habits – whether that’s cutting back on traditional cups of tea or morning cereal or the rise of dairy-free alternatives.
Miller believes the industry has struggled to adapt quickly enough, with small suppliers the most vulnerable. “With milk you can’t turn off the taps easily,” Miller says. “A lot of people said ‘let’s improve and grow and produce more milk.’ We should have been more cautious.
“This is an epic cycle and I don’t see it getting better quick enough,” he says, explaining why he is selling his herd. “We don’t know how long this is going to last.”
Farmers across the country are asking themselves how long they can hold on amid financial pressures, as they continue to grapple with chronic labour shortages. Almost three-fifths of dairy farmers belonging to Arla, the UK’s largest dairy cooperative, complained of worker shortages in a recent survey, saying they were finding it harder to find staff than in 2019.
Andrew Hall, a beef and dairy farmer from Alveston in Warwickshire, has also experienced this. Of his four children, the oldest two have already studied at university, and decided that they don’t want to take over the farm, while workers “who are my age and older are saying ‘I’m sick of this,’” he says.
“I am finding it tough financially and mentally, and obviously labour is a massive issue,” he says, adding that he is receiving 15p less a litre than in February. “Most dairy farmers are working seven days a week, but it’s 2023, not 1983 or 1973. And we have been left behind with wages.”
The 56-year-old is also going to miss out on his one week-long holiday of the year, as his “relief milking” assistant is recovering from a road accident. “I can’t find anybody else to milk,” he says.
To keep on top of his outgoings, Hall has reduced the amount of feed given to his cows and is scaling down production, relieved that there is more grass available than last summer. “You never hear of farmers striking,” he says. “But we have been taken advantage of for too long.”
Succession problems are among the reasons for a large number of dairy herds coming to market at Kivells, an agriculture and livestock auction house. Mark Davis, an auctioneer based in Exeter, is expecting to sell 1,500 dairy cows over the next month. “We are seeing a lot of sales come forward,” he says. “The milk price and finances are bound to have an effect.”
Davis, who also works part-time on the family dairy farm run by his brother, believes the reluctance of the next generation to take over family businesses is also playing a role. “The sales coming up are generally because of retirement, a couple have been in ill-health, in one the farmer died and the family didn’t want to take it on.”
Some farmers are pinning their hopes on the government’s plans to introduce new regulations in the coming months, and bring more stability to the dairy supply chain. The so-called dairy code is intended to “ensure supply contracts in the dairy sector are fair and transparent, with farmers being paid a fair price for their produce”, according to the Department for Environment, Food and Rural Affairs (Defra).
The regulations are designed to allow farmers to challenge prices offered by processors, and prevent contract changes from being imposed on producers without agreement, while allowing them to raise their concerns more easily.
Michael Oakes, a dairy farmer in Worcestershire, is hopeful that the plans, expected to become law in the autumn, might “take out some unfair practice from the supply chain”. He believes that the current situation, where farmers sometimes only find out a few days in advance what they will be paid for next month’s milk, is untenable.
Oakes, who is also chair of the NFU’s dairy board, hopes the regulations could “create a new relationship with processors, get rid of the ‘us and them’. We need each other, but it has never felt like a true partnership.”
For now, dairy farmers such as Hall are committed to remaining in farming, even though he admits that he occasionally dreams of a life without caring for a dairy herd. “I could rent out buildings [on the farm] for storage, and have an easier and better lifestyle.”
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Agriculture
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The UK needs to "take command" of its own food production, a boss at the National Farmers' Union (NFU) has said, as the country faces an ongoing vegetable shortage.
Tom Bradshaw, the group's deputy president, warned that "volatility" from geopolitical events, such as the war in Ukraine, as well as climate change, was putting pressure on supply chains.
He also said that the UK faced the additional challenge of "repositioning" itself with trading partners in the wake of Brexit.
Speaking to Times Radio, he said: "As we reposition ourselves in the world, we've left a trading bloc in the EU where we had very good trading relationships, we've had to go further afield.
"We see geopolitics, and the war in Ukraine being a tragic example, having huge impacts and I don't think that unrest is likely to go away in the near future; we seem to live in a very volatile world.
"We've then got climate change, compounding all of those issues. What we saw last summer with 40C heat is climate change in action.
"And we have 70 million people living on an island and we have to take responsibility for how we're going to feed those 70 million people."
Mr Bradshaw said that imports will "always be a part" of the UK's food supply.
"But with all of that volatility that's happening around the world, we need to take command of the food we can produce for ourselves here and make sure that everybody in that supply chain is getting a fair return so that we can continue to provide the food that everybody needs," he added.
His comments come as Environment Secretary Thérèse Coffey warned on Thursday that shortages of some fruit and vegetables in UK supermarkets could last for a month.
Labour shortages, animal feed increases, inflation and supply chain disruption from the war in Ukraine, as well as the impact of changes from Brexit, have been blamed for some of the supply issues.
The British Retail Consortium (BRC) has blamed "difficult weather conditions" in the south of Europe and northern Africa, for shortages of some items, such as tomatoes, while farmers have highlighted the impact of higher gas prices, which they say are turning growers away from producing out-of-season products indoors in the UK.
Tesco, Morrisons, Aldi and Asda have so far placed purchase limits on some items of fruit and vegetables in an attempt to mitigate against shortages.
Read more:
Vegetable shortages 'could become more common if UK does not act'
British leek supplies 'exhausted by April' in latest warning
The NFU has called on the government to ensure more food is grown here, while also strengthening supply chains and encouraging seasonal eating.
Ms Coffey came under fire for talking about seasonal British foods as a potential alternative to items running low in the shops because bad weather abroad had disrupted imports.
Speaking In the House of Commons on Thursday, she was asked if eating more seasonally and locally would help avoid food shortages, which have prompted purchase limits in some supermarkets.
Ms Coffey responded: "A lot of people would be eating turnips right now rather than thinking necessarily about aspects of lettuce, and tomatoes and similar."
But she added she was "conscious that consumers want a year-round choice and that is what our supermarkets, food producers and growers around the world try to satisfy".
Critics leapt on her ambiguous comments, interpreting them as a call to "eat turnips not tomatoes".
Ms Coffey, echoing the BRC's comments, had blamed the shortages on "very unusual weather" in places like Morocco and Spain, which supply much of Britain's fresh produce during dark winter months.
But reduced imports have compounded an existing shortage of vegetables like tomatoes and cucumbers.
These items are usually grown in heated, lit glasshouses during winter in the UK, but were planted later this year as farmers struggled to meet energy costs.
Growers also warned stocks of British leeks would run out in April after crops suffered from a climate change-fuelled drought and record heat.
The NFU has urged the government to extend a support package for energy costs to horticulture and poultry, two energy-intensive industries that were left out of the financial scheme.
Failure to strengthen food supply chains will lead to "more instances like we have now where there's less availability of home-grown produce and at times when imports are disrupted," Mr Bradshaw told Sky News on Friday.
He also stressed the importance of "eating seasonally".
He added: "It's when British produce is at its best and often most affordable, and it's a great way to support local farm businesses and sustainable diets."
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Agriculture
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An Australian firm which bought the collapsed battery maker Britishvolt has failed to pay its UK staff for the last four months, the BBC has learned.
Recharge Industries took control of Britishvolt after it went into administration in January.
The takeover has not gone smoothly, with some £2.5m of the purchase price still unpaid months after it was due.
However, sources within Recharge Industries insist a deal with a new investor is imminent.
Britishvolt was a start-up with big ambitions. It wanted to build a £4bn "gigafactory" to supply battery packs for a new generation of electric cars.
The plant was to have been built on the site of an old power station near Blyth in Northumberland.
It was seen as an ideal location, with a deepwater port and good access to transport links.
But the venture ran out of money, and fell into administration earlier this year.
After examining a number of bids, administrators at EY agreed to sell Britishvolt's assets to Recharge Industries.
The company agreed to pay £8.57m. Of this, EY says £6.1m was received on initial completion of the transaction.
The remainder, however, is still outstanding.
While most of Britishvolt's staff were made redundant after the company entered administration, 26 were kept on.
The BBC has been told by several sources that Recharge Industries stopped paying them in July. More than half have since left the company as a result.
Pension commitments have not been met since the takeover, they say.
Staff also complain that they have been locked out of computer systems and are unable to work, because an IT contractor has not been paid.
Recharge Industries is a start-up business owned by Scale Facilitation, a New York-based investment firm run by financier David Collard.
David Collard has not commented on the claims.
Recharge Industries plans to use the Blyth site to build vehicle batteries for the Australian military.
But simply to get control of the land, it not only needs to give the remaining £2.47m to EY, but also needs to raise another £11m to pay property investor Katch, which has a financial claim to the site.
Sources within Recharge Industries insist funding from a new investor is imminent and that will enable the to deal to go forward by the middle of next week.
But Britishvolt employees seem to have little confidence this will happen.
"We've heard this time and time again since August", said one.
"He tells us there's an investor waiting. But he can't tell us who it is. It's always the same story".
Another described Mr Collard's claims as "BS".
David Collard insists he can yet prove his many doubters wrong but he has a lot of work to do - and quickly.
Another employee suggested staff were prepared to give the entrepreneur time to secure the new investment.
It is clear that Recharge Industries has struggled to obtain the funding it needs.
Part of that can be attributed to the impact of a tax raid by Australian federal police on the local offices of Scale Facilitation.
At the time of the raid in June, sources close to Mr Collard, who is a former partner at accountancy giant PwC, said that the tax raid is due to a misunderstanding of the interaction between US and Australian tax filings and that all parties were co-operating.
Scale Facilitation denied any wrongdoing.
Sources have acknowledged though that this made investors deeply wary of becoming involved with the Britishvolt project.
Another key problem has been a buyback clause held by Northumberland County Council, the original owner of the land.
This would allow it to repurchase the Blyth site if substantial progress has not been made on developing it by December 2024.
The BBC understands there are serious doubts at the top of Northumberland County Council that Mr Collard has the financial and industry pedigree to deliver on a project they hope will provide thousands of jobs directly and in the supply chain.
Meanwhile, EY has defended its own role in the affair. It insists that the £6.1m already received from Recharge Industries was "materially above the next best alternative, deliverable offer received by the Joint Administrators".
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Workforce / Labor
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Labour's deputy leader Angela Rayner has used her stand-in appearance at Prime Minister's Questions to attack the government's record on housing.
She said homeowners were "sick with worry" over mortgages, while renters' security had been "ripped away".
Ms Rayner also pressed Deputy PM Oliver Dowden on when the government would ban no-fault evictions.
Mr Dowden told MPs the government was standing behind both renters and mortgage holders.
He added that legislation to give renters greater security had been introduced by the government.
The Renters (Reform) Bill was tabled in Parliament in May but has yet to be debated by MPs.
Under the legislation, landlords would be banned from evicting tenants with no justification as part of a long-promised overhaul of the private rental sector in England.
Ms Rayner and Mr Dowden were standing in for their respective party leaders - Sir Keir Starmer and Rishi Sunak - who were both attending a celebration of the NHS at Westminster Abbey.
The pair will meet again next week as the prime minister will be attending a Nato Summit in Lithuania.
Ms Rayner began her questions by asking if the Conservatives could still claim to be the "party of homeownership" given families were "sick with worry about the cost of the Tory mortgage bombshell".
A typical five-year fixed mortgage deal currently has an interest rate of more than 6% - a sharp rise compared to this time last year - leaving homeowners who need to remortgage facing increases in their monthly payments.
The Bank of England has been raising interest rates in a bid to lower inflation.
Mr Dowden said he supported the bank's efforts and pointed to an assessment by the International Monetary Fund, which said the UK was taking "decisive and responsible action" to bring down inflation.
In contrast, he said a Labour government would pursue "endless borrowing" driving up prices.
Ms Rayner said renters would also suffer as landlords pass on the cost of higher mortgages to their tenants.
She noted there had been a 116% increase in no-fault evictions in 2023 and asked when the government would "finally deliver" on its 2019 manifesto promise to ban them.
"The chancellor will take all necessary measures to stand behind both mortgage holders and of course take necessary measures for renters," Mr Dowden replied.
Later in the question session, Labour MP Helen Hayes raised a housing case of one of her constituents, a first year university student, who took his own life in May.
He had signed a private sector tenancy agreement with his parents as guarantors, but the tenancy included a clause that said the responsibilities of the guarantor are unaffected by the death of a tenant.
Ms Hayes asked Mr Dowden to use the Renters Reform Bill to outlaw this practice and protect bereaved families.
The deputy prime minister said the case sounded "totally abhorrent" and would discuss measures to address the issue.
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Real Estate & Housing
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India’s Banks Are Making $64 Billion From A Freebie
Customers pay nothing for choosing a popular cashless option, and yet the country now rivals Japan in payment revenue.
(Bloomberg Opinion) -- On more than 6 billion separate occasions in just one month, the ringing of cash registers in India was replaced by audio confirmations on a digital sound box. Add instances of people paying one another rather than merchants, and the world’s most-populous nation drummed up more than 10 billion cashless transactions in August. All were online, instantaneous… and cost nothing.
At least most of them didn’t. Since April, customers dipping into their mobile-phone wallets to settle bills of more than 2,000 rupees ($24) have to bear a maximum 1.1% fee, but only if they are scanning a different platform’s quick-response code. This charge goes from the merchant to his QR code provider — Amazon.com Inc.-owned PhonePe or homegrown Paytm — for hooking up with Alphabet Inc.’s Google Pay. But the Unified Payments Interface, a common protocol for people to send and receive money into accounts at different banks, remains free for regular use.
Banks do try to impose some costs on high-volume users, and the government gives them money to promote low-value online transactions and make formal credit available to disadvantaged groups like street vendors. Yet, a lot of the lenders complain about being made to watch the swelling wave of online payments from the sidelines, rather than being allowed to ride it. Without a profit motive, how will India sustain an industry that — starting from nowhere seven years ago — has come to transact nearly $2 trillion of value annually?
It appears that those concerns are overblown. Even with a free public utility, India’s payment revenue swelled last year to $64 billion, behind only China, the U.S. and Brazil, and rivalling Japan, according to McKinsey & Co.’s latest global survey. The rising tide of online transactions has led to a surge in digital commerce. That has, in turn, lifted other boats: Credit card usage has also expanded.
Nor has the lack of a profit motive stifled innovation. New initiatives like pre-approved credit lines will supplement the original protocol that only allowed customers to debit bank accounts or wallet balances to pay someone. Since last year, credit cards have also been allowed to be linked — but only if they are on India’s RuPay network. Visa Inc. and Mastercard Inc., which have grumbled about the country’s absence of a level playing field, would love to be included.
It’s a different story from other successful payment systems. While McKinsey expects instant payments, led by the Pix platform, to account for half of the growth in Brazil’s payment revenue from transactions through 2027, the comparable figure for India may not even be 10%.
India’s profit from payments will expand because of sheer volumes. A fifth of the country’s 620 billion transactions last year were settled digitally. By 2027, the figure would rise to 765 billion, and nearly two out of three of these exchanges would be online. Nimble fintech firms would aggressively scout for every new avenue opened by technology or regulatory change. However, “there is ample room for banks to pursue various use cases depending on their specific core competencies and strategic priorities,” the consulting firm notes.
Initially, banks were reluctant to promote the shared network, fearing it would cannibalize their proprietary apps. Those fears weren’t unfounded, though in the process of losing their moat, the lenders have won access to the world’s fourth-largest pool of payment revenue. And this is just the start. From fees on cards to interest income on credit lines, new opportunities may arise in adjacent activities. In the first two months of last quarter, Paytm distributed $1.65 billion in loans on its platform on behalf of lenders, a 137% jump from a year earlier.
The instant-payment protocol may have become wildly popular, but it has only scratched the surface of its potential. The National Payments Corporation of India, the network’s operator, is taking it global. From Paris to Singapore and Dubai, there will be plenty of fees and currency-exchange commissions to be earned when Indian tourists use their rupee wallets — funded by credit lines from local lenders — at shops overseas.
For India’s banks that have turned a giveaway into a catalyst for last year’s 38% revenue growth, it makes sense to not upset the status quo. There’s much to be gained from an online payment system that is familiar, fast, and free.
More from Bloomberg Opinion:
- $1 Trillion in Credit Card Debt Signals Strength: Karl Smith
- Visa, Mastercard Will Dodge Geopolitics in India: Andy Mukherjee
- Sweden Ditching Cash Tells a Cautionary Tale: Lionel Laurent
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Andy Mukherjee is a Bloomberg Opinion columnist covering industrial companies and financial services in Asia. Previously, he worked for Reuters, the Straits Times and Bloomberg News.
More stories like this are available on bloomberg.com/opinion
©2023 Bloomberg L.P.
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Banking & Finance
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Fitch Ratings late Tuesday made good on recent concerns about the U.S. credit profile and downgraded its rating on the nation’s debt one notch to AA+ from AAA, saying that it reflects “expected fiscal deterioration,” a “high and growing” government debt burden, and an “erosion of governance” in face of repeated debt-limit standoffs and other ills.
Fitch warned in June that it could take that step even as the latest debt-ceiling showdown ended in a last-minute deal to avert a government shutdown. The ratings agency initially put the U.S. debt on a negative watch in May, as the debt-ceiling fight has been dragging on for months.
The last 20 years have witnessed a “a steady deterioration in standards of governance” in the U.S., the debt-ceiling agreement notwithstanding, Fitch said Tuesday.
“The repeated debt-limit political standoffs and last-minute resolutions have eroded confidence in fiscal management,” it said. “Several economic shocks” as well as tax cuts and new spending initiatives “have contributed to successive debt increases over the last decade.”
Moreover, the U.S. has had “limited progress” in tackling medium-term challenges related to rising social security and Medicare costs due to an aging population, the debt agency said. Fitch said it expects general-government deficit to rise to 6.3% of the U.S.’s gross domestic product this year, from 3.7% in 2022.
Treasury Secretary Janet Yellen called the move by Fitch “arbitrary and based on outdated data,” in a statement Tuesday. She also said the decision “does not change what Americans, investors, and people all around the world already know: that Treasury securities remain the world’s preeminent safe and liquid asset, and that the American economy is fundamentally strong.”
Fitch said that “tighter” credit, weakening investment in business, and a “slowdown” in consumption “will push the U.S. economy into a mild recession” in the fourth quarter of this year and the first three months of next year. It also called for GDP growth slowing to 1.2% this year, from 2.1% in 2022, and overall growth of just 0.5% in 2024.
On a brighter note and supporting the new AA+ rating, Fitch said that “exceptional strengths” in the U.S. include a well-diversified, high-income economy supported by a “dynamic” business environment. And, critically, the U.S. dollar still reigns as the world’s “preeminent reserve currency,” which gives the government extraordinary financing flexibility.
Stock-market investors weren’t fazed by the warning back in June, but it remains to be seen how they will react when the market opens on Wednesday. The Dow Jones Industrial Average
DJIA,
On the flip side, U.S. borrowing costs have been climbing as it pays higher yields to issue bills to restock its coffers.
The Treasury Department has unleashed a flood of Treasury issuance since its June debt-ceiling deal. The 1-month Treasury yield
TMUBMUSD01M,
–Joy Wiltermuth contributed reporting
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Interest Rates
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Liz Truss is to challenge Rishi Sunak’s government with a so-called alternative budget.
It will come a year after Truss delivered the “mini-budget” which preceded her downfall as prime minister.
The Growth Commission, the body set up by the former prime minister, is set to release a report one week before chancellor Jeremy Hunt delivers his autumn statement on November 22.
It is being called the “Growth Budget” and is expected to propose policy on a range of areas, including, corporation tax, income tax and national insurance.
It is reported to recommend an end to the “tourism tax” by bringing back VAT-free shopping.
Other things on the agenda are public sector spending, productivity as well as regulatory reforms.
At the Conservative Party conference this month, Truss called for tax cuts to “make Britain grow again” as she urged the chancellor to cut corporation tax to at least 19 per cent.
Her fringe event also included speeches from three former cabinet ministers including Priti Patel, Jacob Rees Mogg, and Ranil Jayawardena.
Truss told the fringe event in Manchester she wanted to see the Conservative Party become the “party of business again”, and for the government to stop “taxing and banning things” and instead “build things and make things.”
Economic growth would not be delivered by the Treasury or public spending but by “giving businesses the freedom they need to succeed”, she said.
“We need to acknowledge the government is too big, the taxes are too high. And then we are spending too much,” she added.
According to reports in the Times and the Telegraph, Doug McWilliams, the co-chairman of The Growth Commission, said: “This report is a detailed challenge to the conventional thinking which has proved unable to rise to the challenge of fixing the UK’s low-growth problem. Our analysis will present clear alternatives for policymakers to consider.”
Shanker Singham, the second co-chairman, added: “One of the things about the Growth Commission budget is that we are looking at both tax and fiscal policy as well as regulatory policy. We believe that the potential GDP per capita growth that could be unleashed as a result of regulatory reform is much larger than many have imagined.”
Politics.co.uk is the UK’s leading digital-only political website, providing comprehensive coverage of UK politics. Subscribe to our daily newsletter here.
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United Kingdom Business & Economics
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HDFC Bank Appoints Former Nabard Chairman Bhanwala As Director
The board in its meeting on Monday also approved the appointment of V Srinivasa Rangan, chief financial officer of erstwhile Housing Development Finance Corporation Ltd, as executive director for three years with effect from Nov. 23, 2023, HDFC Bank said in a regulatory filing.
Exterior of HDFC Bank Ltd.'s branch in Mumbai. (Source: Vijay Sartape/ Source/BQ Prime)
HDFC Bank on Monday said the board of the bank has approved the appointment of former Nabard chairman Harsh Kumar Bhanwala as an additional independent director.
HDFC Bank on Monday said the board of the bank has approved the appointment of former Nabard chairman Harsh Kumar Bhanwala as an additional independent director.
The board in its meeting on Monday also approved the appointment of V Srinivasa Rangan, chief financial officer of erstwhile Housing Development Finance Corporation Ltd, as executive director for three years with effect from Nov. 23, 2023, HDFC Bank said in a regulatory filing.
Both appointments are subject to shareholders' approval, it said.
Bhanwala has been appointed for a period of three consecutive years from Jan. 25, 2024 to Jan. 24, 2027, it said.
Currently, Non-Executive Chairman of MCX, Bhanwala also serves as the Director on the boards of IIM Rohtak and Bayer Crop Science Ltd.
Prior to leading National Bank for Agriculture and Rural Development (Nabard), he was the chairman and managing director of the India Infrastructure Finance Company (IIFCL), as per the filing.
