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	<title>Business &#38; MoneyCategory: Financial Reform &#124; Business &#38; Money &#124; TIME.com</title>
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		<title>Business &#38; MoneyCategory: Financial Reform &#124; Business &#38; Money &#124; TIME.com</title>
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		<title>CFPB Finally Fixes the &#8220;Anti-Housewife&#8221; Rule</title>
		<link>http://business.time.com/2013/05/02/cfpb-finally-fixes-the-anti-housewife-rule/</link>
		<comments>http://business.time.com/2013/05/02/cfpb-finally-fixes-the-anti-housewife-rule/#comments</comments>
		<pubDate>Thu, 02 May 2013 09:45:28 +0000</pubDate>
		<dc:creator>Martha C. White</dc:creator>
				<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[CARD act]]></category>
		<category><![CDATA[cfpb]]></category>
		<category><![CDATA[Credit Card]]></category>
		<category><![CDATA[Credit CARD Act of 2009]]></category>
		<category><![CDATA[Credit Card Applications]]></category>
		<category><![CDATA[credit cards]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=79084</guid>
		<description><![CDATA[Just in time for Mother’s Day, the Consumer Financial Protection Bureau reversed an unpopular rule that some women’s advocacy groups called &#8220;insulting&#8221;— although it still took the agency almost a year to do it.  On Monday, the CFPB updated existing regulations so it will be easier for stay-at-home spouses to get credit cards. Intended to keep credit card companies from giving people more credit than they could handle and letting them plunge into debt, the rule is an object lesson in the law of unintended consequences. It stipulated that issuers would have to take into account the applicant’s individual income rather than household income. Sounds logical&#8230;until you realize that it renders every stay-at-home parent who isn’t paid for dishes-and-diaper duty basically uncreditworthy. This ill-considered rule was part of an amendment to the Truth in Lending Act’s Regulation Z, a CARD Act-era regulation the CFPB inherited from the FDIC. According to the CFPB’s own calculations, more than 16 million Americans, or one in three married couples, could have been affected. (MORE: 10 Steps to Spring Clean Your Finances) “I understand that the Federal Reserve is trying to make sure that the person responsible for the credit card can make the payments but did they go too far with this?” SmartCredit.com president of consumer education John Ulzheimer asked when the rule kicked in back in 2011. A lot of people thought the answer was “yes.” Holly McCall of the group MomsRising.org blogged about the embarrassment she felt getting turned down for a Target credit card in spite of her excellent credit score and her husband’s good job. She launched a Change.org petition that garnered 45,000 signatures and campaigned for the CFPB to change the rule she labeled “demeaning” and “flat-out unfair.” As the issue gained notoriety, lawmakers joined her cause. At a Congressional hearing last June, Shelley Moore Capito (R-WV), chair of the House Financial Services Subcommittee on Financial Institutions and Consumer Credit challenged the CFPB and said the rule was a threat to women in abusive relationships and could create an added burden<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=79084&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Financial Reform</primary_category><primary_category_link>http://business.time.com/category/economy-policy/financial-reform-economy-policy/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/05/160888481.jpg?w=240</featured_image>
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			<media:title type="html">Monthly Retail Sales Data Shows Strong January</media:title>
		</media:content>

		<media:content url="http://0.gravatar.com/avatar/9a5a9e4f28beb5afb59b1202632d219a?s=96&#38;d=http%3A%2F%2F0.gravatar.com%2Favatar%2Fad516503a11cd5ca435acc9bb6523536%3Fs%3D96&#38;r=G" medium="image">
			<media:title type="html">marthacwhite</media:title>
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	</item>
		<item>
		<title>Why Companies Should Put Values First &#8212; And How They Can Do It Without Sacrificing Growth</title>
		<link>http://business.time.com/2013/05/01/why-companies-should-put-values-first-and-how-they-can-do-it-without-sacrificing-growth/</link>
		<comments>http://business.time.com/2013/05/01/why-companies-should-put-values-first-and-how-they-can-do-it-without-sacrificing-growth/#comments</comments>
		<pubDate>Wed, 01 May 2013 17:26:28 +0000</pubDate>
		<dc:creator>Dov Seidman</dc:creator>
				<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Leadership]]></category>
		<category><![CDATA[Management & Leadership]]></category>
		<category><![CDATA[Management Strategies]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=78889</guid>
		<description><![CDATA[Nearly five years after the U.S. financial meltdown, the soap opera continues as Wall Street, Main Street, and our government continue to grope for ways to forestall future crises. Unfortunately, the latest episodes – captured in headlines like “KPMG Hit By Insider Trading Allegations” – are beginning to feel like re-runs. The problem is that we’re stuck in a crisis-regulation cycle, trying to avoid future crises by writing rules and regulations aimed at eliminating repeat performances of previous bad acts. Meanwhile, we fail to address the root causes of corporate and financial malfeasance. (MORE: Game Changer: Dov Seidman, Principle Prophet) Instead of squabbling over the specific rules and regulations that should restrict corporate behavior, we need to find ways to inspire our companies to behave when regulators and other stakeholders aren’t looking.  Here are five ways to build company cultures that simultaneously protect against crisis and propel growth: Pursue a long-term vision guided by core values. Too often, short-term planning clouds good business decision-making and causes us to make the wrong move. The only way to meet long-term goals is to root them in missions worthy of our dedication and the kinds of values that meaningfully connect us and enable us to relate deeply to the world around us. Take technology company National Instruments, whose values include respect, integrity, and dedication. The technology company maintains a 100-year plan, unveiled when the company went public in 1995 to warn Wall Street analysts that it could not be goaded into a short-term “raise earnings at all costs” mindset. The 100-year plan focuses on how the company will nurture its culture (by operating with integrity) over the long haul while its 10- and five-year plans delve into specific business strategies and market opportunities. Incorporate values into the recruiting and compensation processes. Hiring, say, bond traders purely on the basis of their talent &#8212; and then “training” them on the values that matter to your company, simply doesn’t work in the long term. Instead, hiring decisions should focus on issues like character from the get-go.<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=78889&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
		<wfw:commentRss>http://business.time.com/2013/05/01/why-companies-should-put-values-first-and-how-they-can-do-it-without-sacrificing-growth/feed/</wfw:commentRss>
		<slash:comments>0</slash:comments>
	<primary_category>Management &amp; Leadership</primary_category><primary_category_link>http://business.time.com/category/management-leadership/</primary_category_link>
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			<media:title type="html">TIME.com</media:title>
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	</item>
		<item>
		<title>The Real Reason to Worry About China</title>
		<link>http://business.time.com/2013/04/28/the-real-reason-to-worry-about-china/</link>
		<comments>http://business.time.com/2013/04/28/the-real-reason-to-worry-about-china/#comments</comments>
		<pubDate>Mon, 29 Apr 2013 02:46:04 +0000</pubDate>
		<dc:creator>Michael Schuman</dc:creator>
				<category><![CDATA[Asia]]></category>
		<category><![CDATA[Economics]]></category>
		<category><![CDATA[Economy]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Financial Reform]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=78814</guid>
