The 10 worst states for taxes in 2014 - (www.cnbc.com) California
blows away Illinois, NY, NJ, and all other ones listed. California: Top State
Income Tax Rate: 13.3 percent. Sales tax: 7.5 percent. Property tax per capita:
$1,450. California has one of the highest income taxes in the country and
imposes an alternative minimum tax on both individuals and corporations. The
Golden State relies heavily on the income tax revenue generated by its richest
residents. This year such revenues are expected to comprise two thirds of California’s general-fund reserves. Its 7.5 percent sales tax rate includes a
mandatory statewide local tax of 1 percent.
US severely exposed if rates rise: Erskine
Bowles - (www.cnbc.com) The
United States spends about $230 billion a year in finance payments to
creditors—a level that could more than double if interest rates returned to
more normal levels, anti-debt crusader Erskine Bowles warned on Monday. To put
$230 billion a year in perspective, Bowles said on CNBC's "Squawk Box," it's more than the U.S. spends at the
departments of Commerce, Education, Energy, Homeland Security, Interior,
Justice, State and the court system combined. "If interest rates were to
return to a median level they were in the 1990s, we'd be spending not $230
billion a year but $650 billion a year," the former co-chair of the
president's debt commission said. "When you think about it, that's $650
billion that will be spent, principally in those countries we're borrowing
money from, to educate their kids, to improve their infrastructure, to do the
high value-added research on their college campuses, so the next new thing is
created over there," Bowles said. "That's crazy."
An Economic 'Perfect Storm' Is Brewing - (www.businessinsider.com) Last
week at the World Economic Forum in Davos, economist Nouriel Roubini told BI's
Joe Weisenthal that it seemed markets had sailed into a "mini-perfect storm," resulting in lots of volatility. "...Between
Chinese PMI of 50, Argentina letting its currency go, noises coming politically
from Ukraine, Turkey, and Thailand … [the] contagion is not just within
emerging markets but also affects advanced economies' equity markets." On
Sunday, the economists at Société Générale issued a similar warning using the
same vivid imagery. In a note to clients titled "Perfect Storm
Brewing As Policy Turns," they write: Following a week of extreme
volatility in emerging markets, many wonder if we are now heading for a perfect
storm, with China increasingly sucked in and Europe's already low inflation
falling further towards deflation. The current developments also mark a shift
in markets' focus on where the need for policy change is the greatest - away
from Europe where bond spreads remain resilient. We remain unconvinced,
however, that the reforms to date in Europe are enough to raise growth
sufficiently and put public debt trajectories on a sustainable path.
Currency crisis at Chinese banks 'could trigger
global meltdown’ - (www.telegraph.co.uk) The growing problems in the Chinese banking
system could spill over into a wider financial crisis, one of the most
respected analysts of China’s lenders has warned. Charlene Chu, a former senior
analyst at Fitch in Beijing and now the head of Asian research at Autonomous
Research, said the rapid expansion of foreign-currency borrowing meant a crisis
in China’s financial system was becoming a bigger risk for international banks.
“One of the reasons why the situation in China has been so stable up to this
point is that, unlike many emerging markets, there is very, very little
reliance on foreign funding. As that changes, it obviously increases their
vulnerability to swings in foreign investor appetite,” said Ms Chu in an
interview with The Telegraph. Ms Chu has been warning since 2009 about the
growth of a shadow banking system in China that has helped fuel the credit
expansion seen in the country in the wake of the Western financial crisis.
Fed draws criticism from abroad as emerging
markets still reeling - (www.reuters.com) The Federal Reserve's decision to keep trimming
its economic stimulus drew fire on Friday as India's central bank chief said
Americans should be more attuned to the global impact of their policies, and
the IMF called for vigilance given strains in financial markets.
The push-back came on Fed Chairman Ben Bernanke's last day on the job and two
days after the U.S. central bank reduced the pace of its huge asset purchase
program. The Fed made the move on Wednesday despite a bruising selloff in
emerging markets that
was prompted in part by the prospect of less U.S. monetary support. With the
turmoil in currencies and stocks spreading
into more emerging markets on Friday, Fed officials, addressing the rout for
the first time, offered no hint the sell-off would influence their policy
stance unless the U.S. economy were
threatened. But in Mumbai, Reserve Bank of India Governor Raghuram Rajan said the United
States "should worry about the effects of its policies on the rest of the
world."
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