Oil declined for a third day in New York amid speculation a report on new homes may add to signs U.S. fuel demand will remain weak and as investors sold contracts against a strengthening dollar.
Crude fell as the Dollar Index climbed for a second day, damping the appeal of commodities as an alternative investment. Ground was broken on 3 percent fewer houses in September in the U.S., the world’s largest oil user, economists estimated before a Commerce Department report tomorrow. Futures declined even as hedge funds last week raised bets oil prices would gain.
“For every bit of economic data, we have to watch a few months to see if there is sign of recovery,” said Ken Hasegawa, a commodity derivative sales manager at brokers Newedge in Tokyo. “It seems oil will stay in a range between $80 and $84. After oil reached $84 last week, now is a time for profit-taking.”
Crude for November delivery dropped as much as 70 cents, or 0.9 percent, to $80.55 a barrel in electronic trading on the New York Mercantile Exchange. It was at $80.75 at 2:55 p.m. Singapore time. On Oct. 15, the contract lost $1.44, or 1.7 percent, to $81.25, the lowest settlement since Sept. 30.
Oil is in the longest pullback since a four-day losing streak through Sept. 17. Futures fell 1.7 percent last week, the first weekly drop in four.
The Dollar Index, used by IntercontinentalExchange Inc. to track the greenback against currencies including the euro, yen and Swiss franc, added as much as 0.6 percent to 77.485. The U.S. currency also climbed 0.7 percent to $1.3884 against the 16- nation euro.
‘Choppy’ Data
“Oil continues to be heavily impacted by U.S. dollar movements,” said Ben Westmore, a minerals and energy economist at National Australia Bank Ltd. in Melbourne. “The data out of the U.S. is pretty choppy at the moment. Some are more positive than others, some are weaker than you expect.”
U.S. retail sales in September advanced 0.6 percent following a 0.7 percent gain in August that was larger than previously estimated, the Commerce Department said Oct. 15. Purchases were projected to increase 0.4 percent, according to the median estimate from 80 economists surveyed by Bloomberg News. Work began on 580,000 houses at an annual rate, down 3 percent from August, based on the median of 56 estimates in a separate poll.
U.S. consumption of refined products rose 1.8 percent in September from the year before, signaling demand is recovering as the economy rebounds, the American Petroleum Institute, a Washington-based industry group, said in an Oct. 15 report. Fuel deliveries, a measure of demand, averaged 18.9 million barrels a day, from 18.6 million in September 2009.
Net-long positions in oil futures and options held by “managed money,” including hedge funds, commodity pools and trading advisers, rose 10,198, or 6.1 percent, to 178,738 contracts, according to the U.S. Commodity Futures Trading Commission.
Brent crude for December settlement declined as much as 69 cents, or 0.8 percent, to $81.76 a barrel on the ICE Futures Europe exchange in London. On Oct. 15, the contract dropped $1.75, or 2.1 percent, to $82.45.
Monday, October 18, 2010
Tuesday, June 22, 2010
As flexible working expands, we need a debate on retirement
THE past decade has seen a rapid expansion in flexible working arrangements of many kinds.
Indeed, flexibility in all its forms is now an integral part of the modern employment relationship in the UK and an important source of competitive advantage.
Our flexible labour market has proved its worth again during the recession. While unemployment has inevitably risen, and is now nudging 2.5 million, the unprecedented co-operation between employers and employees through measures such as short-time working, hiring freezes and moderation in pay has helped to minimise job losses.
Furthermore, businesses of all sizes and from all sectors tell me that the growth of the flexible part of their workforce will be a key part of their resourcing strategy over the coming decade.
But employers recognise that flexibility needs to work for employees as well as the business. The right to request flexible working, for instance, has been a significant success because it encourages employees and employers to take ownership of both the work the employer needs done, and the balance people need between work and other responsibilities.
The CBI supported the right to request flexible working and its extension to carers and to parents of children under the age of 16 – covering an additional 4.5 million employees – when it was based on good evidence.
The essential feature has been the balance between the needs of the employer and the employee. On the basis of successful experience, growing numbers of employers have voluntarily extended the right to request flexible working to their entire workforce.
The new Government plans to extend the right to request to all employees under the current framework, and while this may seem a logical extension, it is vital that the success of the current system is not undermined by these changes.
Employers must be given sufficient time to adapt and get their policies in place.
And the Government must provide clear guidance on how to prioritise requests from employees, since there will inevitably be occasions when not every request for flexibility can be met and some employees will have to be given priority over others.
Another plank of the Government’s employment agenda is to increase participation rates in employment. Boosting participation can mean encouraging older individuals back into the workplace, and retirement policies are likely to be examined carefully to see if they remain fit for purpose.
People are living longer, healthier lives – this is something we should celebrate. And the trend changes the way we think about work and our working lives: projections by the OECD suggest that almost one in 10 of the UK labour force will be over 60 by 2030.