		<description><![CDATA[The world is worried about China, but not for the right reasons. Global financial markets were roiled after the world’s second largest economy notched only a 7.7% boost to GDP in the first quarter — a drool-worthy performance for most nations, but a disappointment for a country that routinely jumped 10% or more over the past three decades. Economists are busily debating the usual: Will China have a hard or soft landing? Will the government step in and stimulate growth? Those questions miss the bigger picture. The reality is that China is unlikely to witness those astronomical growth rates, at least for some time. We may never see them again. The recent slowdown is not a temporary cyclical blip or solely the knockoff effect of the tepid global recovery. China’s growth model is broken and can’t be so easily fixed. Since the start of capitalist reforms in the 1980s, China excelled by throwing tons of resources into a modernizing economy — mountains of cash to build factories, roads and apartment towers, and millions of poor people into making iPads, blue jeans and cars. Under China’s “state capitalism,” bureaucrats often directed the cash into massive infrastructure projects or favored industries. However, this growth engine can’t keep purring indefinitely. The pools of idle labor that filled Foxconn’s assembly lines are drying up — China’s one-child policy made sure of that, by aging the population more rapidly. The workforce has already started to shrink. Even more worrying, the state-led, investment-obsessed system spawns too much debt and too many factories, leading to wasted resources and a debased financial sector. (MORE: Can China Escape the Middle-Income Trap?) That’s what is happening in China today. Everywhere you look, the signs of rot are apparent. In a mad-cap quest to dominate green energy, China’s banks pumped billions into solar-panel manufacturing, creating hundreds of factories and vaulting China into the world’s largest producer. Now the sector has become a victim of its own excess: companies are failing, symbolized by the recent bankruptcy of market leader Suntech Power. Steel companies<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=78814&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Economy</primary_category><primary_category_link>http://business.time.com/category/economy-policy/economy/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/04/biz-china-economy-130429.jpg?w=240</featured_image>
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			<media:title type="html">A laborer works in a chemical plant in Hefei, central China&#039;s Anhui province, April 7, 2013.</media:title>
		</media:content>

		<media:content url="http://1.gravatar.com/avatar/16f24a6058e54145f5ee65b322784b28?s=96&#38;d=http%3A%2F%2F1.gravatar.com%2Favatar%2Fad516503a11cd5ca435acc9bb6523536%3Fs%3D96&#38;r=G" medium="image">
			<media:title type="html">michaeljschuman</media:title>
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		<item>
		<title>Why is Texas Governor Rick Perry in Illinois?</title>
		<link>http://business.time.com/2013/04/24/why-is-texas-governor-rick-perry-in-illinois/</link>
		<comments>http://business.time.com/2013/04/24/why-is-texas-governor-rick-perry-in-illinois/#comments</comments>
		<pubDate>Wed, 24 Apr 2013 18:41:38 +0000</pubDate>
		<dc:creator>Josh Sanburn</dc:creator>
				<category><![CDATA[Economy]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Energy]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Jobs]]></category>
		<category><![CDATA[Labor]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=78359</guid>
		<description><![CDATA[Like an aging rocker, Texas Governor Rick Perry is currently on the 2013 I&#8217;m Coming For Your Jobs tour across America. His first stop: California a couple months ago. This week he’s in Illinois, where he got a nasty reception from public officials. The trips are part of an effort to get businesses from highly taxed and heavily regulated states to relocate down South — but his efforts may fall flat, if recent history is any indication. (MORE: Europeans Are Thinking the Unthinkable: That Debt Defaults Might Make Sense) Texas has arguably become one of the few true economic success stories since the recession. The state has an unemployment rate of around 6% and a $9 billion budget surplus, even as many states struggle with 8% and 9% unemployment and severe budget deficits. The state is run by pro-business Republicans in the state legislature, along with Gov. Perry, who supports low regulation and low taxes. Texas doesn’t have an individual income tax, either. Its minimum wage is lower than other left-leaning states, which keeps labor costs down. Prices for land and housing are low. And the oil and natural gas boom in recent years has kept jobs from leaving the state. The tradeoff for all this, of course: Texas&#8217;s relatively flimsy social safety net. But Perry still isn&#8217;t satisfied with business in Texas. The governor sees even more potential if he can just lure corporations away from states that aren’t as friendly to business. The two states he&#8217;s visited so far, California and Illinois, rank 50th and 48th, respectively, in a survey of best states for business, according to a recent poll in the Wall Street Journal. In February, Gov. Perry visited California, a state with high labor costs, high taxes, and heavy environmental regulation, all of which can make it onerous for businesses to set up shop. According to Reuters, Ron Mittelstaedt, chairman and CEO of Waste Connections Inc., moved his waste business from Sacramento, Calif., to The Woodlands, Texas, and was able to build new facilities in 16 months. In California,<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=78359&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
		<wfw:commentRss>http://business.time.com/2013/04/24/why-is-texas-governor-rick-perry-in-illinois/feed/</wfw:commentRss>
		<slash:comments>0</slash:comments>
	<primary_category>Government</primary_category><primary_category_link>http://business.time.com/category/economy-policy/government-economy-policy/</primary_category_link>
		<media:content url="http://1.gravatar.com/avatar/d88247e41871fc555c4a2747167091d2?s=96&#38;d=http%3A%2F%2F1.gravatar.com%2Favatar%2Fad516503a11cd5ca435acc9bb6523536%3Fs%3D96&#38;r=G" medium="image">
			<media:title type="html">jsanburn</media:title>
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	</item>
		<item>
		<title>Why Derivatives May Be the Biggest Risk for the Global Economy</title>
		<link>http://business.time.com/2013/03/27/why-derivatives-may-be-the-biggest-risk-for-the-global-economy/</link>
		<comments>http://business.time.com/2013/03/27/why-derivatives-may-be-the-biggest-risk-for-the-global-economy/#comments</comments>
		<pubDate>Wed, 27 Mar 2013 15:06:48 +0000</pubDate>
		<dc:creator>Michael Sivy</dc:creator>
				<category><![CDATA[Banking]]></category>
		<category><![CDATA[Bonds]]></category>
		<category><![CDATA[Commodities]]></category>
		<category><![CDATA[Economics]]></category>
		<category><![CDATA[Economics & Policy]]></category>
		<category><![CDATA[Economy]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Europe]]></category>
		<category><![CDATA[Exchanges]]></category>
		<category><![CDATA[Federal Reserve]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Financial Regulation]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Investing]]></category>
		<category><![CDATA[Investment Banking]]></category>
		<category><![CDATA[Markets]]></category>
		<category><![CDATA[Municipal Government]]></category>
		<category><![CDATA[Private Equity]]></category>
		<category><![CDATA[Stocks]]></category>
		<category><![CDATA[The Economy]]></category>
		<category><![CDATA[Too-Big-To-Fail]]></category>
		<category><![CDATA[Wall Street]]></category>
		<category><![CDATA[Wall Street & Markets]]></category>
		<category><![CDATA[Wealth]]></category>
		<category><![CDATA[World Finance]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=75881</guid>
