Artist tax – David Hemmings Bird Photography http://davidhemmingsbirdphotography.com/ Thu, 24 Nov 2022 04:16:00 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://davidhemmingsbirdphotography.com/wp-content/uploads/2021/06/icon-2021-06-25T155134.587.png Artist tax – David Hemmings Bird Photography http://davidhemmingsbirdphotography.com/ 32 32 Bitcoin miner Iris Energy faces potential class action lawsuit https://davidhemmingsbirdphotography.com/bitcoin-miner-iris-energy-faces-potential-class-action-lawsuit/ Thu, 24 Nov 2022 04:16:00 +0000 https://davidhemmingsbirdphotography.com/bitcoin-miner-iris-energy-faces-potential-class-action-lawsuit/ Iris also said its debtors are wholly-owned subsidiaries that are legally structured as special purpose vehicles (SPVs), meaning creditor New York Digital Investment Group (NYDIG) has no financial recourse to the company. mother Iris Energy. The market value of mining equipment dipped below the principal amount of loans in November 2022, after the price of […]]]>

Iris also said its debtors are wholly-owned subsidiaries that are legally structured as special purpose vehicles (SPVs), meaning creditor New York Digital Investment Group (NYDIG) has no financial recourse to the company. mother Iris Energy.

The market value of mining equipment dipped below the principal amount of loans in November 2022, after the price of bitcoin lost around 75% over the past year.

In a Nov. 21 statement filed with the U.S. securities regulator, the SEC, Iris acknowledged that its creditors are now demanding immediate payment in full for loans under notices of default issued.

The stock plunged 18% to $1.55 on the news as Pomerantz went public with its potential claim for large financial compensation the same day. The law firm has prepared a draft legal action against Iris seen by the Australian Financial Review.

crypto winter

Bitcoin miners like Iris and fellow Aussie Mawson Infrastructure are now operating in a tough environment, with horror headlines about bankruptcies, plummeting bitcoin prices and soaring energy bills putting pressure on the industry. economy of their unity.

Other industry issues include a rapid advance in mining equipment capacity and a sharp increase in network hash rate – a term to describe how difficult it is to solve the puzzles that mine bitcoin.

Iris’ decision to unplug some of its mining hardware in response to its $107.8 million default notice triggered a drop in the total bitcoin hash rate on the network earlier this week.

This, in turn, delayed the confirmation of new blocks and the generation of new bitcoins.

Although Iris maintains that she sells her bitcoin immediately and regardless of the market price, not all miners do.

Data from Glassnode, a crypto-mining analytics service, shows bitcoin miners are dumping their holdings in droves as they aim to escape the contagion caused by the collapse of FTX. According to Glassnode, Bitcoin miner selling pressure has jumped 400% in the past three weeks.

Iris’ sustainable energy bills hit $9,300 per bitcoin mined in October. For the year ended June 30, it reported adjusted EBITDA (backing up some costs) of $16 million on bitcoin mining revenue of $59 million.

Its net loss climbed to $417 million after adjusting for losses on convertible notes and derivatives that converted into shares during the group’s problematic listing on Nasdaq.

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Student loans in England: what you need to know | Silver https://davidhemmingsbirdphotography.com/student-loans-in-england-what-you-need-to-know-silver/ Mon, 21 Nov 2022 10:00:00 +0000 https://davidhemmingsbirdphotography.com/student-loans-in-england-what-you-need-to-know-silver/ Undergraduates can borrow tens of thousands of pounds to fund their studies, but when it comes to repaying student loans, the rules can be confusing. What are you going to borrow? “Student loans are a complex subject, and there are many myths out there, so it’s important for students to understand repayments, their obligations, and […]]]>

Undergraduates can borrow tens of thousands of pounds to fund their studies, but when it comes to repaying student loans, the rules can be confusing.

What are you going to borrow?

“Student loans are a complex subject, and there are many myths out there, so it’s important for students to understand repayments, their obligations, and the implications for future borrowing,” says Paula Roche, general manager of consumer solutions at Equifax. UK.

This will depend on when you graduate, as well as where you are from and where you choose to study.

English universities can charge local students up to £9,250 per year. Undergraduate students in England can also take out a maintenance loan of up to £12,667 to cover their living costs. Maintenance grants were phased out in 2016.

The loans don’t have to be repaid until after you graduate, but accrue interest while you study.

What is the interest rate?

Student loans accrue interest from the day the first payment is made to your bank account or at your university, until it is repaid in full or cancelled. Interest is calculated daily and applied to the balance each month, which is called compound interest.

The rules depend on which reimbursement plan you are on: there are four different ones, but if you are an English or Welsh student, who started an undergraduate course anywhere in the UK during the last decade, you’re on plan 2, so we looked at that option.

The loans don’t have to be repaid until after you graduate, but accrue interest while you study. Photography: aberCPC/Alamy

While in school, the interest rate charged is usually based on the Retail Price Index (RPI), which is a measure of inflation that includes housing costs plus 3%, but after graduation , the rate is indexed to your income. The rate is usually set on September 1 of each year, based on the RPI of the previous March.

If you earn £27,295 or less, the interest rate applied is the rate of inflation, but if you earn more, you pay a higher rate linked to your salary. This is a sliding scale and borrowers reach the maximum rate of RPI plus 3% once they earn around £50,000.

Last September, due to soaring inflation, the interest rate on Plan 2 loans was capped at 6.3% for three months, and the government recently confirmed that it will increase to 6, 5% in December.

How much to repay

Full-time students begin repaying their loan through the tax system from April after graduation, but these automatic repayments only begin when your income exceeds your repayment plan threshold, which in this case, is £27,295 per annum.

