Where to keep your cash amid high inflation and rising interest rates: It’s ‘a little tricky,’ says expert

US Top News and Analysis 

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Investors have many options when saving for short-term goals, and those choices have become more complicated amid high inflation and rising interest rates.

While there have been signs of slowing inflation, the Federal Reserve is expecting higher interest rates to continue.

“It looks like this year might be a little tricky,” said Ken Tumin, founder and editor of DepositAccounts.com, a website that tracks the most competitive options for savings.  

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Although the Fed’s federal funds rate has reached the highest level in 15 years, savings account interest rates haven’t matched these hikes, Tumin explained. 

As of Jan. 4, online high-yield savings accounts were paying an average of 3.48%, according to DepositAccounts, with some smaller banks reaching 4%. 

Still, if you’re keeping money in a savings account, Tumin said it’s better to stick with established banks.

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He cautioned savers to be “real careful” with financial technology companies partnering with banks for checking and savings accounts and other cash products. “You should go directly to FDIC-insured banks, rather than through fintechs,” Tumin said. 

It’s a ‘strange environment’ for certificates of deposit

Another option for savings, certificates of deposit, or CDs, may present opportunities for short-term savers, Tumin said. 

“It’s kind of a strange environment where we actually can get a higher rate for short-term CDs than long-term CDs,” he said.

It’s kind of a strange environment where we actually can get a higher rate for short-term CDs than long-term CDs.
Ken Tumin
Founder and editor of DepositAccounts.com

While Tumin expects savings account interest to rise, these rates may not match one-year CDs, which have more closely followed the Fed, and were offering an average of 4.81% as of Jan. 4, according to DepositAccounts.

“From that point of view, you might be better off with a one-year CD than an online savings account over the next year,” he said.

Series I bonds are still a ‘great consideration’ for short-term investors

As inflation has soared, Series I bonds, an inflation-protected and nearly risk-free asset, have also become a popular choice for short-term savings.

I bonds are currently paying 6.89% annual interest on new purchases through April, down from the 9.62% yearly rate offered from May through October 2022.

“These have become very popular among our clients as the rates have skyrocketed,” said certified financial planner Eric Roberge, founder of Beyond Your Hammock in Boston. “This makes them great considerations for shorter-term investors.”

I bonds earn monthly interest with two parts: a fixed rate, which may change every six months for new purchases but stays the same after buying, and a variable rate, which changes every six months based on inflation.

While the current 6.89% annual rate may be appealing, the yield may change in May, based on six months of inflation data. Since you can’t access the money for one year, there’s the potential to lock in a lower rate after the first six months. 

Still, if you need your money in one to five years, this could be a choice to consider, Roberge said.

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Polestar 2 BST 270 Shows Off Its Track Prowess At Ascari Circuit

Carscoops 

If you were to look at the Polestar 2 BST 270 from a distance, you probably wouldn’t think of it as a track-tuned performer. But that’s exactly what it is.

Just like the standard Polestar 2 Long Range Dual Motor, the BST 270 is driven by a pair of electric motors that combine to produce 470 hp and 501 lb-ft (680 Nm) of torque. A series of upgrades were then made to lift the EV’s performance with a particular focus on improving its handling.

For starters, Polestar’s engineers have fitted the car with a set of bespoke two-way adjustable Öhlins dampers. Springs that are 20 per cent stiffer are also fitted, as is a front strut bar while the 4-piston Brembo brakes of the standard model remain untouched.

Read: Polestar 2 ‘Beast’ Edition 270 Goes From Concept To 470 HP Limited Special Priced At $75,500

To show what the car is all about, Polestar chief test engineer Joakim Rydolm had the opportunity to test it at the beautiful Ascari circuit in Ronda, Spain. During the clip, Rydolm talks about the upgrades made to the car and how these alterations improve the car’s track credentials.

A handful of visual alterations also distinguish the Polestar 2 BST 270 from lesser variants. For example, it sits on a set of bespoke 21-inch alloy wheels painted black and wrapped in 245/35 Pirelli P Zero tires that were developed specifically for it. The front bumper and side skirts also feature aerodynamic extensions and customers can order it with a matte-black stripe running the length of the car. Shoppers will be able to order the car in either Thunder or Snow paint finishes.