Rangan has vast experience in housing finance and real estate sector.
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Banking & Finance
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Hong Kong-based crypto company Mixin announced on Sunday that it was breached and that the hackers stole around $200 million.
“In the early morning of September 23, 2023 Hong Kong time, the database of Mixin Network’s cloud service provider was attacked by hackers, resulting in the loss of some assets,” the company wrote on X, formerly Twitter. “Deposit and withdrawal services on Mixin Network have been temporarily suspended. After discussion and consensus among all nodes, these services will be reopened once the vulnerabilities are confirmed and fixed.”
The company said it contacted Google and crypto security firm SlowMist to help with the investigation.
Mixin describes its product as an “open and transparent decentralized ledger, which is collectively booked and maintained by 35 mainnet nodes.” In other words, the Mixin Network is a decentralized exchange and cross-chain network that allows users to transfer digital assets.
At this point, it’s unclear how hackers were able to steal the money after hacking into Mixin’s cloud database, given that — in theory — Mixin is decentralized.
Mixin, Google, and SlowMist did not immediately respond to a request for comment.
In the announcement, Mixin also said that it will announce an unspecified “solution” to deal with the stolen assets at a later date.
The hack on Mixin is the biggest theft in the crypto world in 2023, according to data maintained by Rekt, an organization that publishes a list of hacked crypto organizations and projects. The previous highest theft was that of Euler, a crypto lending platform, which experienced an attack that resulted in the loss of around $197 millions in March.
Do you have more information about this hack or other crypto hacks? We’d love to hear from you. From a non-work device, you can contact Lorenzo Franceschi-Bicchierai securely on Signal at +1 917 257 1382, or via Telegram, Keybase, and Wire @lorenzofb, or email lorenzo@techcrunch.com. You can also contact TechCrunch via SecureDrop.
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Crypto Trading & Speculation
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New Norms For Tax-Free Receipt From Insurance Policies Explained
Here are some of main points that people should keep in mind while looking at tax-free payouts from life insurance policies.
There has been a change in Section 10 (10D) of the Income Tax Act, which deals with the receipt of tax-free amounts from life insurance policies.
In recent times, there have been several exclusions that have been added to this section and the most recent one says that if the premium paid during the year on such life insurance policies exceeds Rs 5 lakh, then the amount would be taxable. The tax department has now come out with an explanatory statement on this. Here are some of the main points that individuals should keep in mind while they are looking at tax-free payouts from life insurance policies.
Issue Date
The most important point for the applicability of the new rules is that the life insurance policy should have been issued on or after April 1, 2023. This clearly shows that all the older policies that were issued before the start of financial year 2024 are not covered under this change and they will continue to enjoy the benefit of the tax-free receipt if they meet the other conditions that are applicable.
Not Applicable On Death
The other factor that also needs to be taken into consideration is that the wordings clearly state that in case any amount is received on the death of the policyholder, then the amount that is received would remain tax-free.
It could be that the policy premium was violating the Rs 5 lakh and if the amount would have been received on maturity, it would have been taxable, but this will have no impact if the situation changes. Policies also have a life-cover element, so if there is any amount received on death, this would not be taxable.
Term Policies Excluded
The current change that has been made is for life insurance policies that exclude the unit linked insurance policies. This is because there is another condition in the same section of the Income Tax Act that was introduced earlier that said receipts on ULIP policies where premium paid in excess of Rs 2.5 lakh paid in a year is taxable.
Within the life insurance policies bouquet, there is an exemption for term policies too even if the premium paid in the year exceeds Rs 5 lakh. Term policies are those where the payout is only on the death of the individual during the policy term. They provide large amounts of cover for a comparatively lower premium as compared to other types of policies as they involve only mortality risk. The figure of the premium paid on term policies are also not to be counted to see which policies exceed the limit of Rs 5 lakh.
Multiple Policies Calculation
If an individual has a single life insurance policy, then the calculation is simple because they just need to see if the premium is less than Rs 5 lakh and if it is, then the receipt would be exempt from tax. However, if there are multiple policies with an individual, then they will be able to get the exemption on those policies where the aggregate premium is less than Rs 5 lakh.
For example, if a person has three policies on which they are paying Rs 3 lakh Rs 2 lakh and Rs 2 lakh as premium, then the exemption will be available for the first two policies where the total premium does not exceed Rs 5 lakh. The individual can choose from the various policies that they have to see which of them yield the best benefit when they look for which to include below the Rs 5 lakh limit.
GST Not Included
Life Insurance Policies also have an impact in the form of goods and services tax that is levied on the premium that is paid by the policyholder. For the calculation of the Rs 5 lakh limit, the GST portion has to be excluded to see whether the policy premium is under the limit for the exemption. This is important because in some cases, the total payment might cross the Rs 5-lakh mark after the GST element is added to the actual premium.
Arnav Pandya is founder at Moneyeduschool
The views expressed here are those of the author and do not necessarily represent the views of BQ Prime or its editorial team
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Personal Finance & Financial Education
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Liquidity has fallen by $150 billion since Congress suspended the debt ceiling, Strategas said.
The debt deal earlier this month cleared the way for the Treasury Department to issue more T-bills.
Meanwhile, the Fed's quantitative easing program is taking money out of the financial system.
Market liquidity has fallen by $150 billion since Congress suspended the debt ceiling earlier this month, according to institutional brokerage and advisory firm Strategas.
In a note Thursday, Strategas attributed the decline to the Treasury Department's issuance of debt and the Federal Reserve's quantitative tightening program to shrink its balance sheet.
The debt ceiling deal cleared the way for the Treasury Department to auction more T-bills, which will restore the government's cash balance.
But the money to buy those T-bills comes out of financial markets, and Strategas said the Fed's reverse repurchase program — which acts like short-term loans — isn't offsetting the loss of liquidity from the auctions.
Meanwhile, the Fed began its quantitative tightening program a year ago, letting bonds roll off its balance sheet as they mature. But Strategas said federal spending via the Treasury General Account isn't offsetting the squeeze on liquidity coming from QT.
And the outflows are only accelerating, the note found, with half of the $150 billion liquidity drain occurring over the past three days.
"Investors have generally forgotten this story, because there wasn't an immediate negative reaction to the equity market," Dan Clifton, head of policy research at Strategas, told Insider. "I think there's a chance here for a surprise."
He said that a major liquidity drain could reverse the outperformance of long-duration stocks, such as technology and communication companies, while those focused on building things could see improved performance.
"To me, it's a really big financial market event," Clifton said.
Draining liquidity from the system could also lead to more bank failures, he warned, adding that he expects that risk will eventually pressure the Fed to slow down its quantitative tightening.
Money will continue to get sucked out of financial markets. Strategas estimated that the Fed's QT alone will drain $200 billion of liquidity by the end of August.
"It is likely that the drain will be larger than outlined because at least some of the Treasury issuance will come from bank reserves rather than the Reverse Repos. This is in addition to the QT effects," the note said.
Meanwhile, the Treasury Department is expected go on a big debt spree, and Strategas expects 50% of the issuance will come from bank reserves, which reduces liquidity.
Analysts at Deutsche Bank estimated in a note earlier this month that $1.3 trillion in T-bills will be issued over the remainder of 2023, bringing the total for the full year to about $1.6 trillion.
From June to August alone, Deutsche Bank predicted that cumulative issuance over the three-month period could top out at $800 billion.
Read the original article on Business Insider
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Interest Rates
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Flexible office-space firm WeWork has filed for Chapter 11 bankruptcy protection, listing over $18.6 billion of debts in a remarkable collapse for the once high-flying startup co-founded by Adam Neumann and bankrolled by SoftBank, BlackRock and Goldman Sachs. From a report: The New York-based firm, which raised over $22 billion and was valued at $47 billion at its peak, has listed assets of over $15 billion in the petition it filed in a New Jersey federal court.
WeWork chief executive David Tolley said about 90% of the company's lenders have agreed to convert their $3 billion of debt into equity. WeWork's bankruptcy filing is limited to locations in the U.S. and Canada, it said. WeWork India has emerged as one of the strongest units in the WeWork franchise, and is largely insulated from the bankruptcy as majority of it is owned by Embassy Group. The India unit makes money and doesn't need external capital to operate, the India head said in a statement today.
WeWork chief executive David Tolley said about 90% of the company's lenders have agreed to convert their $3 billion of debt into equity. WeWork's bankruptcy filing is limited to locations in the U.S. and Canada, it said. WeWork India has emerged as one of the strongest units in the WeWork franchise, and is largely insulated from the bankruptcy as majority of it is owned by Embassy Group. The India unit makes money and doesn't need external capital to operate, the India head said in a statement today.
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Banking & Finance
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PI Industries Q2 Results Review - Operating Leverage, Favorable Product Mix Drive Earnings: Motilal Oswal
The management maintained its revenue growth guidance of 18-20% per annum with continued improvement in margins and return.
BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Motilal Oswal Report
PI Industries Ltd. recorded a healthy revenue growth in Q2 FY24 (up 20% YoY), led by strong growth in the custom synthesis manufacturing business (up 22% YoY); however, the domestic business witnessed subdued demand (revenue down 2% YoY).
PI Industries' Ebitda margin expanded 160 basis points YoY, led by a favorable product mix and operating leverage.
We maintain our FY24/FY25 earnings estimates. We reiterate our 'Buy' rating on the stock with a target price of Rs 4,480.
Click on the attachment to read the full report:
DISCLAIMER
This report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.
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Stocks Trading & Speculation
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Eggs are currently South Africa's hottest commodity.
The country has been grappling with one of its worst outbreaks of bird flu - millions of chickens have been killed over the past few weeks, supplies of poultry meat have been threatened and supermarkets across the nation have run out of eggs.
Experts predict the egg shortage will cause the popular ingredient to jump in price - far from ideal considering it is one of the most affordable sources of protein for the millions living in poverty.
Retailers, farms and industry giants have also been hit, with the nation's largest chicken producer stating the flu had "ravaged" a sector already burdened by rising costs and an electricity crisis.
In an effort to stop the spread of Highly Pathogenic Avian Influenza - a deadly, extremely infectious type of bird flu - farmers have culled more than seven million egg-laying chickens. That amounts to 20-30% of the country's entire chicken stock, according to South African Poultry Association.
As a result, social media sites have been inundated with pictures of bare supermarket shelves, while many shoppers found that shops still selling eggs have set limits on how many can be bought.
Online shopping sites are no better - several consumers hoping to buy eggs on the web have been met with "unavailable" or "low in stock" messages.
No more cheap eggs
Domestic worker Nomalanga Moyo buys eggs every week in order to make muffins for her children's lunchboxes.
Her store of choice is a spaza shop - the term for a small informal outlet - in her township of Diepsloot. Here, she can buy any quantity of eggs - when funds are low, she is able to get just two eggs for about 2.50 rand (13 cents; 11p). However, this week, the store was totally out.
"I am now going to wait until I go to work during the week to see if I can find eggs at the normal shops. However, it will cost me more," a worried Ms Moyo said.
More than half of South Africans live below the poverty line. They already spend about 35% of their income on food and according to the Pietermaritzburg Economic Justice and Dignity research group, this share will likely increase as a result of the egg shortage.
"Not only will consumers spend more for eggs but the rising price of eggs will affect all other food products where producers use eggs and other poultry products," it said.
Businesses have also been impacted by the flu.
In a trading update at the end of last month, leading South African poultry producer Astral Foods said the outbreak had so far cost it $11.5m.
Astral said the flu has "spread at an alarming pace" and ravaged the poultry industry. The company also joined other producers in warning that South Africa could experience a shortage of chicken meat over the next few months.
Small businesses, which are less able to weather market shocks, have also voiced concerns.
"After baking scones for a client yesterday I was left with three eggs. I went shopping after to find more eggs but the price was too much for me," Zamapholoba Ngcobo, a bakery owner in the city of Pietermaritzburg said.
The shortage could not have come at a worse time, Ms Ngcobo said, as wedding and graduation season means cake orders are at an "all-time high".
But where there are losers, it seems there are always winners.
Ukulinga, a poultry farm in KwaZulu-Natal province, saw news of flu outbreaks in Brazil and Argentina earlier this year and implemented strict biosecurity measures as a precaution.
Nkululeko Ngidi, a manager at the farm, said: "When we started the farm we had to go out looking for business. Now that our farm is among the few that are free from bird flu, customers are looking for us.
"We have seen increased demand... we at the moment supply 130,000 eggs to businesses in the area on a weekly basis."
Unfamiliar strain
Farmers and industry experts estimate it will take six months for the poultry sector to replace the chickens it culled - meaning any shortage of poultry products could last through the festive season and into 2024.
Paul Makube, an agriculture economist at First National Bank, told the BBC: "The outbreak has moved at a rapid pace, it is worse than what we saw during the outbreak in 2017. A further complication comes from the fact that we are dealing with a strain we have not previously dealt with."
Concern has spread beyond the border - Namibia, which imports most of its poultry from South Africa, banned poultry products from its neighbour amid the outbreak.
In an effort to reassure its consumers and businesses, South Africa's government announced that it is considering purchasing bird flu vaccines.
And for the lucky South Africans that can actually find eggs in the shops, officials have stressed chicken products on shelves are safe for consumption.
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Agriculture
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Donald Trump Jr. is returning to the stand Thursday to continue testifying in the Trumps' New York civil fraud trial, one day after hewhile claiming little knowledge of the fraud the judge has already found them liable for.
Trump Jr. is the first of four Trumps who will, in which they're squaring off with New York Attorney General Letitia James. Eric Trump is expected to begin testifying later Thursday. Donald Trump will testify Monday, and Ivanka Trump is scheduled to appear two days later.
The judge in the case has already found the Trumps and their company liable for fraud, determining that they inflated Trump's wealth by billions of dollars, and many properties by hundreds of millions, in order to cut favorable deals with banks and insurers. James' office says the Trumps profited by at least $250 million through the scheme.
The trial is proceeding over other allegations related to falsification of business records, conspiracy and insurance fraud, as well as to determine what, if any, penalties the Trumps and their companies will face.
As he arrived at court Thursday, a CBS News reporter asked Trump Jr. what he expected from day two of his testimony. He put two thumbs up and said, "I'll tell you in an hour."
Trump Jr.'s first day of testimony
Trump Jr., the former president's eldest son, was first called to the stand Wednesday afternoon, when he testified for just under 90 minutes.
Though mostly serious, he peppered his responses with occasional jokes, at one point apologizing for talking too fast.
"I apologize, Your Honor, I moved to Florida, but I kept the New York pace," he said.
An executive vice president at the Trump Organization, Trump Jr. said he worked in "an all-encompassing developmental role," but also said he couldn't recall much about a key moment in the company's history: when Allen Weisselberg, the chief financial officer and one of his father's most trusted employees for nearly 50 years, agreed to a $2 million severance earlier this year just before going to jail for fraud.
Trump Jr. ultimately laid the blame for the fraud the company is accused of — a decade-long scheme that enriched the family by more than $250 million, according to James' office — at the feet of Weisselberg and the company's outside accountants.
"I signed off on a document that Mazars prepared with intimate knowledge, and as a trustee I have an obligation to listen to those who are experts, who have an expertise of these things," Trump Jr. said. "So I trust in Allen Weisselberg who is an accountant. I trust Mazars who is a CPA and a big five accounting firm to put together a document of this nature."
"These people had an incredible, intimate knowledge and I relied on them," he added later.
Trump Jr.'s work at the company involved many of the properties and deals that are a focus of the case, including the financing and development of Trump International Hotel & Tower, Chicago, and Trump International Golf Links in Aberdeen, Scotland, as well as commercial leasing deals at properties including Trump Tower and 40 Wall Street in Manhattan.
On Wednesday, he said he viewed his primary responsibility as overseeing the company's overseas branding and hotel deals, which he said were largely put on ice during his father's presidency.
After his father was elected president, Trump Jr. was also given the task of signing off on his father's— documents the attorney general claims, and the judge has agreed, were key to fraudulently inflating the values of company properties and the size of Donald Trump's wealth.
The defendants have all denied wrongdoing in the case, and the Trumps have all accused James — an elected Democratic official — of pursuing them for political gain.
The lawsuit against the Trumps and their company is seeking $250 million and sanctions designed to limit their ability to do business in New York, including permanently barring Donald Trump, Donald Trump Jr. and Eric Trump from serving as an officer or director in any business in the state.
Cassandra Gauthier contributed reporting.
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Banking & Finance
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Braid, a four-year-old startup that aimed to make shared wallets more mainstream among consumers, has shut down.
Founded in January 2019 by Amanda Peyton and Todd Berman (who left in 2020), San Francisco-based Braid set out to offer friends and family an FDIC-insured, multi-user account that was designed to make it easy “to pool, manage and spend money together.” Users could create a cash pool toward a collective goal of, say, saving for a trip to Europe and then spend it on airfare or lodging using a branded debit card.
Braid raised a total of $10 million in funding “over multiple rounds” from Index Ventures, Accel and others, according to Peyton’s LinkedIn page.
In a blog post, Peyton said that Braid closed its doors in September and outlined her experiences in building the company, ultimately realizing that it wasn’t going to be a viable business venture. In the post, Peyton took responsibility for Braid’s demise, but stressed her belief that it was important to share her story of what happened.
“I have no regrets,” Peyton said in an interview with TechCrunch. “We did it the right way: Every customer dollar was cashed out; every employee was treated with care. There is magic in failure too, if you squint a bit. We were given the opportunity to take a big swing and it’s important to recognize how rarely that happens in life.”
She added of the shutdown: “It was terrible, it totally sucks…But it’s part of the life cycle. I think it’s just part of what you sign up for. And it’s part of why we do this…I did YC in 2010 and that is one of those things that, like, sticks with you forever. Part of their whole thing is, like, there just needs to be more startups – like, we just need to do more. There needs to be more than more people starting startups. There needs to be more opportunities…But [failure] – it’s this part of that cycle. And I think it’s the part that people don’t talk about a lot, but it’s just as important as the seed round or the launch.”
Also in her blog post, Peyton described the struggles that Braid faced after having issues with a sponsor bank that led to the company “effectively [being] in a coma from July 2022 to January 2023.” Despite finding a new sponsor bank, Braid continued to struggle. One of the biggest takeaways from her experience, Peyton said, was that leveraging third-party software would not necessarily help the company move faster and focus on its core offering.
She wrote: “What we found, instead, was every additional partner had the potential to break big, important parts of our stack. Building a multiplayer offering meant we had to be as close to the metal as possible, because a lot of our UX didn’t really exist off-the-shelf. After several painful migrations, our distaste for contractual and technical lock-in grew dramatically. By the end, if there was something we could build ourselves in Retool, we did. In addition, building mostly in-house was the only way our unit economics worked. There’s a lot of great fintech software out there, but if that software eats your entire margin, you’ll end up dead regardless.”
Looking ahead, Peyton noted that she, post shutdown, purchased the intellectual property for Braid in an auction.
“I Iove fintech,” she told TechCrunch. “I love payments. I think there’s enormous, humongous opportunity here.”
Prior to co-founding Braid, Peyton worked at Google and Etsy. She also started another company called Grand St., a marketplace for creative and indie technology products that was acquired by Etsy in April of 2014 for an undisclosed amount.
Peyton also started another e-commerce company that wasn’t venture-backed, as well as a mobile messaging company that went through a YC cohort and that the founder noted also “failed.”
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Banking & Finance
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Michael Cohen, Donald Trump's former lawyer and longtime "fixer," is confronting his ex-boss face-to-face for the second time Wednesday, as he resumes testimony in the former president's New York civil fraud trial.
Cohen, with Trump watching, that Trump personally authorized fraudulent inflations of his net worth and property values.
Cohen is a former Trump Organization executive who was for years among Trump's closest confidants. He alleged Tuesday that he and the company's former chief financial officer "reverse engineered" Trump's financial statements to meet valuations that Trump "arbitrarily selected."
Trump and his co-defendants are accused of fraudulently inflating the value of assets for their own financial benefit. New York Attorney General Letitia James is seeking $250 million for the state, and is asking the court to order sanctions restricting Trump's ability to do business in New York. The judge in the civil case has already found Trump and his co-defendants. The trial is proceeding on other accusations, including falsification of records, conspiracy and insurance fraud.
Cohen testified Tuesday that Trump told him to adjust statements of financial conditions — documents at the core of the fraud case — to arrive at a net worth that Trump assigned himself "arbitrarily."
"I was tasked by Mr. Trump to increase the total assets based upon a number that he arbitrarily selected. And my responsibility along with Allen Weisselberg, predominantly, was to reverse engineer the various different asset classes, increase those assets in order to achieve the number that Mr. Trump had tasked us," Cohen said, prompting Trump to shake his head and fold his arms across his chest.
Trump and his co-defendants have denied all wrongdoing, and Trump's legal team has sought to portray Cohen as untrustworthy.
During cross examination by Trump attorney Alina Habba, Cohen said he lied under oath in federal court when he entered a guilty plea to tax evasion in 2018. Cohen now says he didn't evade taxes.
Cohen and Trump had not seen each other in person since that plea, and in the years since the former friends have often sought to vilify each other.
Cohen's testimony under cross-examination Tuesday was often combative. Cohen several times replied to Habba's questions with the phrase, "asked and answered," adopting an objection lawyers sometimes raise, but witnesses cannot.
The last time he did so, it prompted another Trump attorney, Christopher Kise, to jump out of his chair. He protested to the judge, saying, "this witness is out of control."
It is unclear how much more cross-examination is in store for Cohen Wednesday.
His testimony has attracted interest from Manhattan District Attorney Alvin Bragg's office, which brought a separate criminal case against Trump earlier this year that also relies on Cohen's testimony. Susan Hoffinger, the lead prosecutor in that case, was seen entering the courthouse Tuesday afternoon, and returned again on Wednesday, along with four other attorneys from Bragg's office. Hoffinger also led a 2022 case in which two Trump companies were found guilty of 17 felonies related to fraud.
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Real Estate & Housing
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Of all the lies New York attorney general Letitia James has accused Donald Trump of telling as part of an alleged scheme to overvalue his assets for monetary gain, the most ridiculous one arguably concerns his penthouse at Trump Tower. Specifically, Trump has claimed in official bank statements the triplex is 30,000 square feet, when in reality it is approximately one-third that size. Which, clearly, is a very big difference. And according to a document revealed by prosecutors on Tuesday, Trump is fully aware of that fact!
