Ways To Money

The American economy continues to grow at a modest pace, helped by a slight uptick in consumer credit and sales of big-ticket items like houses and cars, according to the Federal Reserves latest Beige Book report.

The report, an informal gathering of economic data from the Feds 12 regional banks, found slow but steady growth in most sectors. Home sales grew modestly in six Fed districts, and grew significantly in Philadelphia, but housing demand remained soft in New York, St. Louis and San Francisco.

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Reports from the twelve Federal Reserve Districts suggest that overall economic activity continued to increase at a modest to moderate pace in January and early February, according to the report.

Philadelphia car dealers did about as well as realtors there, the Beige Book found, and auto sales also improved in Atlanta, St. Louis, Minneapolis and Chicago.

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NO HAND AT THE HELM

Eurasia Group’s Ian Bremmer started the firm more than a decade ago and created Wall Street’s first global political risk index. A Stanford University graduate, he has written several books, including The J Curve: A New Way to Understand Why Nations Rise and Fall, published in 2006.

While much of the media and many analysts remain focused on upcoming elections in the United States, Russia, France and elsewhere, Bremmer has his eye steadily centered on 2013, when the US-China relationship may again take center stage as the key issue dominating global geopolitics. The evolving relationship of the two economic giants is fraught with opportunities and risks, from currency to cybersecurity to economic competitiveness, he notes.

Bremmer says he is sure that the United States will remain an economic powerhouse even as it drops its decades-long role as the driver of the global economy and stability. But without the backing of the US this leaves a worldwide power vacuum that will have long-lasting and far-reaching consequences. What remains to be seen is who will fill the vacuum, and when.

This is G-Zero: In contrast to the G-7 (or the G-1, as the US used to be), Bremmer sees no hand at the helm of the global ship.

There is, at present, no single country that can perform that role, he says, but at some point down the road it must be filled. He

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Greece was last night braced for a further wave of protests after eurozone leaders struck a bail-out deal for the indebted nation that will bring a new round of painful spending cuts and public sector job losses.

The Greek cabinet assembled to discuss how to implement a series of austerity measures.

Ministers were given a copy of the rescue programme and told within the coming week they must sign up to 79 measures being demanded by the troika of the European Central Bank, the International Monetary Fund and the European Commission.

Age of austerity: Spending cuts and job losses are likely to spark more unrest across the country

The reforms will then have to be endorsed by parliament before troika representatives return to Athens in March.

The deal under which eurozone leaders agreed to a 136bn bailout brought a lukewarm response in financial markets. On Wall Street, the Dow Jones index briefly topped 13,000 for the first time since May 2008.  

But in London prices drifted down. The deal was struck after holders of Greek bonds were forced to agree bigger-than-expected write-downs on their holdings and lower interest payments.

Already, Greeces unemployment rate is running at more than 21 per cent and recent figures showed the economy contracted by almost 7 per cent.

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Liz West/flickr

Renowned banking analyst Meredith Whitney spoke with CNBC Wednesday, and she issued a warning about the trajectory of the American banking industry: its going to be forced to push out the middle class. Due to new regulations and tightened credit standards, banks are making their business model less attractive to the vast majority of the country.  

CNBC.com:

“The unintended consequence is it’s really squeezing the middle end,” Whitney said. “You’re going to see more and more people living outside the system. When it happens, it becomes so much more difficult to operateThe pendulum swings to too much regulation and it squeezes out the system.”

Those people getting “unbanked,” as Whitney termed it, will turn more towards payday lenders and others at the periphery of the financial system to get access to money.

In her interview, Whitney pointed out that in the past home equity lending had provided an easy source of credit for middle-class Americans. But nowadays with billions in home equity having disappeared and credit tight besides, home-equity loans are simply not as readily available. Easy access to credit masked the stagnant wage growth the middle class has suffered in recent decades. With that credit

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If you are reading this, chances are that you have or are about to have a new driver in the family. It’s both an exciting and frightening time for parents–letting your child have more freedom is a great thing but you are probably worried about their safety and how much it will cost to add them to your insurance policy. These are all valid concerns which every parent has. Especially if you have a son; boys cost more to insure than girls simply because statistics state that they are involved in more claims. However, here are five tips that you can use to make sure that the cost of your car insurance for new drivers goes up as little as possible.

Make Your Child A Part-Time Driver: If your family has three cars and will have three drivers, each person will be assigned a car. However, if you have just two cars and three drivers, your teen will be considered a part-time driver, meaning that he won’t have access to the car at all times. Driving less equals less risk and so your premiums won’t rise as drastically as if your teen has his own car and is considered a full-time driver.

Don’t Give Them Too Nice of A Car: The above tip won’t work for every family. Some families have always had, or need to have, three cars. In this case make sure that your child is put on the car that is worth the least amount of money. Full Post…