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Coinbase settles with New York regulators, and Messari CEO explains 2023 themes: CNBC Crypto World

US Top News and Analysis 

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Coinbase settles with New York regulators, and Messari CEO explains 2023 themes: CNBC Crypto World

CNBC Crypto World features the latest news and daily trading updates from the digital currency markets and provides viewers with a look at what’s ahead with high-profile interviews, explainers, and unique stories from the ever-changing crypto industry. On today’s show, Ryan Selkis, the CEO of Messari, explains his outlook for Ethereum in 2023.
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China is reopening to tourists, here’s what you need to know

The Points Guy 

On Thursday, the U.S. expects to welcome back Chinese tourists for the first time since 2020, when the Chinese government implemented its now infamous “zero-COVID” policy.

Three days later, as Chinese officials loosen COVID-19 regulations on Jan. 8 (scrapping the previously enforced strict quarantine for all incoming travelers in a government-designated hotel), the U.S. will subject all visitors from China to incoming testing requirements.

As both American and Chinese citizens resume travel between the countries, here’s what you should know about traveling to and from China.

Travelers from China must test to enter the US

Beginning Jan. 5, all travelers from the People’s Republic of China (PRC), as well as the Special Administrative Regions of Hong Kong and Macau, must submit a negative PCR test taken within two days of departure for the U.S., according to the U.S. Centers for Disease Control and Prevention (CDC).

This rule applies to all air travelers aged 2 and older, effective 12:01 a.m. (EST) Friday. However, the rule does not apply to passengers who recently recovered from COVID-19 and tested positive at least 10 days prior to entry.

“CDC is announcing this step to slow the spread of COVID-19 in the United States during the surge in COVID-19 cases in the PRC given the lack of adequate and transparent epidemiological and viral genomic sequence data being reported from the PRC,” the agency said in a press release on Dec. 28. “These data are critical to monitor the case surge effectively and decrease the chance for entry of a novel variant of concern.”

The newly announced testing requirement applies to all inbound air passengers, regardless of nationality or vaccination status, traveling directly from China or via a third country, including those transiting through the U.S.

These testing rules also apply to passengers transiting Incheon International Airport (ICN), Toronto Pearson International Airport (YYZ) and Vancouver International Airport (YVR) on their way to the U.S. if they have been in China within the 10 days preceding entry to the U.S.

“These three transit hubs cover the overwhelming majority of passengers with travel originating in the PRC and the Special Administrative Regions,” the CDC said.

Though the CDC has tasked airlines with confirming receipt of a negative COVID-19 test ahead of flying, passengers are responsible for uploading documentation during the check-in process, either online or with a gate agent. Domestic carriers also noted these changes online; for example, American Airlines says that passengers without a negative test or recovery document won’t be allowed to board the plane.

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Read more: IHG sees a tale of two recoveries between the U.S. and China

“We will continue to monitor travel patterns, adjust our approach as needed, and keep Americans informed in a timely manner,” according to the CDC.

The European Union is also expected to impose mandatory COVID-19 testing on Chinese travelers among its 27 member states this week — following efforts by individual countries, including Italy, France, Spain and Germany, to do so.

“ECDC, together with the EU/EEA Member States and the European Commission has increased its monitoring activities and will revise risk assessments and adjust actions if needed,” the European Centre for Disease Prevention and Control said in a statement on Jan. 3. “ECDC is working closely with the World Health Organization (WHO)/Europe and WHO/Headquarters and is in regular contact with the Chinese Center for Disease Control and Prevention (China CDC) and major CDCs globally.”

Outside of the EU, India and the United Kingdom have done the same.

Current COVID-19 situation in China

The U.S. implementation of testing measures on travelers coming from China is due to a recent surge in new cases among persons in mainland China in December, according to data from both the World Health Organization and The New York Times.

Health and government officials, including the ECDC, have routinely questioned the reliability of COVID-19 data coming from China.

“The number of COVID-19 cases has reached a record high in mainland China, peaking on 2 December 2022,” the ECDC said this week. “In the past three weeks, incidence has fallen, likely also due to a lower number of tests being carried out, resulting in fewer infections being detected.”

Even though the country has administered nearly 3.5 billion vaccine doses as of Nov. 29, 2022, per the WHO, the country has relied on Chinese-made vaccines thus far; these vaccines have shown to be less effective against the omicron variant, according to various reporting, including by NPR.