While questioning former Trump Organization CFO Allen Weisselberg, lawyers for the government showed the court a 1994 document signed by the ex-president putting the size of his Trump Tower abode at 10,996 square feet, according to the Associated Press. While Trump, who has denied all wrongdoing, was not in court to respond to the evidence, Weisselberg told prosecutors that he remembered seeing the email the document in question was attached to, but not the actual document. Nevertheless, he insisted it wouldn’t matter much either way because the penthouse—whose overinflated size Trump used to received more favorable loan terms—was not important relative to his boss’s overall net worth. “I never even thought about the apartment. It was de minimis, in my mind,” Weisselberg said. “It was not something that was that important to me when looking at a $6 billion, $5 billion net worth.”
Weisselberg also testified Tuesday that he first learned there were questions about the size Trump was telling people his home was—and the size it actually was—when a reporter for Forbes magazine told him in 2016. The former CFO said he initially disputed the outlet’s reporting, but could not recall if he tasked anyone with looking into the matter. “You don’t recall if you did anything to confirm who was right?” prosecutor Louis Solomon asked. Weisselberg responded that he did not. Yet emails reportedly show that, as Forbes continued to hone in on the size of the triplex in 2017, a spokesman for the Trump Organization told another executive that Weisselberg had decreed that no one was to engage on the issue. Then, a week later, Trump’s 2016 financial statement came out and, surprise: The apartment was listed with the very wrong square footage.
In 2022, Weisselberg pleaded guilty to conspiring with the Trump Organization to commit numerous crimes, which the company was found guilty of months later. On Tuesday, Weisselberg testified that he is still receiving installments of his $2 million severance package from the company.
In related news, Rolling Stone reports that leading up to the civil trial against the New York attorney general, Trump and his attorneys believed they had little chance of winning and thus decided to craft “an approach to the case that centers around chaos and cacophony” and involves “below the belt” attacks on the judge, witnesses, and prosecutors. While the ex-president’s attorneys have already been fined by Judge Arthur Engoron for bringing up legal arguments he had barred numerous times, a person familiar with the matter told Rolling Stone that Trump has, per the outlet, “privately suggested that his lawyers should not ‘worry’ for now about getting further sanctions by the court for their planned procedural antics.”
RFK Jr. is apparently not ready for prime time
Ron DeSantis encourages people to give Trump the benefit of the doubt re: sharing state secrets
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Real Estate & Housing
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Women seeking asylum in Northern Ireland have said they are frightened to leave their hotel rooms.
Speaking to BBC News NI, one woman said she did not leave her room while her daughter was at school, another said she was scared to go out in public spaces.
Charity All Nations Ministries said the system for housing those seeking asylum in hotels is not fit for purpose.
Mears, who runs the hotel, said welfare officers are on site every day.
The company, which is contracted to the Home Office, said about 3,000 people are housed by them across Northern Ireland in a range of accommodation and that their safety and welfare "was of the utmost importance to them".
'Stuck in a room'
All Nations Ministries, which has helped hundreds of families over the past year, with food, clothing and some education classes, said families living months at a time in hotels should come to an end.
Dikra is one of the people the charity has helped.
She fled an abusive partner who had sexually exploited her in their home in Tunisia. She travelled to Italy but he followed her there, and then she went to Dublin.
She has been in Belfast with her daughter for the last four months.
Dikra said the conditions at the hotel were "very bad".
"We are stuck in the room and I don't leave while she is at school," she said.
Amira, not her real name, is from Palestine and has lived in the same hotel for nine months.
She finds life there lonely and frustrating,
"This is the first time in four days I've left my bed in the hotel," she said when speaking to the BBC.
"I'm very depressed. We left Palestine to find a safe place and the Home Office put me into the hotel."
Amira said she sleeps all the time, there were no activities in the hotel and she was frightened to go anywhere.
"Every day I think I will die. No-one is thinking about us. No-one cares about us," she added.
"I tell the hotel I will go anywhere. I just want to work - I don't want benefits. But there is no news."
'£8 a week'
I meet Dikra and Amira at the All Nations Ministries centre in north Belfast.
It's a hive of activity with English, sewing and computer classes happening in different parts of the building.
Helen Livingston, a retired social worker and volunteer, said the people that came to the charity had experienced great trauma.
She said they were stuck in hotels "for months at a time in one room, nowhere to cook and they're not allowed to work".
"They're given £8 a week," she added.
"They don't look at a map and say Northern Ireland might be nice. They're coming through many countries.
"They leave Syria, Palestine, Yemen and they cross into Europe and make their way through other countries where they might spend long periods.
"We have fluent German speakers because they've spent years there but they aren't being given permanence and then they have to move again."
Helen said the people she helped found the food unpalatable.
"Many of the children won't eat the food and then end up malnourished," she said.
Dikra and Amira both agreed that when there is so little to feel positive about, food could make a small difference.
A Mears spokesperson said hotels had been assessed prior to use to ensure they are of an appropriate standard.
"All accommodation arrangements meet housing standards and the Home Office contract regarding occupancy levels and space," they said.
"Three meals a day are provided, along with snacks, and menus meet NHS Eatwell standards."
The Home Office said: "We are committed to ensuring the well being and safety of those in our care. The use of hotels is a short-term solution and we are working hard to find appropriate accommodation."
You can see more on BBC Newsline on Wednesday at 18:30.
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Nonprofit, Charities, & Fundraising
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With only one month to go before the end of the year, it's time take a look at those remaining funds in yourAn FSA, or Flexible Spending Account, is a pre-tax account that can be used to for certain out-of-pocket health care costs.
FSA balances typically expire at the end of the calendar year, but you might be able to roll over some funds into the next year depending on your employer.
"The maximum amount you can rollover also changes every year and is determined by the IRS — for 2023, the limit is $610," explains Charlene Rhinehart, certified public accountant and personal finance editor at healthcare company GoodRx.
Even with this maximum set, your employer may choose to only let you rollover a lesser amount.
"Some plans might offer a grace period instead of allowing you to rollover funds, giving you extra time — usually 2.5 months — to spend what's left in your account," Rhinehart says, advising people to speak with their employer's benefits manager to confirm what options may apply to you.
According to the Employee Benefit Research Institute's FSA database, 26% of plans give a grace period, 42% let people rollover a certain amount and 33% lose it at the end of the year.
What can I spend my FSA on?
If you're looking to use up your remaining FSA balance, here are some products, classes and programs you can spend it on — just keep your receipts when you pay for items out of pocket, Rhinehart says.
"You'll need to provide them to your plan administrator to request reimbursement for your qualified expense," she explains.
Skincare: Over-the-counter acne treatments, broad spectrum sunscreen with SPF 15+, and hair regrowth medications are eligible. Botox for Federal Flexible Spending Account Program website.may be eligible, but requires a letter of medical necessity signed by your doctor along with a detailed receipt, according to the
Eye, ear and teeth care: In addition to eye exams and surgery, eyeglasses, contact lenses and supplies are also eligible. You can even purchases supplies such as contact lenses solutions, eye glass repair kits and lens wipes.
For your teeth, orthodontia such as braces and retainers as well as mail-order clear dental aligners like Invisalign are eligible. So are supplies such as teeth grinding prevention devices and over-the-counter toothache reliever.
Eligible ear care items include both over-the-counter and prescribed hearing aids and batteries as well as over-the-counter ear drops.
Medicine cabinet essentials: Use your FSA balance to stock your medicine cabinet for the new year — items such as bandages, hand sanitizer andare eligible. So are many over-the-counter medications, including:
- Allergy and sinus medicine
- Cold and flu medicine
- Cough drops, sore throat lozenges and cough syrup
- Antacids
- Aspirin or other pain relievers
- Antibiotic ointment
- First aid kits and emergency medical kits
Immunizations such as flu shots are also eligible. So is COVID testing, both in-person and at-home.
Health tools: Have any health and wellness devices you need to replace or want to upgrade? Some eligible options include blood pressure monitors, thermometers and evenand supplies.
Menstrual products: Menstrual care products are eligible, including pads, tampons, cups and.
Professional services: You may have all your essential doctor and dental visits done for the year, but are there other services that could be beneficial? Physical therapy, massage therapy, chiropractor and acupuncture visits are also FSA eligible.
Pregnancy and family care: If you're pregnant or trying to conceive there are plenty of options you can purchase with your FSA account, from pregnancy tests to prenatal vitamins to breastfeeding and childbirth classes.
Not looking to get pregnant? Over-the-counter contraceptives like condoms as well as birth control pills (bothand prescription) are FSA eligible.
Addiction treatment: A number of treatment programs are also FSA eligible, including alcoholism and drug addiction treatment as well as smoking cessation programs, drugs and patches.
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Personal Finance & Financial Education
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“News deserts” have proliferated across the U.S. Half of the nation’s more than 3,140 counties now have only one newspaper—and nearly 200 of them have no paper at all. Of the publications that survive, researchers have found many are “ghosts” of their former selves.
Journalism has problems nationally: CNN announced hundreds of layoffs at the end of 2022, and National Geographic laid off the last of its staff writers this June. In the latter month the Los Angeles Times cut 13 percent of its newsroom staff. But the crisis is even more acute at the local level, with jobs in local news plunging from 71,000 in 2008 to 31,000 in 2020. Closures and cutbacks often leave people without reliable sources that can provide them with what the American Press Institute has described as “the information they need to make the best possible decisions about their daily lives.”
Americans need to understand that journalism is a vital public good—one that, like roads, bridges and schools, is worthy of taxpayer support. We are already seeing the disastrous effects of otherwise allowing news to disintegrate in the free market: namely, a steady supply of misinformation, often masquerading as legitimate news, and too many communities left without a quality source of local news. Former New York Times public editor Margaret Sullivan has a called this a “crisis of American democracy.”
The terms “crisis” and “collapse” have become nearly ubiquitous in the past decade when describing the state of American journalism, which has been based on a for-profit commercial model since the rise of the “penny press” in the 1830s. Now that commercial model has collapsed amid the near disappearance of print advertising. Digital ads have not come close to closing the gap because Google and other platforms have “hoovered up everything,” as Emily Bell, founding director of the Tow Center for Journalism at Columbia University, told the Nieman Journalism Lab in a 2018 interview. In June the newspaper chain Gannett sued Google’s parent company, alleging it has created an advertising monopoly that has devastated the news industry.
Other journalism models—including nonprofits such as MinnPost, collaborative efforts such Broke in Philly and citizen journalism—have had some success in fulfilling what Lewis Friedland of the University of Wisconsin–Madison called “critical community information needs” in a chapter of the 2016 book The Communication Crisis in America, and How to Fix It. Friedland classified those needs as falling in eight areas: emergencies and risks, health and welfare, education, transportation, economic opportunities, the environment, civic information and political information. Nevertheless, these models have proven incapable of fully filling the void, as shown by the dearth of quality information during the early years of the COVID pandemic. Scholar Michelle Ferrier and others have worked to bring attention to how news deserts leave many rural and urban areas “impoverished by the lack of fresh, daily local news and information,” as Ferrier wrote in a 2018 article. A recent study also found evidence that U.S. judicial districts with lower newspaper circulation were likely to see fewer public corruption prosecutions.
A growing chorus of voices is now calling for government-funded journalism, a model that many in the profession have long seen as problematic.
The U.S. government first started subsidizing journalism when it began offering postal subsidies to newspapers in 1792. Governmental support for the press has since continued, notably with the development of a massive public relations infrastructure at federal and state agencies in the 19th and 20th centuries. In his 1998 book Governing with the News, scholar Timothy E. Cook noted that in this system, “government workers are paid by public funds to help generate the news.”
There have also been more direct efforts, especially when Congress established the Corporation for Public Broadcasting in 1967. That move represented government actively entering the domestic media world. Decades before, in 1942, the U.S. government started Voice of America overseas as part of an effort to combat Nazi propaganda. Nevertheless, the dominant perspective in the country has long revolved around journalism being free from government intervention. This is frequently referred to as a “negative” interpretation of the First Amendment. What is often overlooked is the “positive” interpretation. In a 2022 essay, Victor Pickard of the University of Pennsylvania said the latter perspective focuses on government’s affirmative role to help guarantee the public access to a “diverse and informative media system.”
This approach to media is desperately needed, especially in an information ecosystem overrun by the profit-minded and algorithmic-based approaches of tech platforms such as Google, Twitter (aka X) and Facebook, which prioritize clicks rather than public service. Public media such as NPR, the Canadian Broadcasting Corporation and PBS backed away from Twitter after its CEO Elon Musk suggested NPR—which receives minimal government funding and relies on memberships and sponsorships—was a “government-funded” news organization akin to China’s Xinhua News Agency.
While Musk’s labeling of NPR is inaccurate, his misrepresentation is emblematic of the fundamental challenge to overcome if public media is to help solve the crises of news deserts and misinformation. Accurate, well-researched, contextualized, current information about local communities—i.e., journalism—needs to be considered what economists call a “public good.” Public goods are “nonexcludable” and thus available to all.
For that to happen, there needs to be a fundamental shift in the American view on journalism. Quality information cannot be seen as an optional luxury for the well-off. We need to see it as a critical need, like schools, roads, bridges, clean water and emergency personnel. Seen this way, the argument for publicly funded journalism changes dramatically.
There are, of course, important challenges. The “negative” interpretation of the First Amendment focuses on the ways American media is largely protected from government intervention and regulation—outside of exceptions such as obscenity, libel and infringement on intellectual property. The threat of authoritarian intervention must not be discounted amid partisan accusations of truthful reports as “fake news” and Donald Trump’s labeling of journalists as the “enemy of the people.” When considering these risks, we must not overlook the ways that for-profit corporations are key players in the “capture” of media and the ways that corporate mindsets have gutted newsrooms across the U.S.
Journalism is in what economists call a state of “market failure,” one that media economist Robert Picard has long maintained may merit thoughtful public intervention. This support could come through tax credits that people could use to support news outlets of their choosing. News organizations could be granted tax-exempt status like churches or public schools. Designated tax revenue (for example, from levies on electronics and tech platforms and companies or from “spectrum auctions”) could be developed to support independent journalism. This funding could be overseen by a bolstered Corporation for Public Communication, as scholars Mark Lloyd and Lewis Friedland suggested in a chapter of The Communication Crisis in America, and How to Fix It. Such a board would need to be publicly appointed or elected—with the goal of assessing whether the work of a funding recipient met the public’s information needs. This would help build the infrastructure of state-supported journalism rather than something that could devolve into a state-run propaganda arm.
Research has found consistent relationships between the prevalence of poverty and news deserts. This is both an equality and public health problem, one that will never be resolved until American society recalibrates how it thinks about journalism. It must be considered as much an educational institution as the local elementary school, as essential to public health as a community hospital, as worthy of government investment as a Main Street business district. Without this shift, our news ecosystem will continue serving largely those who are most advantaged; it will leave vulnerable communities in the dark; and it will further drive a wedge between people who have access to honest news and those deluged only with lies and propaganda.
This is an opinion and analysis article, and the views expressed by the author or authors are not necessarily those of Scientific American.
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Nonprofit, Charities, & Fundraising
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Bitcoin and Ether rose during Thursday afternoon trading in Hong Kong, while the top 10 non-stablecoin cryptocurrencies by market capitalization were mixed. Investors remained optimistic as new institutional players like Fidelity prepare to file their Bitcoin ETF applications.
Bitcoin, Ether rise, top 10 cryptos mixed, as Fidelity prepares Bitcoin ETF application
Bitcoin rose 1.07% from 7 a.m. to 4:30 p.m. in Hong Kong to US$30,428. Ether gained 1.2% in the same timeframe, to trade at US$1,849.
The world’s first currency briefly touched US$30,465 during yesterday’s session, as risk appetite remained strong after numerous large institutions led by BlackRock filed their spot Bitcoin ETF applications in the past weeks.
Asset management giant Fidelity is preparing to submit its own spot Bitcoin ETF application, a source familiar with the matter told The Block Tuesday.
“This move is seen as a significant step towards legitimizing cryptocurrencies and could bring in new institutional investors into the market,” wrote Kadan Stadelmann, chief technical officer of blockchain infrastructure development firm Komodo, in a statement shared with Forkast.
“Fidelity’s entry into the cryptocurrency market is expected to bring in more institutional money, which could drive up demand for Bitcoin and other cryptocurrencies. This move is also expected to increase the adoption of cryptocurrencies by traditional financial institutions, further legitimizing them as an investment asset class.”
Solana’s Sol token was the day’s biggest gainer in the top 10, rising 1.32% to US$16.27. Dogecoin was the day’s biggest loser, down 1.91% to US$0.06297.
The total crypto market capitalization over the past 24 hours rose 0.03% to US$1.17 trillion and market volume decreased 21.30% to US$29.58 billion, according to CoinMarketCap.
Bitcoin dominance rose to 50.4%, which marks an over two-year high. April 25, 2021, was the last time Bitcoin Dominance was over 50% when Bitcoin was trading above US$53,000.
Bitcoin NFT sales rise, Ethereum NFT sales fall with Azuki Elementals
The Forkast 500 NFT index fell 0.64% to 2,848.52 points in the 24 hours to 4:30 p.m. in Hong Kong and declined 2.22% during the week.
Bitcoin’s 24-hour non-fungible token sales rose 111.14% to US$3.05 million, as sales for $FRAM BRC-20 NFTs rose 62.94% to US$806,351.
Ethereum’s 24-hour NFT sales fell 65.84% to US$23.49 million, as sales for Azuki decreased 41.7% to US$3.89 million after collectors were disappointed in the release of the new Azuki Elementals collection. Despite selling out within the first 15 minutes on Tuesday, investors criticized the collection for looking almost identical to the original Azuki collection. 24-hour sales for Azuki Elementals fell 56.13% to US$3.62 million.
Among the Forkast Labs NFT indexes, the Forkast CAR NFT Composite was the only one in the black, inching up 0.43% to 990.62 points.
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Crypto Trading & Speculation
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In the age of Brexit, the cost of living crisis, high inflation, high interest rates, high taxation, low growth, climate crisis and serious international turmoil, the business secretary might make headlines talking about business and economics. But then Kemi Badenoch is not in the running to improve Britain, she is in the running to lead the Conservative party. She is here to do well: and if you want to do well in certain echelons of British life, there are 14 words that govern your every utterance: “No Black person ever went broke telling white people what they want to hear.”
With that in mind, this is Kemi: “I tell my children this is the best country in the world to be Black – because it’s a country that sees people, not labels.” Back of the net. She continued: “It wasn’t a tough decision for us to reject the divisive agenda of critical race theory. We believe, as Martin Luther King once said, people should be judged by the content of their character, not the colour of their skin.”
Kemi would be Rishi, so here comes the tummy tickle followed by every rightwinger’s favourite (and only) King quote. We see you, Kemi. But still, let us indulge her for a moment, is Britain really the best place to be Black?
It would be brutally dishonest to suggest that Britain is not a good place to live – for anybody. We are a nation blessed with (often stolen) wealth, truly talented people (many of them were stolen too), and robust systems and controls that theoretically seek fairness, compassion and justice. But scratch the surface, look at some of the statistics and stories that constitute the Black British experience, and less than stellar themes emerge.
Just 24 hours before Badenoch made her “best place to be Black” speech, Hubert Brown, a 61-year-old Black man based in Bristol, was fatally stabbed in the neck in what police say is being treated as a “race hate crime””. In most cases, Black life in Britain is treated as cheap. Last year, in the early hours of 20 November, Fatoumatta Hydara and her two daughters died after her neighbour took petrol from his motorbike and poured it through their letterbox and set their house alight as they slept. He was convicted of murder. It was an unimaginably horrific crime, but didn’t spur massive coverage or a significant political response.
“It’s the economy, Kemi!” And on practically every measure of financial prosperity in Britain, from employment rates to wage gaps to business financing, Black people face additional hurdles and often lag behind. Those of us who do manage to establish ourselves in the professional realm often face serious code-switching (and sometimes, racism laundering) demands that can be a stepping stone to mental (and sometimes even physical) health issues.
Putting aside internationally shameful abominations such as the Windrush scandal, the report by the Commission on Race and Ethnic Disparities (which the UN condemned as an attempt to normalise white supremacy) and the flight of Britain’s first Black princess to America, an analysis of key areas of Black life in Britain – power, portrayal, privilege, protection, pound sterling – reveal varying degrees of comparative disadvantage.
The groundbreaking Black British Voices report – produced by the Voice Newspaper, Cambridge University’s sociology department and management consultancy I-Cubed – polled more than 10,000 Black Britons and outlines their many concerns. It’s stark, bleak and in total opposition to Badenoch’s rosy assertions. Just 50% of Black Britons consider themselves proud to be British, 95% of respondents believe the UK’s school curriculum neglects Black lives and experiences and fewer than 2% think educational institutions take racism seriously; 87% expect to receive substandard levels of healthcare because of their race, while 79% believe the police still use stop and search unfairly against Black people.
Despite, and not because of, the likes of Badenoch and her party, Black people in Britain have made enormous progress and have contributed massively to Britain as a society, and are now – in many ways – a force behind much of the culture holding us together. However, the idea of pondering if Britain is the best place to be an oppressed minority is preposterous. The question should never be: “Is Britain the best place to be Black?” The question and measure should be: “Is Britain as good a place to be Black as it is to be white?”
One thing that is certain if you are Black: Britain is a great country to be a racial demagogue, and racism laundering by those who fancy themselves for the country’s top job could prove a very smart move.
Nels Abbey is a writer, broadcaster and former banker, and the author of Think Like A White Man. His new book, The Hip-Hop MBA: Lessons in Cut-Throat Capitalism From The Moguls of Rap, is out in 2024
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United Kingdom Business & Economics
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Asset protection planning is the process of building barriers around your assets, whether those assets are personal or business, to keep them safe from litigation, creditor claims, seizure and burdensome taxes. It's a vital and completely legal component of both financial planning and estate planning. There are a number of key tools you can utilize to accomplish the goal of protecting your assets. A financial advisor can help you structure and organize your assets so that they are more likely to achieve your financial goals.
What Is Asset Protection Planning?
Contrary to what many people think, asset protection planning is not just for the wealthy. The estates of anyone, in any income group, can be sued or suffer from hefty taxation. These strategies can mitigate the effect of creditor claims and other issues on your wealth.
If you want and need to protect your assets, you have to be proactive. It's too late to employ asset protection strategies after a child is hurt on your property and the child's parents sue you or you are at fault in a serious car accident. You want to set up an asset protection plan before any of these things happen to you.
While many people can benefit from setting up an asset protection plan, not everyone can. If you have a lot of debt and few assets and you are subject to a lawsuit, it may be better to take bankruptcy than set up an asset protection plan. That's because it's only worth it if you have significant assets, though some events cannot be protected against. These include tax liens, mechanics liens, alimony judgments and child support claims.
Who Should Have an Asset Protection Plan?