This equates to a monthly salary of £2,274, or £524 per week, in the UK. If your income is below this threshold, repayments will stop until your income recovers.

In Plan 2, students pay 9% of what they earn over £27,295, regardless of how much debt they owe.

It is possible to make additional repayments but this is not recommended by financial experts. The government’s advice is to ‘consider your personal and financial situation and how it may change in the future’ before doing so.

Borrowers only need to make additional payments if they expect to repay the outstanding balance in full by the end of the 30 years.

At present only around a quarter of students do, although that figure is set to rise as, from next September, students in England will have to repay university loans over 40 years.

Who does not have to repay?

Graduates don’t have to repay their loan if they earn less than £27,295, and the balance will be amortized after 30 years. This means that someone who never earns more than that will never repay their loan.

A student loan can be waived for people who can no longer work due to illness or disability and claim certain benefits, including personal independence payments, disability living allowance, childcare allowance, invalidity for accident at work and an allowance for serious handicap.

It is also expunged if a student dies. Family members must notify the Student Loans Company (SLC) and provide proof, such as an original death certificate and customer reference number.

What about taxation?

Refunds are based on pre-tax income, but the money is taken after the tax has been paid. A person whose annual salary is below the repayment threshold of £27,295 should make no student loan contribution.

However, a refund can be deducted if the income exceeds the weekly or monthly limit of £524 and £2,274 respectively, for example, by working overtime or receiving a bonus.

Overpayments can be recovered at the end of the tax year by contacting SLC.

A stack of documents from the Student Loans Company Limited.
Contact the Student Loans Company at the end of the tax year about recovering overpayments. Photograph: Jonny White/Alamy

What if you move abroad?

It’s a myth that student loan repayments can be avoided by moving abroad. Those planning to move abroad for three months or more should contact the SLC, who will determine what refunds should be made and, if so, how much.

This only applies to people working abroad, not to study, volunteer or travel.

Graduates living abroad must pay the SLC directly rather than money automatically deducted from their salary, either through their online account or by international bank transfer.

Reimbursement rules are the same as in the UK, but there are different income thresholds for each country to reflect the varying cost of living. For example, in the US the threshold is £32,755 and in Singapore it is £16,380.

Anyone who does not give the SLC their income information will have to pay a fixed monthly reimbursement rather than an income-based reimbursement, which could cost more per month.

The Eiffel Tower at sunset in Paris, France
The Eiffel Tower at sunset in Paris. It’s a myth that student loan repayments can be avoided by moving abroad. Photography: Stéphane Mahé/Reuters

Britons who fail to repay their student loans while abroad will run into arrears.

According to the latest government statistics, 54,700 graduates were living abroad and repaying their loans – up from 8,700 people – but the number of borrowers in default jumped from 1,500 to 49,500 in April.

Does this affect mortgages?

Student loans do not show up on credit reports and do not affect credit scores. However, this could still affect how much a bank is willing to lend to those applying for a mortgage, as take home pay is taken into account.

“The first thing to know is that student loan repayments don’t directly affect your credit score,” says Roche of Equifax UK. “They won’t show up on your credit report and won’t directly affect your ability to take out a loan in the future.

“This is because they are automatically deducted from the graduates income, before the money hits your bank account, and it will only happen when you earn more than the threshold amount.

“However, student debt accumulated in other ways will show up on your credit report, for example, credit card spending, overdraft usage, and other personal loans such as for a cellphone.”

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Don’t get too excited about the rates just yet https://davidhemmingsbirdphotography.com/dont-get-too-excited-about-the-rates-just-yet/ Fri, 18 Nov 2022 20:37:00 +0000 https://davidhemmingsbirdphotography.com/dont-get-too-excited-about-the-rates-just-yet/ There’s no doubt that the past week has been an exciting one for rates. On Wednesday, the average 30-year fixed rate was fairly close to the highest levels since 2002. By the following afternoon, it had fallen more than half a percent to the lowest level in almost 2 months – the largest single-day drop […]]]>

There’s no doubt that the past week has been an exciting one for rates. On Wednesday, the average 30-year fixed rate was fairly close to the highest levels since 2002. By the following afternoon, it had fallen more than half a percent to the lowest level in almost 2 months – the largest single-day drop on record.

While rates are still very high compared to all but the past 8 weeks, this was a promising step in the right direction. That raised hopes for a bigger picture change after the fastest rate spike in 40 years.

At the start of the new week, rates managed to hold their new gains relatively well and with minimal volatility on average. Things might have been better had it not been for a concerted effort by the Fed to remind the market not to get too carried away in the face of further declines.

Why is the Fed trying to rain on our parade?

Let’s first examine what was said by the various Fed speakers. Here are some examples (paraphrased):

  • Waller: Thursday’s CPI report was just a data point. The markets are “ahead”.
  • Harker: Inflation will take time to come down. I don’t like basing politics on a few headline numbers
  • George: It would make sense to slow the pace of rate hikes next year
  • Daly: Inflation data is good news, but ‘pause’ not discussed
  • Waller: Inflation data supports 0.5% increase instead of 0.75%
  • Collins: Fed still has work to do, needs to raise rates more
  • Bullard: Fed must hike at least 5% even if inflation data remains supportive
  • Kashkari: Some evidence of an inflation plateau, but cannot be convinced by 1 month of data. The hikes will continue until 2023

If you think a lot of Fed members say/think the same, you’re right. They are extremely united in saying that more rate hikes are coming and that it will take more than a month of rate-friendly inflationary/economic data before they consider pausing rate hikes.

