Americans support increasing government efficiency
Qatar tribune Agencies President-elect Donald Trump campaigned on the promise that his policies would reduce high borrowing costs and lighten the financial burden on American households. But what if, as many economists expect, interest rates remain elevated, well above their pre-pandemic lows? Trump could point a finger at the Federal Reserve, and in particular at its chair, Jerome Powell, whom Trump himself nominated to lead the Fed. During his first term, Trump repeatedly and publicly ridiculed the Powell Fed, complaining that it kept interest rates too high. Trump’s attacks on the Fed raised widespread concern about political interference in the Fed’s policymaking. On Wednesday, Powell emphasized the importance of the Fed’s independence: “That gives us the ability to make decisions for the benefit of all Americans at all times, not for any particular political party or political outcome.” Political clashes might be inevitable in the next four years. Trump’s proposals to cut taxes and impose steep and widespread tariffs are a recipe for high inflation in an economy operating at close to full capacity. And if inflation were to reaccelerate, the Fed would need to keep interest rates high. Because Powell won’t necessarily cut rates as much as Trump will want. And even if Powell reduces the Fed’s benchmark rate, Trump’s own policies could keep other borrowing costs — like mortgage rates — elevated. The sharply higher tariffs that Trump has vowed to impose could worsen inflation. And if tax cuts on things like tips and overtime payanother Trump promise — quickened economic growth, that, too, could fan inflationary pressures. The Fed would likely respond by slowing or stopping its rate cuts, thereby thwarting Trump’s promises of lower borrowing rates. The central bank might even raise rates if inflation worsened. “The risk of conflict between the Trump administration and the Fed is very high,” Olivier Blanchard, former top economist at the International Monetary Fund, said recently. If the Fed hikes rates, “it will stand in the way of what the Trump administration wants. ”Yes, but with the economy sturdier than expected, the Fed’s policymakers may cut rates only a few more times — fewer than had been anticipated just a month or two ago. And those rate cuts might not reduce borrowing costs for consumers and businesses very much. The Fed’s key short-term rate can influence rates for credit cards, small businesses and some other loans. But it has no direct control over longer-term interest rates. These include the yield on the 10-year Treasury note, which affects mortgage rates. The 10-year Treasury yield is shaped by investors’ expectations of future inflation, economic growth and interest rates as well as by supply and demand for Treasuries. An example occurred this year. The 10-year yield fell in late summer in anticipation of a Fed rate cut. Yet once the first rate cut occurred on Sept. 18, longer term rates didn’t fall. Instead, they began to rise again, partly in anticipation of faster economic growth. Trump has also proposed a variety of tax cuts that could swell the deficit. Rates on Treasury securities might then have to rise to attract enough investors to buy the new debt. “I honestly don’t think the Fed has a lot of control over the 10-year rate, which is probably the most important for mortgages,” said Kent Smetters, an economist and faculty director at the Penn Wharton Budget Model. “Deficits are going to play a much bigger role in that regard.” Occasional or rare criticism of the Fed chair isn’t necessarily a problem for the economy, so long as the central bank continues to set policy as it sees fit. But persistent attacks would tend to undermine the Fed’s political independence, which is critically important to keeping inflation in check. To fight inflation, a central bank often must take steps that can be highly unpopular, notably by raising interest rates to slow borrowing and spending. Political leaders have typically wanted central banks to do the opposite: Keep rates low to support the economy and the job market, especially before an election. Research has found that countries with independent centr al banks generally enjoy lower inflation.Even if Trump doesn’t technically force the Fed to do anything, his persistent criticism could still cause problems. If markets, economists and business leaders no longer think the Fed is operating independently and instead is being pushed around by the president, they’ll lose confidence in the Fed’s ability to control inflation. And once consumers and businesses anticipate higher inflation, they usually act in ways that fuel higher prices — accelerating their purchases, for example, before prices rise further, or raising their own prices if they expect their expenses to increase. “The markets need to feel confident that the Fed is responding to the data, not to political pressure,” said Scott Alvarez, a former general counsel at the Fed. He can try, but it would likely lead to a prolonged legal battle that could even end up at the Supreme Court. At a November news conference, Powell made clear that he believes the president doesn’t have legal authority to do so. Most experts think Powell would prevail in the courts. And from the Trump administration’s perspective, such a fight might not be worth it. Powell’s term ends in May 2026, when the White House could nominate a new chair. It is also likely that the stock market would tumble if Trump attempted such a brazen move. Bond yields would probably rise, too, sending mortgage rates and other borrowing costs up. Financial markets