		<description><![CDATA[Four years after the U.S. recession ended, the global economy is still beset by problems. The present danger comes from Cyprus – where the sea foam once gave birth to the goddess Aphrodite but now only creates froth in panicky financial markets. The proposed bailout plan for troubled Cypriot banks would impose losses of up to 40% on the largest depositors. And that, in turn, could undermine confidence in the banks of other troubled euro zone countries. Cyprus is only the latest challenge for global financial stability, however. In the U.S., deteriorating urban finances – from Detroit to Stockton, Calif. – threaten municipal bond holders, public-sector workers, and taxpayers. In addition, a rise in long-term interest rates seems inevitable sooner or later, either because of inflation or because the Federal Reserve backs away from its easy-money policies. Higher interest rates would mean big losses for bond investors, and also for government-sponsored entities, such as Fannie Mae and Freddie Mac, that hold mortgage-backed assets. The greatest risk of all, however, may be one of the least visible – namely, the expanding, shadowy market for derivatives. These highly sophisticated investments have contributed to financial disasters from the 2008 bankruptcy of Lehman Brothers to J.P. Morgan’s 2012 trading losses in London, which totaled more than $6 billion. (MORE: The $600 Billion the IRS Can&#8217;t Collect) Basically, derivatives are financial contracts with values that are derived from the behavior of something else – interest rates, stock indexes, mortgages, commodities, or even the weather. Just as homebuyers make only a down payment when they buy a house with a mortgage, derivatives traders put down only a small amount of cash. Moreover, one derivative can be used to offset or serve as collateral for another. The result is that a massive edifice of derivatives can be supported by a relatively small amount of real money. Some derivatives, such as typical stock options, trade on exchanges. But many are simply private contracts between banks or other sophisticated investors. As a result, it’s hard to know the total<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=75881&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Economy &amp; Policy</primary_category><primary_category_link>http://business.time.com/category/economy-policy/</primary_category_link>
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			<media:title type="html">michaelsivy</media:title>
		</media:content>
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		<item>
		<title>Are Banks Bluffing About the Danger of Banking Regulation?</title>
		<link>http://business.time.com/2013/03/14/book-wall-streets-biggest-and-most-dangerous-untruth/</link>
		<comments>http://business.time.com/2013/03/14/book-wall-streets-biggest-and-most-dangerous-untruth/#comments</comments>
		<pubDate>Thu, 14 Mar 2013 12:00:06 +0000</pubDate>
		<dc:creator>Christopher Matthews</dc:creator>
				<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Financial Regulation]]></category>
		<category><![CDATA[Investment Banking]]></category>
		<category><![CDATA[Too-Big-To-Fail]]></category>
		<category><![CDATA[Wall Street & Markets]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=74533</guid>
		<description><![CDATA[Four and a half years after the passage of TARP, one thing is abundantly clear: The American public really, really hates bank bailouts. And yet, nearly three years after the passage of the Dodd-Frank financial reform bill, it remains unclear whether our financial system is significantly safer, and whether taxpayers are any less likely to have to bail out another large bank in the future. That&#8217;s why an increasing number of voices on both sides of the political spectrum have been pressing for additional reforms that would reduce the chances that the federal government will have to step in to save another big, dumb bank. Adding to this chorus are financial economists Anat Admati and Martin Hellwig with an important new book called The Banker&#8217;s New Clothes, which offers what the Dodd-Frank legislation mostly lacked: a simple and elegant solution to the problem of financial stability. They argue that banks should fund themselves with more equity and less debt &#8212; or, to put it bluntly, that banks should risk more of their own money, and less of everyone else&#8217;s. Banks don&#8217;t want to do that, because they generally fund their operations with disproportionate amounts of debt, and they maintain that their profitability &#8212; as well as our economy&#8217;s growth &#8212; depends on their continuing to do so. The central point of Admanti and Hellwig&#8217;s book is that these protestations are like the emperor&#8217;s new clothes: There&#8217;s simply nothing there. They write: &#8220;A major reason for the success of bank lobbying is that banking has a certain mystique. There is a pervasive myth that banks and banking are special and different from all other companies and industries in the economy. Anyone who questions the mystique and claims that are made is at risk of being declared incompetent to participate in the discussion.&#8221; But let&#8217;s back up for a second to make clear why &#8220;more equity and less debt&#8221; would make our banking system safer. Just like any business, banks can fund their operations either by issuing shares (selling equity, or ownership) or by borrowing<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=74533&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Too-Big-To-Fail</primary_category><primary_category_link>http://business.time.com/category/wall-street-markets/too-big-to-fail-wall-street-markets/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2011/08/wallstreetman1.jpg?w=240</featured_image>
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		<media:content url="http://timebusinessblog.files.wordpress.com/2011/08/wallstreetman1.jpg?w=240" medium="image">
			<media:title type="html">Wall Street</media:title>
		</media:content>

		<media:content url="http://2.gravatar.com/avatar/8f9a71742e964af96ca58c01a0577a0d?s=96&#38;d=http%3A%2F%2F2.gravatar.com%2Favatar%2Fad516503a11cd5ca435acc9bb6523536%3Fs%3D96&#38;r=G" medium="image">
			<media:title type="html">christopherrmatthews</media:title>
		</media:content>
	</item>
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		<title>Why Can&#8217;t This Economy Really Get Going?</title>
		<link>http://business.time.com/2013/02/12/why-cant-this-economy-get-going/</link>
		<comments>http://business.time.com/2013/02/12/why-cant-this-economy-get-going/#comments</comments>
		<pubDate>Tue, 12 Feb 2013 13:00:18 +0000</pubDate>
		<dc:creator>Michael Sivy</dc:creator>
				<category><![CDATA[Austerity]]></category>
		<category><![CDATA[Banking]]></category>
		<category><![CDATA[Bonds]]></category>
		<category><![CDATA[Companies & Industries]]></category>
		<category><![CDATA[Economic Indicators]]></category>
		<category><![CDATA[Economics]]></category>
		<category><![CDATA[Economy]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Europe]]></category>
		<category><![CDATA[Federal Reserve]]></category>
		<category><![CDATA[Finance]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Financial Regulation]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Home-Equity Loans]]></category>
		<category><![CDATA[Investing]]></category>
		<category><![CDATA[Jobs]]></category>
		<category><![CDATA[Markets]]></category>
		<category><![CDATA[Real Estate]]></category>
		<category><![CDATA[Real Estate & Homes]]></category>
		<category><![CDATA[Real Estate Markets]]></category>
		<category><![CDATA[Taxes]]></category>
		<category><![CDATA[Wall Street & Markets]]></category>
		<category><![CDATA[World Finance]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=70353</guid>