After that, they’re also all extremely united in saying they want to keep rates at the “pause” level for as long as possible to make sure inflation has really been beaten. They also all recognized that such a position involves economic difficulties and that it is a requirement of this type of political action. In fact, they will measure their success as a moderate amount of economic pain. In other words, they want to see unemployment rise slightly and spending fall slightly. As perverse as it sounds, they believe that the economic pain that would result from runaway inflation would be far worse.

That’s the attitude the Fed brought to the market this week, and it was probably a good thing. Despite all the rain on our parade, rates managed to stay in much lower territory from recent highs. If the Fed hadn’t brought in the bucket of cold water (especially Bullard. See the next chart of Fed rate expectations for June 2023), there was a risk that the market would have gotten a little carried away, reading too much in a month of inflation data.

This exuberance will continue to be a risk in an environment where rates have risen as rapidly as they did in 2022 and where we know exactly what data matters most to identify change (i.e. inflation data). That said, any near-term risk pales in comparison to December 13-14, when we get the next slice of the Consumer Price Index (CPI) followed by the Fed’s announcement.

To be clear, the CPI is the report that triggered the epic rate drop last week and was the most important entry for rates in 2022 when it comes to forecast economic data.

20221118 nl2.png

The outcome of the December 13 report will be key in helping the Fed lock in an amount to raise rates the next day. Markets currently expect the upside to be 0.50%, but a hot inflation report would easily put 0.75% back on the table. In addition to the hike itself, December is also one of 4 Fed meetings that bring the release of updated Fed rate hike expectations, something the market is always eager to react to.

We do not know what the reality of the rates will be by then. We have almost a month to sit down and observe. Much of that time will be taken up with holiday-related idiosyncrasies for financial markets. This can add volatility for several reasons. To be sure though, incoming economic data will continue to play a role in shaping market expectations ahead of the December 13 CPI report.

Not all data is equal in this respect. Several of this week’s reports were “interesting”, but they didn’t necessarily have a big impact. Existing home sales have fallen again, but the negative implications are somewhat offset by an incredibly tight inventory picture and persistent year-over-year price gains (that doesn’t mean prices aren’t falling not, only that they are still higher than the same month last year, which is more than prices could say for themselves in 2007, the last time sales fell at a pace similar).

20221118 EHS1.png

Taking into account the inventory crisis, we see that sales are much higher than during the last major downturn and much closer to the few years before the pandemic.

20221118 ehs.png

The big question is whether this blue line will continue to decline until it looks like it was in 2008. The Mortgage Bankers Association has a helpful chart in this week’s Credit Availability Index for reminding us why one of these things is not like the other. It shows how fluid mortgage credit was before the crash and how tight it is now as it has ever been.

20221115 mcailt.png

The thing is, lenders aren’t out to do the same kind of reckless lending this time around — not even remotely.

Looking ahead, next week will only have 3.5 working days for the bond market due to the Thanksgiving holiday. Meanwhile, there are only a handful of economic reports and all of them were released Wednesday morning. Traditionally, this can be a volatile week for the bond market (and therefore rates), but mortgage lenders also traditionally build a cushion in rates in the days leading up to the holidays (which includes the current week for many lenders) . Even then, barring an unforeseen shock, rates would wait to make their biggest moves until after the December 13 CPI data.

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Credit card balances, burden, delinquencies and collections in the third quarter: consumers are still in good shape with their cards https://davidhemmingsbirdphotography.com/credit-card-balances-burden-delinquencies-and-collections-in-the-third-quarter-consumers-are-still-in-good-shape-with-their-cards/ Tue, 15 Nov 2022 23:26:15 +0000 https://davidhemmingsbirdphotography.com/credit-card-balances-burden-delinquencies-and-collections-in-the-third-quarter-consumers-are-still-in-good-shape-with-their-cards/ Credit cards are primarily a payment method, paid monthly. The importance of borrowings has diminished over the years. By Wolf Richter for WOLF STREET. Credit card balances include balances that accrue interest and balances that are paid in full by the due date such that no interest accrues. Many Americans use credit cards only as […]]]>

Credit cards are primarily a payment method, paid monthly. The importance of borrowings has diminished over the years.

By Wolf Richter for WOLF STREET.

Credit card balances include balances that accrue interest and balances that are paid in full by the due date such that no interest accrues. Many Americans use credit cards only as a method of payment (and to get the 1.5% cash back or whatever), not as a method of borrowing. Thus, credit card balances are much more a measure of spending than borrowing.

Fitch estimated that the total amount paid with credit cards in the United States reached $4.6 trillion in 2021. Only a tiny fraction of the expenses were not fully repaid and added to the debt carrying interest.

In the third quarter, credit card balances rose $38 billion from the previous quarter to $930 billion, according to the New York Fed’s Household Debt and Credit Report. This $930 billion includes transactions initiated roughly in September but fully repaid in October, which do not generate interest.

Credit card spending has been boosted by the resurgence in travel, with credit cards being used as a method of payment for hotels, airline tickets, rental cars, meals, and more. Soaring costs are further increasing the amounts that pass through credit cards. But cardholders fully refunded almost all of the new amounts paid by credit card during the quarter.

Households have a lot of debt, but the problem isn’t credit cards, it’s mortgages.

In a moment, we’ll look at credit card balances as a percentage of total consumer debt and as a percentage of disposable income, and we’ll look at delinquencies and third-party collections, and we’ll see that the burden of revolving credit is not more than a small fraction of what it was in previous years and decades, and delinquencies have started to rise, but are still below pre-pandemic lows, and third-party collections have dropped to new records.

