The Weekly Scan December 5, 2022

Welcome to the Weekly Scan. Here’s what we’re following for the week of December 5, 2022. Plus, our Certified Financial Planner Lauren Anastasio gives advice on how to respond to the news.

Reverse, reverse. China, which has had some of the strictest Covid-19 restrictions, appeared to begin easing those rules last week in response to increasing protests. Restrictions began lifting in Guangzhou and Chongqing. When Chinese residents began protesting last weekend, the government responded by ramping up security. But the government has been open  to breaking down the restrictions around Covid-19, which have led to a slowdown in economic growth, and frustration among people who have had to stay at home. 

• Lauren’s take: While early COVID lockdowns in China disrupted supply-chains internationally, these current disruptions are not expected to have the same effect since factories remain open.  

New York Times

Slow, but steady. In a conversation at the Brookings Institution think tank last week, the Federal Reserve (the Fed) chairman Jerome Powell indicated that the central bank will start slowing down the interest rate increases. The Fed has been increasing interest rates by three-quarters of a percentage point at rapidly successive intervals since June in an effort to curb inflation. Powell also said that the Fed will adjust its strategy while keeping in mind conditions like high borrowing costs, a labor shortage, and inflation. 

• Lauren’s take: Though the pace may slow down, interest rates will continue to rise which means higher borrowing costs if you have debt. Consider paying off your high-interest rate debt as a New Year’s Resolution. 

Reuters

Senate says “I do.” Last week, the U.S. Senate passed the Respect for Marriage Act, protecting same-sex and interracial marriages. The bill will now go to the House of Representatives, where it is expected to be passed before the end of the year. The bill won’t require all states to legalize same-sex marriage, but it will mandate that they honor any legal marriage from an outside state. The bill is designed to provide security for same-sex couples as the Supreme Court considers overturning Obergefell vs. Hodges, the 2015 decision that legalized gay marriage in the U.S. 

• Lauren’s take: Whether you’re married and file your taxes jointly or are a single filer, the marginal tax brackets for 2023 have changed. Good news—this means you get to keep more of your hard-earned money starting in January!

CNN

Putting the heat on Russia. The European Union came to an agreement capping the cost of Russian oil at $60 per barrel. The European Commission had initially proposed that the cap should be between $65 and $70 per barrel, but Poland pushed for a lower amount. The price limit is an attempt to cut Russia’s revenue from oil, while still buying it. The other aim of the limit is to make it more difficult for Russia to continue its war on Ukraine. The G-7, which includes the U.S., Japan, Canada, France, the U.K., Germany, and Italy, is expected to support the price cap. 

• Lauren’s take: Oil and gas prices are causing heating costs to soar this winter. One cost cutting hack is to eliminate “vampire energy sources” which are devices that stay plugged in even when not in use (think coffee maker, entertainment unit.) We recommend keeping those items unplugged which could add up to big energy cost savings. 

Wall Street Journal

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