		<description><![CDATA[It’s no secret that the U.S. economy isn’t doing especially well. But there’s a cliché – one that I’ve repeated myself – that conditions are improving, even if progress is disappointingly slow. That notion was exploded two weeks ago when the Department of Commerce estimated that GDP actually declined in the fourth quarter of 2012. It’s true that the drop wasn’t very big and was offset to some extent by better-than-expected results earlier in the year. But when you average results for the past four quarters, overall growth last year amounted to only half the normal rate, and there’s not really any upward trend. Those results are even worse than they sound. After a recession ends, the economy typically enjoys a bit of a boom. And the deeper the slump, the more powerful the rebound usually is. For brief periods, GDP growth can get up as high as 9% (at an annual rate). And over several years, the economy can expand considerably faster than the historical average rate of 3.25%. In short, after a recession there’s typically a catch-up period, in which the economy makes up some of its lost ground. (MORE: 9 Easy Ways to Save Money on Your Next Vacation) So the problem is not just that business conditions are taking a long time getting back to normal. What’s a lot more disappointing is that there hasn’t been any real rebound at all. In fact, GDP growth hasn’t outpaced the historical average rate for two consecutive quarters since the recession ended. This chronic weakness isn’t result of any single problem. Instead, there are a host of factors that have combined to produce the entrenched stagnation we see today. Among them: The housing bust. Home prices have stopped falling and have turned up over the past year. But many American families still have not recovered from the 30% drop in prices between 2006 and 2009. By some estimates, a fifth of all the homes with mortgages are worth less than is owed on them. Not only does this prevent many homeowners<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=70353&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Economy &amp; Policy</primary_category><primary_category_link>http://business.time.com/category/economy-policy/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/02/rtr3dn1w.jpg?w=240</featured_image>
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			<media:title type="html">Traders work on the floor of the New York Stock Exchange after the opening bell Feb. 11, 2013.</media:title>
		</media:content>

		<media:content url="http://2.gravatar.com/avatar/b8875a12f713f52ecc28fe72efed7fd4?s=96&#38;d=http%3A%2F%2F2.gravatar.com%2Favatar%2Fad516503a11cd5ca435acc9bb6523536%3Fs%3D96&#38;r=G" medium="image">
			<media:title type="html">michaelsivy</media:title>
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		<title>Lessons in Socialism: How Cuba Can Become Relevant Again</title>
		<link>http://business.time.com/2013/02/06/lessons-in-socialism-how-cuba-can-become-relevant-again/</link>
		<comments>http://business.time.com/2013/02/06/lessons-in-socialism-how-cuba-can-become-relevant-again/#comments</comments>
		<pubDate>Wed, 06 Feb 2013 15:00:09 +0000</pubDate>
		<dc:creator>Dan Kadlec</dc:creator>
				<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Entrepreneurship]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Financial Regulation]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Real Estate & Homes]]></category>
		<category><![CDATA[The Economy]]></category>
		<category><![CDATA[Uncategorized]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=69595</guid>
		<description><![CDATA[Havana, Cuba — In this once spectacular tropical city, three buildings collapse from neglect every single day. There has been little infrastructure investment in 50 years and the average worker earns $20 a month. By almost any economic measure, socialism under Fidel Castro has been an abject failure. Yet things are beginning to change. Presumed to be ailing, Castro has handed power to his brother Raul, who is permitting modest levels of private enterprise and home ownership. Meanwhile, President Obama has eased U.S. travel restrictions to Cuba. Legal passage from the States has soared more than 10-fold in a decade. Most of the 600,000 U.S. residents expected to visit Cuba this year have family there, but conventional tourism is on the rise as well. I was there in January on a people-to-people visa. Critics worry that tourist dollars will prop up the failed socialist system and prolong its grip. But based on my trip, there&#8217;s reason to believe the opposite may prove to be the case: Spirited young entrepreneurs are rising from Havana’s rubble to take advantage of these small but important signs of economic liberalization. Interestingly, Cuba&#8217;s glacial but perceptible shift to the right comes as the U.S. has turned sharply to the left, raising income taxes on the rich and searching for other means to redistribute wealth. I was introduced to this burgeoning new economic order through a young entrepreneur I’ll call Javier.  Javier did not ask that I not use his real name, but after speaking frankly with me about emerging Cuban business opportunities, Javier worried that he had made dangerous political statements. If he were judged to be subversive, his budding business empire could be shut down in minutes. (MORE: Is it Time to Rethink the Role of Credit Agencies?) Javier is 31 years old. He’s college educated, speaks fluent English, and calls himself “ambitious and restless.” He has taken advantage of the fledgling residential real estate market in Havana, brokering home sales from struggling Cubans to fellow countrymen with money sent from family in the U.S. and abroad. (Foreigners are<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=69595&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Economy &amp; Policy</primary_category><primary_category_link>http://business.time.com/category/economy-policy/</primary_category_link>
		<media:content url="http://1.gravatar.com/avatar/d69b05e696e822e7e41ae630be72226a?s=96&#38;d=http%3A%2F%2F1.gravatar.com%2Favatar%2Fad516503a11cd5ca435acc9bb6523536%3Fs%3D96&#38;r=G" medium="image">
			<media:title type="html">dankadlec</media:title>
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		<title>Justice Sues S&amp;P; Is It Time to Rethink the Role of Ratings Agencies?</title>
		<link>http://business.time.com/2013/02/06/justice-sues-sp-but-what-purpose-are-ratings-agencies-serving-anyway/</link>
		<comments>http://business.time.com/2013/02/06/justice-sues-sp-but-what-purpose-are-ratings-agencies-serving-anyway/#comments</comments>
		<pubDate>Wed, 06 Feb 2013 10:45:52 +0000</pubDate>
		<dc:creator>Christopher Matthews</dc:creator>
				<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Financial Regulation]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Investment Banking]]></category>
		<category><![CDATA[Wall Street & Markets]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=69813</guid>
		<description><![CDATA[Most of the time, court cases are manna for journalists. The politicians and corporations we cover aren&#8217;t in the habit of dishing out information they don&#8217;t want the public to know. But along comes a lawsuit, and the parties are often forced to put a lot of juicy details on the public record. So when the Justice Department yesterday announced a joint federal and state lawsuit against the ratings agency Standard &#38; Poor&#8217;s for defrauding investors in the run up to the financial crisis with its overly optimistic ratings of mortgage-related investments, I was excited to see what new dirt the complaint would unearth. Much to my chagrin, however, the complaint is a fairly mundane read  for the simple fact that we have known for years that the ratings agencies were hamstrung by a fundamental conflict of interest: They are paid by the sellers of securities rather than the buyers. So during the inflation of the real estate bubble in the early 2000s, as investment banks scrambled to package mortgages into complex financial instruments, ratings agencies also scrambled to figure out how to get those investment banks to chose them to rate their securities. What was S&#38;P&#8217;s strategy to entice investment banks to pay it rather than its competitors? Rate their securities higher. The complaint does put this dynamic into sharper relief, as it provides us with the details of conversations, emails, and instant message exchanges that show the evolution of S&#38;P&#8217;s ratings philosophy from one focused primarily on accurate analysis to one focused on pleasing issuers who paid it large fees. (MORE: The S&#38;P Soars, the Economy Snores) Of course, this conflict of interest was well documented in the immediate aftermath of the bursting of the real estate bubble and even before the financial panic of 2008. A 2011 report from the Senate Permanent Subcommittee on Investigations named rating agency failure as a contributing factor to the financial crisis. Reads the report: Because credit rating agencies issue ratings to issuers and investment banks who bring them business, they are subject to an inherent conflict<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=69813&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Financial Regulation</primary_category><primary_category_link>http://business.time.com/category/economy-policy/financial-regulation-economy-policy/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/02/biz-standard-poors-0205.jpg?w=240</featured_image>
