European Central Bank pledges unlimited bond purchases
In an effort to save the euro, European Central Bank President Mario Draghi has pledged to follow through with a bond purchase plan that proposes unlimited buying of government debt with maturities up to three years. According to Bloomberg, Germany’s Bundesbank is said to oppose the proposal, because it is beyond the mandate of the ECB. A meeting in Europe today will focus on the plan and will set interest rates. The outcome of the meeting is expected to impact market volatility. The Dow closed up 11 points on Tuesday, ending at 13,047. Asian and European markets are up on Wednesday.
Food stamp enrollment hits record 46.7 million in June
Food stamp enrollment climbed to a record 46.7 million in June according to numbers released by the Department of Agriculture. That number was 32 million in January of 2009. As reported by Fox News, the cost of the food stamp program exceeds $6 billion annually and averages $133 per person each month.
Microsoft expands in China
The Associated Press is reporting that Microsoft Corp. will hire more than 1,000 employees to add to its 4,500 employees already in China. Employees in Microsoft’s six development centers in China will shift their focus from global development to Chinese development. Microsoft hopes to catch up with its rivals, Apple and Google, in China. China had 583 million people online at the end of July, up 11 percent from a year ago. The share that used wireless devices grew twice as fast and represented 70 percent of the total. Android is currently used on 76 percent of Chinese phones.
Goldman Sach’s private bank increases loan portfolio
The private bank of Goldman Sach’s currently holds $13.8 billion of loans, including mortgages made to its wealthy customers. According to the Financial Times, the bank is now learning how to make the snoozy private bank more dynamic by offering “standby letters of credit” and “subscription capital call loans”. These loans allow customers to borrow money from the private bank to invest in private equity investments that Goldman is sponsoring. The two types of loans are expected to increase to around $900 million annually. Not your typical private bank.
Andy Warhol collection to hit art market
At least 350 paintings and 1,000 prints, plus thousands of drawing and unique photographs created by Andy Warhol are about to hit the market, according to the Wall Street Journal. The Andy Warhol Foundation for the Visual Arts has enlisted Christie’s to sell of the rest of the Warhol collection to increase its $225 million endowment and expand its art related programs. Experts fear that the value of the existing pieces will be diluted when such a large number of works hit the market simultaneously. Five years ago a collector paid $71.7 million for a 1963 work called “Green Car Crash”.
Closure of seven coal plants will lead to higher costs
First Energy Corp, headquartered in Ohio, closed three power plants on Saturday and four more are scheduled to be closed in 2015. It would cost the company $975 million to become compliant with new standards recently required by the Obama administration. Fox News reports that only 50 jobs will be lost because 600 employees have been redeployed to different jobs or have chosen to retire. It is anticipated that as more plants are closed, electricity prices will increase.
Airfares continue to increase
The Transportation Department’s Bureau of Transportation Statistics indicates that domestic fares increased 4.8 percent in the first quarter of 2012, compared to a year ago. USA Today reports that, adjusting for inflation, fares are 10.1 percent higher than in 2009. The increases are blamed on higher fuel prices as well as mergers. In some cases, lack of competition at certain airports is responsible for the increase in fares. The airport with the largest increase? Flint, Michigan where fares increased 23.7 percent in the first quarter
Catherine S. McBreen is President of Millionaire Corner. McBreen plans and develops content for Millionaire Corner. Catherine balances editorial content to meet the informational needs of both new and seasoned investors. She designs special monthly surveys on topical issues affecting the economic environment.
McBreen has a B.S. in speech communications from Northwestern University and a J.D. from DePail University College of Law. She is a member of the American Bar Association, the Illinois Bar Association, and the Chicago Bar Association.
Well-known for her expertise in the affluent and retirement arenas, McBreen is a frequent speaker at industry conferences. She has been quoted widely by the financial media, including The Financial Times, The Wall Street Journal, Research, Private Asset Management, On Wall Street, Reuters, Bloomberg News, The Dow Jones Newswires and Worth. Cathy has appeared as a guest on CNBC Closing Bell, First Business Morning News, Neal Cavuto at Fox Business News, ABC and CBS radio.
McBreen is co-author with Spectrem President George H. Walper, Jr. of the book "Get Rich, Stay Rich, Pass It On: The Wealth-Accumulation Secrets of America's Richest Families" (Portfolio, January 2008)
Catherine is the mother of four and is involved in many school and community events.