Businesses value the skills and experience of older members of the workforce and are increasingly flexible about how they manage employees who want to delay retirement.
In future, more people will want to work on and employers will increasingly welcome that. It is equally likely that the explosion in flexible working we have seen in the past few years will help people stage their retirement over a longer period.
Working longer is an integral part of coping with the demands that our ageing society will place on pension provision.
These developments are welcome, but everyone will want – and need – to retire from work at some stage. We will still require a framework for retirement which includes a constructive discussion between employer and employee, and a hook on which to hang that conversation. Currently, this is delivered through the right to request continuing to work that all employees have when approaching retirement age, but it would not be possible without a set default retirement age.
This is not a philosophical argument but a practical issue: the default retirement age (DRA) is an essential part of employment practice, enabling businesses to plan and develop their workforces.
In its absence, workforce planning, staff development and business innovation would become harder – and there would be an increased risk of age- based litigation. Managing the transition to retirement would be more difficult for firms and employees, who might eventually have to be dismissed on competence grounds even where they have a long history of good work with the company.
For businesses to operate effectively, an alternative framework will have to be developed to either remodel or replace the DRA. The Government must address the practical concerns of business in this area, as a vacuum will create uncertainty for employers and employees. We need a debate about how people retire and what the correct legislative structure is to smooth the transition.
Indeed, flexibility in all its forms is now an integral part of the modern employment relationship in the UK and an important source of competitive advantage.
Our flexible labour market has proved its worth again during the recession. While unemployment has inevitably risen, and is now nudging 2.5 million, the unprecedented co-operation between employers and employees through measures such as short-time working, hiring freezes and moderation in pay has helped to minimise job losses.
Furthermore, businesses of all sizes and from all sectors tell me that the growth of the flexible part of their workforce will be a key part of their resourcing strategy over the coming decade.
But employers recognise that flexibility needs to work for employees as well as the business. The right to request flexible working, for instance, has been a significant success because it encourages employees and employers to take ownership of both the work the employer needs done, and the balance people need between work and other responsibilities.
The CBI supported the right to request flexible working and its extension to carers and to parents of children under the age of 16 – covering an additional 4.5 million employees – when it was based on good evidence.
The essential feature has been the balance between the needs of the employer and the employee. On the basis of successful experience, growing numbers of employers have voluntarily extended the right to request flexible working to their entire workforce.
The new Government plans to extend the right to request to all employees under the current framework, and while this may seem a logical extension, it is vital that the success of the current system is not undermined by these changes.
Employers must be given sufficient time to adapt and get their policies in place.
And the Government must provide clear guidance on how to prioritise requests from employees, since there will inevitably be occasions when not every request for flexibility can be met and some employees will have to be given priority over others.
Another plank of the Government’s employment agenda is to increase participation rates in employment. Boosting participation can mean encouraging older individuals back into the workplace, and retirement policies are likely to be examined carefully to see if they remain fit for purpose.
People are living longer, healthier lives – this is something we should celebrate. And the trend changes the way we think about work and our working lives: projections by the OECD suggest that almost one in 10 of the UK labour force will be over 60 by 2030.
Businesses value the skills and experience of older members of the workforce and are increasingly flexible about how they manage employees who want to delay retirement.
In future, more people will want to work on and employers will increasingly welcome that. It is equally likely that the explosion in flexible working we have seen in the past few years will help people stage their retirement over a longer period.
Working longer is an integral part of coping with the demands that our ageing society will place on pension provision.
These developments are welcome, but everyone will want – and need – to retire from work at some stage. We will still require a framework for retirement which includes a constructive discussion between employer and employee, and a hook on which to hang that conversation. Currently, this is delivered through the right to request continuing to work that all employees have when approaching retirement age, but it would not be possible without a set default retirement age.
This is not a philosophical argument but a practical issue: the default retirement age (DRA) is an essential part of employment practice, enabling businesses to plan and develop their workforces.
In its absence, workforce planning, staff development and business innovation would become harder – and there would be an increased risk of age- based litigation. Managing the transition to retirement would be more difficult for firms and employees, who might eventually have to be dismissed on competence grounds even where they have a long history of good work with the company.
For businesses to operate effectively, an alternative framework will have to be developed to either remodel or replace the DRA. The Government must address the practical concerns of business in this area, as a vacuum will create uncertainty for employers and employees. We need a debate about how people retire and what the correct legislative structure is to smooth the transition.
Monday, June 7, 2010
Osborne to announce CGT exemptions for over-65s
Chancellor George Osborne is due to announce a number of concessions in the planned capital gains tax (CGT) rise, including exemption for over-65s, according to The Sunday Telegraph.
The government has come under fire over its plans to raise CGT from the flat rate of 18% to 'close to' income tax rates. Conservative MP John Redwood has led the charge against the increase and has been supported by businesses and savers - particularly elderly people who have invested in property to fund their retirement.