A boom to travel expected

China’s reopening next week will almost certainly impact the average nightly price of a hotel room in some of the world’s most popular destinations, per industry experts TPG spoke to.

In 2019, Chinese tourists accounted for 4.2% of worldwide tourism — or $154 billion of total spending, according to a recent analysis conducted by AllianceBernstein, a global investment firm. Collectively, China accounted for 12% of the world’s total spending on hotel rooms in 2019. In 2023, it’s practically at zero.

At the same time, we expect to see hotel rates increase in U.S. cities previously frequented by Chinese tourists pre-pandemic, such as San Francisco, Las Vegas and New York City.

Thus, travelers will likely see the biggest impact in major cities still struggling to recover to pre-pandemic hotel rates, namely San Francisco.

“I see a clear positive correlation between demand and pricing,” Richard Clarke, a managing director who covers the hotel industry at Bernstein, told TPG via email. “Those locations that get a lot of Asian visitors have lagged on pricing, so a catch-up on demand should help.”

Although analysts are cautious about forecasting exact numbers specifying how much more expensive hotel rates might get with the return of travelers, they seem to rally around the idea this is good news for hotel owners — especially amid so much economic uncertainty.

“It seems like there’s an only upside, but the exact timing is a little uncertain,” Patrick Scholes, managing director of lodging and leisure equity research at investment bank Truist Securities, said.

Bottom line

The timing of China’s reopening aligns with the Chinese New Year, which begins on Jan. 21 and runs for nearly a month. With many people traveling to China for the largest Chinese holiday of the year, a large spike in new COVID-19 cases is expected.

“We look forward to welcoming Chinese travelers back to the United States,” U.S. Travel Association President and CEO Geoff Freeman said on Dec. 28. “The Biden administration’s highly targeted COVID testing approach is reasonable and appreciated.”

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South Korea: Talks with US on management of nukes underway

SEOUL, South Korea (AP) — South Korea maintained that Seoul and Washington are discussing its involvement in U.S. nuclear weapons management in the face of intensifying North Korean threats, after President Joe Biden denied that the allies were discussing joint nuclear exercises.

The purported difference came as South Korea is seeking a greater U.S. security commitment after North Korea’s record number of missile tests and escalating nuclear doctrine last year caused security jitters among many people in the South.

Some experts say South Korea’s statement on the discussion is likely largely based on an agreement between their defense chiefs in November to conduct table-top exercises, usually computer simulations, annually and further strengthen the alliance’s information sharing, joint planning and execution. In November, they also reaffirmed the U.S. commitment to providing extended deterrence, a reference to a U.S. promise to use full U.S. capabilities, including nuclear, to protect its allies.

In a newspaper interview published Monday, South Korean President Yoon Suk Yeol said that Seoul and Washington were pushing for joint planning and training involving U.S. nuclear assets and that the United States responded positively to the idea. Asked by a reporter later at the White House about whether the two countries were discussing joint nuclear exercises, Biden replied, “No.”

After Biden’s comments created a brief stir in South Korea, Yoon’s top adviser for press affairs, Kim Eun-hye, issued a statement Tuesday to reconfirm Yoon’s earlier remarks. Kim said the two countries “are discussing an intel-sharing, a joint planning and subsequent joint execution plans over the management of U.S. nuclear assets in response to North Korea’s nuclear (threats).”

The White House National Security Council in a statement on Tuesday said Biden and Yoon have “tasked their teams to plan for an effective coordinated response to a range of scenarios, including nuclear use by North Korea.”

A senior Biden administration official said U.S. and South Korean officials are expected to hold table-top exercises soon to chart out a potential joint response to a range of scenarios, including deployment of a nuclear weapon by the North. The official spoke on the condition of anonymity to discuss planning.

Moon Seong Mook, an analyst for the Seoul-based Korea Research Institute for National Strategy, said Yoon likely was referring to the November agreement on the alliance’s capabilities, which he said definitely include U.S. nuclear assets that are essential to the U.S. extended deterrence commitment.