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			<media:title type="html">Standard &#38; Poor&#039;s headquarters in New York, Feb. 5, 2013.</media:title>
		</media:content>

		<media:content url="http://2.gravatar.com/avatar/8f9a71742e964af96ca58c01a0577a0d?s=96&#38;d=http%3A%2F%2F2.gravatar.com%2Favatar%2Fad516503a11cd5ca435acc9bb6523536%3Fs%3D96&#38;r=G" medium="image">
			<media:title type="html">christopherrmatthews</media:title>
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		<title>Has the Banking Industry Really Been Fixed?</title>
		<link>http://business.time.com/2013/02/05/has-the-banking-industry-really-been-fixed/</link>
		<comments>http://business.time.com/2013/02/05/has-the-banking-industry-really-been-fixed/#comments</comments>
		<pubDate>Tue, 05 Feb 2013 13:00:45 +0000</pubDate>
		<dc:creator>Michael Sivy</dc:creator>
				<category><![CDATA[Banking]]></category>
		<category><![CDATA[Companies & Industries]]></category>
		<category><![CDATA[Economics & Policy]]></category>
		<category><![CDATA[Economy]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Finance]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Financial Regulation]]></category>
		<category><![CDATA[Foreclosures]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Investing]]></category>
		<category><![CDATA[Investment Banking]]></category>
		<category><![CDATA[Markets]]></category>
		<category><![CDATA[Personal Finance]]></category>
		<category><![CDATA[Portfolio Strategy]]></category>
		<category><![CDATA[Private Equity]]></category>
		<category><![CDATA[Real Estate & Homes]]></category>
		<category><![CDATA[Real Estate Markets]]></category>
		<category><![CDATA[Stocks]]></category>
		<category><![CDATA[The Economy]]></category>
		<category><![CDATA[Wall Street & Markets]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=69750</guid>
		<description><![CDATA[The biggest economic puzzle of the past few years is why the recovery has remained so weak. The underlying cause of the 2007-2009 recession was the bursting of the real estate bubble. But it was the banking crisis resulting from the drop in home prices that actually sent the U.S. tumbling into the worst economic downturn since the Great Depression. Continuing problems in the banking industry have been among the chief factors holding back the recovery. The key question now is whether the banks have finally tackled their problems, so that the economy can start to grow more robustly. It certainly seems as though the banking sector should be on the mend. Home prices have turned up after hitting bottom early last year. And other borrowers are in better shape, too. Corporate profits have rebounded powerfully, and consumers have got their household debt under control. So you might think that banks would be in a stronger position to finance economic growth. The reality, however, is more complicated. The losses banks suffered because of falling home prices exposed a host of fundamental problems in the industry. Here’s a look at what needs to be addressed to get the financial system back to full strength: (MORE: Misguided? Half of Adult Children Think Parents Made No Money Mistakes) Regulation. There are two key types of regulation. The first limits the amount of risk a bank can take. Only trouble is, it’s hard for regulators – or anyone else – to monitor the riskiness of bank portfolios. Indeed, the major credit-rating agencies have come under sharp criticism for failing to recognize the risk of some sophisticated investments. The second type of regulation separates aggressive forms of banking from more mundane lending for mortgages, businesses, and consumer finance. That prevents speculative losses from leading to a cutback in credit available for ordinary business activities. A provision known as the Volcker Rule restricts banks from making risky investments with the same capital that they use to make loans to clients. But the rule does not require the nearly complete separation<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=69750&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Banking</primary_category><primary_category_link>http://business.time.com/category/banking-2/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/02/rtxdamt.jpg?w=240</featured_image>
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			<media:title type="html">Traders stand outside the New York Stock Exchange on March 27, 2009.</media:title>
		</media:content>

		<media:content url="http://2.gravatar.com/avatar/b8875a12f713f52ecc28fe72efed7fd4?s=96&#38;d=http%3A%2F%2F2.gravatar.com%2Favatar%2Fad516503a11cd5ca435acc9bb6523536%3Fs%3D96&#38;r=G" medium="image">
			<media:title type="html">michaelsivy</media:title>
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		<title>As Battle Brews Over Financial Watchdog Agency, A Look at What&#8217;s It&#8217;s Done So Far</title>
		<link>http://business.time.com/2013/01/28/as-battle-brews-over-financial-watchdog-agency-a-look-at-whats-its-done-so-far/</link>
		<comments>http://business.time.com/2013/01/28/as-battle-brews-over-financial-watchdog-agency-a-look-at-whats-its-done-so-far/#comments</comments>
		<pubDate>Mon, 28 Jan 2013 16:00:34 +0000</pubDate>
		<dc:creator>Martha C. White</dc:creator>
				<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[cfpb]]></category>
		<category><![CDATA[Congress]]></category>
		<category><![CDATA[financial reform]]></category>
		<category><![CDATA[financial regulation]]></category>
		<category><![CDATA[Richard Cordray]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=68762</guid>
		<description><![CDATA[When an appeals court ruled that President Obama&#8217;s recess appointments of members of the National Labor Relations Board was unconstitutional, it also threw into doubt the validity of the recess appointment last January of Richard Cordray, director of the Consumer Financial Protection Bureau. There was already a clash shaping up over Cordray&#8217;s reappointment; Obama nominated him Thursday, and Senate Republicans vowed to block the nomination, setting up the same stalemate that led to last year&#8217;s recess appointment in the first place.  The CFPB has had a turbulent childhood, so to speak, since it began operations in July 2011 (for one thing, it operated without a director for six months). Last week&#8217;s NLRB court decision sets a legal precedent, but it won&#8217;t affect the CFPB&#8217;s day-to-day operations, at least not in the near future. &#8220;Going forward, we will continue our essential work to protect American consumers,&#8221; a spokesperson says. The White House can  — and probably will — appeal this decision to the Supreme Court, but the CFPB still faces resistance. It&#8217;s not Cordray himself, a former Ohio attorney general who was aggressive in pursuing mortgage robo-signing fraud, that Congressional Republicans have a problem with. They want to have the bureau overseen by a committee, which supporters of the current structure say would give the industry too much of a chance to exert its influence and water down the rules meant to regulate it. For what it&#8217;s worth, even some in financial services have come around to Cordray over the year he&#8217;s been at the helm of the CFPB. Richard Hunt, president and CEO of the Consumer Bankers Association, told The Hill. “As chair of a commission, he would be a worthwhile, credible candidate.&#8221; &#8220;Our mission is to stand on the side of consumers&#8230; and see that they’re treated fairly,&#8221; Cordray said in a statement last week. So, how&#8217;s that working out? For the average bank accountholder, credit card user, borrower — you know, pretty much all of us — the CFPB has done a lot in its short tenure to implement<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=68762&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Financial Reform</primary_category><primary_category_link>http://business.time.com/category/economy-policy/financial-reform-economy-policy/</primary_category_link>