Tory MPs met with Osborne (pictured) last week to try to cap CGT at 25%, according to the paper, and the chancellor is now looking at a number of exemptions including those for entrepreneurs and those nearing retirement.
A source close to the situation told The Sunday Telegraph that there would be 'generous exemptions'.
The reintroduction of taper relief is also being considered for long-term assets.
Redwood said: 'It seems to me clear that the best answer is to charge 40% on short-term gains and taper it down to a much lower rate for long-term gains.'
The government has come under fire over its plans to raise CGT from the flat rate of 18% to 'close to' income tax rates. Conservative MP John Redwood has led the charge against the increase and has been supported by businesses and savers - particularly elderly people who have invested in property to fund their retirement.
Tory MPs met with Osborne (pictured) last week to try to cap CGT at 25%, according to the paper, and the chancellor is now looking at a number of exemptions including those for entrepreneurs and those nearing retirement.
A source close to the situation told The Sunday Telegraph that there would be 'generous exemptions'.
The reintroduction of taper relief is also being considered for long-term assets.
Redwood said: 'It seems to me clear that the best answer is to charge 40% on short-term gains and taper it down to a much lower rate for long-term gains.'
Monday, May 24, 2010
Money-saving tips to beat inflation
1 Buy UK-produced fruit and vegetables
Apparently that unpronounceable Icelandic volcano is partly responsible for the price of produce going up: fruit and veg supplies are stuck in their land of origin, increasing the price of the produce that is in store over here. So instead of buying overpriced beans and berries, why not follow Nigel Slater's lead and get stuck into home-grown asparagus and the season's first broad beans.
2 Shop around for petrol
Asda has just cut its prices by 2p to 115.9p a litre, hopefully setting a trend that other petrol retailers will follow. Keep an eye on your local forecourts.
3 Invest in a National Savings & Investments (NS&I) inflation-linked savings certrificate
These are designed to give savers a guaranteed tax-free rate of return, higher than inflation measured by the Retail Prices Index (RPI), if held for the full certificate term. They are currently available in three- and five-year terms and are sold in issues which allow savers to invest up to £15,000 in each.
4 Use discount vouchers
It's almost impossible to visit certain restaurants nowadays without seeing whole forests of vouchers being waved at waiters, and the Guardian and Observer now have their own discount voucher site at www.guardianvouchercodes.co.uk. If you are based in London you could try a new one called Crowdity (www.crowdity.com). This enables you to get big discounts (such as a comedy evening with three-course dinner at Jongleurs for £5 instead of £40) – provided you can get enough friends to agree to take it up.
5 Ask for a pay rise
Okay, it is pretty unlikely in the current economic climate, but if you go about it the right way and you deserve one, you could surprise your employer into action. Gill Corkindale, writing in the Harvard Business Review, says it is important to identify whether or not your company is in a financial position to give you a rise – if the answer is yes, make sure that you are well known in your company (for the right reasons) and that your contributions are noted at appraisals. Then determine a realistic figure to aim for and pick the right time to ask. Above all, don't become emotional about it.
6 Find ways to earn extra cash
If your boss says no, think of other ways to earn a bit of extra cash. We're interested in (but have yet to try) the OnePoll iPhone app, which apparently allows you to earn money by completing surveys. The app is free and OnePoll pays between 10p and £5 for each survey of between 10 and 20 questions. Once users have reached £40 the cash is transferred directly to their PayPal or bank account.
7 Cycle to work
Halifax believes that taking to two wheels will increase in popularity this summer because of the high cost of petrol. The bank, rather cynically, is reminding cyclists to be aware of the increased risk of bike theft.
8 Forage
We're coming to that time of year when food becomes widely available for free in the countryside. Currently gracing our grassy verges are nettles and wild garlic– good for soup or with rabbit, or as Skordalia, a garlicky Greek dip. And although they are a bit late this year, there will soon be enough elderflowers to make champagne.
9 Pay down your debts
While interest rates paid on savings accounts are pitiful, banks are still managing to charge huge amounts for borrowing – an average rate of 18.3% for credit cards and 12.4% for personal loans, according to comparison website Moneynet. If you already have savings to cover emergencies, use your spare cash to pay off credit.
10 Book your summer holiday in the eurozone
According to Duncan Higgins of foreign exchange company Caxton FX, sterling has slipped drastically against the US, New Zealand, Canadian and Australian dollars, but the euro is in an even more dire state than the pound, thanks to Greece's difficulties. The other advantage of sticking to Europe, of course, is that you don't have to take a plane.
Apparently that unpronounceable Icelandic volcano is partly responsible for the price of produce going up: fruit and veg supplies are stuck in their land of origin, increasing the price of the produce that is in store over here. So instead of buying overpriced beans and berries, why not follow Nigel Slater's lead and get stuck into home-grown asparagus and the season's first broad beans.
