Category Archives: Economy

Economy and financial news

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China skeptical over Geithner’s offer of ‘greater access to US market’

BEIJING: China is skeptical over  US offer to free up trade in high-tech goods. Chinese government advisers and economists said on Thursday that in the aftermath of the offer,  Chinese government should  reject to be involved into a negotiation  to speed up Yuan appreciation.

Timothy Geithner, treasury secretary, said that the United States wants to give China a greater access to US market and high-tech goods and in exchange for that expects Beijing to review its strictly controlled exchange rate system.

Meanwhile Chinese officials refused to comment on Geithner’s proposal that is made just ahead of Chinese President Hu Jintao’s visit to the United States next week. Many analysts are of the view that it is dubious to accept this trade-for-currency proposal.

“China will not act according to US direction; as far as Yuan appreciation is concerned, it must follow a general trend and not be impacted from the US sentiments,” said Ding Yifan, an analyst of the State Council.

One of the analysts is of the view that China should not be bothered about US demands as Beijing can have a greater access to high level of high-tech goods with ease from the Western Europe.

This week China has guided the Yuan move upward 0.4 percent against the US dollar. It has been a well-known pattern of pushing Yuan value up against the dollar before any diplomatic engagements.

Analysts are of the view that more and more Yuan appreciation will be needed over the period of time as inflation has been skyrocketing for the last two years and the trade surplus touching nearly $200 billion last year.

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Republicans to fight with Obama over budget

A new scenario is waiting in Washington for US President Barack Obama after vacations. Republicans with more prominence in Senate now will prepare to make it a tough time for Obama over budget while the countdown for 2012 elections is already started.

Democrats expect Obama to deal with the new political disputes with a more confident stand.

This new phase of Obama’s administration will witness Ruling party’s bipartisanship with the Republicans that may change the tone and strategies of present government and would definitely affect ballot boxes in 2012 presidential polls.

However, despite the compromises made on tax issues, nuclear treaty with Russia and same-sex relationship in military, Obama still occupies an increasingly focal place in his party.

The President acknowledges the challenges coming ahead and expressed hopes to continue to be in tune with common Americans needs and purposes.

The status of Democrats has changed with Republicans overtaking them in the House after November polls. Obama’s land mark steps on Health care bill and $800 billion package were taken much before when the Democrats dominated so only time will tell whether the President will be able to continue with same impact in making decisions or not.

There is a strong probability of confrontations between the two parties over key issues like budget deficit of 1.3-trillion-dollar and government budget for 2011.

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Unemployment Rate increases in Colorado

Unemployemnet remains high in US

The United Sates is still recovering from the aftermath of economic recession with high rates of unemployment. Despite the increasing number of jobs in the state of Colorado, unemployment rate were still on the rise in the state in November.

The southern west state of the US has registered a rise in number of jobless people to 8.6%, that is higher than its previous level in October. Colorado’s Labor and Employment Office stated on Friday that the unemployment rate has grown 8.6 percent within a short span of one month.

There were 3,800 jobs in Colorado in November. However the number of people seeking for jobs also increased by 6,900, to about 230,000 in the state.  Thus, despite an increase in the total number of jobs the rate of increase in number of unemployed youth remained higher than that of job creation.

In previous year, national unemployment rate raised to 10 percent whereas for Colorado it was 9.8 percent this year in November.

Colorado’s chief economist Alexandra Hall commented on this situation as very confusing as people do not know what to do. Despite the increase in jobs in last three months the employment situations have not changed much in Colorado, he added.

Hall further added that it would not be easy for all people to recover from the job loss during recession. Many professionals were found opting for babysitting or other short term jobs after losing their work.

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Republicans complain over the size, cost of spending bill

US Government proposes spending bill while Republicans criticize

Washington –The opposition Republicans gave green signal to the spending authorization bill of the US government.  On Thursday, they passed $1.1 trillion spending bill to allow the federal government spend funds for the remaining fiscal year, though many of them severely criticized the cost and size of the total expenditure.

Mitch McConnell, Senate Minority Leader from R-Kentucky, however presented another bill to propose an alternative to the government’s bill. This would stop the government from making major financial decisions till February 18 and it would not be able to raise its fund level.

From January, the Republicans will enjoy a majority in the Congress and therefore can pass a less expensive bill if they wanted so.

Mitch McConnell further added that the Republicans would go for a less expensive bill to avoid waste of funds in the new Congress but for now they were obliged to respect the current bill proposed by the government.

The opposition members complained over the spending bill’s various appropriations bills of around $8 billion that were included in a single package by legislators.

Sen. Dick Durbin, D-Illinois, faulted Republicans’ out cry over the bill saying that the large number of the earmarks in the bill were requested by Republican members. said he also stated that the bill had reached the mark of $1.1 trillion to appease McConnell’s demands. Durbin criticized the Republicans for their dual strategy over the legislation.

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Democrats finally agree to go with Obama’s tax plan

Democrats were deeply divided over Obama tax plan

The US president got a relief when Democrats have moved toward approving his deal to extend George Bush’s tax cuts for the richer section.

Obama’s chances of getting 60 votes required to pass his Tax relief plan were quite bleak as Democrats were quite apprehensive and feared that he might compromise too much with Republicans, the opposition party members. Obama asked the ex-president Bill Clinton to persuade Democrats to approve the deal.

Following the Democrats’ approval the bill would go to other house of the Senate in the House of Representatives. Obama is likely to win in the other House.

The Republicans won in the November 2 congressional elections taking control over the House of Representatives.