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			<media:title type="html">marthacwhite</media:title>
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		<title>What (If Anything) Can Fix the SEC?</title>
		<link>http://business.time.com/2013/01/28/what-if-anything-can-fix-the-sec/</link>
		<comments>http://business.time.com/2013/01/28/what-if-anything-can-fix-the-sec/#comments</comments>
		<pubDate>Mon, 28 Jan 2013 13:00:18 +0000</pubDate>
		<dc:creator>Christopher Matthews</dc:creator>
				<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Financial Regulation]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Wall Street & Markets]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=68336</guid>
		<description><![CDATA[When President Obama nominated former U.S. Attorney Mary Jo White to be the next Chairman of the Securities and Exchange Commission (SEC), the reaction was generally positive. White will be the first prosecutor to head the nation&#8217;s top financial regulator, and many critics of Big Finance are seeing the pick as a clear indication that the President wants to get tough on Wall Street shenanigans. For instance, Dennis Kelleher, president of the nonprofit organization Better Markets, which lobbies for financial regulatory reform, said in a statement: &#8220;Mary Jo White was a tough, smart, no nonsense, broadly experienced and highly accomplished prosecutor.  She knew who the bad guys were, went after them and put them in prison when they broke the law.  That’s what must happen if integrity and investor confidence is to be restored in our securities markets.  Wall Street is a high crime area and Mary Jo White brings the right skill set to restore the rule of law on Wall Street.&#8221; Kelleher is right in that the rule of law on Wall Street has broken down in recent years. Scandal has rocked the financial world for most of the new century, beginning with the collapse of Enron and the dot-com bubble bursting at the turn of the century, followed by the various misdeeds that lead to the 2008 financial crisis, and continuing to this day with banking scandals like LIBOR. But is a new leader with a bit of prosecutorial zeal all that&#8217;s needed at the SEC? After all, according to the SEC, the outgoing head of the SEC Mary Schapiro, oversaw a &#8220;record&#8221; number of enforcement cases, including bringing action against 129 seperate individuals whose transgressions were directly related to the financial crisis. Yet the public still feels like justice has not been done. The most high profile bankers who presided over the crisis are either still in their jobs, or left their positions with lucrative golden parachutes. And the financial industry as a whole appears to have little respect for the law of the land, as it produces scandals<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=68336&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Financial Regulation</primary_category><primary_category_link>http://business.time.com/category/economy-policy/financial-regulation-economy-policy/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/01/mary-jo-white.jpg?w=240</featured_image>
		<media:thumbnail url="http://timebusinessblog.files.wordpress.com/2013/01/mary-jo-white.jpg?w=240" />
		<media:content url="http://timebusinessblog.files.wordpress.com/2013/01/mary-jo-white.jpg?w=240" medium="image">
			<media:title type="html">Mary Jo White</media:title>
		</media:content>

		<media:content url="http://2.gravatar.com/avatar/8f9a71742e964af96ca58c01a0577a0d?s=96&#38;d=http%3A%2F%2F2.gravatar.com%2Favatar%2Fad516503a11cd5ca435acc9bb6523536%3Fs%3D96&#38;r=G" medium="image">
			<media:title type="html">christopherrmatthews</media:title>
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		<title>Waiting for Change: The Battle Over the U.S. Penny</title>
		<link>http://business.time.com/2013/01/24/waiting-for-change-the-battle-over-the-u-s-penny/</link>
		<comments>http://business.time.com/2013/01/24/waiting-for-change-the-battle-over-the-u-s-penny/#comments</comments>
		<pubDate>Thu, 24 Jan 2013 13:00:18 +0000</pubDate>
		<dc:creator>Josh Sanburn</dc:creator>
				<category><![CDATA[Currency]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Federal Reserve]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Government]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=68161</guid>
		<description><![CDATA[When was the last time you stopped to pick up a penny? Given that its purchasing power has dwindled to nearly nothing over the years, it&#8217;s probably been a while. The U.S. penny persists — but how long can it hold on? On Feb. 4, Canada will begin taking its pennies out of circulation, citing cost (it takes 1.6 cents to mint each one) and diminishing utility. And America&#8217;s anti-penny forces are hopeful that actions by our neighbor to the north will spur Washington to eliminate U.S. one-cent coins, each of which costs two cents to mint. Indeed, it gets increasingly difficult to defend a coin that costs us all money every year. But there are forces fighting for the status quo as well, including the zinc lobby. (Pennies are mostly made of zinc, not copper.) Plus, there&#8217;s the fact that without the penny, we&#8217;ll become more reliant on the nickel — a coin with it&#8217;s own sticky set of issues. Check out the latest TIME Explains video to get a sense of the U.S. penny&#8217;s persistent problems; and this week&#8217;s issue of TIME Magazine for the full story, &#8220;Waiting for Change.&#8221;<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=68161&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
		<wfw:commentRss>http://business.time.com/2013/01/24/waiting-for-change-the-battle-over-the-u-s-penny/feed/</wfw:commentRss>
		<slash:comments>0</slash:comments>
	<primary_category>Currency</primary_category><primary_category_link>http://business.time.com/category/economy-policy/currency-economy-policy/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/01/time_explainerpenny_1280.jpg?w=240</featured_image>
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			<media:title type="html">jsanburn</media:title>
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		<title>Four Misconceptions About Taxes and the Deficit</title>
		<link>http://business.time.com/2012/12/26/four-misconceptions-about-taxes-and-the-deficit/</link>
		<comments>http://business.time.com/2012/12/26/four-misconceptions-about-taxes-and-the-deficit/#comments</comments>
		<pubDate>Wed, 26 Dec 2012 10:45:11 +0000</pubDate>
		<dc:creator>Michael Sivy</dc:creator>
				<category><![CDATA[Austerity]]></category>
		<category><![CDATA[Economics]]></category>
		<category><![CDATA[Economy]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Health Care]]></category>
		<category><![CDATA[Healthcare]]></category>
		<category><![CDATA[Jobs]]></category>
		<category><![CDATA[Taxes]]></category>
		<category><![CDATA[Wall Street & Markets]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=65040</guid>