might also react negatively if Trump is seen as appointing a loyalist as Fed chair to replace Powell in 2026. Yes, and in the most egregious cases, it led to stubbornly high inflation. Notably, President Richard Nixon pressured Fed Chair Arthur Burns to reduce interest rates in 1971, as Nixon sought re-election next year, which the Fed did. Economists blame Burns’ failure to keep rates sufficiently high for contributing to the entrenched inflation of the 1970s and early 1980s. Thomas Drechsel, an economist at the University of Maryland, said that when presidents intrude on the Fed’s interest rate decisions, “it increases prices quite consistently and it increases expectations, andthat worries me because that means inflation might become quite entrenched.” Since the mid-1980s, with the exception of Trump in his first term, presidents have scrupulously refrained from public criticism of the Fed. “It’s amazing, how little manipulation for partisan ends we have seen of that policymaking apparatus,” said Peter Conti-Brown, a professor of financial regulation at the University of Pennsylvania’s Wharton School. “It really is a triumph of American governance.” Yes, most advanced economies do. But in some recent cases, as in Turkey and South Africa, governments have sought to dictate interest-rate policy to the central bank. And soaring inflation has typically followed. Turkey’s president, Recep Tayyip Erdogan, for years pressured the country’s central bank to cut interest rates even as prices spiked. He even fired three central bankers who had refused to comply. In response, inflation skyrocketed to 72% in 2022, according to official measures. Last year, Erdogan finally reversed course and allowed the central bank to raise rates. Copy 06/12/2024 10
Mumbai: A 25-year-old IIT Mumbai student fell victim to a digital fraud scam, losing Rs.7.29 lakh to cybercriminals who falsely accused her of being involved in 17 money laundering cases. The scammers intimidated her into compliance, keeping her under virtual house arrest for nearly 24 hours. The Powai police registered an FIR against unidentified individuals on November 25. According to the FIR, the student, Bhaviya Bhargava, hails from Ghaziabad but resides in an IIT Bombay hostel in Powai for her education. She holds an account in a national bank in Powai. On November 24, at 11.01 a.m., she received a call from an unidentified mobile number. The caller posed as an officer from a government telecom company, alleging that 17 complaints linked to her Aadhaar and PAN card were registered against her. The scammer instructed her that she should obtain a clearance certificate to deactivate her mobile number and transferred the call to a supposed Cyber Branch officer. The scammers then asked for her Aadhaar number, bank details, and other personal information, which she provided. They also showed her a fabricated complaint letter, leaving her frightened. To resolve the alleged issue, she was coerced into transferring Rs.29,500 to the scammer’s account. Later, she received a video call from an individual posing as a Superintendent of Police and claiming to be a CBI officer. The fake officer threatened to implicate her in a money laundering case and demanded her cooperation. Overcome with fear, Bhargava followed the instructions, providing scanned copies of her bank documents. The scammers used this information to withdraw Rs.7 lakh from her account. She was also instructed to stay confined in her room until noon on November 25, under the pretense of verifying her documents. When she did not receive any further communication, Bhargava contacted her bank and discovered she had been defrauded. She then approached the Powai Police Station, where an FIR was registered under sections 318(4) (cheating and dishonesty) and 319(2) (cheating by personation) of the Bharatiya Nyaya Sanhita along with relevant provisions of the Information Technology Act.The swift and decisive action by UEFA in response to the investigation of Koot by the Premier League referee corporation demonstrates the commitment of European football's governing body to upholding integrity and fairness in the sport. This proactive approach highlights the importance of accountability and transparency in refereeing decisions at the highest levels of professional football.
Americans support increasing government efficiencyThe tragic death of the American internet celebrity in the Philippines has sparked a global conversation about safety and security for influencers and travelers. It highlights the need for increased awareness, precautions, and support for individuals who put themselves in the public eye. Governments, law enforcement agencies, and social media platforms must work together to ensure the safety and well-being of those who engage in online activities and promote themselves online.
Moreover, the ongoing efforts to expand market access and enhance trade facilitation have further bolstered China's foreign trade capabilities. The implementation of the Regional Comprehensive Economic Partnership (RCEP) agreement, as well as the Belt and Road Initiative, has created new opportunities for trade cooperation and investment across borders, fostering a more inclusive and interconnected trading environment.WeChat, one of the most popular messaging apps in the world, has recently rolled out an exciting new feature - an upgrade to its group call functionality. This upgrade allows users to make group calls with up to 100 participants, providing a seamless and convenient way for large groups to communicate. In this article, we will explore the benefits and implications of this new feature.