“South Korea isn’t a nuclear state so it won’t be likely South Korea jointly using U.S. nuclear weapons. But the wording (in the November agreement) meant that South and the U.S. would consult on the operations of U.S. nukes from the planning stage until the training stage,” said Moon, a retired brigadier general.

While some observers say Yoon’s comments to the Chosun Ilbo newspaper didn’t reveal much new development on the issue, Moon said that Yoon might have tried to emphasize efforts to boost the effectiveness of the U.S. extended deterrence because North Korea is escalating its nuclear threats on South Korea. In the interview, Yoon said he finds it difficult to assure his people of a security guarantee with the current levels of U.S. security commitment.

“This is an unnecessary dispute. Neither side was talking inaccurately,” said Park Won Gon, a professor at Seoul’s Ewha Womans University.

“The extended deterrence is a commitment and a promise but not a treaty or a binding one,” Park said. “For South Korea, they trust the U.S. but think there should be ways to institutionalize it because North Korea’s nuclear threats are rising. To do so, (the joint) planning and execution are the key.”

South Korea has no nuclear weapons and is under the protection of a U.S. “nuclear umbrella,” which guarantees a devastating American response in the event of an attack on its ally. But some experts question the effectiveness of such a security commitment, saying the decision to use U.S. nuclear weapons lies with the U.S. president.

Last year, North Korea test-launched more than 70 ballistic and other missiles capable of reaching the U.S. mainland and U.S. allies South Korea and Japan. In September, North Korea also adopted a new law authorizing the preemptive use of its bombs in a broad range of cases, including non-war scenarios.

During a recently ended ruling party meeting, North Korean leader Kim Jong Un ordered the “exponential” expansion of his country’s nuclear arsenal and the mass-production of tactical nuclear weapons missioned with attacking South Korea, as well as the development of a new ICBM tasked with having a “quick nuclear counterstrike” capability — a weapon he needs to strike the mainland.

On Wednesday, Yoon ordered officials to consider ending a 2018 tension-reduction deal with North Korea if the North launches provocations that violate South Korea’s territory, according to Yonhap news agency. It said Yoon made the instruction during a meeting to discuss North Korea’s recent flying of drones that Seoul says crossed the rivals’ border for the first time in five years.

Yoon’s office didn’t provide many details about his government’s discussion with the United States. Some observers say South Korea is seeking to obtain a greater role in the U.S. decision-making process on the deployment of its nuclear assets in times of tensions with North Korea.

Kim Taewoo, a former head of Seoul’s Korea Institute for National Unification, said the reported South Korea-U.S. discussion likely “benchmarked a NATO-style nuclear-sharing arrangement” that allows NATO member states’ warplanes to carry U.S. nuclear weapons. He said the discussion still appears to be falling short of the NATO arrangement because possible nuclear exercises between the two countries would likely be South Korean air force aircraft escorting U.S. aircraft simulating nuclear strikes during joint drills.

“North Korea would take this sensitively. (South Korea and the U.S.) are discussing this to get North Korea to take this sensitively … because that can be a deterrence against North Korea,” Kim Taewoo said. ___

Associated Press White House correspondent Zeke Miller contributed to this report from Washington.

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First ‘gender-queer’ priest in Church of England expresses desire for ‘normalizing’ identity among children

Latest & Breaking News on Fox News 

A non-binary gender-queer Anglican priest in the United Kingdom is on record claiming to use the clerical position in hopes of “normalizing” such behavior among children.

“I try to get involved in, not just in my religious work but outside it, with the local secular LGBT youth groups,” said Rev. Bingo Allison, a Church of England priest in the Diocese of Liverpool who identifies as gender-queer and uses “they/them” pronouns, according to an interview with the Liverpool Echo.

“One of the biggest things is just being a visual representation in my community and going into schools, doing assemblies and making a huge difference in normalizing it for children. When I’m wearing my collar it lets children know that is OK and that there is a place in church and the outside world for people like me,” Allison added.

Allison, who claims to be the first non-binary gender-queer priest in England’s established church, claimed to have discovered a biblical basis for gender fluidity during a late-night reading of Genesis 1:27, which recounts how God created humans male and female.

UK SCHOOL CHAPLAIN SUES AFTER BEING FIRED, REPORTED AS TERRORIST FOR SERMON QUESTIONING LGBTQ ACTIVISTS

“So God created man in his own image, in the image of God created he him; male and female created he them,” reads the verse, which Allison maintained expresses “maleness to femaleness” instead of men and women.

