In the United States, the debt burden is increasing among Generation Z (those born after the mid-1990s). According to Credit Karma, the average debt balance of Gen Z was $16,283 in the third quarter of 2018, up 3.1% from the third quarter of 2018. The rate of increase is higher than other generations such as millennials and baby boomers. Wages have not kept up with inflation , and more people rely on credit cards, especially those who have been in the workforce for a relatively short time and are paid relatively low wages.Generation Z seems to be struggling. Here are five news items to keep in mind as you start your day.
Rate increase of 0.25pt
Federal Open Market Commission (FOMC) to raise the key policy interest rate by 0.25 points. He said he would continue to raise interest rates despite the risk of a worsening banking crisis. The target range for the Federal Funds (FF) rate is 4.75-5%, the highest since September 2007. The decision was unanimous. According to FOMC participants’ economic and interest rate forecasts released at the same time, the policy interest rate was around 5.1% at the end of 2023, unchanged from the median forecast in December last year. The median forecast for 2024 rose to 4.3% (previously 4.1%).
Does not consider full deposit insurance
US Treasury Secretary Yellen said regulators were not considering providing “full-scale” deposit insurance to stabilize the US banking system. He also said the head of a recently bankrupt US bank should be held accountable. “I have not considered or discussed the full insurance or deposit guarantee,” Yellen told a Senate subcommittee hearing.
US currencyPacWest Bancorp said it secured $1.4 billion in cash from investment firm Atlas SP Partners. The bank has lost 20% of its deposits since the beginning of the year. He said he had given up on other fundraising efforts. PacWest said in a statement that its outflows totaled $6.9 billion, of which about $4.9 billion came from its enterprise banking division. Deposit levels were “stable,” he added.
Apollo and Carlisle
US alternative investment firm Apollo Global Management and Carlyle GroupIts aim is to acquire loans that will be sold in the bankruptcy of SVB Financial Group. The loans are tied to SVB Capital, the investment arm of SVB Financial, and SVB Securities, which was in charge of investment banking, according to people familiar with the matter. The loans sold could be worth up to $10 billion, some of the people said. Alternative investment firms are likely to be most interested in $1 billion worth of segmented loans, another person said.
AT1 bank bonds rise
In the financial market on the 22nd, “Other Tier 1 bonds” issued by banks (bonds AT1) rose. The decision was based on Goldman Sachs Group Inc.’s supervisory and warning warrant. that AT1 bonds are a buying opportunity. Goldman credit analysts Kenneth Ho and Chakki Ting said they see attractive opportunities in some AT1 bonds issued by some of Asia Pacific’s biggest banks, which have already exceeded its cost of equity.
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