During the pandemic, plummeting reservations for airline tickets, hotels, entertainment and sports venues, restaurant meals, etc., have led to a drop in the use of credit cards as payment , and that’s where the big dip happened; it shows the collapse of expenditure on services. It is now back to normal as service spending recovers.

And yet, outstanding credit card balances in the third quarter increased by only $43 billion, showing the universal use of credit cards as a method of payment, with balances paid in full each month, and in the extent to which credit cards are used as a method of borrowing. And that makes sense because borrowing with a credit card can be ridiculously expensive, with rates as high as 30%, but paying with a credit card can earn you a kickback.

“Other” consumer loans, such as personal loans, payday loans and Buy-Now-Pay-Later (BNPL) loans, increased by $21 billion, reaching $490 billion in the third quarter . Most of them bear interest, but not all of them: for example, BNPL loans can be subsidized by the trader. These loan balances are now back to their 2003 level, despite 19 years of population growth, rising incomes and runaway inflation.

What is amazing, in fact, is how down these balances are after 20 years of population growth, income growth and inflation:

Decrease in the amount of credit card debt.

Consumers have reduced their reliance on credit card debt over the years, although credit cards have largely replaced checks and cash as payment methods. In 2021, $4.6 trillion was spent on credit cards, yet over the same period credit card balances grew by only $40 billion.

In 2003, credit card balances and other loans combined (the red and green lines in the chart above) accounted for more than 16% of total consumer debt, which also includes mortgages, auto loans and student loans. During the pandemic, this figure fell to 8%. In the third quarter, credit card balances and other consumer debt reached 8.6% of total consumer debt, roughly within the range of the pre-pandemic low in 2014.

Debt burden as a percentage of disposable income.

In 2003, credit card balances and “other” consumer debt accounted for 14% of disposable income (income from all sources minus taxes and social contributions). And then over the years it fell steadily as the burden of credit card balances and “other” consumer loan balances fell relative to disposable income. In the first quarter of 2021, it fell to an all-time low of 6% as disposable income ballooned with stimulus funds. In Q3 2022, it rose to 7.6%, roughly within the range of pre-pandemic lows:

Delinquencies increase, remain at or below pre-pandemic lows.

Stimulus funds delivered directly to consumers during the pandemic – stimulus checks, PPP loans, additional unemployment benefits, etc. – as well as the sums that consumers did not have to pay – mortgage forbearance, bans on eviction, etc. dough, and many who had fallen behind on their credit cards have caught up. Others were able to enter their credit card arrears into forbearance programs, and the outstanding balance was marked “current”.

That’s all over, and credit card balances that are becoming unpaid — 30+ days past due — have been growing all year. In the third quarter, they reached 5.2% of total balances, which is in the same range as during the pre-pandemic lows of early 2016.

“Other” consumer loans, such as personal loans, that are becoming delinquent reached 5.8% of total “other” balances and remain well below pre-pandemic lows:

Third-party collections fell to new all-time lows.

The percentage of consumers with third-party collections fell to 5.7%, the lowest on record, and down from 14.6% of all consumers following the unemployment crisis of the Great Recession.

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Sean Penn lends Zelensky one of his Oscars https://davidhemmingsbirdphotography.com/sean-penn-lends-zelensky-one-of-his-oscars/ Sat, 12 Nov 2022 17:59:00 +0000 https://davidhemmingsbirdphotography.com/sean-penn-lends-zelensky-one-of-his-oscars/ Oscar winner and self-proclaimed political ambassador Sean Penn recently made headlines for his political activism, this time in Ukraine. He is producing a war documentary for VICE Studios and was already there to cover the crisis on February 24, the day Russia invaded the Eastern European country. He strongly condemned Russia’s invasion of Ukraine, which […]]]>

Oscar winner and self-proclaimed political ambassador Sean Penn recently made headlines for his political activism, this time in Ukraine. He is producing a war documentary for VICE Studios and was already there to cover the crisis on February 24, the day Russia invaded the Eastern European country. He strongly condemned Russia’s invasion of Ukraine, which earned him and fellow actor Ben Stiller a permanent ban on entering Russia as a result of his words and actions.


According to the New York Post, the 62-year-old actor and director was in Kyiv this week and met with the president Volodymyr Zelensky to lend him one of his two Oscars as a show of solidarity with the country amid the ongoing war with Russia. President Zelenskyy was instructed by the actor to hold it until Ukraine won the war, then return it to him in Malibu when the conflict was finally over.

VIDEO OF THE DAY

“It’s just symbolic nonsense, but if I know it’s here with you, I’ll feel better and stronger for the fights,” Sean Penn said in a video shared by President Zelenskyy’s office. “When you win, take it back to Malibu.”

At first, President Zelenskyy was hesitant to accept the controversial gift, but he eventually accepted it.

“We have to win,” Zelenskyy replied.

Related: Sean Penn Is On The Ground In Ukraine For New Documentary


The gesture drew mixed reviews

The gesture was received with praise and criticism from around the world.

Actor and activist Russel Brand said: “In a way I think it’s really, really sweet because I feel like Sean Penn is a totally sincere person and he knows things. and saw things that I can’t begin to comprehend or comprehend but in another way doesn’t that show you that we’ve become completely immersed in some sort of wag the dog style event rather than an authentically rendered military experience.Because Sean Penn gives Zelenskyy an Oscar and says, “Take him back to Malibu” at the same time as nuclear plants are bombed and bridges are destroyed.

In return, President Zelenskyy awarded Sean Penn the Order of Merit, for his involvement in raising international support for Ukraine, and added the actor’s name to the ‘March of the Brave’ on Constitution Square in Kyiv, which honors leaders and representatives. other countries which have supported Ukraine in particular.