		<description><![CDATA[In all the negotiations to prevent the fiscal cliff from hurting the economy, potential compromises keep coming apart over the issue of raising income tax rates, especially on high earners. Income taxes stir up strong feelings among voters because of concerns about fairness — and politicians exploit those emotions, whichever party they belong to. As a result, the broader budget discussion keeps getting diverted to focus on tax rates, which actually play only a small role among the causes of current U.S. financial troubles. In fact, there are really two different budget problems that often get mixed together. One is the current deficit, which totaled more than $1.1 trillion last year, almost double the amount that the U.S. economy can comfortably carry. The other is the long-term accumulation of debt. Even after the U.S. economy fully recovers from the effects of the recession, the federal deficit is projected to remain too high. As a result, the national debt is on course to keep rising as a percentage of GDP until it reaches dangerous levels. (MORE: Entitlement Cuts Loom as Obstacle to Fiscal-Cliff Deal) While everyone agrees that growth of the national debt needs to be slowed over the long term, experts are divided over how much the current deficit should be cut. Some commentators even argue that the short-term deficit should be allowed to continue for another year or so to stimulate the sluggish economy. The best solution to both these problems would be a grand bargain that limits the growth of debt over the long term while trimming the immediate deficit just enough to show that policy is heading in the right direction. What keeps getting in the way are a bunch of misconceptions, chiefly about tax rates. Here are the four biggest: The Bush cuts in tax rates caused the deficit. Some economists argue that Bush Administration policies taken as a whole, including costly wars in Iraq and Afghanistan, caused much of the borrowing beyond what the U.S. economy can sustain. More often, though, the blame is focused specifically on the cuts in tax rates. Those rate<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=65040&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Economy &amp; Policy</primary_category><primary_category_link>http://business.time.com/category/economy-policy/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2012/12/c2a17e9cd7d94b4eb34e7d43558.jpg?w=240</featured_image>
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			<media:title type="html">Fiscal Cliff Tax Fixes</media:title>
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			<media:title type="html">michaelsivy</media:title>
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		<title>Do We Have Another Financial Bubble On Our Hands? Or Three?</title>
		<link>http://business.time.com/2012/12/19/do-we-have-another-financial-bubble-on-our-hands-or-three/</link>
		<comments>http://business.time.com/2012/12/19/do-we-have-another-financial-bubble-on-our-hands-or-three/#comments</comments>
		<pubDate>Wed, 19 Dec 2012 14:00:17 +0000</pubDate>
		<dc:creator>Michael Sivy</dc:creator>
				<category><![CDATA[Austerity]]></category>
		<category><![CDATA[Banking]]></category>
		<category><![CDATA[Bonds]]></category>
		<category><![CDATA[Economics]]></category>
		<category><![CDATA[Economy]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Federal Reserve]]></category>
		<category><![CDATA[Finance]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Investing]]></category>
		<category><![CDATA[Jobs]]></category>
		<category><![CDATA[Markets]]></category>
		<category><![CDATA[Mortgages]]></category>
		<category><![CDATA[Municipal Government]]></category>
		<category><![CDATA[Real Estate & Homes]]></category>
		<category><![CDATA[Real Estate Markets]]></category>
		<category><![CDATA[Stocks]]></category>
		<category><![CDATA[Taxes]]></category>
		<category><![CDATA[Wall Street & Markets]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=64489</guid>
		<description><![CDATA[More than two years ago, economists started talking about a bubble in Treasury bonds that would eventually burst, just as the dot.com bubble and the housing bubble had. If that happens, the prices of long-term bonds could fall by 10% to 20%. So far, that bond bust hasn&#8217;t materialized. But one of the characteristics of bubbles is that they often go on longer than anyone expects. What is most troubling now is that the problem is spreading beyond Treasuries. Excessive borrowing and ultra-low interest rates are now distorting all the debt markets. As a result, there is no longer just one bubble – there are many. The details vary, but debt bubbles have two things in common. First, there is a big increase in borrowing often promoted by government policies and sometimes accompanied by a decline in lending standards. Second, there is a huge increase in the amount of money available that keeps interest rates low. Sometimes the cash comes from the government and sometimes it is provided by the banking sector, as it was during the housing bubble. The current debt market bubbles are largely the result of Federal Reserve Chairman Ben Bernanke’s decision to pump huge amounts of money into the banking system. Because of the recession, interest rates would probably have fallen somewhat anyway. And because bond prices normally move in the opposite direction from rates, prices would have risen. But the Fed&#8217;s policies over the past couple of years have depressed interest rates and pushed up bond prices far more than normal. Only trouble is, the Fed can&#8217;t keep this up forever. Rapid money growth can be absorbed if the economy is slack. But once a recovery picks up speed, consumers start spending more exuberantly and businesses become more willing to invest. Excess cash then begins to encourage inflation unless the Fed turns around and drains money from the banking system. Interest rates are likely to rise either way, whether the Fed allows inflation or restrains money growth. (MORE: Why the Fiscal Cliff May Cost You $6,000 in<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=64489&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Economy &amp; Policy</primary_category><primary_category_link>http://business.time.com/category/economy-policy/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2012/12/money-in-pockets.jpg?w=240</featured_image>
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			<media:title type="html">Do We Have Another Financial Bubble On Our Hands?</media:title>
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			<media:title type="html">michaelsivy</media:title>
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		<title>Banking&#8217;s Really Bad Day</title>
		<link>http://business.time.com/2012/12/12/bankings-really-bad-day/</link>
		<comments>http://business.time.com/2012/12/12/bankings-really-bad-day/#comments</comments>
		<pubDate>Wed, 12 Dec 2012 13:00:43 +0000</pubDate>
		<dc:creator>Rana Foroohar</dc:creator>
				<category><![CDATA[Banking]]></category>
		<category><![CDATA[Curious Capitalist]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Finance]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Financial Regulation]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[White Collar Crime]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=63969</guid>
		<description><![CDATA[Four years on from the financial crisis, new banking scandals still seem to break out every few months. But this week has been particularly bad for the industry. There was HSBC’s $1.9 billion settlement with the U.S. Justice Department over laundering money for Latin American drug cartels and helping countries like Iran, Cuba, Sudan, Libya, and Burma avoid sanctions. Standard Chartered, another British bank, got dinged too, and now owes Justice a total of $667 million in fines for similar sanction breaches. Then there were the arrests of three London bankers, including one who had worked at Swiss financial giant UBS, by London police as part of the ongoing investigation into widespread manipulation of “LIBOR,” or the “London Interbank Offered Rate,” which is the interest rate that a bank might charge one another bank to borrow money. UBS has reportedly put aside an extra $610 million this year to deal with regulatory issues, presumably in expectation of fines along the lines of the $450 million paid by Barclays for rate manipulation earlier this year. (MORE: The Case for Banking Regulation) Whew. It’s a lot to take in, and market officials are opening public coffers and doing just that &#8212; indeed, given the low-hanging fruit of scandal that still seems to exist in the banking industry, it may be that throwing more money at regulators who turn up further financial misdeeds could be a new way to plug the deficit. But joking aside, not all these scandals are created equal. Standard Charter’s sanction offenses are specific to the politics of the U.S. HSBC’s money laundering is a bigger deal, and as Financial Times columnist John Gapper pointed out in a very smart blog post, raises the issue of the high reward/high risk ratio of doing business in emerging markets. Both HSBC and Standard Chartered have their roots in Asia, and have done well in boom times. But emerging markets are tougher to police than more regulated ones like Europe and the U.S. – and clearly, HSBC missed the boat. It’s also worth pointing out, as I did in a column<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=63969&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Financial Regulation</primary_category><primary_category_link>http://business.time.com/category/economy-policy/financial-regulation-economy-policy/</primary_category_link>
