Economic Recovery Measures
Today, the Congressional Quarterly reported that a coalition of airport authorities, port authorities, and student loan lenders is pushing Congress to extend one of the stimulus tax breaks on “private activity” municipal bonds. The stimulus exempted these bonds from the Alternative Minimum Tax (AMT) for 2009 and 2010.
The IMF has recently released its monthly World Economic Outlook, the IMF’s premier publication on the state and health of both the global economy and member country economies.
The report states that a global recovery has taken root but that it will likely be some time before employment begins to improve.
In response to high unemployment numbers, the Obama Administration is discussing the idea of a tax credit for employers that create new jobs. House Republican whip Eric Cantor demonstrated the likely broad bipartisan appeal of this type of a tax credit by saying, “There is a lot of traction for this kind of idea.
For the U.S. taxpayer, last weekend’s International Monetary Fund (IMF) meetings in Turkey were a reminder of the importance of global cooperation to tackle the economic and financial crisis. As we (hopefully) enter a new phase of economic and financial recovery, global cooperation will continue to be critical for taxpayer interests.
Saturday marked the one-year anniversary of the Troubled Asset Relief Program (TARP), established as part of the Emergency Economic Stabilization Act of 2008. Originally intended to purchase so-called “toxic-assets” and take them off of banks’ balance sheets, the $700 billion TARP program has been used by both the Bush and Obama administrations in order to help stabilize the financial sector and the economy more broadly.
This weekend, there have been a number of editorials about fiscal and budget policy. Among them:
This week, the FDIC issued a Notice of Proposed Rulemaking (NPR) to require insured banks to prepay premiums for Q4 2009 all the way through 2012. The FDIC estimates that this change would raise around $45 billion.
Each FDIC insured institution must pay the FDIC a risk-adjusted quarterly premium for the insurance. Rates vary from 12 cents per $100 in deposits for the safest banks to 45 cents for those considered to be risky.
It would be easy to dismiss the recent G-20 Summit in Pittsburgh as just more political babble, more empty business as usual just among more countries – but you would be wrong. The Summit’s agenda was pragmatic and ambitious, perhaps one of the most ambitious in awhile. And, contrary to what some pundits cautioned, the array of possible deliverables in the next year is mind-numbing, from fiscal policy to financial sector reform to energy policy.
On Friday evening, the FDIC reported that it has taken over an additional bank (Georgian Bank) for a cost to the FDIC of around $892 million. This brings the total number of failed banks since the beginning of 2008 to 111. Total deposits of all failed banks now equal $87.08 billion for 2009 and over $321 billion since the beginning of 2008, all at an estimated cost to the FDIC of just under $48 billion.