Penn won two Best Actor Oscars, one in 2004 for his role as ex-con Jimmy Markum in the mystical river (2003), and in 2009 he got his second for portraying Harvey Milk in the biopic Milk (2008).

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Statewide Live Updates https://davidhemmingsbirdphotography.com/statewide-live-updates/ Wed, 09 Nov 2022 22:30:00 +0000 https://davidhemmingsbirdphotography.com/statewide-live-updates/ Read in Spanish Most major races in Arizona were still undecided, and updated vote totals wouldn’t come out of Maricopa County until around 8 p.m. Wednesday. So no, we’re not there yet. The deliberate counting process is proceeding according to election officials’ plan due to the tens of thousands of ballots cast at polling centers […]]]>

Read in Spanish

Most major races in Arizona were still undecided, and updated vote totals wouldn’t come out of Maricopa County until around 8 p.m. Wednesday. So no, we’re not there yet.

The deliberate counting process is proceeding according to election officials’ plan due to the tens of thousands of ballots cast at polling centers on election day and the safeguards built into the vote counting process.

Expect voting updates from other counties and updates throughout Wednesday after an Election Day marked by voting equipment issues, ink-stained conspiracies and a lawsuit to extend voting hours.

Here is a recap of Tuesday’s election events.

Follow Republic reporters’ coverage of the Arizona midterm elections here.

3:30 p.m.: Hamadeh takes the lead in the Arizona attorney general race

The results of the ballots counted so far show Republican Abe Hamadeh leading the race to become Arizona’s next attorney general as of Wednesday afternoon.

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Europe’s top bankers are pressuring their regulator to back down https://davidhemmingsbirdphotography.com/europes-top-bankers-are-pressuring-their-regulator-to-back-down/ Fri, 04 Nov 2022 12:51:46 +0000 https://davidhemmingsbirdphotography.com/europes-top-bankers-are-pressuring-their-regulator-to-back-down/ (Bloomberg) – European bank executives are expressing growing frustration over what they see as excessive interference and unreasonable demands from the region’s top financial regulator. Bloomberg’s Most Read Bankers are now increasingly vocal about a series of longstanding irritations with the European Central Bank’s watchdog arm, headed by Andrea Enria. These include more day-to-day complaints, […]]]>

(Bloomberg) – European bank executives are expressing growing frustration over what they see as excessive interference and unreasonable demands from the region’s top financial regulator.

Bloomberg’s Most Read

Bankers are now increasingly vocal about a series of longstanding irritations with the European Central Bank’s watchdog arm, headed by Andrea Enria. These include more day-to-day complaints, such as heavy data requests, but also larger debates about the freedom of lenders to pay dividends and bonuses as well as the level of intrusion that supervision justifies, according to leaders familiar with the subject.

With discontent growing, Lorenzo Bini Smaghi, chairman of Societe Generale SA in France and a former member of the ECB’s executive board, wrote to the central bank in October protesting officials’ demands to be present at board meetings. administration of the bank, according to a document seen by Bloomberg. . He argued that the practice undermines the effectiveness of management discussions.

“To my knowledge, no other authority in major advanced economies attends board and committee meetings as part of their oversight activity,” he wrote. “Not the Federal Reserve, nor the Bank of England, nor the Swiss National Bank, nor Finma. Some European supervisors have adopted such a practice in the past, with apparently very little benefit and serious concerns raised by the entities. monitored.

After nearly a decade of oversight by the ECB, which set up the Single Supervisory Mechanism as part of the region’s response to the sovereign debt crisis, banks have weathered the pandemic era by largely unscathed thanks to better capitalization and significant government support. And while the industry has also finally benefited from years of pressure from the ECB to reduce bad loans and improve risk management, bankers say it is now going too far.

Risk Warning

While banks and their supervisors often have friction, the latest comes amid calls from the ECB to prepare for the high level of impending risk in the economy. In September, the European Systemic Risk Board issued an official warning about vulnerabilities in the financial system amid soaring energy prices and soaring inflation.

Officials have also been prescient in their warnings in recent years of growing risks in the leveraged lending industry, as global banks have racked up billions of dollars in mark-to-market losses in this area over the past few years. last six months.

On Friday, Enria warned in a presentation that while lenders’ balance sheets are generally healthy, risks are mounting in a number of areas, including the residential real estate market, amid rising interest rates.

The SSM “was created to foster the safety and soundness of the banking sector, and we are committed to fulfilling this mandate and evaluating banks against very high standards,” an ECB spokesperson said in a statement. communicated. “We have always been and remain open to dialogue about the efficiency and effectiveness of our oversight processes.”

In the letter, addressed to Ramon Quintana, director general of the ECB, Bini Smaghi said he had called a meeting with Enria and the presidents of the other major European lenders “to exchange views on how to ensure a good assessment of bank governance”. .”

The ECB has previously said that the occasional attendance of its staff as observers at board meetings is one of the tools it uses to assess banks’ governance frameworks. Societe Generale declined to comment on the letter.

Bankers polled by Bloomberg say the ECB’s de facto ban on payments at the height of the pandemic hurt them in the eyes of investors, and moderation is no longer warranted given their windfall earnings. Businesses from Deutsche Bank AG to Banco Santander SA recorded double-digit gains in loan income in the third quarter, helping to bolster profits even as rapid increases in central bank interest rates squeeze businesses and consumers with higher borrowing costs.

Amid this tension, the watchdog’s day-to-day surveillance is grittier than usual. One executive likened the watchdog to the Federal Bureau of Investigation, saying supervisors ask different bank employees the same question multiple times in order to compare answers.