The proposed bill includes a package of $856 billion and extends unemployment benefits and tax breaks for lower income groups. The bill if passed will also revoke many subsidies for businessmen and renewable energy sector.

The deal retains all tax relief schemes for richer Americans passed under the Republican government under George Bush which would otherwise expire by January 1.

However, the Democrats wanted to raise tax rates for rich Americans by 2% to lower the already high deficit of the United States.

They were resentful for Obama’s readiness to retain Republicans’ tax cuts and agreed to support the bill only after former president Bill Clinton’s persuasion.

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Obama Appeals to Former President Clinton to Help on Tax Issue

Barack Obama appealed to Bill Clinton for convincing Democrats

The US president seeks help from his predecessor. He asked former president Bill Clinton to persuade Democrats for supporting the Tax Relief Plan.  Obama wanted the bill to be cleared before expected prices rise in January.

Assisting the incumbent president, Bill Clinton requested Democrats of House of Representatives to pass the Tax Relief Plan right now before it goes in the hands of Republicans in the coming month. Referring to Obama’s Tax Relief Plan Clinton stated that it was a good agreement and should be passed before January.

Clinton’s regime in the United States has been an exemplary for every Democrat seeking for a recovery plan after the defeat in congressional elections in November. The president’s tax deal of $856 billion is awaiting Republican’s onion and this makes the Democrats concerned that Obama might compromise to bargain to win their acceptance for the deal. The budget commission stated that lower tax rates could be beneficial too if specialized deductions and other tax breaks are removed, however the Democrats were not convinced on how this tax relief plan could generate more revenue.

The Democrats expected tougher estate tax provisions for the rich people of the United States, which is not featuring in Obama’s bill. The Tax Relief Plan is expected to be passed on Tuesday but with a very bleak possibility.

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Facebook Chief Joins Richest Americans Group for Charity

Mark Zuckerberg, Founder & CEO, Facebook

Another milestone in the history of philanthropy has been created in the united States. Social network Facebook chief join hands with 16 other richest people of America to devote money for charity issues.

Facebook CEO, Mark Zuckerberg, junk bond pioneer Michael Milken and AOL co-founder Steve Case together have joined philanthropic community promising to give away their wealth for social welfare.  Zuckerberg has already devoted $100 million to Newark NJ school education system. Giving Pledge is a charity organization founded by Microsoft  founder Bill Gates and Warren Buffet. Facebook CEO has joined Giving Pledge with other rich people of America and commit to step up his donations toward charity.

The group has already 57 members devoting their wealth for humanity. The members include celebrities like New York Mayor Michael Bloomberg, CNN founder Ted Turner and film director George Lucas. But Zuckerberg and Facebook co-founder Dustin Moskowitz, who is just 26 years old.

Today, younger generation is thriving on success so they should initiate work for charity in their youth, he social network chief stated. Though Giving Pledge do not have a criteria about how much money should be devoted for philanthropic causes, most of the members have committed to spend half of their wealth.

By joining the world of philanthropy at this age, Facebook chief has set a milestone for upcoming young entrepreneurs to give it a thought right now.

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US Steps To Help Illegal Immigrants

The Speaker of the House of Representatives supporting illegal immigration

Taking a step forward toward granting legal status to the illegally migrated youths, the US House of Representatives passed a bill for changing immigration law.

The US representatives voted the bill with a majority [198] to change the current immigration law, that do not permit illegal immigrants to enjoy normal rights. For converting into a law, the bill needs to win 60 votes at least in the House of Chambers.

However, the Republicans plan to block the bill unless Obama administration extends tax cuts initiated by George Bush and before the next fiscal year begins in October.

The proposed bill has also been considered as a DREAM Act as it, if passed would allow illegal young immigrants to get legal rights as residents provided they serve in military or study for 5 years. This provision will come into effect with the cooperation of Representative Howard Berman, a California Democrat, and Representative Lincoln Diaz-Balart, a Florida Republican who would also sponsor the process.

The proposed bill has been titled as a ‘tailored’ transformation of immigration laws to revamp the shattered US economy. This would also promote employment and education.

Democrats regarded the bill targeted youth migrated to the US with their parents who entered the country illegally.

The Opposition however called the measure as an ‘amnesty’ to shade illegal migration and feared that this would again give a chance to foreigners to grab the jobs otherwise meant for American youths.

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Embattling Obama takes resort to new tax plan, jobs

Obama announcing tax relief plan

President Obama’s last year predictions about economic revival have proved wrong.  Extending the tax cuts, the US president has tried to compensate for the mistakes, the democrats did last time. This is also a step to appease the Republicans in exchange of approval for unemployment benefits, reduction in payroll and other taxes.

The White House has taken a complete ‘U’ turn in its policies. The Health care Bill and financial laws have lost their glories after the hollow noise of economic recovery and the US administration has tuned back to realistic goals now.

However, all the Democrats have not welcomed these moves very warmly. Seeing positive forecasts for economic growth and jobs, the Democrats have no option but to accept the transformation of economic policies.

The midterm poll victory for Republicans gave a clear message to the Obama administration about people’s disappointment with the government. Had Obama changed his strategies on economy before the elections, the result would have been less negative for the Democrats. Even the recent changes are not expected to bring much change in the current unemployment level very soon.

What American expected from President Obama was much more than what has been delivered.  Cutting employee’s portion in tax has not done much advantage to employees.

The new extension to the tax cuts will definitely help economy but would not benefit the Democrats politically.