2 Shop around for petrol
Asda has just cut its prices by 2p to 115.9p a litre, hopefully setting a trend that other petrol retailers will follow. Keep an eye on your local forecourts.
3 Invest in a National Savings & Investments (NS&I) inflation-linked savings certrificate
These are designed to give savers a guaranteed tax-free rate of return, higher than inflation measured by the Retail Prices Index (RPI), if held for the full certificate term. They are currently available in three- and five-year terms and are sold in issues which allow savers to invest up to £15,000 in each.
4 Use discount vouchers
It's almost impossible to visit certain restaurants nowadays without seeing whole forests of vouchers being waved at waiters, and the Guardian and Observer now have their own discount voucher site at www.guardianvouchercodes.co.uk. If you are based in London you could try a new one called Crowdity (www.crowdity.com). This enables you to get big discounts (such as a comedy evening with three-course dinner at Jongleurs for £5 instead of £40) – provided you can get enough friends to agree to take it up.
5 Ask for a pay rise
Okay, it is pretty unlikely in the current economic climate, but if you go about it the right way and you deserve one, you could surprise your employer into action. Gill Corkindale, writing in the Harvard Business Review, says it is important to identify whether or not your company is in a financial position to give you a rise – if the answer is yes, make sure that you are well known in your company (for the right reasons) and that your contributions are noted at appraisals. Then determine a realistic figure to aim for and pick the right time to ask. Above all, don't become emotional about it.
6 Find ways to earn extra cash
If your boss says no, think of other ways to earn a bit of extra cash. We're interested in (but have yet to try) the OnePoll iPhone app, which apparently allows you to earn money by completing surveys. The app is free and OnePoll pays between 10p and £5 for each survey of between 10 and 20 questions. Once users have reached £40 the cash is transferred directly to their PayPal or bank account.
7 Cycle to work
Halifax believes that taking to two wheels will increase in popularity this summer because of the high cost of petrol. The bank, rather cynically, is reminding cyclists to be aware of the increased risk of bike theft.
8 Forage
We're coming to that time of year when food becomes widely available for free in the countryside. Currently gracing our grassy verges are nettles and wild garlic– good for soup or with rabbit, or as Skordalia, a garlicky Greek dip. And although they are a bit late this year, there will soon be enough elderflowers to make champagne.
9 Pay down your debts
While interest rates paid on savings accounts are pitiful, banks are still managing to charge huge amounts for borrowing – an average rate of 18.3% for credit cards and 12.4% for personal loans, according to comparison website Moneynet. If you already have savings to cover emergencies, use your spare cash to pay off credit.
10 Book your summer holiday in the eurozone
According to Duncan Higgins of foreign exchange company Caxton FX, sterling has slipped drastically against the US, New Zealand, Canadian and Australian dollars, but the euro is in an even more dire state than the pound, thanks to Greece's difficulties. The other advantage of sticking to Europe, of course, is that you don't have to take a plane.
Sunday, May 9, 2010
Land Rover creates 275 manufacturing jobs
Automotive manufacturer Land Rover has announced the creation of 275 temporary jobs at its manufacturing plant in Solihull, West Midlands.
A spokesperson told Recruiter that the firm was looking for “skilled” manufacturing workers due to increased demand for its 2010 model year vehicles.
A spokesperson told Recruiter that the firm was looking for “skilled” manufacturing workers due to increased demand for its 2010 model year vehicles.
Monday, April 26, 2010
Car Insurance Premiums Take A Breather, But It’s Only Temporary
According to the latest benchmark AA British Insurance Premium Index, which tracks the movement of both home and car insurance premiums every quarter, the average quoted premium for a comprehensive car insurance policy fall by 3.2 per cent.
Simon Douglas, director of AA Insurance, says that while the sudden stall in the upward premium trend is a surprise he points out that a respite of this sort isn’t uncommon during the first quarter. He said “Most years we have seen insurers hold their premiums during the first quarter of the year, when there is greatest competition for business. It’s when most cars are sold and historically, it’s when most car policies are renewed.”
The Shoparound index, which is closer to the premiums customers can expect to pay if they shop around, showed modest rises over the first quarter, suggesting that the cheapest premiums on the market are continuing to increase faster.
Comparison sites such as Quotezone, Gocompare or Confused.com can help you compare car insurance quotes and help you ensure you get the cover you need at the best price.
Douglas believes that after the first quarter, premiums will resume their upward trend and expects premiums over the next two quarters to show significant rises taking increases into double digits by the end of the year.
He said “Insurers no longer have reserves on which to call in order to keep premium rises in check. The same pressures as last year continue to force insurers to increase premiums: fraud and personal injury claims especially remain a significant concern.”
Despite the respite, car insurance premiums have risen by more than 13% since this time last year.
