Is your wallet feeling the squeeze? We dive deep into the Fed's possible rate cuts and how they could impact your next big purchase. Plus, a year after the Silicon Valley Bank collapse, we investigate: has the financial system learned its lesson?
Get ready to dissect the 2025 budget proposal! From affordable housing to healthcare, we explore how it could affect your wallet and the political wrangling it'll face in Congress. And with whispers of a Trump comeback, we discuss what's on the horizon for the political scene.
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The feds to finally start rate cuts in June. And not so happy anniversary to the SVB meltdown. And President Biden wants to tax the wealthy. These are the top three headlines in this week's weekly business briefs.
Speaker 1:
First up, you know how everyone's been talking about inflation being a total buzzkill for all of us. Well, the Federal Reserve, which is basically the boss of interest rates, might about to give us a break. Economists are saying there's a good chance they'll start cutting rates in June to cool off inflation. The median prediction is for three quarters of a percentage point cuts for this year. That would be 325 basis point cuts in three different meetings. This could mean cheaper loans, which would be pretty sweet if you're thinking about buying your dream house or even a car. Although some folks are saying the rate cuts might be kind of small, it's still a move in the right direction. Now I'm right about that. We sure need rate cuts. Did you know that what the government is spending in interest on the debt that the government currently has is more than the budget that they have for the military? That's how much of an impact these interest rates have on all of us, all the way from the government on down.
Speaker 1:
Next up, the banking industry has changed since Silicon Valley Bank went out of business. Banks are now more careful about collecting deposits and are using technology to be more efficient. People are also more aware of how much their money is insured by the government. Banks are focusing on building deposits and using technology to improve efficiency. Consumers are more aware of deposit insurance limits. The Federal Reserve is proposing new regulations on bank liquidities and capital requirements. Some argue that the Fed's existing rules were not enforced. Others argue that the problems were specifically in Silicon Valley and not a systemic issue. Well, that's incorrect information, as we saw a slew of bank failures during that time last year. Now we have New York Bank Corp, which is in trouble, and they're in the brinks of going under.
Speaker 1:
And in this week's On Biden Watch, here's a quick rundown of the President, joe Biden's proposed budget for fiscal year 2025. Increased spending on affordable housing, including $258 billion to build or preserve over 2 million units of affordable housing. That is a big problem America needs to solve for so check off my list Childcare, healthcare Another big problem America needs to solve for. Domestic spending as discretionary spending areas that aren't linked with mandatory programs. Office of the Justice Department and tax breaks for A homeowners, b people buying health insurance and C middle class taxpayers making less than $400,000 per year. And increase tax on corporations from 21% to 28%. Increased corporations and billionaires Minimum tax of 21%. Stock buybacks. Capital gains over 1 million to be taxed at the same rate as wages. Yikes, that's going to be painful for investors and multinational corporations to 21%. His other proposals are ending tax incentives for the oil and gas industry, capping prescription drug costs at $2,000 for all Americans and expanding Pell Grants.
Speaker 1:
Now this, on the surface, looks really interesting. Some of these proposals I think are needed in our country and some I disagree. However, getting this proposed budget passed through Congress, good luck. We'll have to wait and see. I doubt that this bill will pass. I doubt that they'll get this budget passed with everything that President Biden wants in there. Are you guys excited to get Trump back or not? Where are you in 2024 for the presidential primary ballot? And this has been your weekly business brief. I'll see you guys next week. Peace out.