Some requests are seen as probing deeply into the business decisions of private companies, for example specific drivers of profitability, says one of the people familiar with such interactions. Conversely, some bankers also allege that the teams entrusted to them by the ECB and national regulators are often inexperienced or ask for very granular reports and end up not being read.

Bank board meeting agendas are seen as focusing too much on relatively minor issues at subsidiaries raised by the regulator, one executive said. Meanwhile, committees below the board are forced to provide the watchdog with transcripts of meetings, another says, giving a sense of unnecessary intrusion. Compliance teams complain of difficulty in retaining staff exhausted by growing demands.

Yet the issue of dividends shows that the ECB and the bank are still able to work together. ING Groep NV, a Dutch lender that has one of the highest levels of capital among European banks, said on Thursday it would buy up to 1.5 billion euros ($1.5 billion) from actions after getting approval from the watchdog. Chief executive Steven van Rijswijk said the conversations the bank had had with regulators had been “constructive”.

Created in 2014, the banking supervision arm of the ECB is unlike any other regulator, in that it coordinates financial supervision in the 19 countries of the euro zone. The watchdog has previously been accused of overstepping its mandate, including for the way Enria’s predecessor pushed banks to reduce their mountain of bad debts. Now bankers – and even some regulators – are complaining that ECB plans to control climate risks are going too far or that authorities are taking a heavy-handed approach to the lucrative effect finance business. of leverage.

While much of the bankers’ frustration is about interacting with the ECB at an operational level, big projects like this year’s climate change stress test are also a sore spot.

The labor-intensive review was touted as a “learning exercise” for regulators and lenders, but several banks Bloomberg spoke to said they were disappointed the criticism initial was not more constructive given the efforts they have made.

Enria, 61, has long been at the heart of efforts to improve the financial health of European banks. Before taking over as chairman of the ECB’s supervisory board in early 2019, he headed the European Banking Authority, which helps enforce regulations and organizes stress tests for lenders in the region. The Italian national made the ECB’s oversight activities more transparent, for example outlining how it deals with bank mergers, and sought to remove obstacles banks face in moving cash across borders, though with mixed results.

Supervisory review

In September, the ECB launched a review of the annual surveillance process, known as SREP. The European Banking Federation, a lobby group, said through a spokeswoman there was ‘room for improvement’ in SREP although it was an ‘achievement’ and that it would use the review to engage with the ECB on this.

Enria itself recently hinted at the strained relationship with banks, but doubled down on warnings that individual institutions need to focus on future risks rather than flooding investors with cash.

In a speech last month, he said banks’ optimism about windfall earnings this year had generated “some reluctance on the part of banks to seriously engage in prudential discussions” about economic risks.

Even so, Enria acknowledged that the ECB and other authorities were too pessimistic in their warnings at the start of the pandemic.

“We could suffer the same fate as the boy who cried wolf in Aesop’s Fables, and a tendency could spread among banks to dismiss their supervisors’ pleas for caution as unwarranted conservatism,” he said. he declares.

–With the help of Alexandre Rajbhandari.

(Add Enria’s comments to eighth paragraph)

Bloomberg Businessweek’s Most Read

©2022 Bloomberg LP

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Biden’s student loan forgiveness plan divides Americans ahead of midterm election https://davidhemmingsbirdphotography.com/bidens-student-loan-forgiveness-plan-divides-americans-ahead-of-midterm-election/ Tue, 25 Oct 2022 22:16:48 +0000 https://davidhemmingsbirdphotography.com/bidens-student-loan-forgiveness-plan-divides-americans-ahead-of-midterm-election/ New Orleans – Katelyn Umholtz still owes nearly $25,000 in college debt. Umholtz said when she first heard the news that President Joe Biden was ordering partial forgiveness of student loan debt like hers, she immediately texted her family in celebration. “This is a big and exciting deal for us,” Umholtz told VOA. “My sister […]]]>

Katelyn Umholtz still owes nearly $25,000 in college debt. Umholtz said when she first heard the news that President Joe Biden was ordering partial forgiveness of student loan debt like hers, she immediately texted her family in celebration.

“This is a big and exciting deal for us,” Umholtz told VOA. “My sister also has a lot of student debt. We came from a low-income family and our father told us that taking out loans was the only way to go to college.

According to US government data, Americans owe a combined total of $1.6 trillion in college debt, nearly equivalent to the size of the entire Australian or Brazilian economy.

In August, President Biden gave hope to tens of millions of these borrowers. He announced that the government would forgive $10,000 in federal student loan debt for any American who earns less than $125,000 a year. Loan recipients who received a Pell grant — typically for low-income students who demonstrate financial need — would have an additional $10,000 forgiven in the president’s plan.

The excitement came to a head last week when the program’s online application went live. Already more than 22 million people have registered via the digital form.

For borrowers like Umholtz, there is hope that partial student debt forgiveness could provide critical relief as the crippling cost of living rises and record inflation hampers Americans still trying to recover from the economic ramifications of the coronavirus pandemic.

“I’ve never missed a student loan payment,” Umholtz said, “but the payments are high, as are rent, health insurance, and other living expenses. I’ve incurred medical debt and I have incurred credit card debt I hope that canceling my student loan will give me space to pay off these expenses and then, maybe one day, to think about starting a family or buying a house. I haven’t been able to save for it yet.

Despite progress in Biden’s plan becoming a reality, student loan forgiveness is not yet guaranteed. Six conservative-leaning states filed a lawsuit arguing that the president’s program would hurt businesses handling federal loans.

On Friday, a federal appeals court temporarily blocked the write-off of any debt until it deliberates on whether writing off student loan debt falls within the president’s authority.

