The federal stimulus program is expected to continue as job growth continues to be slow.
JP Morgan $13 Billion Settlement Not a Done Deal
Reuters reports that JPMorgan Chase & Co.’s preliminary $13 billion deal to resolve federal and state investigations into its mortgage bond business has hit some stumbling blocks. At issue is a provision in a draft settlement circulated late on Sunday which effectively shut down any criminal inquiries into the bank's packaging and sale of mortgage securities, apart from an investigation by California prosecutors that the bank has already disclosed, a source told Reuters. The largest U.S. bank had previously agreed to keep all criminal probes out of the settlement, the source added. Another issue is a long-running disagreement between the bank and the Federal Deposit Insurance Corp over legal liabilities from JPMorgan's $1.9 billion takeover of Washington Mutual assets and obligations during the financial crisis. The Department of Justice has sought a provision in the settlement that prohibits JPMorgan from seeking to push the WaMu liabilities from the settlement onto the FDIC.
Wal-Mart Promotes From Within in a Big Way
Wal-Mart, the world’s largest retailer and the nation’s largest private employer, is promoting 25,000 employees in the fourth quarter, USA Today reports. The on-the-spot surprise promotions were announced Tuesday. The promotions are going to employees, mostly hourly workers, who applied and interviewed for the positions. Some will advance to store management positions. The promotions follow Wal-Mart’s announcement in September that it would move 35,000 workers from temporary to part-time status and another 35,000 from part-time to full-time by the end of the year. The retailer promotes more than 160,000 employees a year, and expects that number to be about the same this year, USA Today states.
Fed-Watch Begins: No Tapering Expected
As Federal Reserve policymakers begin this week, economists are saying there is “virtually no chance” they will scale back the central bank’s monthly bond-buying stimulus program, USA Today reports. But the post-meeting statement will be parsed for clues as to whether there is a possibility that there will be tapering this year or delayed until 2014. Economists surveyed by USA Today have pushed back their projections for an initial pullback from the stimulus from December to next March. Slowing job growth, rising interest rates and concerns about the debt-ceiling budget showdown in Congress compelled the Fed to take no action last September. The government shutdown and last-minute debt ceiling agreement are cited as reasons for Fed policymakers to again delay tapering. The shutdown delayed the release of key economic reports the Fed needs to make its decision regarding the program.
Job Growth in October Dropped Below Expectations
The private sector added just 130,000 new jobs in October, falling below projections, according to the latest report from ADP and Moody’s Analytics. Projections were for the private business sector to add 150,000 jobs last month, but the actual October numbers followed the trend from September when the initial job creation numbers were revised from the initially announced 160,000 to 145,000. Almost all the new jobs were in services, which added 107,000 positions. Large businesses added 81,000 new jobs, taking the lead after recent months when small businesses were creating the most jobs. Businesses with fewer than 50 employees added 37,000 jobs, while medium firms came in at just 13,000.
Social Security Benefits Will Rise Just 1.5 Percent Next Year
Social Security benefits, which affect almost 58 million Americans, will rise just 1.5 percent next year, one of the smallest automatic increases since the new system was put in place in 1975, according to the federal government. The cost-of-living adjustment, or COLA, is based on a government measure of inflation that was released Wednesday. Because consumer prices have not increased much in the last year, inflation has been low, and thus the cost-of-living adjustment is low. The COLA affects benefits for more than one-fifth of the country, including millions of disabled veterans, federal retirees and people who get Supplemental Security Income, the disability program for the poor. Social Security pays the average retired worker $1,272 a month. A 1.5 percent raise would come to about $19.
Putin Most Powerful Person in the World
Russian president Vladimir Putin supplanted American president Barack Obama as the most powerful person in the world for 2013, according to Forbes’ annual ranking of the world’s leaders. Obama, who was the most powerful person in the world for 2012, is now No. 2, and is followed by the general secretary of China’s Communist Party, Xi Jinping, who jumped up from the No. 9 position in 2012. Pope Francis moved into the No. 4 spot, followed by German Chancellor Angela Merkel at NO. 5 and Bill Gates at No. 6, Chairman of the Federal Reserve Ben Bernanke was No. 7, while Wal-Mart CEO Michael Duke was ranked 10th. To compile the list, Forbes looked at whether the candidate has power over a lot of people, and the financial resources they control, such as gross domestic product for heads of state. The publication also assessed whether the candidate was powerful in "multiple spheres," and if they actively used their power.