Anyone can put an asset protection plan into place. A plan benefits the following people the most:
While even those with a modest net worth should at least consider asset protection, it's especially important for anyone with a significant amount of assets.
Anyone with a significant, recurring amount of credit card debt.
Homeowners who are underwater on their mortgage. In other words, if your mortgage balance is greater than the value of your home, you need to consider an asset protection plan.
Anyone whose profession carries with it a high probability of liability. Doctors and lawyers are some common examples.
Some assets are not at the mercy of your creditors, such as retirement accounts under the protection of the Employee Retirement Income Security Act of 1974 (ERISA). You may also legally preserve at least a portion of your home equity. Homes may be put in another individual's name. Bank accounts can be transferred to offshore banks to preserve their value.
How Does an Asset Protection Plan Work?
The goal of an asset protection plan is to put a degree of legal separation between you and your assets. With this legal separation, you can legally shelter your assets from creditors without doing anything illegal. Generally, the first step you take to protect your assets is to transfer them from their unprotected ownership to a protected form of legal ownership, such as one or more of the options below.
Family Limited Partnership
One very common vehicle to protect your assets is a family limited partnership (FLP). If there are any family-owned businesses or assets, such as properties, that you want your children to own after you’re gone, you can set up a FLP.
Typically, creating an FLP involves establishing a general partnership and then making your heirs and family members limited partners. As the general partner, you’ll still be able to call the shots. But your partners, whether they’re your children or other relatives, will have a stake in the partnership or own a portion of the assets. As a result, the size of your estate will be smaller.
Each year, members of the FLP can give up to the gift tax limit to other individuals. The gift tax limits are $15,000 for a single individual and $30,000 for a couple. If you have multiple family members you want to gift to, you can gift up to these amounts for each of them. Income from an FLP is also excluded from estate taxes if that person dies.
Tenancy by the Entirety
Another way to achieve asset protection is with tenancy by the entirety (TBE), a form of joint legal ownership between two married individuals. It is only offered in specific states but provides certain estate benefits to those who choose to hold their property in TBE.
Tenancy by the entirety is designed to not only simplify the inheritance process, but also ensure shared ownership of a property while maintaining survivorship benefits. TBE offers some financial protections, as well, safeguarding property from certain creditors and litigation. Both owners in a tenancy by the entirety will hold an equal share of the property, regardless of where the funds to purchase that property came from. The property also cannot be sold or transferred without the consent of the other spouse.
Debt claims against an estate can only be applied to a TBE property if the debts are also shared. Individually owned debts cannot be claimed against the property. This means that if only one spouse is sued or files for bankruptcy as a result of individual debts, the TBE-held property is not generally within reach of creditors.
Asset Protection Trust
An asset protection trust (APT) is an irrevocable, self-settled trust that can insulate your assets from creditor actions, including lawsuits. These legal structures can be domestic or international. Not all U.S. states recognize them, so as of this article's writing, it's only possible to have a domestic APT in 17 states. International APTs are more expensive than their domestic counterparts but offer stronger protection, primarily because they place assets outside the reach of U.S. laws and courts.
Asset Protection Mistakes to Avoid
Just knowing about asset protection isn't enough. Execution is everything, and there are a number of ways that attempts at asset protection can fail to deliver the desired result. Here are some of the most common pitfalls to avoid:
Waiting too long: Once you've been named in a lawsuit or litigation against you is imminent, it's likely too late to try to erect a legal fence around threatened assets. Courts generally don't look kindly on last-minute defensive moves, and judges and juries can nullify such moves as fraudulent.
Taking an off-the-shelf, one-size-fits-all approach: A successful asset protection plan must be customized to your specific situation. Think of it this way: the legal fence you put around your property should fit your property and not the property of some generic asset-holder.
Relying on a will or living trust: These instruments will not protect assets from Medicaid estate recovery or nursing homes.
Bottom Line
Asset protection planning is the process of transferring either personal or business assets into vehicles like a family limited partnership, tenancy by the entirety and asset protection trust. They can be expensive and complex so engaging an experienced attorney is a key part of the process. Asset protection, at least in the U.S., does not create absolute protection from tax liens, mechanics liens, alimony and child support claims.
Estate Planning Tips
It might be a good idea to work with a financial advisor who's skilled in estate planning and asset protection planning if you aren't sure where to start. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors in your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Do you want to learn about the estate planning laws in your state? Take a look at SmartAsset's estate planning guide to find that information and much more.
Photo credit: ©iStock.com/Natali_Mis
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Personal Finance & Financial Education
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Sunburn, food poisoning, lost luggage…there are plenty of things that can ruin a vacation. Thankfully, there are also plenty of ways we can prevent them from happening to ensure our hard-earned time away is memorable for the right reasons.
This summer, as you pack up your sunscreen and put a tracker in your luggage, consider how you can protect yourself against another travel risk: identity theft.
Our digitized lives have made accessing sensitive personal information and using it to impersonate or steal personal assets easier than ever before — especially when we’re in vulnerable situations on vacation. While no one can prevent all identity theft, here are the top four ways it can happen and how LifeLock by Norton(opens in a new tab) and a little tech-savvy sense can help keep you safe.
1. You used public WiFi and now your device is compromised
Free WiFi while abroad feels like a win when you find yourself looking to kill time in between activities and want to hunt for the best bar or coffee spot nearby. But, without protection, it could also be a hacker’s win.
Public WiFi networks have either limited or no security, leaving your devices at risk of malware, WiFi snooping, malicious hotspots, and man-in-the-middle attacks. With LifeLock by Norton’s virtual private network (VPN), you can tap into a public WiFi network through a private network or VPN tunnel. This adds an extra layer of security to your device to help prevent attacks.
Even with a VPN, it’s best to follow general security rules(opens in a new tab) like sticking to HTTPS websites and avoiding sensitive sites like your online banking while using public WiFi.
2. You can’t find your wallet
The best cure for stolen ID is to avoid it at all costs, so be mindful of your surroundings, only carry what you really need for the trip, and avoid putting all of your identification documents in one place.
If your wallet is pinched by a pickpocketer or lost on public transport, you’ll need to immediately cancel or replace your driver’s license, credit cards, insurance cards, and other documents. This is where LifeLock by Norton’s Stolen Wallet Protection service comes in. They’ll handle the necessary calls to get your identification documents and bank cards canceled while you continue to enjoy the rest of your vacation.
Additionally, LifeLock by Norton’s Credit Monitoring Service will have your back in the event your identity is used at the bank. The service monitors credit reports for you and alerts you when we find that a lender, bank, or credit card provider checks your credit. If you receive an alert that you’ve applied for a card that’s not familiar, you’ll know there’s a bad actor at play and can take steps to rectify the situation.
3. Your mail was stolen while you were away
Let’s say you’re gone for two weeks. In that time, you may have received a letter from your bank, an electricity bill, a birthday card, and more. Identity thieves can steal your mail and use this information to get access to your existing bank accounts, open new accounts, or obtain documents in your name.
To avoid this, ask USPS to pause mail delivery, get a PO box, or have a friend or neighbor collect your mail. If something slips through the cracks and your documents are stolen, LifeLock by Norton and its Credit Monitoring and Identity and Social Security Number Alerts will help ensure you catch the activity. If the worst happens, you can lean on Stolen Funds Reimbursement of up to $25,000 for the LifeLock Standard plan.*
4. And yet, you still fall prey to a travel scam
Scammers are more sophisticated than ever before. From the moment you book your accommodation online to the moment your vacation ends, even savvy travelers risk falling victim to a travel scam.
When booking hotels and rooms online, take your time reading reviews for both the property itself and the site you’re considering to book through to check legitimacy. If an unknown number calls and says they represent the hotel and ask for personal information, ask to hang up and call back using a publicly registered phone number before providing your information. The same caution also applies to emails and texts — avoid responding to phishy-looking emails and smishy texts.
Leaning on identity theft protection plans like LifeLock by Norton(opens in a new tab) can further fortify your defenses against potential threats to help keep yourself and your vacation memories safer. By adopting various security measures, such as securing your digital devices and being mindful of your surroundings, you can reduce the risk of falling victim to travel scams.
*Reimbursement and Expense Compensation, each with limits of up to $25,000 for Standard, up to $100,000 for Advantage and up to $1 million for Ultimate Plus. And up to $1 million for coverage for lawyers and experts if needed, for all plans. Benefits provided by Master Policy issued by United Specialty Insurance Company, Inc. (State National Insurance Company, Inc. for NY State members). Policy terms, conditions and exclusions at: NortonLifeLock.com/legal(opens in a new tab)
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Consumer & Retail
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Black Friday bargain hunters shattered online shopping records, with nearly $10 billion spent online as consumers desperate for deals largely opted to avoid chaotic crowds.
Buyers spent a record $9.8 billion online Friday, up from $9.12 billion the day after Thanksgiving 2022, according to Adobe Analytics, which analyzes e-commerce transactions.
Electronics like smart watches, televisions and Bluetooth headphones were hot ticket items.
Other favorites were Barbie Fashionistas dolls, Mini Brands toys, cordless and robot vacuums, cookware, skincare and coffee makers.
In the past week, 72% more shoppers used “buy now, pay later” flexible payment options, like Klarna and Afterpay, than the week prior, Adobe reported.
On Thanksgiving day, shoppers gobbled up $5.6 billion in online goods, breaking the record for Turkey Day and paving the way for Black Friday.
Adobe reported that e-commerce prices have fallen over the last 14 months.
“The decline in online prices over the last year has created a favorable environment for consumers with strong discounts this season that are tempting even the most price conscious consumers,” said Vivek Pandya, lead analyst of Adobe Digital Insights.
In-store sales estimates were not yet available, and while reports say the crowds at the malls were “subdued,” Macy’s and Walmart executives said the crowds were bigger than last year.
“It has started out well, but it’s too early to call,” Macy’s CEO Jeff Gennette told the Wall Street Journal. “Just because you have a great Black Friday doesn’t mean you have a great holiday season.”
Retailers slashed seasonal hiring, ordered fewer goods for this holiday season and pushed sales in October and November, reducing the incentive to head to the malls on Black Friday.
The early sales enabled shoppers to spread out spending, yet many are expected to wait until the last minute for the best deals possible, experts note.
And it could pay off — stores will likely discount throughout the season to avoid getting stuck with extra inventory after the holidays.
Consumers are resisting impulse buys and splurges as savings dwindle, credit card debt grows and inflation and high interest rates persist.
Prices were up 18.2% in October this year compared to October 2020, according to the inflation figures.
Shoppers in the Big Apple opted for affordability over luxury on Black Friday, The Post reported.
“People are more value conscious,” said Barbara Kahn, a professor at The Wharton School at University of Pennsylvania. “People are spending, but they’re spending more conservatively.”
Despite the record spending to start the season, holiday spending in the US is expected to rise at the slowest pace in five years.
Shoppers have an average budget of $875 for holiday purchases, $42 more than last year.
Clothes, gift cards and toys at the top of most shopping lists, according to a survey by the National Retail Federation
Adobe expects Cyber Week — Thanksgiving to Cyber Monday — to generate $37.2 billion online, up 5.4% from last year and representing 16.8% of the whole holiday season.
Cyber Monday is expected to remain the season’s and year’s biggest online shopping day, with spending of $12 billion forecast, up 6.1% from 2022.
With Post wires
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Consumer & Retail
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Fintech startup Bitpanda is splitting into two companies as Bitpanda Pro — the company’s cryptocurrency exchange — is going to become its own independent company called One Trading. As part of this move, One Trading is also raising $33 million (€30 million) in funding.
Peter Thiel’s Valar Ventures is leading the funding round with participation from MiddleGame Ventures, Speedinvest, Keyrock and Wintermute Ventures.
Bitpanda is a popular consumer trading app that has raised hundreds of millions of dollars and attracted millions of users in Europe. While the company started as a crypto broker and exchange, it then added the ability to buy and sell stocks, ETFs, precious metals like gold and commodities.
More recently, the company has been partnering with other fintech startups so that they can offer stock and crypto trading in their own apps. For instance, Lydia and N26 both selected Bitpanda as their white-label trading partner.
In addition to these trading products designed for retail investors, Bitpanda has been running its own crypto exchange called Bitpanda Pro. This service is designed for institutional investors who handle large orders or businesses that want to trade using bots and the company’s API.
And that’s the part of the business that is becoming its own company called One Trading. Going forward, Bitpanda is still going to offer crypto trading — but it will act as a broker, not an exchange. A crypto exchange manage trades between different users while a broker acts as an intermediary between customers and different markets.
One Trading CEO Joshua Barraclough, who was already in charge of Bitpanda Pro, said in an email that Bitpanda and Bitpanda Pro are “separating so that they can build out a market leading product for sophisticated retail and institutional customers, with the right focus and investment to be successful. Bitpanda continues to operate, but no longer has an exchange or institutional OTC business.”
Splitting the company also means that Bitpanda won’t face as many regulatory challenges as One Trading. For instance, One Trading plans to offer derivatives, which are risky financial assets.
Similarly, in the U.S., crypto companies like Coinbase and Binance are facing lawsuits for securities law violations. While the regulatory landscape seems more stable in Europe for now, things could change in the future. Isolating Bitpanda from the crypto exchange activities seems smart to guarantee Bitpanda’s long-term prospects.
So far, Bitpanda Pro hasn’t been the most active crypto exchange. As of this writing, CoinMarketCap reports that the platform has facilitated $634,000 in transaction volume over the past 24 hours. As a comparison, Binance and Coinbase have handled more than $8 billion and nearly $1 billion in transaction volume respectively.
One Trading hopes that it can improve liquidity with recent infrastructure improvements. “We aim to become a utility for large liquidity providers to exchange unlimited amounts of risk under a membership model instead of pay-per-trade and have low fees and deep books for retail with a number of liquidity protections,” Barraclough said in a statement.
“We will then start listing more products with appropriate controls and vetting as we move into derivatives. Above all we want a regulated, institutional-grade platform where people feel safe to trade with unique product options,” he added.
It’s going to be interesting to see if there is any significant change in transaction volume in the coming weeks.
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Crypto Trading & Speculation
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Lidl has become the latest supermarket to impose limits on the numbers of peppers, cucumbers and tomatoes customers can buy.
As with other leading supermarkets which have imposed purchase limits on certain salad items, Lidl has said the move is due to shortages of the products because of weather conditions.
"As advised to our customers through signage in our stores last week, adverse weather conditions in Spain and Morocco have recently impacted the availability of certain salad items across the supermarket sector," the German discount supermarket said.
The measure is precautionary in nature it said, and availability is good across the majority of stores.
"Due to a recent increase in demand we have taken the decision to temporarily limit the purchase of peppers, tomatoes and cucumbers to three items per person," Lidl said. "This will help to ensure that all of our customers have access to the products they need."
It comes as UK supermarkets have been called in to answer questions from the Department for Environment Food and Rural Affairs (DEFRA) as vegetable shortages persist.
Representatives from major retailers experiencing shortages are to meet food and farming minister Mark Spencer on Monday afternoon.
Lidl joins Tesco, Aldi, Asda and Morrisons who have all announced limits on some items in the past week.
"I am calling in supermarket chiefs to find out what they are doing to get shelves stocked again and to outline how we can avoid a repeat of this", Mr Spencer said.
Today's meeting follows conversations between Environment Secretary Therese Coffey and some of the main retailers on Friday.
Drought in the summer in Morocco and Spain followed by cold weather in winter has caused damaged crops. The two locations are where the UK meets much of its winter demand for salad vegetables.
Read more
UK needs to 'take command' of its own food production, says NFU's deputy president
Vegetable shortages could become more common if UK does not act
At the same time many UK farmers have reduced their greenhouse output due to high energy costs. Items such as tomatoes and peppers can be grown in the UK through winter via lit and heated greenhouses and with fertiliser derived from gas.
But the energy intensive industry has not been given the same government supports as other big energy users. As a result some UK farmers have been put off planting and planted later in the year.
Supermarkets in the European Union have managed to avoid the shortages as charging higher prices mean suppliers prioritise them.
The problem was compounded by poor weather impacting sea crossings from Morocco to Spain. Fruit and vegetables from Morocco make two sea crossings: across the straits of Gibraltar and the channel in a journey that takes four to six days.
The second hit in the fruit and vegetable journey came from strikes by Border Force workers and Calais port workers last week.
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Consumer & Retail
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Mortgage lenders are offering new products to people struggling to borrow money because of climbing interest rates, which the Bank of England recently raised for the 12th consecutive time, to 4.5%.
People with mortgages tied to this base rate are now paying hundreds more a month and first-time buyers are struggling to get a deal at all.
As a result, banks and building societies are offering deals for first-time buyers without a deposit - or people trying to renew their mortgage.
Here is a look at five new products lenders are offering, and whether they might catch on.
No-deposit mortgages
You can apply for a new deposit-free deal through Skipton, the UK's fourth largest building society. It is available for the same amount as you currently pay in rent and unlike other 100% mortgages, it doesn't need a guarantor.
But when the BBC went to the North Yorkshire market town the building society is named after, not everyone was sold on the idea.
Holly Wardman lives in the nearby village of Carleton, where rent is cheaper, and put her £625-a-month rent into the company's affordability calculator.
"It said I could borrow just over £116,000, there's no way I'm going to get anywhere in Skipton for that money," the 24-year-old teacher told the BBC.
Chris Sykes, technical director at mortgage broker Private Finance, said: "The deal won't help everyone, but will maybe allow some people to get on the property ladder."
If you have parents to turn to there are deals that allow them to help, said David Hollingworth, associate director at L&C Mortgages. For example, the Barclays Family Springboard mortgage uses your family or friends' savings to get your own no-deposit mortgage and pay them back with interest.
Smaller lenders like Buckinghamshire, Loughborough and Tipton have similar schemes. "But these require additional collateral like cash or equity in the parental home," Mr Hollingworth said.
The idea that other lenders could follow Skipton in offering zero-deposit mortgages may not be welcomed by everyone - riskier mortgages with a high loan-to-value ratio were a cause of the 2008 financial crash. But mortgage expert Andrew Montlake said it could work if the loans were "underwritten sensibly".
Removing the stress test
Lenders want to know that you can afford your mortgage in the future even if interest rates rise - this is known as the stress test.
Many potential first-time buyers are being turned down for this reason. But a long-term fixed-rate mortgage reduces the risk to lenders and can therefore help buyers get on the ladder.
Kensington Mortgages, which was taken over by Barclays in March, has a 40-year deal, the longest currently on offer.
Mr Sykes at Private Finance said: "I would love to see more similar products in the future. More in the market would encourage competition and lower rates."
But Mr Hollingworth at L&C Mortgages warned that rates can be high at the moment so locking in for a long time "won't be for everyone".
Zero-interest loans for green improvements
While mortgage rates have been climbing, so have energy bills - although the amount households pay for gas and electricity is due to drop in July with a new price cap.
If you are looking to make your home more energy efficient to save on bills, there are a range of interesting offers from lenders to encourage you.
From 1 June, Nationwide building society will offer a 0% loan to existing mortgage customers wanting to spend up to £15,000 on energy-efficient home improvements such as solar panels, window upgrades or an electric car charging point.
Other lenders may follow suit, said Mark Harris, chief executive of mortgage broker SPF Private Clients.
Too old to borrow?
Some older people looking to renew or take out their first mortgage are being turned away by lenders because the length of time they have to pay back is too short.
Some lenders have become more flexible about age limits, with deals available for borrowers often until they reach 80.
"It has been an opportunity for niche lenders to enhance their criteria around older borrowers and take other factors into account, such as rental income or pensions," said Mr Sykes.
Smaller building societies around the country - such as Hinckley & Rugby, Tipton, and Teachers - have been particularly open to older borrowers, as long as they pass their usual affordability tests.
Overpaying to reduce overall cost
If you're in the fortunate position to be able to overpay on your mortgage you could save thousands on the overall cost.
For instance, with a £350,000 loan you could normally overpay up to 10% a year - up to £35,000 - saving you roughly £1,600 a year on a 4.5% mortgage.
You would usually be charged a redemption penalty for repaying more than 10% of the loan, which can make it unwise - but NatWest Bank has doubled the amount it allows borrowers to overpay, to 20%, which means savings can be even higher.
"It's a good innovation which we hope to see other lenders follow," said Mr Sykes.
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Real Estate & Housing
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Sainsbury's has said customers are starting to switch back from discounters Aldi and Lidl.
The UK's second biggest supermarket chain has been trying to regain ground after shoppers turned to cheaper rivals as the cost of living has soared.
It said customers who used to shop only at the discounters were now buying items in Sainsbury's too.
Grocery sales at Sainsbury's were up 10% in the six months to 16 September, compared with a year earlier.
Sainsbury's said the sales hike was driven not just by price rises, but by the fact that shoppers were also buying more items.
However, the supermarket's profit before tax dropped by 27% to £275m.
Clothing sales, in particular, were hit by a cooler summer and warm early autumn, reducing demand for seasonal items, the company said.
Supermarket battleground
Household budgets have been hit hard by inflation, the rate at which prices rises.
As cost of living pressures squeeze shoppers, they have been turning to Aldi and Lidl as they hunt for bargains.
Both supermarket chains have been opening stores as they battle for shoppers with the more established players in the UK: Tesco, Sainsbury's, Asda and Morrisons.
Sainsbury's said it had not gained more of an overall share of the market, but it did claim that it was the only big supermarket to be winning back customers and gaining spend from Aldi and Lidl.
Its chief executive Simon Roberts said: "We know people are still finding things tough and we're working harder than ever to reduce our costs, putting the money back into our customers' pockets through lower prices on the products they buy most often."
He added: "Food inflation is coming down and we are passing savings on to customers."
Sainsbury's has been running an "Aldi price match" campaign as part of its battle.
However, Aldi said: "Shoppers know that the only place to get Aldi prices is at Aldi.
"That's why we've been confirmed as the UK's cheapest supermarket for 16 consecutive months, growing our market share and attracting around one million new customers."
Lidl said it did not comment on competitor activity.
Competition probe
Earlier this year, supermarkets were investigated by the Competition and Markets Authority after concerns that customers were overpaying for food and fuel.
The watchdog found that higher food costs had not been passed on in full to consumers and that people were shopping around to get the best deals.
But it said that customers had been overpaying for fuel.
Mr Roberts said on Thursday that the group's food price inflation was running at half the level reported by the Office for National Statistics (ONS), with price cuts in some areas such as fresh food.
The ONS said in October that food price inflation remained high at 12.2% on an annual basis, but had been easing.
