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Federal Reserve settle up with hike in interest rates this winter

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By prolonging its policy of targeting interest rates at zero, the Federal Reserve spared the country from half or more of the damage to the US economy that would have followed the steep rise in the dollar over the past year, Fed Vice Chairman Stanley Fischer said Thursday evening.

A Reuters poll published on Tuesday showed a 70 percent chance the us central bank would raise its short-term lending rate at its December 15-16 meeting, after a stronger-than-expected jobs report last week.

Federal Reserve officials stressed that policy should be tightened gradually after interest rates are increased for the first time since 2006, in an attempt to shift investors focus as NY Fed President William C. Dudley said the conditions for liftoff could soon be satisfied. The presentations and discussions of the 12 academic papers on the conference program will surely provide a foundation for what I expect will be a stimulating discussion of important topics over the next two days.

I have been an advocate of ending the Federal Open Market Committees (FOMCs) near-zero nominal interest rate policy. Looking ahead the Board forecasts that inflation will continue at a low level, due mainly to the effects of the low oil prices.

Lacker said it was too soon to tell whether the Fed had waited so long to raise rates that it would now need to act even more quickly in order to control inflation.

More specifically, before raising rates, I would like to have more confidence than I do today that inflation is indeed beginning to head higher.

Fischer said that while the stronger dollar and foreign weakness have been a sizable shock, he believes the US economy is holding up reasonably well, in part because the Fed has responded so far this year by deferring any moves to hike interest rates.

Indications of a continued solid pace of domestic spending supports the case for the Fed to start to withdraw some of the current highly accommodative monetary stimulus, said Paul Ferley, assistant chief economist with RBC Economics.

He earlier said in a prepared speech that the global outlook seemed less problematic than it did just a few months ago.

He noted that job growth rebounded in October, allaying concerns about a downward trend, and that labor market slack had clearly diminished.

The Fed, which is obligated to conduct financial coverage primarily based on a twin mandate of managing inflation and employment, has seen the unemployment charge drop to five%, however relying on how inflation is measured, its nonetheless effectively wanting the Feds 2% goal.

Indeed, one the Feds core tools - quantitative easing - which is aimed at boosting inflation, may actually CAUSE deflation.

Household balance sheets do not appear over-extended, Dudley added.

$30K in Student Loan Debt Could Mean $325K Less In Retirement

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Millennials who begin their careers with $30,000 in student loan debt may find themselves with $325,000 less at retirement than their debt-free peers, according to new findings from LIMRA Secure Retirement Institute.

A new report from LIMRA Secure Retirement Institute looks at the effects education debt can have on retirement savings.

A full consideration of retirement security has to account for debt, according to the report, Calculated Choices: Examining Debt and Retirement Savings Decisions. Having debt reduces the money available to save and limits funds available for retirement expenses. Looking at financial assets in isolation may understate the gravity of the retirement lsquo;crisis.

Researchers at the Secure Retirement Institute found that a 22-year old who begins his or her career with $30,000 of student loan debt could reach retirement with $325,000 less than a peer who is not burdened with an education loan. For $50,000 of debt, the amount is closer to $530,000 less in retirement savings.

The general belief has always been an investment in education was worthwhile because it would result in a higher paying career, LIMRA states. However, the recession impacted millennials at the start of their careers, with many ending up unemployed or underemployed for years after they graduated.

While companies that administer 401(k) and other defined contribution (DC) plans report high participation rates by millennials, LIMRA finds the debt-burdened millennials are saving at a lower rate.

According to LIMRAs research, millennials without student loans are 60% more likely to maximize their employer match compared with those who are paying education loans.

Outside of mortgages and home equity loans, student loans comprise the highest median amount of debt.

According to LIMRA, more than 20% of the US population have student loans. (In comparison, 43% of US households have mortgage and home equity debt and 38% hold credit card balances.)

The under-35 age group has more than tripled its education debt since 1989. According to LIMRAs report, the average education debt increased from $3,000 in 1989 to over $19,500 in 2013 for this age group.

LIMRA finds this is largely due to increases in college tuition.

LIMRA looked at The College Board data showing that the average tuition and room and board charges for a public four-year school were $9,000 in 1990 and increased to $19,000 in 2015. For a private four-year school, the average tuition and room and board charges were $24,000 in 1990 and increased to $42,500 in 2015, according to The College Board.

LIMRA also looked at how much education debt pre-retirees and retirees hold.

For pre-retirees age 55 to 64, the average education debt has increased from $600 in 1989 to just under $8,000 in 2013.