As Lee Griffin, business development director at Gocompare.com, comments, “”Alarm bells should be ringing when the car insurance renewal quote drops through the letter box this year. Don’t be fooled by any respite in premium increases.
“When premiums are rising it is more important than ever to check what other insurers could offer you. If you happen to be with the wrong insurer at the moment, you could be facing a hefty rise. It is often possible to get very similar cover for a much lower rate simply because each insurer will have a very different view of you as a risk and some insurers will not have increased their rates as much as others.”
Simon Douglas, director of AA Insurance, says that while the sudden stall in the upward premium trend is a surprise he points out that a respite of this sort isn’t uncommon during the first quarter. He said “Most years we have seen insurers hold their premiums during the first quarter of the year, when there is greatest competition for business. It’s when most cars are sold and historically, it’s when most car policies are renewed.”
The Shoparound index, which is closer to the premiums customers can expect to pay if they shop around, showed modest rises over the first quarter, suggesting that the cheapest premiums on the market are continuing to increase faster.
Comparison sites such as Quotezone, Gocompare or Confused.com can help you compare car insurance quotes and help you ensure you get the cover you need at the best price.
Douglas believes that after the first quarter, premiums will resume their upward trend and expects premiums over the next two quarters to show significant rises taking increases into double digits by the end of the year.
He said “Insurers no longer have reserves on which to call in order to keep premium rises in check. The same pressures as last year continue to force insurers to increase premiums: fraud and personal injury claims especially remain a significant concern.”
Despite the respite, car insurance premiums have risen by more than 13% since this time last year.
As Lee Griffin, business development director at Gocompare.com, comments, “”Alarm bells should be ringing when the car insurance renewal quote drops through the letter box this year. Don’t be fooled by any respite in premium increases.
“When premiums are rising it is more important than ever to check what other insurers could offer you. If you happen to be with the wrong insurer at the moment, you could be facing a hefty rise. It is often possible to get very similar cover for a much lower rate simply because each insurer will have a very different view of you as a risk and some insurers will not have increased their rates as much as others.”
Tuesday, March 30, 2010
Friday, March 19, 2010
Mortgages under 5% are back in bloom
The possibility of securing a mortgage rate below 5% has greatly improved in recent weeks, in a positive sign for would-be home buyers.
Home mortgage rates fell for the sixth straight week, according to two key measures, with one of them pointing to a sub-5% rate for the 30-year fixed loan for the second week in a row.
Freddie Mac's (FRE, Fortune 500) weekly report said the 30-year rate slipped to 4.87% for the week ended Thursday, the lowest since May. According to the mortgage backer, last week's rates stood at 4.94%.
Mortgage tracker Bankrate.com said the average 30-year fixed loan slipped to 5.22% from 5.25% the previous week. The 15-year fixed rate also fell, Bankrate said, to 4.6% from 4.64% the week before.
The 30-year rate is influenced by the benchmark 10-year note's yield, which moves in the opposite direction of its price. Treasury prices have risen over the past week as $78 billion worth of auctions received above-average demand.
"Another disappointing employment report had investors questioning the strength and sustainability of the economic rebound," the Bankrate report said. "The resulting uncertainty drove investors into the safety of government and mortgage-backed bonds."
"Not even a substantial auction of government debt has been enough to derail the streak of declining mortgage rates," the Bankrate report said.
Rates are returning to levels not seen since the spring when, in an effort to cap mortgage rates, the Federal Reserve began a campaign to buy back $300 billion in Treasurys. The Fed hoped that it would spark demand and keep yields -- and therefore, mortgage rates -- in check.
Mortgage rates fell as refinancings abounded. But those benefits seemed to wear off, as rates started on a tear in the summer. By June, the benchmark 10-year bond's yield had increased steadily to hover around 4%.
Now the central bank has less than $15 billion left to spend on its buyback program, which led some investors to worry that yields would soar again. So far, that's not the case.
On Wednesday, reports said Democratic congressional leaders were working to extend a $8,000 tax credit for first-time home buyers past the Nov. 30 expiration date and could even make it available to current homeowners who buy a new house.
Homeowners have received a boost from both the tax credit and the lower rates -- last year, the average 30-year fixed mortgage rate was 6.2%, according to Bankrate.
To translate the difference in mortgage rate into dollars, consider a $200,000 loan. At last year's rate of 6.2%, the monthly payment would be $1,224.94, or $124 higher than the monthly payment at the current rate.
The low rates helped mortgage applications surge by 16.4% last week, according to a separate report.
Home mortgage rates fell for the sixth straight week, according to two key measures, with one of them pointing to a sub-5% rate for the 30-year fixed loan for the second week in a row.
Freddie Mac's (FRE, Fortune 500) weekly report said the 30-year rate slipped to 4.87% for the week ended Thursday, the lowest since May. According to the mortgage backer, last week's rates stood at 4.94%.