In fact, for all Americans celebrating Biden’s push, many others scoff at it as an example of wasteful spending during a time of mounting national debt and economic turmoil.

“I think this could all potentially be a publicity stunt to help the president’s Democratic Party in the midterm elections in a few weeks,” said Angelica Garcia, a Republican voter from Saginaw County, Michigan. “If we want to help the economy, this is not the right way to do it. These are unnecessary expenses and will have disastrous consequences for the future of our country.

Expected Divisions

Political analysts say disagreement over the wisdom of partially canceling student debt is being split the same way as many issues in the United States — along political lines.

“The distribution is really exactly as one would expect,” explained Robert Collins, professor of urban studies and public policy at Dillard University in New Orleans. “The vast majority of Democratic voters — who are also the most likely to go to college and support economic aid for those in need — favor canceling student debt. The majority of Republican voters are against it.

A poll last month by Economist/YouGov confirmed this, showing that 80% of Democrats supported canceling college debt while 72% of Republicans opposed it. Independent voters — particularly significant because they are less likely to have voted for one of the two main political parties — were split almost exactly in the middle with 44% in favor of Biden’s student debt plan and 42% against.

At the heart of the argument of many college debt relief proponents is the belief that student loan providers act in a predatory manner against borrowers — many of whom are just children when they agree to terms. of the loan.

“When you take out a loan for a car or a house, you are an adult,” Liz Skelding, a teacher in Glastonbury, Connecticut, told VOA. “But I was 17 when I signed my student loan papers. No one explained the terms to me. No one explained how the interest will accrue so I can never get out of debt. I was 17!”

Natalie Krusemeier, a middle school teacher in Ethete, Wyoming, took on $70,000 in student debt to earn associate’s, bachelor’s and master’s degrees. She agrees that the current interest rate structure makes it difficult to repay university loans.

“I’ve made my student loan payments every month, but what do I need to prove?” she asked. “After the tens of thousands of dollars I paid, I kind of owe $12,000 more than when I started paying back. Everything I paid goes toward interest. It does not work. We need help.”

A matter of fairness

For many who have already paid off their student loan or who never took out a loan to begin with, it seems unfair that taxpayers’ money is used to partially ease the debt burden of others while they themselves are not. have not received such help.

“I paid for my entire education myself,” Denver Mullican, a resident of Natchez, Mississippi, told VOA. “I worked while in college, then had three jobs every summer to pay for my education. Nine of my closest college friends worked and went to college at the same time.

In last month’s Economist/YouGov poll, a majority of respondents (56%) said they felt student debt cancellation was unfair to Americans who had already paid off their debt.

Collins, of Dillard University, said he believed a false narrative was to blame for the division on this issue.

“There’s this idea that canceling student loans is going to have a huge impact on the national debt or on increasing inflation,” he said, “but that’s not true. Your cost of gas, eggs and milk does not increase because a small student debt is forgiven.

“There’s also a narrative among conservatives that canceling student loans helps spoiled brats, wealthy graduate elitists,” Collins said. “As a university professor, I can tell you that is not true. Most of the people this will help are not from wealthy families, because then they wouldn’t need loans. This relief will go to people who can actually use the aid.

Impact on elections

While the current lawsuit of six Republican-led states has prevented the Biden administration from wiping out any debt, that hasn’t stopped them from continuing to encourage borrowers to submit their applications online.

“Amid Republican efforts to block our debt relief program, we are moving full speed ahead to be ready to provide relief to borrowers who need help,” the US Secretary of Education tweeted. Miguel Cardona.

“[It will not] prevent us from reviewing the millions of applications we have received,” he added in another tweet.

The last time the federal government launched a high-profile online presence was a decade ago, when passage of the Affordable Care Act (also known as “Obamacare”) necessitated the creation of an online market. The website crashed frequently and did not work in its early days, angering voters and embarrassing Democrats.

While some feared that the same could happen with online student loan application, so far this has not been the case.

“It took about two minutes,” Colleen LaFlamme, a musician from Lawrenceville, New Jersey, told VOA. “Incredibly easy. Simple. User-friendly. It was great.”

As the fate of the presidential order to cancel student loans awaits a ruling from the courts, many Americans are wondering how the plan will affect the midterm elections, just two weeks away.

“I think Biden is trying to falsely portray Republicans as heartless,” Michigan’s Garcia said. “He wants to force Republican politicians to block his measure. They’re blocking it because it’s bad for the economy, but it looks like they don’t want to help people in debt.

Although Dillard University’s Collins doesn’t think the student loan forgiveness will change anyone’s mind on who to vote for, he thinks it could have an impact on the election.

“This election is going to be about who can excite their base enough to show up and vote,” he said. “Student debt isn’t going to overturn anyone’s vote, but it could excite more Democratic voters to get out and vote. Whether that will be enough to have an impact on the election – we will find out soon.

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Student borrowers should always seek relief, says Cardona https://davidhemmingsbirdphotography.com/student-borrowers-should-always-seek-relief-says-cardona/ Sun, 23 Oct 2022 10:45:00 +0000 https://davidhemmingsbirdphotography.com/student-borrowers-should-always-seek-relief-says-cardona/ Comment this story Comment The Biden administration is moving “full speed” in preparing to implement its plans for widespread student debt cancellation, Education Secretary Miguel Cardona said on Saturday, a day after a Federal Court of Appeals temporarily blocked the immediate cancellation of the loans. Cardona called the lawsuits to block President Biden’s debt relief […]]]>

Comment

The Biden administration is moving “full speed” in preparing to implement its plans for widespread student debt cancellation, Education Secretary Miguel Cardona said on Saturday, a day after a Federal Court of Appeals temporarily blocked the immediate cancellation of the loans.