The large increase in education debt indicates that many pre-retirees are taking on their childrens and grandchildrens student loans, LIMRA states. They may also have their own student loans if they sought additional schooling for a second or third career.

Meanwhile, retirees age 65 to 74 took essentially no education debt into retirement in 1989.

According to LIMRA, the average education debt for this age group increased from $400 in 1989 to more than $2,300 in 2013.

As with other forms of debt carried into retirement, education loans can hamper a retirees ability to meet discretionary and nondiscretionary expenses, LIMRA states.

---Related on ThinkAdvisor:

• College Planning: 7 Steps to Filing the FAFSA
• Even Affluent Parents Arent Footing the Full College Bill
• Top 13 Colleges Whose Grads Earn the Most: 2015
• Why Now Is a Good Time to Remind Clients to Save for College
• 5 Steps to Help College Graduates With Student Debt

FBI Reminds Shoppers to be Aware of Cyber Criminals Offering Scams This ...

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San Diego, California - The FBI reminds shoppers in advance of the holiday shopping season to beware of cyber criminals and their aggressive and creative ways to steal money and personal information. Scammers use many techniques to defraud consumers by offering too good to be true deals via phishing e-mails advertising brand name merchandise, quick money making offers, or gift cards as an incentive to purchase a product. Remember, if the deal looks too good to be true, it probably is. Never provide your personal information to an unknown party or untrusted website.

Scammers often use e-mail to advertise hot-ticket items of the year that may become hard to find during the holidays to lure unsuspecting consumers to click on links. Steer clear of untrusted sites or ads offering items at unrealistic discounts or with special coupons. You may end up paying for an item, giving away personal information and credit card details and then receive nothing in return, along with your identity compromised. These sites may also be offering products at a great price, but the products being sold are not the same as the products they advertise. This is known as the bait and switch scam.

Beware of posts on social media sites that appear to offer vouchers or gift cards, especially sites offering deals too good to be true, such as a free $500 gift card. Some may pose as holiday promotions or contests. It may even appear one of your friends shared the link with you. If so, it is likely your friend was duped by the scam after it was sent to them by one of their friends. Oftentimes, these scams lead to online surveys designed to steal personal information.

When purchasing gift cards online, be leery of auction sites selling discounted or bulk offers of gift cards. When purchasing gift cards in the store, examine the protective scratch-off area on the back of the card to see if it has been tampered with.

Be on the lookout for mobile applications designed to steal your personal information from your smartphone. Such apps are often disguised as games and are often offered for free. Research the company selling or giving away the app and look online for third party reviews before installing an app from an unknown source.

Tickets to theater, concerts, and sporting events are always popular gifts during the holidays. If you purchase or receive tickets as a gift, do not post pictures of the tickets to social media sites. Protect the barcodes on tickets as you would your credit card number. Fraudsters will create a ticket using the barcode obtained from searching around social media sites and resell the ticket. You should never allow the barcode to be seen on social media. If you are in need of extra cash at this time of year, beware of sites and posts offering work you can do from the comfort of your own home. Often, the work from home opportunities rely on convenience as a selling point for applicants with an unscrupulous motivation behind the posting. You should carefully research the job posting and individuals or company contacting you for employment.

As a consumer, if you feel you are a victim of an Internet-related crime, you may file a complaint with the FBI's Internet Crime Complaint Center at www.IC3.gov.

Here are some additional tips you can use to avoid becoming a victim of cyber fraud:

• Check your credit card statement routinely.
• Protect your credit card numbers from "wandering eyes."
• Do not respond to unsolicited (spam) e-mail.
• Do not click on links contained within an unsolicited e-mail.
• Be cautious of e-mail claiming to contain pictures in attached files, as the files may contain viruses. Only open attachments from known senders. Scan the attachments for viruses if possible.
• Avoid filling out forms contained in e-mail messages that ask for personal information.
• Always compare the link in the e-mail to the link you are actually directed to and determine if they actually match and lead you to a legitimate site.
• Log on directly to the official website for the business identified in the e-mail instead of linking to it from an unsolicited e-mail. If the e-mail appears to be from your bank, credit card issuer, or other company you deal with frequently, your statements or official correspondence from the business will provide the proper contact information.
• If you are requested to act quickly or there is an emergency, it may be a scam. Fraudsters create a sense of urgency to get you to act quickly.
• Verify any requests for personal information from any business or financial institution by contacting them using the main contact information on their official website.