Mortgage tracker Bankrate.com said the average 30-year fixed loan slipped to 5.22% from 5.25% the previous week. The 15-year fixed rate also fell, Bankrate said, to 4.6% from 4.64% the week before.
The 30-year rate is influenced by the benchmark 10-year note's yield, which moves in the opposite direction of its price. Treasury prices have risen over the past week as $78 billion worth of auctions received above-average demand.
"Another disappointing employment report had investors questioning the strength and sustainability of the economic rebound," the Bankrate report said. "The resulting uncertainty drove investors into the safety of government and mortgage-backed bonds."
"Not even a substantial auction of government debt has been enough to derail the streak of declining mortgage rates," the Bankrate report said.
Rates are returning to levels not seen since the spring when, in an effort to cap mortgage rates, the Federal Reserve began a campaign to buy back $300 billion in Treasurys. The Fed hoped that it would spark demand and keep yields -- and therefore, mortgage rates -- in check.
Mortgage rates fell as refinancings abounded. But those benefits seemed to wear off, as rates started on a tear in the summer. By June, the benchmark 10-year bond's yield had increased steadily to hover around 4%.
Now the central bank has less than $15 billion left to spend on its buyback program, which led some investors to worry that yields would soar again. So far, that's not the case.
On Wednesday, reports said Democratic congressional leaders were working to extend a $8,000 tax credit for first-time home buyers past the Nov. 30 expiration date and could even make it available to current homeowners who buy a new house.
Homeowners have received a boost from both the tax credit and the lower rates -- last year, the average 30-year fixed mortgage rate was 6.2%, according to Bankrate.
To translate the difference in mortgage rate into dollars, consider a $200,000 loan. At last year's rate of 6.2%, the monthly payment would be $1,224.94, or $124 higher than the monthly payment at the current rate.
The low rates helped mortgage applications surge by 16.4% last week, according to a separate report.
Wednesday, March 10, 2010
Jobless claims bill OK'd by Senate
The Senate on Wednesday approved a wide-ranging bill that would push back the deadline to file for extended unemployment insurance until year-end and extends dozens of expired tax breaks.
The bill, passed by a 62-36 vote, is the latest job creation effort to go before lawmakers, though it contains virtually no new initiatives to boost employment. Its price tag has wavered between $140 billion and $150 billion, which is partially offset. Its next stop is the House, where a quick passage is anything but assured.
Facebook Digg Twitter Buzz Up! Email Print Comment on this story
Lawmakers have come under pressure from both the White House and unemployed Americans to do more to spur hiring. But after many speeches, officials have enacted little to help the nearly 15 million looking for work.
The latest efforts -- which include a $15 billion job creation initiative that the Senate will take up next -- don't sit well with members from either side of the aisle. Some say that more must be done to boost employment. Others, particularly Congressional Republicans, have voiced concerns about adding to the deficit.
While the House passed a comprehensive $154 billion job creation bill in December, the Senate has opted to address the unemployment issue with a series of smaller measures. Senate Majority Leader Harry Reid, D-Nev., has said he will soon unveil additional efforts, including those aimed at small businesses.
In this bill
The bill passed Wednesday would push back the deadline to file for extended jobless benefits and the federal subsidy for COBRA health insurance until Dec. 31.
Federal unemployment benefits kick in after the basic state-funded 26 weeks of coverage expire. These federal benefits, worth up to 73 weeks, are divided into tiers, and the jobless must apply each time they move into a new tier.
The measure would also extend dozens of tax provisions -- including allowing teachers to deduct education expenses and providing businesses a research and development credit -- that expired at the end of last year.
"Getting Americans back to work is a critical priority and extending the tax cuts and benefits in this bill will help build the stable environment we need for job creation," said Senate Finance Committee Chairman Max Baucus, D-Mont., who co-sponsored the bill.
It would also temporarily halt a 21% reduction in Medicare physician reimbursement rates. And it would send another $25 billion to the states to help them fund their Medicaid programs for another six months.
The bill also extends two Recovery Act provisions for small businesses. It provides $354 million to continue funding the increased Small Business Administration guarantee and fee waiver through year's end.
Next up
Next up is a $15 billion bill that would:
--Exempt employers from Social Security payroll taxes on new hires who were unemployed.
--Fund highway and transit programs through 2010.
--Extend a tax break for business that spend money on capital investments, such as equipment purchases.
--Expand the use of the Build America Bonds program, which helps states and municipalities fund capital construction projects.
The Senate already passed this measure, but then the House amended it last week, sending it back to the Senate. Should it pass again, this time unchanged, the bill would go to President Obama for his signature.
The bill, passed by a 62-36 vote, is the latest job creation effort to go before lawmakers, though it contains virtually no new initiatives to boost employment. Its price tag has wavered between $140 billion and $150 billion, which is partially offset. Its next stop is the House, where a quick passage is anything but assured.
