Economic Glance
Federal requirements to buy American-made products may be forcing some U.S. transit systems to spend more money, according to a new study from a center-right think tank.
The American Action Forum (AAF) released research Friday that found “Buy America” rules for Federal Transit Administration (FTA) grants could be raising procurement costs in some areas.
Study: ‘Buy America’ rules raising costs for US transit systems
Fed hikes interest rates, signals two more increases for 2017
The Federal Reserve’s top policymaking body on Wednesday pulled the trigger on another increase in interest rates, the first since Donald Trump became president, and signaled there will be two more hikes this year.
The Federal Open Market Committee, which sets the key borrowing rate that affects interest payments on everything from mortgages to savings accounts, raised rates one-quarter of a percentage point. Still, the FOMC emphasized that it plans to nudge up interest rates gradually. The key rate now stands at between 3/4 of a percent and 1 percent.
Carrier agrees to keep 1,000 jobs in Indianapolis
Carrier Corp. is staying in Indianapolis after all.
Nearly nine months after announcing it would relocate its Indianapolis operations to Mexico, Carrier has reached an agreement with the incoming Trump administration to keep 1,000 jobs in the city. The company confirmed its plan on Twitter.
President-elect Donald Trump and Vice President-elect Mike Pence are scheduled to be in Indianapolis Thursday for a formal announcement, according to a transition official. Another source, who is familiar with the plan, said state incentives are part of the deal.
Deutsche Bank faces new blow as Justice Department demands record $14B
Deutsche Bank faces the prospect of having to tap shareholders for more cash after the U.S. Department of Justice asked Germany’s flagship lender to pay $14 billion to settle an investigation into alleged mis-selling of mortgage-backed securities. The record fine marks the latest blow to the bank, which has run a gauntlet of setbacks since the 2008 financial crisis.
The Department of Justice move was only the first salvo in what could be a lengthy negotiation over the size of the fine, but it raised fears the final penalty will be far greater than expected. Deutsche Bank said on Friday it has “no intent” to settle the issue at “anywhere near the number cited.”
The negotiations are only just beginning. The bank expects that they will lead to an outcome similar to those of peer banks which have settled at materially lower amounts.
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US corporations have $1.4tn hidden in tax havens, claims Oxfam report
US corporate giants such as Apple, Walmart and General Electric have stashed $1.4tn (£980bn) in tax havens, despite receiving trillions of dollars in taxpayer support, according to a report by anti-poverty charity Oxfam.
The sum, larger than the economic output of Russia, South Korea and Spain, is held in an “opaque and secretive network” of 1,608 subsidiaries based offshore, said Oxfam.
U.S. watchdog to probe Fed's lax oversight of Wall Street
A U.S. watchdog agency is preparing to investigate whether the Federal Reserve and other regulators are too soft on the banks they are meant to police, after a written request from Democratic lawmakers that marks the latest sign of distrust between Congress and the central bank.
Ranking representatives Maxine Waters of the House Financial Services Committee and Al Green of the Subcommittee on Oversight and Investigations asked the Government Accountability Office on Oct. 8 to launch a probe of "regulatory capture" and to focus on the New York Fed, according to a letter obtained by Reuters.
Macy's announces closure of 36 stores, layoffs after slow holiday sales
Retailer Macy's Inc. announced the elimination of more than 4,500 jobs and the closure of 36 stores after disappointing sales during the holiday season.
It said Wednesday it would initiate "a series of cost-efficiency and process-improvement measures" by reducing the workforce at each of about 770 Macy's and Bloomingdale's stores, closing other stores, and offering a "voluntary separation opportunity" to some senior executives. The downsizing actions are set to begin early this year.
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