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Consumer & Retail
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Asia Central Banks Get Creative On Currencies To Defend Reserves
Asian currencies are especially exposed to outflows as benchmark rates in the region are generally lower than their emerging peers
(Bloomberg) -- Emerging Asian central banks are turning to innovative ways to protect their currencies as fears over higher-for-longer US interest rates and rising global tensions drag down risk assets.
Asian currencies are especially exposed to outflows as benchmark rates in the region are generally lower than their emerging peers, resulting in a wider differential with the US.
Among some of the ways officials are countering that: Indian policymakers said this month they’re looking to sell more bonds to soak up cash, which should bolster the rupee. Their Indonesian peers in September started issuing a new line of debt to attract inflows and underpin the currency. China is selling a record amount of local-currency sovereign debt offshore to raise yuan demand.
Indonesia and India are issuing more of their higher-yielding bonds to encourage inflows, which “is a new way where they can still support the currencies without having to use foreign-exchange reserves,” said Eddie Cheung, a senior emerging markets strategist at Credit Agricole CIB in Hong Kong. “I think that’s playing it quite smart.”
The use of creative ways to support their currencies is one way out of the dilemma of having to choose between allowing a currency to weaken, burning through reserves, or raising rates and crimping economic growth.
Bloomberg’s dollar index has surged more than 6% from its July low as traders have boosted bets on higher Fed rates amid sticky inflation and robust US economic data. At the same time, the war in Ukraine and the Israel-Hamas conflict are pushing up oil prices, driving haven demand for the greenback.
The outlook for Asia currencies is a big deal for global emerging-market indexes. The yuan, rupee and rupiah have a collective weighting of 45% in the MSCI EM Currency Index. China and India’s government bonds make up a combined 22.2% of the JPMorgan Government Bond Index-Emerging Markets, according to a representative from the US bank.
Depleting Stockpiles
India’s falling foreign-currency reserves suggest the central bank has been dipping into its stockpiles this year to bolster its currency. Policymakers took another step at their Oct. 6 meeting by announcing a potential bond-sale plan to mop up extra cash and support the rupee by pushing up yields.
The measures employed by India so far have largely succeeded as the rupee has been virtually unchanged this year even as most of its emerging peers have weakened.
Indonesia’s central bank began selling so-called Bank Indonesia Rupiah Securities in mid-September with the goal of luring in more inflows. The bills, known as SRBI, allow global investors to take short-term currency risk exposure. They were introduced as the nation saw outflows of $1.1 billion from Indonesian bonds last month, the most in almost a year.
‘Creative Complements’
The measures from India and Indonesia “make for very creative complements to currency support that also take into consideration judicious use of FX reserves,” said Vishnu Varathan, head of economics and strategy at Mizuho Bank Ltd. in Singapore. “Especially given that reserve drawdown can be a double-edged sword that suddenly accentuates a selloff if it presents worries about a possible cash-burn.”
China is employing a range of measures to buttress its currency. The government this week announced a 26 billion yuan ($3.6 billion) issue of yuan-denominated sovereign bonds for this quarter, boosting its 2023 total to a record 55 billion yuan. Investors see the main goal of the issuance is to support the yuan by raising demand for the currency.
The People’s Bank of China last month intervened in the offshore yuan market, increasing the cost for banks to borrow the currency from each other in Hong Kong to make it less attractive to bet against it.
Hedging Issues
Some of these measures come with their own costs. In China’s case, investors who own the nation’s bonds are finding it more difficult to hedge as cash rates increase.
“China bonds were suddenly no longer attractive to us when the PBOC abruptly jacked up their offshore cash rates,” said Robert Samson, co-head of global multi-asset at Nikko Asset Management in Singapore. “If you can’t hedge it and you’ve got concerns about the currency, I don’t know how you own it.”
While the various creative measures don’t totally replace the use of foreign-exchange reserves, they do help reduce the amount needed.
Most emerging-market central banks have an import cover ratio — the number of months of imports that foreign reserves can cover — well above the traditional rule of thumb of three months.
“Reserve adequacy isn’t a concern across most of Asia,” said Arindam Sandilya, head of emerging Asia local markets strategy at JPMorgan Chase Bank in Singapore. “There are variations across countries, but for the most part, they are well in excess of prudential norms.”
What to Watch
- China will release third-quarter GDP Wednesday, with economists expecting growth to decelerate to 4.5% year-on-year. Nation will also industrial production, retail sales and fixed asset investment figures the same day
- Bank Indonesia and Bank of Korea are both forecast to keep rates unchanged Thursday
- Malaysia, Thailand and Mexico all release foreign-reserves data next week, while Malaysia and Poland will publish inflation figures
--With assistance from Subhadip Sircar, Karl Lester M. Yap and Colleen Goko.
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.
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Banking & Finance
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Labour has vowed to ease the "burden" on university graduates by lowering monthly student loan repayments.
It is the first indication of how the party plans to reform the system after leader Sir Keir Starmer scrapped a leadership pledge to abolish tuition fees entirely.
Politics live: 'Plenty of politics at play' in Johnson WhatsApp row
Writing for The Times newspaper, shadow education secretary Bridget Phillipson said if Labour wins the next general election it "could reduce the monthly repayments for every single graduate".
She said this could be done "without adding a penny to government borrowing or general taxation", as Labour modelling showed scope for a "month-on-month tax cut for graduates".
But the left-wing group Momentum said young people will still be left with "a mountain of debt" under the reforms as it accused the party leadership of backtracking on promises.
Setting out Labour's plan, Ms Philipson said the university tuition fee system was "broken" but repeated Sir Keir's insistence that scrapping loans was no longer affordable.
However, she said it could be made fairer as she attacked recent reforms which will mean graduates face higher repayments.
Last year, the Treasury announced that students in England will be asked to repay their loans for up to 40 years rather than the current 30-year period and that they will have to start paying off the debt from when they earn £25,000, rather than £27,295.
Ms Phillipson said the changes mean future nursing graduates "will repay about £60 more a month" and accused the Tories of "hammering the next generation of nurses, teachers and social workers; of engineers, of designers and researchers".
She added: "Reworking the present system gives scope for a month-on-month tax cut for graduates, putting money back in people's pockets when they most need it. For young graduates this will give them breathing space at the start of their working lives and as they bring up families."
However, the plan appears to have done little to quell the anger among those who want Sir Keir to stick to his promise of scrapping the £9,250 tuition fees.
This was a key part of the 2017 and 2019 Labour manifestos, and a policy Sir Keir pledged to take forward when he ran to replace Jeremy Corbyn.
Fabiha Askari, vice-chair of the National Labour Students Committee, said: "When Labour committed itself to abolishing tuition fees in 2017, hundreds of thousands of students flocked to the Labour Party.
"As more young people find themselves disillusioned with Westminster politics, Labour should make commitments that seek to build a broad coalition of voters to kick out the Tories and their failed policies."
A spokesperson for Momentum, the left-wing grassroots campaign organisation, said: "Once again we are seeing a worrying poverty of ambition from the Labour leadership. The proposed cuts to repayments will still leave young people facing mountains of debts, even as they already struggle with sky-high rents."
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United Kingdom Business & Economics
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House Speaker Mike Johnson is facing calls to be investigated over alleged "repeated violations" while filing his financial disclosure statements (PFDs).
End Citizens United, a grassroots progressive political group, has written to the Office of Congressional Ethics and asked them to look into Johnson's finances over claims he has "blatantly omitted" reportable information and made numerous errors in several of his filings since he was first elected to Congress in 2016.
Among some of the key allegations from the group are that the newly elected House Speaker failed to disclose multiple trips paid for by private entities and did not fully report the source of his wife's income, nor her ownership interests in a privately-held business.
The Office of Congressional Ethics has also been asked to investigate Johnson for failing to list having a personal bank account on his financial disclosure, or disclosing any retirement assets. It was previously reported that Johnson never listed having a savings or checking account in his or his wife Kelly's name, or in the name of any of his children.
Johnson listed having a retirement account with less than $15,000 in 2016, but has not mentioned it in subsequent filings. As noted by CNN, this could mean the money was moved into a retirement savings account used by federal employees, which was reported between 2017 and 2020. Johnson could have also cashed out the account, or it now has less than $5,000 in it.
In a recent interview with Fox News, Johnson was asked why he has not declared a bank account or assets on a financial disclosure going back to 2016. In response, Johnson replied: "I'm a man of modest means."
Tiffany Muller, president of End Citizens United, told The Daily Beast it is "laughable" that Johnson did not report any savings or retirement accounts, while accusing the House Speaker of "clearly violating federal laws" in his financial disclosures.
"The American people deserve to know whether the Speaker of the House has financial conflicts of interests, but Speaker Johnson is clearly violating federal laws by hiding critical information from the public," Muller said.
"It's laughable to believe that the person leading government funding negotiations doesn't have a reportable savings or retirement account. But beyond his own potential financial mismanagement, failing to disclose travel and his spouse's sources of income is against the law and the Office of Congressional Ethics must investigate and hold him accountable."
Johnson's office has been contacted for comment via email.
According to End Citizens United's complaint, Johnson failed to report at least two separate trips that were paid for by private sources.One, an all-expenses-paid trip to Israel in February 2020 to an event sponsored by the 12 Tribe Films Foundation, cost $17,950. Johnson also allegedly accepted a free trip in April 2022 to Williamstown, Kentucky, which was paid for by Christian fundamentalist group, Answers in Genesis.
"These blatant omissions are clear violations of federal law and show a disregard for the Act's important transparency goals that allow the public to know what groups have privately funded the Speaker's travel," the letter to the Office of Congressional Ethics said.
Johnson also allegedly failed to disclose his wife's interest in Onward Christian Counseling Services, a private company owned by Kelly Johnson.
The complaint states that if Kelly Johnson's interest in the company is valued at more than $1,000 or generated more than $200 in unearned income, the Louisiana Republican is required to disclose that interest on his PFDs, which he failed to do.
"In fact, as noted above, Speaker Johnson has never reported a single asset held by his spouse in any of the eight reports he has filed," End Citizens United said.
The complaint could end up in a referral to the Standards Committee or a complete dismissal by the Office of Congressional Ethics, although any decision either way could take weeks.
Uncommon Knowledge
Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
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About the writer
Ewan Palmer is a Newsweek News Reporter based in London, U.K. His focus is reporting on US politics, domestic policy and the courts. He joined Newsweek in February 2018 after spending several years working at the International Business Times U.K., where he predominantly reported on crime, politics and current affairs. Prior to this, he worked as a freelance copywriter after graduating from the University of Sunderland in 2010. Languages: English.
You can get in touch with Ewan by emailing e.palmer@newsweek.com.
Ewan Palmer is a Newsweek News Reporter based in London, U.K. His focus is reporting on US politics, domestic policy... Read more
To read how Newsweek uses AI as a newsroom tool, Click here.
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Banking & Finance
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MANCHESTER, England, Oct 1 (Reuters) - British finance minister Jeremy Hunt on Monday will announce a rise in the minimum wage in his annual Conservative party conference speech, where he is expected to ignore a growing clamour for tax cuts within his party.
The extracts of the speech released by the party made no reference to taxes after Conservative lawmakers and even senior minister Michael Gove have called for tax cuts ahead of an election expected next year.
On Saturday Hunt ruled out near-term tax cuts ahead of a mid-year fiscal statement due on Nov. 22, and he has supported Prime Minister Rishi Sunak's goal to halve inflation, rather than lower taxes, this year.
In the meantime, average weekly earnings have risen sharply for workers across the board, which the Bank of England has said is its biggest concern regarding inflationary pressures.
On Monday Hunt will announce that the living wage, the minimum wage for workers over 23 years old, will rise to at least 11 pounds ($13.42) an hour from 10.42 pounds.
"We are waiting for the Low Pay Commission to confirm its recommendation for next year. But I confirm today, whatever that recommendation, we will increase it next year to at least 11 pounds an hour," Hunt will say.
He will also announce a review that seeks to toughen the benefit sanctions system.
Prior to Hunt's speech, former Prime Minister Liz Truss will put pressure on the government to lower taxes in her only expected intervention at this year's conference.
A year ago as prime minister, she had to scale back her tax-cutting plans in a U-turn at conference, and the market turmoil she sparked forced her resignation in October.
However, since then she has stuck to her message that lower tax, especially for businesses, is part of what Britain needs to spark growth.
($1 = 0.8199 pounds)
Reporting by Alistair Smout, Elizabeth Piper and Andrew MacAskill; Editing by Emelia Sithole-Matarise
Our Standards: The Thomson Reuters Trust Principles.
Read Next
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Europe's solar power industry has warned policymakers not to impose tariffs on imports, amid fears that disrupting supplies of products from China would seriously damage Europe's ability to rapidly install clean energy.
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Workforce / Labor
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The UK government will launch a consultation in Spring 2024 on introducing a captive insurance regime as it seeks to revive the insurance market.
The Chancellor, Jeremy Hunt, announced in his Autumn Statement that the Government plans to consult on a new framework to encourage the establishment of captive insurance companies in the UK.
The move comes after the London Market Group (LMG) approached the Treasury a year ago. Speaking to City A.M. Caroline Wagstaff, CEO of LMG said: “If we are to retain our position as the world’s leading market for risk transfer, we do need to be able to offer customers all the tools in the toolkit, and that includes captive insurance companies.”
Captive insurance is a form of self-insurance, whereby a company is created and wholly owned by those it insures. The idea behind it is that companies have control over the type of policies it needs, while also receiving coverage at a reduced cost compared to traditional insurance.
This type of insurance structure is extremely popular in the US, where Vermont has the highest number of captives domiciled with 1242 companies, according to Captive Insurance Times.
In Europe, the market leaders are Guernsey, Luxembourg and Ireland. While, globally, the captive insurance regime is usually found on off-shore islands with Bermuda as the leader, followed by the Cayman Islands.
Bermuda is known to have the highest total of captive insurance companies domiciled. It has created a well-oiled infrastructure on the island. Its small capital, Hamilton, is home to the Big Four, notable law firms like Appleby and Conyers, as well as several insurance companies that specialise in captive management.
Speaking to City A.M. Peter Carter, head of Willis Tower Watson (WTW) global captive practice explained: “I’m not surprised that this is being looked at now. France recently enacted legislation to make it friendly for corporations to domicile their captives in the country.”
It is argued that the UK could offer an attractive regime. Wagstaff explained that a lot of businesses have their core operations in the UK.
“Therefore having [a captive] which sits in Bermuda or Vermont or somewhere is operationally, quite clunky,” Wagstaff added.
She highlighted that for companies’ reputation, lots of boards are looking at where they keep these types of operations, as several parts of the world have “reputations for being tax havens”. She explained that the LMG were told that companies would consider taking their captives onshore to somewhere where the regulation is first class and there are no worries about tax avoidance.
However, it will of course all come down to how attractive the Treasury makes it for corporations in terms of capital requirements and taxation. Carter added that it will be a “make or break” factor.
He explained that for years UK corporations have opted for Guernsey or the Isle of Man as there is an established captive management infrastructure in place.
Carter also highlighted that even though London has the services needed to set up and maintain captives, it can be a lot more expensive in the City compared to other established domiciles.
He added that even if this gets the green light, in his opinion, it takes years for a domicile to become fully established and competitive.
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Banking & Finance
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How To Manage Your Budget During Persistent Food Inflation
With the prices rising sharply, there is a lot of pressure that families are under.
The household budget is an important part of the overall financial planning activity for every family. The manner in which this budget is managed impacts the kind of savings and further investments that are made over a period of time. One major component of the household budget is food items and with the prices rising sharply, there is a lot of pressure that families are under. There are ways in which this situation can be tackled, especially where the rise is not fleeting in nature.
Period Of Rise
Food prices, by their very nature, are volatile and there are lots of times when there is a sharp jump in the prices of several items. This is often seen in potatoes, onions, tomatoes, pulses and even other smaller items like lemon, ginger, mint leaves, etc. The important part that requires some action on the budget front is the time period for which the prices remain elevated. If the rise is for a short period of time, then this is not a very tough job to tackle and it can be handled through proper management of the available funds. However, if the prices remain elevated for a longer time period and that too for high consumption items, then some reallocation would need to be done in the budget.
Extent Of Price Rise
The widespread nature of the price rise can also have an impact on when there is a need to take a relook at the overall budget. If the rise is restricted to a few areas and these turn out to be short-lived, then there is not much of a problem. If the rise is widespread and it is across vegetables plus cereals and even wheat and rice, then the problem becomes acute. This is because the price rise will impact a large part of the food budget and this will require a lot of additional funds that would have to be spent here. This kind of situation cannot be constantly met through the buffer or the contingency part that has been built into the budget.
Reallocate Money
The way in which the situation would have to be handled is to ensure that the entire budget for the time being is reworked. This will require reallocation of money between various areas and this will mean that money will have to be taken from some other allocation and given to this area. This process of reallocation will be different for each family, as they will need to see where they can cut back on expenses and allocate more money here. The extent of the budget that is spent on food will also be important because if a lower amount in terms of percentage is used, then it is easier to do this reallocation.
Cutting Out Expenses
The important part of completing the entire exercise is which other expenses would need to be sacrificed. In many cases, the first impact is seen on entertainment, eating out and even shopping expenses that have to be curtailed. This is the most obvious area where the amount can be shifted from and it will ensure that those spends that are not immediately required, or those that can be pushed back are taken into consideration. In some cases, a higher value purchase might have to be pushed back. This will ensure that for the immediate future, when more amounts are needed for the purpose of food expenses, these are available.
Arnav Pandya is founder at Moneyeduschool.
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Inflation
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NEW YORK -- Michael Cohen will be back on the witness stand Wednesday, testifying against his ex-boss Donald Trump in a civil trial over allegations that the former president chronically exaggerated the value of his real estate holdings on financial documents.
During his first day of testimony Tuesday, Cohen said he and key executives at Trump's company worked to inflate the estimated values of his holdings so that documents given to banks and others would match a net worth that Trump had set “arbitrarily.”
Trump watched as his lawyer Alina Habba then cross-examined Cohen, working to portray him as a convicted liar.
Cohen worked as Trump's lawyer and fixer for many years, but in 2018 he was prosecuted for tax evasion, making false statements to a bank and to Congress and making illegal contributions to Trump's campaign in the form of payouts to women who said they had extramarital sexual encounters with the Republican. Trump said the women's stories were false. Cohen has said he orchestrated payments to the women at Trump's direction.
Since his legal problems started in 2018, Cohen has been a Trump foe. The two men hadn't been in a room together in five years until Tuesday's court session.
Cohen called it a “heck of a reunion.”
Outside the courtroom after Tuesday's court session, Trump dismissed Cohen as a “disgraced felon."
Cohen is also expected to be an important prosecution witness in a criminal trial scheduled for next spring in which Trump is accused of falsifying business records. That case is one of four criminal prosecutions Trump faces in New York, Florida, Georgia and Washington, D.C.
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Real Estate & Housing
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Stocks At New Highs: Palantir, Visa
Palantir stock rallied to new highs Friday, hitting the 20.24 buy point of a cup base. PLTR stock is in the 5% buy zone reaching to 21.25, per MarketSmith pattern recognition. Friday's move lifted shares and their relative strength line to new highs.
The stock soared more than 20% after the data analytics and privacy software company reported higher-than-expected third-quarter earnings and sales on Nov. 2. Management also raised its full-year 2023 revenue guidance.
The company is focused on utilizing AI technology to drive its current earnings and sales growth, with its Artificial Intelligence Platform and its MetaConstellation satellites. PLTR stock is nearing levels it hasn't seen since November 2021, according to Dow Jones Market Data. Shares are up around 218% this year, at new highs.
Meanwhile, Dow Jones stock Visa tapped the 250.06 buy point of a cup base, hitting new highs before backing off Friday. The payment processor topped analysts' estimates on its September-quarter profit and sales on Oct. 24. Management also authorized a new $25 billion multiyear share buyback program in the earnings report.
Quarterly earnings growth improved to 21%, from 9% and 17% in the prior two quarters. Sales growth continues to hold in the 11%-12% range. Analysts expect 13% EPS growth in fiscal 2024 and 2025.
Follow Kimberley Koenig for more stock market news on X/Twitter @IBD_KKoenig.
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Stocks Trading & Speculation
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Saving for retirement is one of the most important parts of securing your financial future. While programs like Social Security can help, they often aren’t enough on their own. This is why it is crucial to have retirement savings of your own. You may be wondering exactly how much money is enough; for instance, could you survive on $800,000? Let’s take a look.
For more help planning your retirement, consider working with a financial advisor.
Determining Retirement Expenses
The first step to knowing how long your money will last is to figure out your living expenses:
Fixed Expenses
Fixed expenses are those that don’t change from one month to the next. For example, this might include rent or a mortgage, insurance premiums and utilities. Add these expenses together and see how much you spend monthly and annually.
Variable Expenses
Variable expenses are expenses that are not the same every month. Many things could fall into this category, including travel expenses, health care costs, entertainment and charitable donations. Because these expenses are variable, you will likely have to set a limit on how much you can spend on them each month. If you reach that limit, you must either use money from elsewhere in your budget or forego the purchase.
Calculating Retirement Income
The next challenge is calculating retirement income. This can be more challenging than calculating your income while working because you might have more sources of income. For example, your retirement income might include:
Social Security
Pension plans
Retirement savings
The good news is that Social Security and pension benefits don’t change from one month to the next. They might include cost of living increases each year, but their relative stability makes planning around them easier. What can be tougher to plan around is retirement savings, especially if you are relying on investments. You can use SmartAsset’s free retirement calculator to see if you are on track to meet your retirement goals.
Estimating the Length of Retirement
Another challenge of planning for retirement is estimating how long your retirement will be. This is not an easy question to answer, as many variables can affect life expectancy. However, estimating your life expectancy is an important part of retirement planning. People live longer than they used to, so it’s important to be prepared if you will live several decades after you retire. The life expectancy is currently about 77 years in the United States.
In addition to life expectancy, you should consider things like your current health and family history and how that will affect your life expectancy. Finally, you should use an inflation calculator to see how long your money will last.
Retirement Portfolio Styles
The next step is to determine your investment strategy. For example, your portfolio might be more on the conservative side, or it could be more on the aggressive side. Here is a quick look at how an $800,000 retirement portfolio might look, depending on your strategy:
Conservative Portfolio
With a conservative portfolio, your investments will consist mainly of relatively low-risk investments. For example, you might have:
50% bonds ($400,000)
30% cash ($240,000)
20% stocks ($160,000)
The goal of a conservative portfolio is generally one of wealth preservation rather than wealth building. Thus, you might also focus on blue-chip stocks that pay dividends rather than growth stocks.