Facebook Digg Twitter Buzz Up! Email Print Comment on this story
Lawmakers have come under pressure from both the White House and unemployed Americans to do more to spur hiring. But after many speeches, officials have enacted little to help the nearly 15 million looking for work.
The latest efforts -- which include a $15 billion job creation initiative that the Senate will take up next -- don't sit well with members from either side of the aisle. Some say that more must be done to boost employment. Others, particularly Congressional Republicans, have voiced concerns about adding to the deficit.
While the House passed a comprehensive $154 billion job creation bill in December, the Senate has opted to address the unemployment issue with a series of smaller measures. Senate Majority Leader Harry Reid, D-Nev., has said he will soon unveil additional efforts, including those aimed at small businesses.
In this bill
The bill passed Wednesday would push back the deadline to file for extended jobless benefits and the federal subsidy for COBRA health insurance until Dec. 31.
Federal unemployment benefits kick in after the basic state-funded 26 weeks of coverage expire. These federal benefits, worth up to 73 weeks, are divided into tiers, and the jobless must apply each time they move into a new tier.
The measure would also extend dozens of tax provisions -- including allowing teachers to deduct education expenses and providing businesses a research and development credit -- that expired at the end of last year.
"Getting Americans back to work is a critical priority and extending the tax cuts and benefits in this bill will help build the stable environment we need for job creation," said Senate Finance Committee Chairman Max Baucus, D-Mont., who co-sponsored the bill.
It would also temporarily halt a 21% reduction in Medicare physician reimbursement rates. And it would send another $25 billion to the states to help them fund their Medicaid programs for another six months.
The bill also extends two Recovery Act provisions for small businesses. It provides $354 million to continue funding the increased Small Business Administration guarantee and fee waiver through year's end.
Next up
Next up is a $15 billion bill that would:
--Exempt employers from Social Security payroll taxes on new hires who were unemployed.
--Fund highway and transit programs through 2010.
--Extend a tax break for business that spend money on capital investments, such as equipment purchases.
--Expand the use of the Build America Bonds program, which helps states and municipalities fund capital construction projects.
The Senate already passed this measure, but then the House amended it last week, sending it back to the Senate. Should it pass again, this time unchanged, the bill would go to President Obama for his signature.
Wednesday, January 13, 2010
Taxpayer advocate to IRS: Don't lien too heavily
NEW YORK (CNNMoney.com) -- The tax man has gotten a lot more aggressive in slapping liens on taxpayers who are seriously delinquent in their payments.
In fact, the Internal Revenue Service issued 475% more liens last year than it did in 1999.
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Rates provided by Bankrate.com. But it hasn't been doing so judiciously, which is causing unnecessary harm to some taxpayers and, ironically, to federal coffers, according to national taxpayer advocate Nina Olson.
"Taxpayers are being greatly harmed for very little benefit to the government," Olson told CNNMoney.
Olson is a government official whose job is to highlight for Congress the most serious problems facing taxpayers. Lien issuance makes her top 5 list.
In her annual report to Congress, released on Wednesday, Olson says the IRS must do more to assess whether the benefits of a tax lien outweigh its harm to the taxpayer.
The IRS imposes a lien on a person's property to ensure the government is first in line to be paid if a delinquent taxpayer sells or refinances property. The lien is issued when an agent determines a taxpayer can't pay up.
But IRS agents only take into account a person's income and expenses and not other debts and assets when sizing up his ability to pay, according to Olson. Then, the decision to issue the lien is typically not reviewed by higher-ups at the agency.
"Employees should look at all the facts and circumstances," said Olson.
That's because issuing a lien against someone who can't pay and who doesn't have any assets can create a "lose-lose" proposition for both the taxpayer and for the government, she noted in her report.
Here's why: A lien slams a taxpayer's credit score and can remain on a credit report anywhere from 10 years to 15 years or more, depending on the policy of the credit bureau.
That means it harms a person's ability to get an affordable loan. And it can hurt his chances of getting a job or an insurance policy since employers and insurers often check credit history. So potentially his costs go up while his earning potential goes down along with his potential to be a source of tax revenue for Uncle Sam in the future.
Worst case scenario: It may mean the taxpayer ends up needing to tap Uncle Sam for cash.
"If the filing of a tax lien drives up a taxpayer's costs and renders him or her unemployed or underemployed, the government may be forced to make outlays in the form of unemployment benefits, food stamps and the like," Olson wrote.
To measure the effectiveness of liens in collecting revenue, Olson's office tracked the cases of 270,000 taxpayers who first had a tax balance due in 2002 and on whom the IRS later put a tax lien.
One of the findings: Lien issuance doesn't boost revenue collection.
Last year the IRS issued 966,000 liens, up from 168,000 in 1999. During the same decade, however, the money the agency collected in delinquent cases fell by 7.4% after adjusting for inflation.