Allison described the revelation as “a deepening spiritual experience” by which God “was guiding me into this new truth about myself.”

CAMBRIDGE DEAN DEFENDS SERMON ABOUT JESUS’ ‘TRANS BODY,’ ‘VAGINAL’ SIDE WOUND BLASTED AS ‘HERESY’

“One of the things that has kept with my ministry ever since is that transition and coming out can and should be a spiritual experience, as well as an emotional and social and sometimes physical one,” Allison told the U.K. outlet. “There is something beautiful about growing into who we were created to be and growing into our authentic selves.”

A third-generation priest and father of three who was ordained at Liverpool Cathedral in 2020, Allison claimed to have grown up in a household that was “strongly religious” and believed homosexuality and transgender behavior to be a “sinful thing.”

But after learning the term “gender-queer” about seven years ago, Allison said “everything suddenly clicked.”

“It was a lot harder than I thought having come out to myself to then remain in the closet,” Allison said. “There were definitely lots of times before when I kind of questioned my identity but growing up in a more conservative form of Christianity meant that it was just so far beyond my imagination.”

In a sermon commemorating Trans Day of Visibility in 2021, Allison likened the plight of transgender people to the suffering of martyrs mentioned in the 11th chapter of Hebrews in the New Testament.

CHURCH OF ENGLAND RECEIVES PETITION TO SCRAP ‘DEEPLY DAMAGING AND WRONG’ TRANSGENDER GUIDANCE FOR CHILDREN

Calvin Robinson, an Anglican deacon in the separatist Free Church of England who recently told Fox News Digital that his ordination in the Church of England was “snatched away” because of his conservative theological views, condemned Allison’s positions and urged others to “call out his heresy and blasphemy.”

“Challenge the Church’s apparent apostasy,” Robinson said. “Don’t resort to ad hominem attacks. We know how this story goes. The conversation gets shifted from truth/lies to ‘bullying.’”

“You can predict it like clockwork,” Robinson continued. “In a week or so, he’ll be back in the headlines of left-wing papers saying he was abused and targeted for his looks. The Church of England won’t rebuke him for his errors, instead it’ll double-down and say it needs to be even more inclusive. Pray for his wife and children and the awful time he must be putting them through with this scandal.”

A spokesperson for the Church of England referred Fox News Digital to the Diocese of Liverpool, which did not respond to a request for comment by time of publication.

CHRISTIAN PARENTS WIN IN COURT AFTER SCHOOL LABELED 6-YEAR-OLD SON POTENTIALLY ‘TRANSPHOBIC’

A box of petitions urging the Church of England to scrap its controversial transgender guidance for primary schools was delivered to Archbishop of Canterbury Justin Welby’s palace in London last month.

Critics claim the guidance maintains children as young as 5 years old should be affirmed in the opposite sex if they identify with it, though the Church of England has said the guidance “is intended as a document to prevent bullying so that all children are afforded their dignity.”

Multiple bishops in the Church of England have publicly urged the institution in recent months to begin conducting same-sex weddings, and the church is slated to vote on the issue during its general synod in February.

 

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Biden says he intends to visit southern border on Mexico trip

Just In | The Hill 

President Biden on Wednesday told reporters that he intends to visit the southern border while he’s in Mexico next week.

The president said that arrangements to visit the border are being worked out but that the visit could take place before he goes to Mexico City for the North American Leaders’ Summit. The summit with Mexican and Canadian leaders is set to start on Jan. 9.

“That’s my intention. We’re working out the details now,” Biden said about visiting the border.

The visit to the southern border would be Biden’s first since taking office. The president has faced criticism for months because he has not visited the border amid the migrant crisis.

The Supreme Court last month ordered that the Title 42 border policy must remain in place, reversing an order from a federal judge in Washington, D.C., who ruled that the Trump-era border policy must end.

Biden, who has been under pressure from Republicans to reinstate Title 42, last week said that the end to the policy is “overdue” but that it has to be enforced in the wake of the court’s decision. Title 42, implemented at the start of the pandemic, allows for migrants to be quickly expelled at the border without asylum processing.