Balanced Portfolio
A balanced portfolio may be appropriate for retirees who want a mix of growth and income and are willing to accept some risk in exchange for higher returns. An example of your asset allocation might be:
50% stocks ($400,000)
30% bonds ($240,000)
20% cash ($160,000)
This portfolio includes a noticeably higher allocation to stocks, and cash becomes the lowest percentage. A balanced portfolio often includes a mix of stocks, bonds and cash. It tends to focus on diversified investments that offer a mix of growth and income.
Aggressive Portfolio
An aggressive portfolio may be appropriate for retirees with a longer time horizon who are willing to accept higher risk in exchange for higher potential returns. If you have an aggressive $800,000 retirement portfolio, stocks become the focus of your portfolio:
70% stocks ($560,000)
20% bonds ($160,0000
10% cash ($80,000)
An aggressive portfolio might include a mix of high-growth stocks and small-cap stocks. Some aggressive investors might venture into alternative investments like commodities or precious metals.
It’s important to note that these are just examples, and the right investment strategy for your retirement portfolio will depend on your individual goals, risk tolerance and time horizon. It is always a good idea to consult with a financial advisor before making any major investment decisions, especially when it comes to retirement planning.
Bottom Line
How long $800,000 will last in retirement depends on factors like your expenses, retirement income and how long your retirement will be. If you have substantial income from sources like a pension and Social Security, an $800,000 portfolio could last for many years. That’s especially true if your expenses are low and you don’t have significant health care expenses. But again, there are many variables. It’s best to meet with a financial advisor who will help you build a custom retirement plan.
Tips for Retirement Savings
A financial advisor can guide you through major financial decisions, like determining your investing strategy. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
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Personal Finance & Financial Education
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Siemens To Buy Additional 18% Stake In India Unit For €2.1 Billion
Shares of Siemens Ltd. rose as much as 4.41% to Rs 3568.80 a piece on the news.
Siemens AG plans to acquire an additional 18% stake in its India unit from Siemens Energy AG for €2.1 in cash
Siemens and Siemens Energy will jointly propose to the board of directors of the Indian subsidiary, Siemens Ltd., to separate the energy business by way of a demerger, according to a release.
This would increase Siemens' stake in the publicly listed India unit from 51% to 69%, while Siemens Energy's stake would decrease from 24% to 6%, it said. "With the intended acquisition, Siemens and Siemens Energy accelerate unbundling the business activities of the Indian subsidiary of Siemens."
The purchase price reflects a customary discount of 15% on the five-trading-days volume-weighted average price before the day of signing. Siemens will provide no new guarantees to Siemens Energy, the statement said.
Siemens Energy, created by spinning off gas and power business from the German company, is looking to shore up its finances to offset losses at its Gamesa wind business.
Shares of India-listed Siemens rose as much as 4.41% during the day to Rs. 3568.80 apiece on the NSE. It was trading 3.68% higher compared to a 0.93% advance in the benchmark Nifty 50 as of 11:59 p.m.
The stock has risen 25.57% on a year-to-date basis. The total traded volume so far in the day stood at 3.6 times its 30-day average. The relative strength index was at 58.23 as of 11:59 a.m.
Of 27 analysts tracking the company, 15 maintain a 'buy' rating, six recommend a 'hold', and six suggest to 'sell', according to Bloomberg data. The average of 12-month price targets implies an upside of 13.4%.
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India Business & Economics
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HCG Q2 Results Review - Occupancy Plateaus; ARPOB Drives Margins: ICICI Securities
Strong performance across mature and new centres.
BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
ICICI Securities Report
Traction in surgical oncology was a key driver of HealthCare Global Enterprises Ltd.'s 5.7% QoQ revenue growth in Q2 FY24. Average occupancy fell to 63.6% in Q2 FY24 mainly due to a dip in emerging centres. However, margins of emerging and existing centres surged 120 basis points/90 bps QoQ to 10%/23.9%, respectively.
Average revenue per occupied beds for oncology centres rose 6% QoQ to Rs 42,054. The management is targeting 20% Ebitda margin by Q4 FY24. HealthCare Global has completed the acquisition of a 50-bed hospital in Indore and over the next two years it will add 100 beds for a capex outlay of Rs 400-500 million.
Expansion projects in Ahmedabad and Bangalore are also on track to be operational in FY25.
We raise our FY24/25E earnings by 3-5% to factor in margin improvement. We maintain our 'Add' rating and raise target price to Rs 410 based on 15 times FY25E enterprise value/Ebitda.
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This report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.
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Stocks Trading & Speculation
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Amusement parks Six Flags and Cedar Fair are merging in an $8 billion deal that creates a theme park powerhouse across North America.
The companies control 27 amusement parks and 15 water parks between them across the US, Canada and Mexico. Six Flags and Cedar Fair operate in different parts of the North America, so a combined company could help them better manage seasonal dips in park attendance.
In addition Cedar Point, its flagship theme park in Sandusky, Ohio, Cedar Fair owns Knott’s Berry Farm in California, Schlitterbahn water park in Texas and Canada’s Wonderland in Ontario. Six Flags primarily operates under its own banner with about 20 parks in the US, two in Mexico and one in Canada.
Cedar Fair said the combined company will allow management to ramp up investments in the parks, which should help boost demand.
The new company will keep the Six Flags name, but will trade under Cedar Fair’s stock ticker FUN.
Merging the companies gives them scale amid the consumer cutting back their spending, climate change, and well-known rivals like SeaWorld, Comcast-owned Universal Studios and Disney, with the latter recently announcing a $60 billion investment in its parks.
Attendance at theme parks are struggling since the pandemic. Wait times for rides and attractions and Walt Disney World and Universal Orlando in Florida were short this summer for several reasons, including extreme weather and heat in Florida, a waning post-pandemic travel boom and a tense political climate in Florida that has prompted travel warnings from some groups.
Combining the companies will result in $200 million in cost savings, according to their projections, with more than half of those savings coming from administrative and operational cost savings. It’s also forecast to generate $3.4 billion in revenue.
Cedar Fair (FUN) shareholders will get one share of stock of the newly combined company for each share owned, and Six Flags (SIX) shareholders will receive 0.58 shares for every share currently owned.
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Consumer & Retail
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There is likely to be a tomato shortage in Ireland until May at the earliest because of the cost of energy, says a leading grower.
Martin Flynn, who grows three hectares of tomatoes in greenhouses at his farm in Swords, Co Dublin, said problems with shortages because of bad weather in Spain and Morocco will be compounded in Ireland because growers cannot afford to heat their greenhouses.
Unseasonably cold weather in southern Spain and northern Morocco has caused problems with the supply not only of tomatoes but also peppers and cucumbers across Europe. The problem is most acute in the UK and is compounded by Brexit.
Mr Flynn said many Irish growers start growing their tomato plants in January with a growing period of between 16 and 17 weeks. Natural gas is needed to heat the greenhouses until the early summer, but the cost of it means that many Irish growers are now waiting until this month or next month to start the growing process.
The cost of gas is now four times the long-term average for tomato growers, he states, and energy is typically 30 per cent of the cost of producing plants.
Mr Flynn, who is also the vice-chairman of the Irish Farmers’ Association field vegetable and protected crops committee, said current shortages of many horticulture food crops are a direct result of soaring input costs and of the imbalance of power in the food supply chain.
The industry is calling on the Government to urgently reinstate the Horticultural Exceptional Payment Scheme (HEPS) which provided one-off payments last year of €2.8 million for horticultural growers to subsidise the cost of energy following Russia’s invasion of Ukraine.
Mr Flynn believes the shortages on Irish shelves demonstrated that Ireland has become too dependent on foreign imports. He said Irish buyers could extend the season with Government support. “We can produce tomatoes sustainably from March until November and produce them more sustainably.
“We are tired of hearing from Government that more Irish produce is required when we simply cannot afford to expand the shoulders of our season. It’s clear from the current shortages of vegetables from Spain and Holland that retailers cannot rely on imported produce. The first step that retailers must undertake is to listen to their grower suppliers of Irish produce.”
He stated that the process of producing tomatoes in an Irish environment under glass with natural gas is environmentally friendly because the plants absorb the carbon dioxide and produce oxygen.
“We are not putting carbon dioxide into the atmosphere, we are putting it into the glasshouse and the plants absorb that. We are carbon neutral.”
There is also a shortage of cucumbers and peppers. Ireland’s only commercial pepper producer is not producing this year because of soaring costs, Mr Flynn said.
Matt Wallace, the managing director of Wexford Tomatoes, said many Dutch growers are struggling with nursery plants because of the costs and this is having a knock on effect.
“We were purchasing plants from a big grower in the Netherland and about two weeks before we placed our order this week, we got notice that they had closed down because of gas prices,” he said.
“A lot of Dutch growers use artificial lighting on crops which means they are producing things over the winter months.
“Most of the growers decided not to plant for the winter months and this is a void in the market at present.”
He anticipates that a lot of smaller growers will not plant this year because of the costs involved and also the difficulties in getting labour.
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Agriculture
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On Friday, Sam Bankman-Fried began his first day testifying before a jury with a loss. The FTX co-founder had intended to explain exactly how much he relied on lawyers to steer his decision-making amid the cryptocurrency exchange's rise and collapse, but US District Judge Lewis Kaplan ruled that particular part of his proposed testimony could not be heard by the jury, The Wall Street Journal reported.
Bankman-Fried had testified on Thursday that his in-house legal team oversaw paperwork for "hundreds of millions of dollars in personal loans to himself and other founders of the platform," CNBC reported. He told the court that having his legal team's blessing was something that he "took comfort in."
“That evidence would in my judgment be confusing and prejudicial,” Kaplan said, dealing what many outlets considered a serious blow to Bankman-Fried's defense.
Bankman-Fried's defense started Thursday with the testimony of two other witnesses, CNBC reported. But winning hinges largely on Bankman-Fried's testimony, which could be critical to convince a jury that FTX's demise could be chalked up to a businessman making mistakes, not—as the government contends—to a "mastermind" scheming to misappropriate customer funds. According to The New York Times, Bankman-Fried has been accused of investing $10 billion in customer funds to finance his "lavish spending."
Bankman-Fried faces seven criminal charges, including felony counts of wire fraud and conspiracy to launder money, and could face decades in prison if he's found guilty. He has pleaded not guilty, and on the stand Friday, when he was asked if he defrauded anyone or used customer funds, he told the jury that the answer to both questions was "no," CNBC reported. He also pleaded ignorance several times, testifying that, at times, he had no knowledge of how Alameda Research was managing customer funds.
Since the trial started, the jury has spent weeks weighing what CNBC described as a "mountain of damning evidence," painting Bankman-Fried as the key figure "orchestrating the spending of FTX customer money."
On Friday, Bankman-Fried testified that his biggest mistake was not investing in risk management, the WSJ reported, admitting to "significant oversights" that triggered the collapse, allegedly occurring without any malicious or nefarious intent. Because he did not hire a dedicated risk management team and a chief risk manager at FTX, he said that FTX ultimately lacked appropriate oversight while experiencing rapid growth—a recipe for its collapse.
Bankman-Fried said that he'd initially intended for Sam Trabucco, former co-CEO of Alameda Research, to serve as a risk manager, but after Trabucco left for "early retirement," the other co-CEO Caroline Ellison was stuck juggling Trabucco's responsibilities with her duties as the "people manager," The Washington Post reported. Some of this testimony was refuted by Ellison, who is serving as a witness cooperating with the government. At least three cooperating witnesses have testified that "Bankman-Fried had directed them to engage in a scheme to misappropriate FTX customer money and conceal it," The Times reported.
Legal experts have said that Bankman-Fried's testimony could be a disaster for his defense, unintentionally convincing the jury that he is the criminal mastermind and fraudster he insists that he is not. It's clear from today's testimony that he intends to counter that narrative by portraying himself as someone who made mistakes while acting in good faith. Despite analysts' predictions that Bankman-Fried might dig his own grave, the WSJ reported that on Friday, Bankman-Fried appeared "confident" in building his defense before the jury.
However, not everyone was as confident in the answers that Bankman-Fried gave on the stand, and it seems likely that the jury may have occasionally grown frustrated with Bankman-Fried during his time on the stand. According to The Post, the first three hours of Bankman-Fried's testimony contained "no revelations," and the judge repeatedly grew impatient whenever Bankman-Fried gave "long, rambling answers."
On "multiple occasions," Kaplan asked Bankman-Fried "to stop talking" and eventually "admonished Bankman-Fried for trying to provide his own definition of market manipulation."
"You will take what I say manipulation means," Kaplan instructed Bankman-Fried and the jury.
Bankman-Fried's testimony is expected to continue on Monday, when the government's cross-examination will likely start early in the morning.
While Bankman-Fried will not necessarily be able to blame FTX lawyers for steering him wrong, he will be able to argue that lawyers influenced his decisions about FTX's document retention policies, The Post reported.
At the trial's conclusion, if Bankman-Fried is found guilty, Kaplan will issue sentences for both Bankman-Fried and witnesses cooperating with the prosecution, the WSJ reported. The cooperating witnesses likely expect reduced sentences, hoping to escape jail time. Bankman-Fried could receive a maximum sentence of 110 years, Reuters reported.
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Crypto Trading & Speculation
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There is a chart in the Bank of England’s latest report on the economy which illustrates that price gouging may still be a factor in pushing up inflation.
What unions and academics have complained about for more than two years – and policymakers at the central bank have downplayed – is that corporate profits could be pumping up inflation as much as rising wages.
The chart tells us that prices in the shops are rising when the costs of production remain much the same. Customers are paying 8% more for their goods than last year, despite an easing of supply chain pressures and a fall in commodity prices that mean it costs no more to produce goods now than it did in the summer of 2022. Producer price inflation is close to zero.
It is the first time such a gap has opened up since the 2008 financial crash, and the Bank says it is struggling to find an answer. Usually, a competitive market for goods means that a fall in the wholesale price leads to a fall in the retail price.
As the Bank says in the report: “That relationship would suggest that goods price inflation could decline sharply in the near term.”
But its forecasts appear to accept the gap will continue, because it thinks other factors are at play – and not just greedy businesses, mostly large and with a strong marketing presence, making sizeable windfall profits.
Chief among the other factors are energy costs, which the figures for factory prices exclude. The report argues that while the price of gas and electricity has fallen steeply this year, it is possible a majority of companies were panicked into buying long-term, fixed-price energy contracts when prices were high, and those contracts have yet to run out.
Manufacturers are heavy users of gas and electricity, and so it could be that their costs are high compared with a year ago and it is legitimate for them to continue passing on the difference to their customers.
The data also excludes the impact of rising import prices, leaving companies that rely on foreign partners for components in a worse position than those that source components from domestic suppliers.
Officials at the Bank think these reasons are more likely than price gouging, although they concede firms may be jacking up prices for a last hurrah before consumers cotton on to the idea that inflation is not a thing any more and that price rises should not be tolerated.
“It is possible that consumer-facing firms have sought to rebuild margins. But there is not much evidence at the whole-economy level that firms have increased their margins so far,” the Bank says.
That would seem to flatten the idea of greedflation. Margins are the same, so nothing to see here.
Yet margins being the same is a huge boon for businesses. To have maintained margins in a period as difficult and uncertain as the last three years is a colossal victory.
And stable profit margins must mean higher prices above and beyond the increase in running costs. Otherwise margins would fall.
Nestlé and Procter & Gamble, which fill UK supermarket shelves with their products, are the clearest examples of firms that have maintained or improved margins, allowing them to maintain dividends throughout the crisis period. There are plenty more highlighted in research by the Unite union, based on analysis of company reports.
In the spring, Which? made an assessment of supermarket food prices and found Aldi and Lidl were to blame for the steepest increases in everyday groceries. The price of some items had doubled in a year, the consumer champion said. Asda, Morrisons, Ocado, Sainsbury’s, Tesco and Waitrose all took their lead from the German discounters.
They are cutting prices now, and margins are suffering a little, but not to the extent that they have fallen to anywhere near pre-pandemic levels.
The Bank of England doesn’t ask questions about the profits made by businesses that make the goods and services that drive inflation. It waits to see data from the Office for National Statistics (ONS) about company profitability before making a judgment.
The ONS will produce the latest wages data this week for the year to June. By contrast, the profitability data is eight months out of date. Nevertheless, it shows margins stable over the two years to the end of December 2022 – a period when household incomes were falling.
There must be a reason the Bank focuses on labour and not capital when it makes its assessment of prices across the economy, and it won’t be the timeliness of the data.
Governor Andrew Bailey must have called for wage restraint 10 times for every one he has mentioned companies and their profits. It’s a bias that deflects from one of the main causes of inflation and should be corrected.
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Inflation
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THE Government is being urged to set a legally binding lower minimum for Universal Credit payments, to ensure that essential items, such as food and bills, are always covered.
The call for an “Essentials Guarantee” by the Trussell Trust national foodbank charity and the social-policy-campaigning Joseph Rowntree Foundation, comes as new research suggests that minority groups are disproportionately at risk of facing hunger.
The chief executive of the Trussell Trust, Emma Revie, said: “Nobody in the UK should face hunger. That is why research like this is so vital. It provides the evidence we need to be able to change systems, policies, and practices, so that no one is left unable to afford the essentials. We know that if all of us work together, we can end the need for foodbanks. It’s time to guarantee our essentials and create a roadmap to solve this, once and for all.”
Under the proposals, the Essentials Guarantee level would be set independently and reviewed regularly. Any benefit reductions, such as debt repayments to the Government, or because a claimant has reached the benefit cap, should not take support below that level.
The survey, Hunger in the UK, published on Wednesday by the Trussell Trust, questioned 2563 people using 99 of its foodbanks last summer. It found that most of those who were experiencing hunger (82 per cent), and who had been referred to foodbanks in the Trussell Trust network (90 per cent), were in debt, compared with 52 per cent of the general population.
Almost half (47 per cent) of those referred to foodbanks were repaying debts to local or national government through their benefits for previous advances; benefit overpayment; Department of Work and Pensions loans; or other debts and fines.
In all, one in seven respondents (14 per cent) experienced hunger because they did not have enough money, equating to about 11.3 million people — more than double the population of Scotland.
The research showed that certain groups were more likely to experience hunger than others. They included: disabled people; families with children (especially single parents); carers; people who had spent time in the care system; LGBTQ+ and ethnic minority communities; single adults living alone; and people who had had adverse life experiences, such as a bereavement or domestic abuse.
Three-quarters of foodbank users surveyed were either disabled or had someone disabled in their household — almost three times higher than the percentage in the national population.
Nearly half (47 per cent) of the households experiencing hunger included children aged under 16, compared with 29 per cent of families in the general population. Single adults living with children make up just three per cent of the population — but 11 per cent of people experiencing hunger.
One in four people from an ethnic-minority background faced hunger — almost twice the rate for white people; and more than one quarter (27 per cent) of people who are LGBTQ+ experienced hunger, compared with 13 per cent of people who are heterosexual.
Nearly one quarter (23 per cent) of people caring for a dependent faced hunger, compared with 12 per cent of non-carers; and the majority (66 per cent) of people referred to foodbanks had experienced one or more adverse life experiences in the past year — compared with 26 per cent on average around the UK.
Ms Revie said: “Being forced to turn to a foodbank to feed your family is a horrifying reality for too many people in the UK, but, as Hunger in the UK shows, this is just the tip of the iceberg. Millions more people are struggling with hunger. This is not right.
“Foodbanks are not the answer when people are going without the essentials in one of the richest economies in the world. We need a social-security system which provides protection and the dignity for people to cover their own essentials, such as food and bills.”
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Nonprofit, Charities, & Fundraising
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Most readers would already be aware that Coventry Group's (ASX:CYG) stock increased significantly by 31% over the past three months. As most would know, fundamentals are what usually guide market price movements over the long-term, so we decided to look at the company's key financial indicators today to determine if they have any role to play in the recent price movement. Specifically, we decided to study Coventry Group's ROE in this article.
Return on equity or ROE is an important factor to be considered by a shareholder because it tells them how effectively their capital is being reinvested. Put another way, it reveals the company's success at turning shareholder investments into profits.
How Do You Calculate Return On Equity?
ROE can be calculated by using the formula:
Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity
So, based on the above formula, the ROE for Coventry Group is:
2.2% = AU$2.5m ÷ AU$113m (Based on the trailing twelve months to June 2023).
The 'return' refers to a company's earnings over the last year. One way to conceptualize this is that for each A$1 of shareholders' capital it has, the company made A$0.02 in profit.
What Is The Relationship Between ROE And Earnings Growth?
Thus far, we have learned that ROE measures how efficiently a company is generating its profits. We now need to evaluate how much profit the company reinvests or "retains" for future growth which then gives us an idea about the growth potential of the company. Assuming everything else remains unchanged, the higher the ROE and profit retention, the higher the growth rate of a company compared to companies that don't necessarily bear these characteristics.
Coventry Group's Earnings Growth And 2.2% ROE
It is quite clear that Coventry Group's ROE is rather low. Not just that, even compared to the industry average of 9.5%, the company's ROE is entirely unremarkable. In spite of this, Coventry Group was able to grow its net income considerably, at a rate of 58% in the last five years. We reckon that there could be other factors at play here. For instance, the company has a low payout ratio or is being managed efficiently.
As a next step, we compared Coventry Group's net income growth with the industry, and pleasingly, we found that the growth seen by the company is higher than the average industry growth of 26%.
Earnings growth is a huge factor in stock valuation. It’s important for an investor to know whether the market has priced in the company's expected earnings growth (or decline). This then helps them determine if the stock is placed for a bright or bleak future. One good indicator of expected earnings growth is the P/E ratio which determines the price the market is willing to pay for a stock based on its earnings prospects. So, you may want to check if Coventry Group is trading on a high P/E or a low P/E, relative to its industry.
Is Coventry Group Efficiently Re-investing Its Profits?
Coventry Group's significant three-year median payout ratio of 66% (where it is retaining only 34% of its income) suggests that the company has been able to achieve a high growth in earnings despite returning most of its income to shareholders.
Moreover, Coventry Group is determined to keep sharing its profits with shareholders which we infer from its long history of paying a dividend for at least ten years. Upon studying the latest analysts' consensus data, we found that the company's future payout ratio is expected to drop to 44% over the next three years. Accordingly, the expected drop in the payout ratio explains the expected increase in the company's ROE to 6.8%, over the same period.