Another finding from the study: In many cases where money is recovered, it's not because of the lien.
More than 80% of the money the IRS collected was the result of of other measures - such as the withholding of a taxpayer's refunds.
The IRS contested Olson's finding. It said the study's methodology - for instance, only considering payments that had been coded as a lien payment - "limits the ability to draw meaningful conclusions" since the study ended up excluding 56% of the payments made.
In addition, liens can spur taxpayers to pay up, the agency said.
"Taxpayer actions such as making installment payments, filing an offer in compromise or paying the liability in full may be motivated" by the filing of a lien or even the threat of one, the IRS said.
And it did not agree with a recommendation that employees get managerial approval for liens in cases where the taxpayer has no current assets.
The story isn't over. Olson said she would continue to press her recommendations with the IRS. And key lawmakers are already weighing in.
"I worry that the IRS is reverting to some old habits to taxpayers' detriment," Sen. Charles Grassley, R-Iowa, said in a statement. "The IRS has to use its discretion to determine when liens are the best course to improve tax collection and when they are just a knee-jerk enforcement tactic that will do more harm than good."
In fact, the Internal Revenue Service issued 475% more liens last year than it did in 1999.
Facebook Digg Twitter Buzz Up! Email Print Comment on this story
CDs & Money Market
MMA 0.94%
$10K MMA 1.03%
6 month CD 0.97%
1 yr CD 1.42%
5 yr CD 2.66%
Find personalized rates:
Rates provided by Bankrate.com. But it hasn't been doing so judiciously, which is causing unnecessary harm to some taxpayers and, ironically, to federal coffers, according to national taxpayer advocate Nina Olson.
"Taxpayers are being greatly harmed for very little benefit to the government," Olson told CNNMoney.
Olson is a government official whose job is to highlight for Congress the most serious problems facing taxpayers. Lien issuance makes her top 5 list.
In her annual report to Congress, released on Wednesday, Olson says the IRS must do more to assess whether the benefits of a tax lien outweigh its harm to the taxpayer.
The IRS imposes a lien on a person's property to ensure the government is first in line to be paid if a delinquent taxpayer sells or refinances property. The lien is issued when an agent determines a taxpayer can't pay up.
But IRS agents only take into account a person's income and expenses and not other debts and assets when sizing up his ability to pay, according to Olson. Then, the decision to issue the lien is typically not reviewed by higher-ups at the agency.
"Employees should look at all the facts and circumstances," said Olson.
That's because issuing a lien against someone who can't pay and who doesn't have any assets can create a "lose-lose" proposition for both the taxpayer and for the government, she noted in her report.
Here's why: A lien slams a taxpayer's credit score and can remain on a credit report anywhere from 10 years to 15 years or more, depending on the policy of the credit bureau.
That means it harms a person's ability to get an affordable loan. And it can hurt his chances of getting a job or an insurance policy since employers and insurers often check credit history. So potentially his costs go up while his earning potential goes down along with his potential to be a source of tax revenue for Uncle Sam in the future.
Worst case scenario: It may mean the taxpayer ends up needing to tap Uncle Sam for cash.
"If the filing of a tax lien drives up a taxpayer's costs and renders him or her unemployed or underemployed, the government may be forced to make outlays in the form of unemployment benefits, food stamps and the like," Olson wrote.
To measure the effectiveness of liens in collecting revenue, Olson's office tracked the cases of 270,000 taxpayers who first had a tax balance due in 2002 and on whom the IRS later put a tax lien.
One of the findings: Lien issuance doesn't boost revenue collection.
Last year the IRS issued 966,000 liens, up from 168,000 in 1999. During the same decade, however, the money the agency collected in delinquent cases fell by 7.4% after adjusting for inflation.
Another finding from the study: In many cases where money is recovered, it's not because of the lien.
More than 80% of the money the IRS collected was the result of of other measures - such as the withholding of a taxpayer's refunds.
The IRS contested Olson's finding. It said the study's methodology - for instance, only considering payments that had been coded as a lien payment - "limits the ability to draw meaningful conclusions" since the study ended up excluding 56% of the payments made.
In addition, liens can spur taxpayers to pay up, the agency said.
"Taxpayer actions such as making installment payments, filing an offer in compromise or paying the liability in full may be motivated" by the filing of a lien or even the threat of one, the IRS said.
And it did not agree with a recommendation that employees get managerial approval for liens in cases where the taxpayer has no current assets.
The story isn't over. Olson said she would continue to press her recommendations with the IRS. And key lawmakers are already weighing in.
"I worry that the IRS is reverting to some old habits to taxpayers' detriment," Sen. Charles Grassley, R-Iowa, said in a statement. "The IRS has to use its discretion to determine when liens are the best course to improve tax collection and when they are just a knee-jerk enforcement tactic that will do more harm than good."
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