The president has also recently renewed calls for Congress pass comprehensive immigration reform measures and for Republicans to “move past political finger-pointing” and join Democrats to solve the challenge at the border.

The White House, which has tried to declare that the southern border is not open even if Title 42 ends, is asking Congress for $3.5 billion in funding to help with the situation at the southern border.

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Climate impact labels could help promote sustainable food choices: study

Just In | The Hill 

Story at a glance

 Red meat is a key contributor to greenhouse gas emissions. 

New research shows menu labels that warn of red meat’s high climate impact may encourage consumers to opt for more environmentally sustainable options.

However, some consumers may conflate a food’s sustainability with its overall healthfulness. 

Labels placed on fast food items highlighting their high climate impact may sway consumers to make more sustainable choices, new study results show. 

Food accounts for around one-third of all human-made greenhouse gas emissions, while animal-based foods like red meat and dairy products make up a large proportion of these emissions. 

Researchers carried out a randomized clinical trial with over 5,000 participants to determine whether calling attention to red meat’s climate impact could change consumer menu selections. 

Individuals were shown a sample online fast food menu and asked to select an item for dinner. 

A control group received a menu with a quick response code label on all items and no climate labels. Another group received a menu with green low-climate impact labels, positively framing options like fish, chicken, or vegetarian options. The third group received a menu with red high-climate labels on items containing red meat, negatively framing the options. 

Results showed 23 percent more participants in the high climate label group ordered a sustainable, non-red meat option, and ten percent more in the low-climate group ordered a sustainable option, compared with controls.

America is changing faster than ever! Add Changing America to your Facebook or Twitter feed to stay on top of the news.

“In the United States, meat consumption, red meat consumption in particular, consistently exceeds recommended levels based on national dietary guidelines,” researchers wrote in the study. 

“Shifting current dietary patterns toward more sustainable diets with lower amounts of red meat consumed could reduce diet-related [greenhouse gas emissions] by up to 55 [percent].” 

Excess red meat consumption can also be harmful to human health and has been linked with increased risks of diabetes and certain cancers. Fast food restaurants are a key source of red meat in many Americans’ diets, authors noted, adding more than one-third of U.S. individuals consume fast food on a given day.

“These results suggest that menu labeling, particularly labels warning that an item has high climate impact, can be an effective strategy for encouraging more sustainable food choices in a fast food setting,” said lead study author Julia Wolfson in a statement. Wolfson is an associate professor in the department of international health at the Johns Hopkins University Bloomberg School of Public Health. 

Participants were also asked to rate how healthy they perceived their order to be. No food items included in the study were considered healthy based on Nutrition Profile Index scores.

Regardless of the climate label, those who selected a non-beef option perceived their choice to be healthier than those who selected a red meat item, researchers found. 

These results suggest climate labels may make a food item seem more healthy than it is.

“An undeserved health halo conferred to unhealthy menu items could encourage their overconsumption,” said Wolfson. “So we have to look for labeling strategies that create ‘win-wins’ for promoting both more sustainable and healthy choices.”

The randomized trial was carried out online between March and April 2022.

​Climate Change, Changing America, Sustainability, climate impact, red meat, sustainable food Read More 

Moody’s warns of ‘slowcession’ that could last throughout 2023

Just In | The Hill 

Moody’s Analytics warned in a new report that the U.S. could face what it called a “slowcession” this year but maintained that the economy will most likely avoid a full-blown downturn.

“Under almost any scenario, the economy is set to have a difficult 2023,” Moody’s chief economist Mark Zandi said in the January report. “But inflation is quickly moderating, and the economy’s fundamentals are sound. With a bit of luck and some reasonably deft policymaking by the Fed, the economy should avoid an outright downturn.”

Fears of a looming recession have been pervasive throughout the last year, as inflation skyrocketed and the Federal Reserve raised interest rates in an effort to rein in the rising prices.

Two-thirds of economists at 23 major financial institutions predicted that a recession would occur this year, according to a recent survey from the Wall Street Journal.

However, Zandi warned that such recession pessimism could be self-fulfilling.

“Recessions are ultimately a loss of faith — a loss of faith by consumers that they will hold on to their jobs, causing them to curtail their spending, and a loss of faith by businesses that they will be able to sell what they produce, causing them to lay off workers,” he said. “A self-reinforcing vicious cycle — a recession — takes hold.”