Summary
In total, it does look like Coventry Group has some positive aspects to its business. While no doubt its earnings growth is pretty substantial, we do feel that the reinvestment rate is pretty low, meaning, the earnings growth number could have been significantly higher had the company been retaining more of its profits. That being so, a study of the latest analyst forecasts show that the company is expected to see a slowdown in its future earnings growth. To know more about the company's future earnings growth forecasts take a look at this free report on analyst forecasts for the company to find out more.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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Stocks Trading & Speculation
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DCB Bank - Promoter Announces Capital Infusion Amid MD, CEO Succession: ICICI Securities
Promoter intends $10 million cap infusion; stake to rise more than 15%
BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
ICICI Securities Report
DCB Bank Ltd. has informed exchanges that AKFED, the promoter of the bank, has expressed its interest to invest up to $10 million by subscribing to additional equity shares.
The purpose of the infusion is to further strengthen the bank’s capital position and support its growth plans. We calculate that the proposed investment would translate to additional tier-I of less than 30 basis points.
Importantly, the proposed investment would result in ~2% rise in promoter stake, catapulting it to beyond 15%, which could necessitate specific approval from the Reserve Bank of India, in our view.
While the quantum for capital raise is rather modest, promoter intent to increase its stake carries strong positive signalling impact. DCB Bank would see a change of guard in April 2024 wherein the incumbent Managing Director and Chief Executive Officer, having served the bank for 15 years (maximum permissible tenure), would step down.
We believe the promoter’s announcement to further infuse capital clearly shows continued commitment amidst management succession.
We reiterate 'Buy' with unchanged target price of Rs 140.
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DISCLAIMER
This report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.
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Banking & Finance
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Supermarket chain Sainsbury's has cut the price of its own-brand butter and bread.
The supermarket is reducing its salted and unsalted butter from £1.99 to £1.89 for 250g packets from Tuesday.
Wholesale food prices have been falling globally, but food price inflation in the UK was recently at a 45-year high.
The move by Sainsbury's comes after criticism of supermarkets for not passing on wholesale price falls quickly enough.
Inflation was expected to fall below 10% last month but soaring food prices meant it fell by less than expected.
Price cuts
Sainsbury's will cut the price of 50g of salted butter by 20p to £3.75.
It is also cutting the price of its some of its own-brand bread to 75p from 85p.
Sainsbury's said it was able to lower some of its bread and butter prices due to wholesale prices beginning to fall.
"Whenever we are paying less for the products we buy from our suppliers, we will pass those savings on to customers," the UK's second largest supermarket chain said.
Food price inflation in was at its fastest pace for 45 years in March.
The war in Ukraine has driven up food prices around the world, but the UK has also faced its own problems too - from Brexit red tape to labour shortages.
However, as commodity prices have started to fall, supermarkets have started to cut prices on some products - but not others.
Some of the earliest price falls have been in milk, with Aldi, Lidl and Asda recently following Sainsbury's and Tesco in cutting the price of milk by at least 5p.
Last month the Office for National Statistics said the UK was "not there yet" in terms of supermarkets reflecting wholesale price falls.
And in March, the union Unite accused some retailers of "fuelling inflation by excessive profiteering".
In April industry body the British Retail Consortium said there is a three to nine-month lag to see wholesale price falls reflected in shops, with production prices peaking in October 2022.
How can I save money on my food shop?
- Keep track of what you have
- Head for the reduced section first
- Make better use of your freezer
- Make food last longer by understanding packaging
- Make use of local experts
Last summer, butter brand Lurpak said it had put prices up so dairy farmers would get a fair deal.
Some shoppers had expressed shock at rapidly rising prices, with a 750g tub of Lurpak priced at £7.25 in Sainsbury's in July 2022.
That price is the same in May 2023.
Farmers have been under pressure as milk prices have dropped, with one dairy farmer in Shropshire recently saying he is on a "knife edge".
Sainsbury's said its price drop would not have an impact on how much it paid farmers.
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Inflation
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Abu Dhabi’s ADQ, Chimera Set To Commit Billions More To New Fund
Backers of a new $50 billion Abu Dhabi fund, part of Sheikh Tahnoon bin Zayed Al Nahyan’s empire, are considering committing additional capital to the entity to double its portfolio over time, people familiar with the matter said.
(Bloomberg) -- Backers of a new $50 billion Abu Dhabi fund, part of Sheikh Tahnoon bin Zayed Al Nahyan’s empire, are considering committing additional capital to the entity to double its portfolio over time, people familiar with the matter said.
Chimera Investment LLC and Abu Dhabi wealth fund ADQ are in talks to commit more capital to Lunate and boost its assets under management to $100 billion over time, the people said, declining to be identified discussing confidential information. Lunate will also look to raise new funds from outside investors, they said.
Talks are ongoing and no final decisions have been made, the people said. ADQ and Lunate declined to comment. Representatives for Chimera and its parent firm, International Holding Co., weren’t available for comment.
Lunate is the latest player in Abu Dhabi, an emirate that’s used energy riches to become a major force in the investing landscape. The city is home to wealth funds Abu Dhabi Investment Authority, Mubadala Investment Co. and ADQ, which oversee well over a trillion dollars in assets in total.
Sheikh Tahnoon, a brother of the United Arab Emirates’ ruler and the country’s national security adviser, presides over many of these entities — including ADIA and ADQ — as well as International Holding.
Owned by Chimera and Lunate’s senior management, the new fund was unveiled in September to invest across private equity, venture capital, private credit, real assets, public equities and public credit. At the time, Lunate had said its team would comprise of more than 150 employees — including about 80 investment professionals — and that it expects to start operations later this year.
--With assistance from Farah Elbahrawy and Nicolas Parasie.
©2023 Bloomberg L.P.
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Banking & Finance
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Soaring energy bills are forcing people with severe disabilities and chronic health conditions to choose in extreme cases between “eating or breathing” as they struggle to navigate the cost of living crisis, new research shows.According to a survey by the charity Euan’s Guide, people are either opting to reduce their use of vital, energy-intensive electrical medical aids and equipment – putting their health in jeopardy – or where this is impossible, cutting back drastically on food, heating and travel.Respondents to the survey, many of whom have multiple and complex health conditions, variously report routinely skipping meals, cancelling trips to hospital appointments, switching the heating off and going for days without washing or showering, just so they can keep life-saving equipment turned on.One said: “Everything has gone up, every part of my life is affected. I use a powerchair, stairlift, bath lift and a Cpap machine [to ensure the user continues to breathe while sleeping]. At times I feel like I have to choose between eating and breathing, because my bill a year ago was £60 [a month] and it’s now nearly £150.”Another respondent, Karis Williamson, 24, of Inverness, who has a life-limiting form of muscular dystrophy and is permanently on a ventilation machine, told the Guardian she and her family turned the central heating off for long periods to ensure they could afford to use the medical equipment she relies on.This includes ventilators and suction pumps to enable her to breathe, a feed pump, a powerchair, electric bed and hoist. “My home is full of equipment that keeps me alive and out of hospital, which also saves the NHS an absolute fortune … I wouldn’t be able to go without any of the everyday equipment and survive,” she said.John Mcclafferty-Brown, 44, of Leicester, who has multiple sclerosis, cancer and arthritis, said he used a Cpap machine at night when he was asleep, but would often risk not using it during the day, even when short of breath, because of the expense, and the need to set aside money for basics such as food and heating.Helen Bolland, 42, of Thirsk, an armed forces veteran who was medically discharged after being injured in Iraq, said she had cancelled hospital appointments because she could not afford the cost of travel. “The cost of living crisis means you make difficult decisions. I’m scared of running up a bill I can’t afford to pay,” she said.Others said they could no longer always power up electric wheelchairs that enabled them to leave their home, or afford aquatherapy and swimming sessions that helped them cope with chronic pain. Some said they now stayed at home all the time and had effectively abandoned their social life, causing depression and anxiety.The findings are from a cost of living questionnaire attached to the annual Euan’s Guide survey of disabled access to venues around the UK. Over 7,000 people responded to the survey, carried out last autumn. It found 68% of respondents had cut back on energy use and 55% said they were less active as a result.“Not only do disabled people face the increased costs of fuel, food, and travel like everyone else, they have the additional cost of simply staying alive, staying active and staying well,” said Paul J Ralph of Euan’s Guide. “It’s a crazy situation when people cannot afford to run essential equipment to stay alive,” he added.Earlier this month the Guardian reported on the plight of the Van Keoghs, who had been told by the NHS that it could no longer guarantee to send nurses to their home to treat their severely disabled son Marley because the family could not afford to keep the heat on overnight.Campaigners have called for a special social tariff to cap the energy bills of people with disabilities and chronic health conditions who are intensive energy users out of necessity, and whose life and wellbeing is at risk if they have to cut energy use.A government spokesperson said: “We understand this is a difficult time for families across the country, including those living with a disability, which is why we have put in place immediate support for this coming winter. This includes direct payments to vulnerable households worth £1,200, plus an additional £150 disability cost of living payment. On top of this, the government’s energy price guarantee will save the typical household around £900 this winter.”
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Energy & Natural Resources
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What are your thoughts on Roth conversions if you are in the highest tax bracket and plan to be there moving forward?
-Joel
If you ask some financial professionals, the answer to this question might be a resounding no, and the discussion would be over. But there are arguments for doing Roth conversions, even if you are in the highest tax bracket.
In fact, there are specific instances where converting at the highest tax rates makes sense. And they are worth considering. (If you need help managing your retirement accounts, consider working with a financial advisor.)
Advantages of Using Roth Conversions in the Highest Tax Bracket
Consider these three advantages of using a Roth conversion, even when you’re in the highest tax bracket.
Taking Advantage of Relatively Low-Income Tax Years
This is the most common focus of planning for Roth conversions. The idea is that relatively low-income years, often thought of as the years between retiring and taking Social Security or required minimum distributions (RMDs), generate an opportunity to intentionally pay taxes.
For younger earners, this could also be thought of as converting (or contributing) to Roth before your earnings increase as your career progresses.
If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.
Removing Tax Uncertainty
If a taxpayer is concerned that tax rates could go up in the future, converting to a Roth takes tax rate changes out of the equation. The tax code is written in pencil, and Congress has the power to change it at any time and in any way it decides.
Nobody knows what tax laws will be in place in a few years, especially with the expiration of provisions of the Tax Cuts and Jobs Act in 2025. So if your concern is that tax rates will go up, converting to Roth now, in some ways, protects you from those potential increases.
Creating Tax Flexibility
A Roth can give you the flexibility to have funds available when you need them without fretting over the tax consequences. (If you need help with the tax consequences of your investment decisions, consider working with a financial advisor.)
When Would It Make Sense for a Roth Conversion in the Highest Tax Bracket?
The most clear-cut instance of Roth conversions making sense in the highest bracket is for taxpayers at a level of income and wealth where they can reasonably expect to be in the highest tax brackets throughout their lives. Tax rates may rise in 2026 and are currently at historical lows. For taxpayers already in the highest bracket who expect to always be there, converting to a Roth is a way to pay the devil we know instead of waiting to find out what the devil we don’t know will look like in the future
The uncertainty of tax rates in the future may be more painful than the check you’d have to write today.
This comes down to personal preferences and expectations for the future. By converting to a Roth in anticipation of tax rates significantly rising in the future, you are taking a risk to remove the IRS as a debt holder on your wealth.
If rates don’t go up in your lifetime or even go down in the future (whether because Congress changes the rates or you end up with lower income in the future), you could certainly end up paying more in taxes than if you did not convert.
It is important to make these decisions with as much information and context as possible. No one can guarantee what tax rates will be in the future. (If you need help managing the tax implications of your retirement decisions, consider working with a financial advisor.)
Next Steps
Whether you are in the highest tax bracket or any other, tax planning is most effective when you are thinking about the long term. Converting to Roth always means paying more in tax this year than you otherwise would have. So for a conversion to make sense, it has to be part of a longer-term plan.
The benefits of a conversion are typically recognized over time, not in the year of the conversion. The most successful Roth conversion strategies are going to be ones that are intentional and focused on multi-year planning.
Tips for Finding a Financial Advisor
Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Consider a few advisors before settling on one. It’s important to make sure you find someone you trust to manage your money. As you consider your options, these are the questions you should ask an advisor to ensure you make the right choice.
©iStockPhoto/Kobus Louw, ©iStockPhoto/courtneyk
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Personal Finance & Financial Education
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Siemens Q4 Results Review - Demerger On Cards; Turbulence At Parent Reaches Indian Shores: ICICI Securities
Siemens AG has entered into a share purchase agreement to acquire an 18% stake in Siemens India from Siemens Energy
BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
ICICI Securities Report
Siemens Ltd. reported a good set of results – 24% YoY growth in revenues and 163 basis points YoY improvement in Ebitda margin for Q4 FY23, and Ebitda growth of 39% YoY and profit after tax growth of 53% YoY for FY23.
Order inflow for Q4 FY23 grew 12% YoY, taking the order book to Rs 455 billion. The book to bill ratio came in at 2.5 times (versus 1.1 times last year) aided by strong order inflow for locomotives.
Siemens remains the best play with a strong product suite to participate in the capex uptick across new factories, transmission and mobility (driven by new locomotives and Vande Bharat tenders).
Affected by financial issues, the holding companies of Siemens India rejigged their shareholdings – Siemens Energy is going to sell 18% of the 24% stake it owns in Siemens India.
We maintain 'Add' with an SoTP-based target price of Rs 4,190.
Click on the attachment to read the full report:
DISCLAIMER
This report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.
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Stocks Trading & Speculation
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Calculate monthly payments for different loan scenarios with our
Mortgage Calculator.
The rates you see here generally won’t compare directly with teaser rates you see advertised online, since those rates are cherry-picked as the most attractive, while these rates are averages. Teaser rates may involve paying points in advance, or they may be selected based on a hypothetical borrower with an ultra-high credit score or taking a smaller-than-typical loan. The mortgage rate you ultimately secure will be based on factors like your credit score, income, and more, so it may be higher or lower than the averages you see here.
Lowest Mortgage Rates by State
The lowest mortgage rates available vary depending on the state where originations occur. Mortgage rates can be influenced by state-level variations in credit score, average mortgage loan type, and size, in addition to individual lenders' varying risk management strategies.
The states with the lowest 30-year new purchase averages were Vermont, Delaware, Mississippi, Connecticut, and Louisiana, while the states with the highest averages were Arizona, Nevada, Oregon, Minnesota, Washington, and Georgia.
What Causes Mortgage Rates to Rise or Fall?
Mortgage rates are determined by a complex interaction of macroeconomic and industry factors, such as:
The level and direction of the bond market, especially 10-year Treasury yields
The Federal Reserve's current monetary policy, especially as it relates to bond buying and funding government-backed mortgages
Competition between
mortgage lenders and across loan types
Because fluctuations can be caused by any number of these at once, it's generally difficult to attribute the change to any one factor.
Macroeconomic factors kept the mortgage market relatively low for much of 2021. In particular, the Federal Reserve had been buying billions of dollars of bonds in response to the pandemic's economic pressures. This
bond-buying policy is a major influencer of mortgage rates.
But starting in Nov. 2021, the Fed began tapering its bond purchases downward, making sizable reductions each month until reaching net zero in March 2022.
Since that time, the Fed has been aggressively raising the
federal funds rate to fight decades-high inflation. While the fed funds rate can influence mortgage rates, it does not directly do so. In fact, the fed funds rate and mortgage rates can move in opposite directions.
However, given the historic speed and magnitude of the Fed's 2022 and 2023 rate increases—raising the benchmark rate 5.25 percentage points over the last 18 months—even the indirect influence of the fed funds rate has resulted in an upward impact on mortgage rates over the last two years.
The Fed has opted to hold rates steady at its last two meetings, which concluded Sept. 20 and Nov. 1. Though Fed Chair Jerome Powell made it clear that
another rate increase is still possible at a future meeting, encouraging inflation data released Nov. 14 has since dampened almost all expectations of future increases. The Fed’s next rate announcement will be made on Dec. 13.
How We Track Mortgage Rates
The national averages cited above were calculated based on the lowest rate offered by more than 200 of the country's top lenders, assuming a
loan-to-value ratio (LTV) of 80% and an applicant with a FICO credit score in the 700–760 range. The resulting rates are representative of what customers should expect to see when receiving actual quotes from lenders based on their qualifications, which may vary from advertised teaser rates.
For our map of the best state rates, the lowest rate currently offered by a surveyed lender in that state is listed, assuming the same parameters of an 80% LTV and a credit score between 700–760.
Investopedia / Alice Morgan
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Real Estate & Housing
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Shoppers facing cost-of-living pressures turned to discount and second-hand stores last month, giving retail sales a surprise boost.
Sales volumes rose by 1.2% in February, official figures showed, the biggest monthly gain since October last year.
Food sales also rose, but the Office for National Statistics said there were signs price pressures had cut spending in restaurants and on takeaway meals.
Figures out earlier this week showed prices rising faster than expected.
Inflation - the rate at which prices rise - jumped to 10.4% in the year to February, remaining close to its highest level for 40 years.
The Bank of England has been rising interest rates in an attempt to cool price rises, and on Thursday it lifted rates to 4.25% from 4%.
February's rise in retail sales was stronger than forecast, and followed an upwardly revised 0.9% increase in January.
Sales volumes are now back to pre-pandemic levels, the Office for National Statistics (ONS) said, although are still 3.5% lower than a year ago.
"The broader picture remains more subdued, with retail sales showing little real growth, particularly over the last 18 months with price rises hitting consumer spending power," said ONS director of economic statistics Darren Morgan.
The ONS said non-food sales rose by 2.4% last month, boosted by discount department and clothing stores. There was also "strong growth" in second-hand goods stores, such as auction houses and charity shops.
"Looking at the latest retail sales figures you might be forgiven for wondering if Britain really is in the middle of a cost-of-living crisis," said Danni Hewson, head of financial analysis at AJ Bell.
"But pop the hood and the reality is laid bare... people are hunting out bargains whether they're found in the sales aisles being well-stocked by department stores, or in charity shops or other second-hand emporiums."
Businesses are also feeling the squeeze from rising costs. Pub chain Wetherspoon said inflationary pressures - from the cost of energy, food and labour - had been "ferocious", as it reported its latest results.
"The Bank of England, and other authorities, believe that inflation is on the wane, which will certainly be of great benefit, if correct," said chairman Tim Martin.
Wetherspoon reported a pre-tax profit of £4.6m ($5.6m) for the six months to 29 January, compared with a £21.3m loss a year ago. However, that is still well down on £50m Wetherspoon made in the first half of 2019 before the Covid pandemic hit.
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Inflation
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Sir Keir Starmer has accused the prime minister of overseeing a "collapse" in housebuilding.
The Labour leader said Rishi Sunak was "shuttering the dream" of those who "desperately" want to own a home.
But Mr Sunak defended the government's record, saying housing supply was up 10% in the last year.
The government is set to miss its target of building 300,000 new homes a year in England by the mid-2020s, a figure it has never achieved.
Last year Mr Sunak was accused of watering down local housing targets, following a rebellion by some Conservative MPs.
The government has said it remains committed to the 300,000 figure but has given councils more flexibility in meeting centrally-set targets.
During Prime Minister's Questions, Sir Keir said "housebuilding has collapsed" since Mr Sunak "crumbled to his backbenches and scrapped mandatory targets".
He said the prime minister's "failure" was "shuttering the dream of those who desperately want to own their own home".
"How can they ever look the British people in the eye again, and claim to be the party of homeownership?" he asked.
Mr Sunak said the government had delivered almost record numbers of new homes in each of the past three years, while the number of first-time buyers was at a 20-year high.
"He talks about targets, so let's be clear, I promised to put local people in control of new housing, I delivered on that policy within weeks of becoming prime minister," he said.
Earlier this year Housing Secretary Michael Gove said the UK housing model was "broken" and more homes were "desperately" needed.
Labour has sought to make housing central to its pitch to voters ahead of the next general election, which is expected next year.
Sir Keir also accused the Conservatives of being responsible for a "mortgage bombshell", after interest rates rose for the 13th consecutive time to 5% last week.
The Bank of England has been increasing interest rates since the end of 2021 in an attempt to tame rising prices.
This makes it more expensive to borrow money and theoretically encourages people to borrow less and spend less, meaning price rises should ease.
However, it also means homeowners are facing big increases in mortgage payments.
Sir Keir criticised the government's "softly, softly approach" of asking banks to offer more flexibility to struggling mortgage-holders, rather than making this mandatory.
Mr Sunak said it was right to provide support for mortgages and the "vast majority" of the market was now covered by the measures.
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Real Estate & Housing
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How To Ensure There Is No Unnecessary Tax Deducted At Source?
Those who do not have taxable income can submit Form 15G or 15H to avoid TDS. Here is how.
One of the common experiences for taxpayers is that they face Tax Deducted at Source on various investments. This is especially true for areas like interest and dividends, where there is a TDS after the income crosses the threshold limit. This can be a source of concern for those who do not have taxable income and hence, would need to claim back the amount as refunds from the tax department.
There is, however, an option available to submit Form 15G or 15H and avoid the TDS. Here is how to go about the entire process.
TDS Threshold Limits
There is a specific limit after which the income earned from a particular source will be subject to TDS. This is different for various types of income, and sometimes the limit is also different based on the kind of taxpayer bracket you fall under.
For example, the threshold limit for dividend income is Rs 5,000, after which the TDS will be done. When it comes to interest from a bank, the limit is Rs 40,000 for a normal individual, but for a senior citizen this goes up to Rs 50,000. This threshold limit is important as the TDS will start after the limit is breached, and this will be applicable to everyone.
Non-Taxable Income
There are several people who might not have taxable income during the year.
A lot of them are senior citizens, as they might not have much income in their names, but they would have some investments that are present. At the same time, this category would also cover housewives who might not have a regular income, but might have saved some money that they have invested. Some individuals might find themselves temporarily in this category, and this can be those who are taking a break from work for a short period of time.
The problem for these people is that if they face TDS, then the money will come back to them only after the financial year is complete, and the return is filed and is processed. This could turn out to be quite long and hence, there is a need to ensure that the entire process of TDS is not done at all, so that this trouble is avoided.
Form 15G/15H
The first thing to understand is which Form can be used by which category of people. The forms that have to be used to ensure that there is no TDS are Forms 15G and 15H. This form ensures that if an individual does not have taxable income, they can make sure that the TDS is not paid.
Form 15G is for people who are below 60 years of age and they can use this form. While, Form 15H is for those who are senior citizens, which means that they are above 60 years of age.
The important thing to note is that the form has to be submitted to the entity that is going to deduct the tax. The main thing is that the individual's income for the year has to be below the basic exemption limit and that the tax on this should be nil. If there is even a small amount of tax to be paid on the income, then this form cannot be submitted.
Details
There are several details that are important when this form is being submitted. This form has to be submitted each year, so if there was one submitted last year, then this would not be valid for the current financial year. Hence, a new one for the current financial year has to be submitted.