Cardona called the lawsuits to block President Biden’s debt relief package “baseless”, saying in a video posted on Twitter that the administration was “undeterred”.

Biden’s plan met its first substantive hurdle Friday night, when the United States Court of Appeals for the 8th Circuit granted an administrative stay for one of the lawsuits, filed by six Republican-led states. The administrative suspension is not a decision on the merits of the case, but rather a temporary pause until the court decides.

Until Friday, it appeared that the Biden administration was dodging legal challenges targeted by Republicans against its debt relief plan. A U.S. District Judge had on Thursday dismissed the States’ lawsuit for lack of standing, the same day Supreme Court Justice Amy Coney Barrett dismissed a separate lawsuit brought by a conservative legal institute on behalf of an association of Taxpayers, who argued that the debt relief was unconstitutional because its goals of closing the racial wealth gap amounted to an “inappropriate racial motive.”

The six Republican-led states – Arkansas, Iowa, Kansas, Missouri, Nebraska and South Carolina – argued that debt relief would lead to lower revenue from loans that were due to be forgiven. Judge Henry E. Autrey of the U.S. District Court for the Eastern District of Missouri wrote in his order that concerns about lost tax revenue were “merely speculative.”

In an op-ed published Saturday in USA Today, Cardona took issue with Republicans’ argument, saying they don’t dispute the billions of dollars in pandemic aid for business owners in their states, with cuts to taxes for high earners or with a loan forgiveness that helped Republican members of Congress. “It’s only when relief goes to American workers and middle classes that these elected officials have a problem,” he wrote.

Despite the lawsuits, Cardona has encouraged eligible borrowers to apply for relief as the Department of Education moves “at full speed in preparations for the legal implementation of our program so that we can provide relief to borrowers who need it most,” he wrote.

In August, Biden announced plans to forgive up to $10,000 in federal student debt for people earning up to $125,000, or up to $250,000 for married couples. Pell Grant recipients are eligible for an additional $10,000. Requests for relief are open until the end of next year, although the administration has encouraged borrowers to apply earlier in the hope cancellations could hit accounts before a break expires on student loan repayments on December 31.

University of Alabama law professor Luke Herrine, who has argued the president has the power to write off student debt on a large scale, said debt relief could still come soon despite the federal appeals court hurdle. Herrine said that while the appeals court’s decision was uncertain, “I would expect them to affirm the district court’s decision” against the Republicans’ lawsuit.

He said he expected a decision from the appeals court “at least within a few weeks” given that the suspension was “an urgent request”.

Borrowers seeking relief should still apply despite the legal noise, he said. “If you get your app now, you’re more likely to get relief,” Herrine said. “There is no harm in applying,” he added.

Danielle Douglas-Gabriel and Kelly Kasulis Cho contributed to this report.

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Protecting student loan cancellation as CPS lags on employment verification https://davidhemmingsbirdphotography.com/protecting-student-loan-cancellation-as-cps-lags-on-employment-verification/ Thu, 20 Oct 2022 21:02:34 +0000 https://davidhemmingsbirdphotography.com/protecting-student-loan-cancellation-as-cps-lags-on-employment-verification/ Dear CTU Family: As you know, the deadline for federal student loan relief is October 31st – yet we keep getting reports that CPS is jeopardizing loan forgiveness because their talent department is taking 72 hours or more. to process Loan Forgiveness Verification Forms – when they answer all. Although some directors have already signed […]]]>

Dear CTU Family:

As you know, the deadline for federal student loan relief is October 31st – yet we keep getting reports that CPS is jeopardizing loan forgiveness because their talent department is taking 72 hours or more. to process Loan Forgiveness Verification Forms – when they answer all. Although some directors have already signed these forms, until today CPS legal counsel had insisted that members should continue to rely on Talent to process these forms.

It’s not enough – and because we’ve been pushing the CPS for weeks as we approach this critical deadline, we’re finally getting a breakthrough from a bureaucracy that’s terrible at serving its stakeholders.

This morning we got the response from the CPS, which clearly stated that principals will be able to approve employment verification, provided they are able to confirm teachers’ lengths of service. CPS also said the Talent Office will send a notice to all staff reminding them of the deadlines and will be prepared to process any submissions that cannot be approved at the school level.

It remains a frustrating process, one in which we continue to push CPS to improve, especially when millions of dollars in student loan relief may be jeopardized by the chronic bureaucratic loopholes of our school district’s mismanagement. by Mayor Lightfoot.

Click here for more information on Civil Service Loan Cancellation – and let your manager know they can sign your employment verification form, by the CEO of CPS, for this vital student loan relief.

Remember, as a public worker, all of your student debt could be forgiven, but you MUST take action by October 31, 2022. More than 200,000 student borrowers have used the waiver to date and got about $13 billion in loan forgiveness — but sadly, that’s only about half of those estimated to be eligible..

As we’ve noted in previous emails, the PSLF waiver was transformative for public school educators, who were promised that their student loans would be forgiven if they stayed in the public service for ten years. Loan forgiveness allows our grassroots members to buy a home, start a family, or send a child to college. You deserve this loan forgiveness for all you do for our students and our families.

Apply to the PSLF before October 31! Visit www.aft.org/pslf to find out how to apply for a PSLF using the FSA’s PSLF help tool before October 31. This same information and instructions (but in a slightly different and more detailed form) plus additional updates as they arrive may also be available at www.forgivemystudentdebt.org. From Saturday October 22 to Monday October 31, AFT is hosting student loan clinics at least once a day. People can register at this link.

In solidarity,

Chicago Teachers Union

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