Despite recession concerns, there have been positive indicators in recent months, as inflation has continued to slow after reaching 40-year highs last year. The annual inflation rate for November came in at 7.1 percent, down from 7.7 percent in October.

Although that is still much higher than normal, the improving outlook allowed the Federal Reserve to limit its interest rate hike to 0.5 points last month, following four straight increases of 0.75 points.

The economy also has “generally solid fundamentals,” which could help it avoid a recession, Zandi noted.

“Typically, prior to recessions, the economy is plagued by significant imbalances such as overleveraged households and businesses, speculative asset markets, an undercapitalized financial system that has extended too much credit, overbuilt real estate markets, or financially stretched state and local governments,” he said. “For the most part none of these imbalances exist today.”

The most significant threat to the economy is a potential misstep in policy by the Federal Reserve, Zandi said. If the Federal Reserve were to increase interest rates higher than necessary in an effort to continue to bring down inflation, it could push the economy into a recession, he added.

However, “the baseline outlook holds that the Fed will be able to accomplish this without precipitating a recession,” Zandi said.

​Finance, federal reserve, inflation, interest rate hikes, Mark Zandi, Moody's, Recession, recession fears Read More 

Bezos Headed Back to Amazon This Year: Money Manager

TheStreet 

The online retailer’s founder will come back to deal with its woes, said Michael Batnick of Ritholtz Wealth Management.

Plenty of financial-market professionals have spit out predictions for 2023 in the last few weeks.

These forecasts are often wrong, as when the consensus view called for an increase in stock prices during 2022. Instead, the S&P 500 fell 19%.

Michael Batnick, a managing partner at esteemed Ritholtz Wealth Management, acknowledges that annual predicting is futile.

“Market predictions are silly. We all learned this a long time ago,” he wrote in a commentary. “But that doesn’t mean they’re completely worthless.”

And why is that?

“Even though forecasts are almost always wrong, they can be entertaining and educational,” Batnick said. “That’s all I’m trying to do with this post. Entertain and educate.”

None of this constitutes investment advice, he said. “I’m not doing anything with my portfolio based on these predictions, and neither should you.”

Here are the forecasts.

· Tech continues its layoffs.

· International Stocks Outperform.

· The IPO market remains frozen.

· Value Outperforms Growth Again.

· Gold makes a new all-time high.

· Energy stocks continue to outperform.

· Bitcoin gains 100%.

Bonds Hold Their Own as a Diversifying Asset

“Bonds have historically done well when stocks got dinged,” though last year was an exception, Batnick said.

“The 10-year treasury yield went from an all-time low in 2020 to the highest levels in over a decade in fairly short order,” he explained. “That was painful, but the good news is we got it over with. You can’t go from [a yield of] 50 basis points to 4% again this year.”

So the good news is “if stocks have another rocky year, bonds should do ok,” Batnick said. “Even if interest rates were to rise, lowering [bond] prices, at least we’ve got the fixed income component to cushion the blow.”

“It would be easy to suggest that a massive decline in home prices is underway,” given the huge price jump from 2020 through the middle of 2022, Batnick said.

“But I don’t see that happening. The supply-demand imbalance is structural, with buyers outnumbering sellers by a lot. “

Further, “you see activity picking back up as interest rates have [dipped] over the past couple of weeks,” he said.

“As long as [mortgage] rates don’t shoot back up to 7%, home prices will cool, but they won’t crash.” The 30-year fixed mortgage rate averaged 6.42% in the week ended Dec. 29.

The Economy Avoids Recession, Stocks Gain Double Digits and Bezos Returns

This year will resemble 2022 in that macro factors will dominate, Batnick said. “With peak inflation hopefully behind us, a consumer that is still in good shape, and an investor class that is negative across the board, it wouldn’t take much in the way of an upside surprise for stocks to take off.”

Amazon  (AMZN) – Get Free Report stock dropped 50% last year, its largest annual decline since the dot-com bubble burst in 2000, Batnick said.

“Jeff Bezos spent 27 years at Amazon and has been gone for less than two,” he said. “In 2023 he pulls a Bob Iger and returns to steady the ship.”

Iger came back to Disney as chief executive in November, after retiring from the position in 2020.

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