The other thing is that for fixed deposits, this has to be submitted at the branch where the deposit is present. For the dividend aspect, it has to be given to the registrar, and in most cases, the registrar will send an email to the shareholders, before the dividend is paid, mentioning the manner in which this can be submitted.
At some places, it is also possible to submit the form online; otherwise, it has to be given physically. The Permanent Account Number has to be mentioned in the form, and at the same time, the details about the income and the investment have to be mentioned in the form. Correctly completing the form is a vital part of completing this entire process.
Arnav Pandya is founder Moneyeduschool
The views expressed here are those of the author, and do not necessarily represent the views of BQ Prime or its editorial team.
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Personal Finance & Financial Education
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(Bloomberg) -- Changpeng Zhao had long cultivated the image of the rugged pugilist of the cryptocurrencies world.
Most Read from Bloomberg
When his rival Sam Bankman-Fried’s crypto empire collapsed a year ago, Zhao, or “CZ” as his fans call him, was in the middle of it all, yanking his money in a very public way and helping trigger the ultimately fatal run on the firms. Years earlier he claimed the company’s headquarters was wherever he happened to be, a thinly veiled salvo against regulators trying to nail down jurisdiction. And this March, when US regulators charged Zhao and his firm, Binance Holdings, with violating US securities laws, his on-line response was “4,” which is Zhao code for dismissing something as unworthy of his attention.
On Tuesday, though, Zhao cut a very different image in a Seattle courtroom. Dressed in dark suit and pale blue tie before a federal judge, he pleaded guilty to criminal charges for anti-money laundering and US sanctions violations, including allowing transactions with Hamas and other terrorist groups, under a sweeping deal with the Justice department designed to keep the biggest crypto exchange operating. Binance itself agreed to plead guilty to criminal charges and pay over $4 billion in penalties. Zhao stepped down as CEO and will pay a $50 million fine.
Zhao’s capitulation in many ways is the culmination of a multi-year dragnet by international regulators who sought to rein in and impose regulations on Binance — and, by extension, the broader industry.
Moreover, it marks the second time in less than a year that the crypto universe, still reeling from a crash that shaved some $2 trillion off the value of the market, loses one of its biggest stars. Bankman-Fried may have been the best known name in crypto but Zhao, worth almost $100 billion at his zenith in early 2022, was the wealthiest and most powerful.
“This is a big deal,” said Michael Rosen, chief investment officer at Angeles Investments. Zhao’s “prominence helped him until it hurt him,” converting him eventually into a big target for authorities.
Richard Teng, a civil servant-turned-crypto executive, succeeded Zhao.
Binance Coin, a cryptocurrency also known as BNB that is the main transactional token on the exchange, dropped more than 8% on Tuesday.
Zhao played a key role in bringing cryptocurrencies into the mainstream. He built Binance into a juggernaut that at one point controlled almost two-thirds of spot trading over centralized exchanges — attracting scrutiny from regulators and law enforcement agencies around the world along the way.
The departure of crypto’s perhaps most iconic remaining executive comes as the industry tries to put its reputation for scandals, scams and other illicit activities behind it. Several entrepreneurs associated with that era, from Bankman-Fried to Do Kwon and Alex Mashinsky, are either in jail or have been charged with alleged crimes that led to multibillion-dollar losses.
Zhao faces as many as 10 years in prison but is expected to get no more than 18 months under a plea deal that appears to have saved him from the harsh penalties that other prominent crypto criminals have faced. The Justice Department hasn’t decided yet what length of a prison term they will seek for him.
“I will have to deal with some pain, but will survive,” Zhao said in an internal announcement. “I needed a break anyway.” He also provided a glimpse of what’s in store for Binance: “We will get through, although with some changes in structure.”
Born in China, Zhao moved to Vancouver when he was 12 and became a Canadian citizen. With a computer science degree from McGill University, he began a career building trading systems, including a stint at Bloomberg LP, the parent company of Bloomberg News.
In 2013, Zhao was running his own software company in Shanghai when he discovered Bitcoin over a poker game. After working at crypto firms Blockchain.info and OKCoin, he started Binance in 2017 together with Chief Marketing Officer Yi He, with whom he has children.
Binance quickly embarked on an acquisition spree that saw it morph into a brokerage, digital wallet, venture fund, custody service, data provider, digital-art marketplace and token issuer — all under Zhao’s direct control.
Within just a few years, Zhao was the richest person in crypto. Favoring a buzz cut and black polo shirts featuring Binance’s logo, he became a fixture on the crypto conference circuit, spending 580 hours on airplanes in 2022 by his own estimate.
The lack of separation between business actives such as custodial and trading services common among crypto exchanges, unlike in traditional finance — has stirred concerns that giant crypto exchanges like Binance could pose systemic risks.
When Bankman-Fried’s FTX imploded in November 2022, billions of dollars of client funds were trapped because FTX had lent assets to the hedge fund he also controlled, Alameda Research, which had made huge losing bets. Zhao himself helped hasten FTX’s demise with a post on Twitter about selling Binance’s holding of its native token FTT, which touched off a stampede to withdraw money from FTX.
Bankman-Fried was convicted of a massive fraud in early November and is awaiting sentencing. He faces the possibility of decades in prison.
Binance and other exchanges have argued that they present no similar risks because all of their client assets are kept separated and thus available for withdrawal at any time. Zhao himself regularly uses the term “SAFU” in tweets to assure customers that their funds are safe.
In the third quarter, the exchange has accounted for about 38% of all trading volumes across the spot market, down from nearly 55% in the first quarter of the year, according to researcher CCData. By comparison, Coinbase Global Inc., the biggest US crypto exchange, had a 5.7% market share in the quarter.
While Zhao publicly displayed defiance amid the charges, Binance authorities were working with regulators behind the scenes. Even Zhao’s official statement back in March was a bit more conciliatory than his “4” tweet, saying the firm was looking for “amicable solutions.”
The 4 tweet quickly became a favorite of his on-line detractors Tuesday. It actually represented, they snickered, the $4 billion fine Binance would pay.
--With assistance from Justina Lee, Emily Nicolle and Isabelle Lee.
(Updates with comment from Zhao in 12th paragraph.)
Most Read from Bloomberg Businessweek
©2023 Bloomberg L.P.
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Crypto Trading & Speculation
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The Stoner Cats NFTs, associated with a cartoon including the voice talent of Mila Kunis and Ashton Kutcher, were actually unregistered securities, the Securities and Exchange Commission said today. The company behind the NFTs, called Stoner Cats 2, paid $1 million in fines and agreed to destroy all of the NFTs in its possession without admitting guilt.
This is the second action the SEC has taken against NFTs, and unlike the last one, it may have broad consequences for the industry. Between the two cases, the SEC is “drawing a picture where all NFTs are within their jurisdiction,” says Hermine Wong, the former head of policy at Coinbase and a former SEC regulator. The order is likely to have a chilling effect on the industry, she says.
“Investors were also told that ‘the more successful the show, the more successful your NFT’ will be.”
The purpose of the Stoner Cat NFTs was to fund an animated web series, also called Stoner Cats, the SEC says. Stoner Cats 2 “offered and sold the Stoner Cats NFTs as an investment into SC2’s efforts to create this content,” the SEC order says. Six episodes of the show were produced — and only those who had the NFTs could view the show.
Though no individuals are named in the order, Kunis’ production company was involved in creating the web series and forming “a formidable collective of voice talent, animators, and creatives of all kinds to come together with technology and NFT experts (including the brilliant minds behind CryptoKitties) to bring this story to life using NFTs,” according to the Stoner Cats website.
Funds from the NFTs were used to pay the voice cast, the SEC order says. That talent included Kutcher, Kunis, Chris Rock, Jane Fonda, NFT influencer Gary Vaynerchuk, and Ethereum founder Vitalik Buterin, among others. The money raised from NFTs also paid management, producers, and others associated with the show. “Investors were also told that ‘the more successful the show, the more successful your NFT’ will be,” the order says.
The SEC order also zeroes in on the Stoner Cats’ royalties, and this is the part that is particularly troublesome for other NFT projects. The Stoner Cats NFTs were configured so that whenever one of the NFTs was resold, Stoner Cats 2 received a 2.5 percent royalty. “The royalties created incentives for SC2 to encourage individuals to buy and sell the Stoner Cats NFTs in the secondary market,” the order reads. “If the Stoner Cats show was successful, the price of the NFTs could rise and so could the amount of royalties.”
“Even more troubling is how artists and creators are supposed to interpret this.”
Royalties are associated with many NFT projects and are among the draws for artists who might consider NFTs. In the ordinary art market, an artist receives nothing from the resale of their work — and the possibility of getting a cut when their work was resold was a big draw. Some exchanges, such as OpenSea, have dropped the royalty cut completely.
“Even more troubling is how artists and creators are supposed to interpret this,” says Wong. The SEC didn’t issue guidance about what royalties might count as a violation of securities law, so a reasonable person might assume all royalties are in violation.
SEC Commissioners Hester Peirce and Mark Uyeda dissented from the enforcement action, saying that the SEC should lay out clear guidelines for artists. “This enforcement action involves activity that we believe constitutes fan crowdfunding,” they wrote in their dissent. They compared the Stoner Cats NFTs to Star Wars collectibles sold in 1977, which promised future action figures. Those Star Wars collectibles, however, didn’t offer royalties upon resale to Lucasfilm, which seems like a significant difference.
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Crypto Trading & Speculation
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UK homeware retailer Wilko has warned that it is on the brink of collapse, putting some 12,000 jobs at risk.
The privately-owned company said it had filed a "notice of intention" to appoint administrators after failing to find enough emergency investment.
Wilko, which has 400 UK stores across the UK, is well-known for its affordable everyday items.
Chief executive Mark Jackson said it would continue to talk with interested parties about options for the business.
He said the company was left with "no choice but to take this action", but hopes to find a solution as quickly as possible to "preserve the business".
Wilko did not confirm in the announcement on Thursday whether or not any jobs would be affected.
Andy Prendergast, national secretary at the GMB union, said: "This is extremely concerning but we remain hopeful that a buyer can be found.
"Wilko's staff deserve reassurance that their jobs are safe. We hope this is the number one priority going forward."
Wilko added that it had received "significant interest" from investors and some offers but none of them would have provided enough cash within the time needed.
Rising interest rates, higher energy costs and squeezed consumer spending have all been weighing on retailers.
But Wilko's boss said on Thursday that the company, which has an annual turnover of about £1.2bn, had a "robust turnaround plan" in place.
The discount chain has been struggling for months and had been considering a company voluntary arrangement, where some of its landlords would receive no rent for three years.
After Mr Jackson joined the retailer late last year, it also announced that it would cut 400 jobs in a bid to cut costs.
At the time, the GMB union said that the company was in a "fight for survival".
The latest move gives Wilko breathing space of up to 10 working days to come up with a rescue deal.
The company, which was founded in 1930 in Leicester, is still owned by the Wilkinson family.
It has already borrowed £40m from Hilco, a specialist retail investor and the owner of Homebase, and has even been exploring the potential sale of a stake in business, according to reports by Sky News.
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Consumer & Retail
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Indians Given A Week More To Find $1.7 Billion Worth Of Banknotes Before Withdrawal
India’s central bank on Saturday extended a deadline to return the country’s highest value banknotes by another week, after billions of rupees’ worth remained in circulation.
(Bloomberg) --
India’s central bank on Saturday extended a deadline to return the country’s highest value banknotes by another week, after billions of rupees’ worth remained in circulation.
The Reserve Bank of India ordered the withdrawal of the 2,000-rupee note on May 19, giving people until the end of September to exchange or deposit 3.56 trillion rupees ($42.9 billion) at banks across the country. But as of Friday, notes worth 140 billion rupees ($1.7 billion) remained unaccounted for, the central bank said in a statement on its website.
Read more: Indians Have Five Days to Deposit $3 Billion in Soon-to-Be-Withdrawn Banknote
“As the period specified for the withdrawal process has come to an end, and based on a review, it has been decided to extend the current arrangement for deposit or exchange of 2000 banknotes until October 07, 2023,” the RBI said.
From Oct. 8, banks will not accept these notes anymore, but they can be exchanged, up to a maximum 10 notes or 20,000 rupees at a time, at 19 RBI issue offices. People can also return the notes at the RBI offices, “for credit to their bank accounts in India for any amount.”
The highest denomination note was introduced in November 2016 to quickly remonetize the economy after Prime Minister Narendra Modi’s shock decision to remove 1,000 and 500 rupee notes as legal tender overnight. In its May notice the RBI said the notes had served their purpose and must be withdrawn as per its “clean note policy” to replace soiled bills every four to five years.
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.
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India Business & Economics
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Credit Card Default Rises To Rs 4,072 Crore In FY23
Credit card default rose to Rs 4,072 crore or 1.94% at the end of March 2023, Parliament was informed on Tuesday.
Credit card default rose to Rs 4,072 crore, or 1.94%, at the end of March 2023, Parliament was informed on Tuesday.
"As per the inputs received from RBI, in respect of defaults in credit cards, the gross non-performing assets in credit cards was Rs 3,122 crore in March-2022 and Rs 4,072 crore in March-2023, while credit card outstanding in March-2022 and March-2023 was Rs 1.64 lakh crore and Rs 2.10 lakh crore, respectively," Minister of State for Finance Bhagwat Karad said in a written reply in Rajya Sabha.
GNPAs in credit cards have declined from 3.56% in March 2021 to 1.91% in March 2022, and stand at 1.94% in March 2023 against the schedule commercial banks' GNPA of 3.87% in March 2023, he said.
Replying to another question, Karad said, the total number of frauds as reported by the cooperative banks during FY23 was 964 with amount involved to the tune of Rs 791.40 crore.
During FY22, the total number of fraud was 729 and the amount involved was Rs 536.59 crore as against 438 frauds involving Rs 1,985.79 crore in FY21, he said.
All cooperative banks are required to comply with the guidelines issued by the Reserve Bank of India from time to time, he said.
Compliance to RBI guidelines issued to banks is examined on sample basis during the supervisory assessment of the banks and any non-compliance observed is taken up with the banks for rectification apart from initiating supervisory/ enforcement action against the bank, as deemed fit, he said.
RBI and NABARD have informed that they undertake measures for strengthening fraud risk management in banks, including issuing caution advises, advising banks for rotation and mandatory leave of staff, compliance monitoring, cyber security advisories, etc., he said.
In a separate reply, Karad said, as per inputs received from public sector banks, several steps have been taken to ensure ethical debt collection practices.
Banks conduct auction of the properties through online portals, as per their board approved policy framed under the guidance of fair practices code issued by Reserve Bank of India, and applicable laws and regulations of the SARFAESI Act, 2002, he said.
Banks also issue public auction notices of properties in two newspapers, i.e. in English as well as in vernacular local language, he said.
Further, he said, multiple valuations are obtained from empanelled/registered valuers to calculate reserve price of auction and the same is fixed with the approval of competent authority.
Besides, he said, RBI as part of its supervisory assessment, reviews adherence to its guidelines, and non-compliance observed are taken-up with banks for rectification apart from initiating supervisory/enforcement action, as deemed fit.
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Banking & Finance
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Minister Claire Coutinho said the government’s childcare plans will make it “easier” to have a family, in an exclusive interview with HuffPost UK.
The Tory MP also hit back at Jacob Rees-Mogg who criticised Rishi Sunak’s free childcare expansion as “anti-family”.
Chancellor Jeremy Hunt has promised a £4billion plan to fund 30 hours of free childcare a week for all children, from the end of parental leave until school age.
“This is the single largest ever investment in childcare…I don’t want any mum to feel that childcare is a barrier to work.”
Former cabinet minister Rees-Mogg described it as “fundamentally anti-Conservative” and said the party should offer policies to encourage marriage instead, at a speech in London on Tuesday.
Asked about his comments, Coutinho insisted their policy is “definitely something which is family positive” and would help families to stay together.
“I’ve worked on family policy for a long time,” the minister for children, families and wellbeing said.
“One of the periods when you have a higher amount of family breakdown - when families are really strained - is in those early years.
“That’s why it is really important to support those early years. So this is supporting families, it’s supporting them to stay together, it’s supporting them to make the right choices in terms of their work, in terms of their family balance.”
The offer of free childcare will be available to working parents of two-year-olds from April 2024, but initially it will be limited to 15 hours.
From September 2024, the 15-hour offer will be extended to children from nine months, and the full 30-hour offer to working parents of children under five will come in from September 2025.
Coutinho said the pandemic and cost of living crisis had made raising a family “really hard” and added: “All of our policies that we are looking at is to try and make it easier to have a family and to make sure that you’re supported during that time.”
She said mothers told her they were really struggling with childcare costs and getting back into work.
“That’s why we put in place this policy,” she said. “I do think it’s genuinely radical. We’re going to be doubling the amount that we spend on childcare by 2027-28.
“It is the single largest investment ever into childcare. And it will save families on average something like £6,500 [a year].”
As part of their plan, the government will also pilot incentive payments of £600 for childminders joining the profession, and £1,200 if they join through an agency.
They are also providing £289 million for schools to increase the supply of wraparound care and changing minimum staff-to-child ratios in nurseries England from 1:4 to 1:5 for two-year-olds in England.
Childcare support will also be paid to parents on Universal Credit upfront - rather than in arrears.
However, questions have been raised about the plan, including over the funding, the supply of places and concerns that the quality of childcare could be sacrificed in the pursuit of getting people into work.
Another concern is the lack of early years workers as so many have left the profession.
A survey of providers found that 84% said they were finding it “difficult” to recruit suitable new early years staff, with a majority (60%) finding it “very difficult”.
Coutinho pointed to the government’s grant incentive schemes and said she was keen to make the registration period for childminders “smoother” and ensure the sector feels “valued”.
The minister insisted the government’s plan is “genuinely radical” and added: “I have heard from parents who are really struggling and it is often mum who is trying to make the decision between going back to work and whether they’re going to be able to cover their costs of childcare.
“And what I’m hoping to see, in two years time, is I don’t want any mum to feel that childcare is a barrier to work.”
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Consumer & Retail
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Friday in my constituency summed up for me the state of our country. Local headteachers I respect and admire were in tears as they described the challenges they are grappling with. The owner of a popular local chippy showed me his energy bill, up from £5,000 a quarter to £11,000, as he shared his fears for his business. A parent showed me a photo of his straight-A son beaten black and blue in the middle of his GCSEs and shared his frustration that he has put more work into the investigation than the police.
People are increasingly looking to Labour to get Britain out of this mess. Last week Keir Starmer set out the fifth of Labour’s five missions for government: to smash the class ceiling that holds back kids from working-class backgrounds like mine. Taken together with our ambition to build an NHS fit for the future out of the ashes of the worst crisis in its history, to make our streets safe, to deliver clean power by 2030 and to get our economy racing ahead of the world, with the benefits shared so that we’re all better off, Keir’s missions amount to an ambitious vision of what our country can look like in the 2030s.
Labour faces two big hurdles – both largely of the Conservatives’ making, both of which will make our job more difficult.
The first is the car crash of the public finances. The Conservatives’ ideological joyride of a budget last year has left everyone paying the price through higher rents, higher mortgages and higher bills. Keir and Rachel Reeves face tougher choices than Tony Blair and Gordon Brown in 1997. As Keir said in his conference speech in September, this means there will be good Labour things we want to do but won’t be able to promise.
We face a huge deficit of trust in politics too. It’s a far bigger problem for us than it is for the Tories. As Britain’s progressive party, Labour is where people turn when they believe things can get better. When cynicism wins, so do the Tories. It falls to us to win public confidence in the Labour party and in the ability of politics to be a force for good.
That’s why we are being so careful to only make promises we know we can keep. The only thing worse than no hope is false hope. It will disappoint some of our friends that we are not pledging support for every cause they believe in. But it would be so much more damaging to make promises now and then break them after the election. Ask the Lib Dems what far-fetched promises on tuition fees did for them.
As shadow health secretary I have a challenging public service brief. It is not always easy being unable to pull the spending lever. But that is exactly why Keir and Rachel are right to prioritise economic growth, because that’s the only way we are going to be able to give the NHS and other public services the investment they need.
Imagine Britain leading the G7 with the highest sustained economic growth, with a million more jobs in green energy, with an NHS fit for the future, safe streets and a trusted justice system, and with every child, whatever their background, having the best start in life. That will be Labour’s platform at the next general election, and because we are making the hard choices necessary for government, it will be a platform you can trust us to deliver.
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Energy & Natural Resources
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RBI Nod To Appointment Of Hinduja Directors On Reliance Capital Board
Hinduja Group firm IndusInd International Holdings Ltd (IIHL) had emerged as the highest bidder for Reliance Capital in an insolvency proceeding to recover unpaid loans. IIHL had made an offer of Rs 9,650 crore to take over Reliance Capital in the second round of auction concluded in April.
The Reserve Bank of India (RBI) has ordered an arms length distance between Hinduja group-run IndusInd Bank Ltd and Reliance Capital - the debt-laden firm the conglomerate is acquiring in an insolvency proceeding..
The RBI laid down the condition while giving nod to the appointment of five Hinduja Group representatives as directors on the board of Reliance Capital, sources said citing the central bank's November 17 letter.
Hinduja Group firm IndusInd International Holdings Ltd (IIHL) had emerged as the highest bidder for Reliance Capital in an insolvency proceeding to recover unpaid loans. IIHL had made an offer of Rs 9,650 crore to take over Reliance Capital in the second round of auction concluded in April.
The RBI in the November 17 letter conveyed its no objection to the transfer of control of Reliance Capital Ltd to IIHL BFSI (India) Ltd (wholly owned subsidiary of IndusInd International Holdings Ltd).
It also approved the appointment of Amar Chintopanth, Shardchandra V Zaregaonkar, Moses Newling Harding John, Bhumika Batra, and Arun Tiwari as directors on the Reliance Capital board, sources said.
The no-objection was being granted on the condition that pursuant to the change of control and management, the company shall maintain a strict arm's length distance with respect to any transaction with IndusInd Bank Ltd, they said citing the central bank letter.
The RBI also stipulated that any change in the shareholding, post takeover, will be subject to prior approval by the central bank.
The RBI has also directed that a copy of the NCLT order approving the IIHL's resolution plan will have to be submitted to the bank.
The NCLT approval on IIHL's resolution plan is still pending as the Supreme Court is yet to decide on the Torrent Investment's plea against the second round of auction held by the lenders of Reliance Capital.
A hearing on Torrent's plea in the Supreme Court is scheduled for Tuesday.
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Banking & Finance
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