how are you? (January 15-21)
US reaches debt ceiling
The US hit its $31.4 trillion borrowing limit on Thursday, setting the stage for a fierce fiscal battle in Congress over raising the limit. Treasury Secretary Janet L. Yellen said the government will take “special measures” and continue to pay bills until at least early June. Democrats and the White House, as well as forecasters and economists, risk the country slipping into a financial crisis or other disastrous economic scenario if lawmakers don’t raise limits before the Treasury runs out of ability to buy more time. But Republicans have said they won’t raise the borrowing limit again unless President Biden agrees to a drastic cut in federal spending.
“Samcoins” and the Last Days of FTX
Details about how the exchange works are coming to light as the government continues to file a lawsuit against crypto exchange FTX founder Sam Bankman-Fried. Rivals said Bankman-Fried often promoted a digital currency known as “thumcoin.” Bankman-Fried said he used his clout to persuade people to buy tons of coins, artificially inflating their value, to make cryptocurrency trading firm Alameda Research look healthier than it actually was. It is (Bankman-Fried denies accusations of trying to manipulate the cryptocurrency market.) Also, according to documents obtained by The New York Times, FTX’s management allegedly committed a crime in the weeks leading up to the company’s collapse. , had expressed concerns about the use of client funds. .
Layoffs on the rise at Big Tech
Two of the tech industry’s biggest companies announced thousands of job cuts last week. Microsoft announced Wednesday it would lay off about 10,000 employees, while Google’s parent company Alphabet announced Friday it would lay off 12,000 of its employees. Across the tech industry, employers are pulling out after years of feverish hiring to accommodate the surge in online services caused by the pandemic. Nearly 200,000 tech workers have lost their jobs since early 2022, according to Layoffs.fyi, which tracks job cuts in the sector. Even industry powerhouses are affected. Apple is the only major company that has yet to announce significant cuts. “Frankly, we in the tech industry need to be efficient, too,” said Microsoft CEO Satya Nadella last week at the World Economic Forum meeting in Davos, Switzerland. There is.”
Understanding the U.S. Debt Ceiling
What is the debt ceiling? A debt ceiling, also called a debt limit, is the maximum amount of money the federal government is permitted to borrow via U.S. Treasury bills, such as notes and savings bonds, to meet its financial obligations. The US has a budget deficit and has to borrow a lot to pay its bills.
what’s next? (January 22-28)
Initial estimates of economic growth
The Bureau of Economic Analysis is due Thursday to release initial forecasts for U.S. economic growth for the fourth quarter of 2022. A report on Gross Domestic Product may show that inflation-adjusted economic output increased at an annual rate of 1.5. Percentage of the quarter, according to the forecaster’s forecast. That represents a slowdown from his 3.2% in the third quarter. The Federal Reserve’s campaign to raise interest rates and curb inflation is hurting the economy, especially the housing market. Although consumer spending has slowed, the economy has shown remarkable resilience after contracting in the first half of last year.