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			<media:title type="html">ranaforoohar</media:title>
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		<title>Regulatory Report Card: How Effective Was Mary Schapiro as SEC Chair?</title>
		<link>http://business.time.com/2012/11/27/regulatory-report-card-how-effective-was-mary-schapiro-as-sec-chair/</link>
		<comments>http://business.time.com/2012/11/27/regulatory-report-card-how-effective-was-mary-schapiro-as-sec-chair/#comments</comments>
		<pubDate>Tue, 27 Nov 2012 14:00:09 +0000</pubDate>
		<dc:creator>Christopher Matthews</dc:creator>
				<category><![CDATA[Economy]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Financial Regulation]]></category>
		<category><![CDATA[Government]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=62136</guid>
		<description><![CDATA[SEC Chairman Mary Schapiro announced yesterday that she would be stepping down from her role in December, marking the end of one of the most eventful four-year periods in the SEC&#8217;s history. When she assumed the Chairmanship of the SEC in January of 2009, the reputation of America&#8217;s financial regulatory apparatus was at its nadir. For more than a decade, regulators had failed to react to a growing real estate bubble, the bursting of which precipitated the worst financial crisis the country had seen in generations. Then, in December 2008, Bernie Madoff was arrested and charged with criminal securities fraud related to a decades-old ponzi scheme that he had operated right under the noses of the SEC, the most powerful and prominent securities regulator in the country. Meanwhile, large financial institutions were being bailed out with taxpayer money because the regulatory system had failed to require those firms to hold enough rainy-day capital. Schapiro, in other words, came to Washington needing to not only help guide the country through the financial crisis, but justify the SEC&#8217;s very existence in light of its past failures. Indeed, Schapiro&#8217;s central victory as SEC Chair may be that she protected her organization&#8217;s role in the regulatory process during the Dodd-Frank overhaul. The SEC&#8217;s reputation was damaged by the Madoff affair in particular, given that whistleblowers had repeatedly warned the regulator about the ponzi scheme over several years before Madoff&#8217;s machinations were finally exposed. As Huffington Post&#8217;s Mark Gongloff writes: &#8220;Before Schapiro took office, there was talk in Washington that maybe the SEC, which had completely failed to notice Bernie Madoff openly ripping people off for years, should be abolished. Schapiro helped end that talk by showing that the agency could occasionally still take stabs at setting rules and enforcing laws on Wall Street.&#8221; The SEC did emerge from the Dodd-Frank regulatory overhaul with its power mostly in tact. But if the successful waging of a regulatory turf war is one of Schapiro&#8217;s primary successes, that&#8217;s not much to write home about. After all, before Schapiro got the role of SEC chair,<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=62136&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Financial Regulation</primary_category><primary_category_link>http://business.time.com/category/economy-policy/financial-regulation-economy-policy/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2012/11/biz_schapiro_112612.jpg?w=240</featured_image>
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			<media:title type="html">christopherrmatthews</media:title>
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		<title>Why the Fiscal Cliff is the Wrong Thing to Worry About</title>
		<link>http://business.time.com/2012/11/27/why-the-fiscal-cliff-is-the-wrong-thing-to-worry-about/</link>
		<comments>http://business.time.com/2012/11/27/why-the-fiscal-cliff-is-the-wrong-thing-to-worry-about/#comments</comments>
		<pubDate>Tue, 27 Nov 2012 13:00:53 +0000</pubDate>
		<dc:creator>Michael Sivy</dc:creator>
				<category><![CDATA[Austerity]]></category>
		<category><![CDATA[Bonds]]></category>
		<category><![CDATA[Economics]]></category>
		<category><![CDATA[Economy]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Federal Reserve]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Health Care]]></category>
		<category><![CDATA[Healthcare]]></category>
		<category><![CDATA[Investing]]></category>
		<category><![CDATA[Jobs]]></category>
		<category><![CDATA[Portfolio Strategy]]></category>
		<category><![CDATA[Stocks]]></category>
		<category><![CDATA[Taxes]]></category>
		<category><![CDATA[Wall Street & Markets]]></category>
		<category><![CDATA[World Finance]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=62104</guid>
		<description><![CDATA[When asked what it was like living through the German bombing of Crete during World War II, British novelist Evelyn Waugh replied that it began impressively enough but went on far too long. The same might be said for the current debate over the Fiscal Cliff. This issue loomed large during the Presidential campaign, but now promises to become an endless and tedious dispute. In the end there will probably be an unsatisfying compromise that avoids disaster but solves nothing important, while little attention is paid to America&#8217;s fundamental economic problems. The essence of the debate is that the Federal government has been running an ultimately unsustainable deficit of more than $1 trillion a year. A variety of changes in taxes and government spending are scheduled to go into effect in 2013 that would reduce this deficit by as much as $645 billion. That would bring the deficit down to a tolerable level, but poses two problems. First, more than two-thirds of the financial burden of this reduction would fall on the middle class – something both political parties have promised they would avoid. Second, there is genuine disagreement as to whether such a sudden drop in the deficit would be a drag on a still-weak economy. (MORE: As Fiscal Cliff Approaches, Mayors Warn of the Toll on Cities) One school of thought is that there is plenty of money around, thanks to the Federal Reserve’s policy of quantitative easing. In addition, U.S. corporations have accumulated a cash hoard of more than $1.7 trillion, according to the Fed, and may have trillions more stashed in overseas subsidiaries. The reason for today&#8217;s slow growth, therefore, is not a lack of money but rather the fact that everyone is hesitant to spend because of uncertainty about the deficit, taxes and government policy generally. From this perspective, any consensus solution that starts bringing down the deficit would unleash loads of consumer spending and business investment. The alternative viewpoint, advocated by economists such as New York Times columnist Paul Krugman, is that reducing the deficit makes no<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=62104&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Economy &amp; Policy</primary_category><primary_category_link>http://business.time.com/category/economy-policy/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2012/11/biz_fiscalcliff_1130.jpg?w=240</featured_image>
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			<media:title type="html">image: The sun rises on a cloudy morning at the Capitol in Washington, Nov. 13, 2012.</media:title>
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		<media:content url="http://2.gravatar.com/avatar/b8875a12f713f52ecc28fe72efed7fd4?s=96&#38;d=http%3A%2F%2F2.gravatar.com%2Favatar%2Fad516503a11cd5ca435acc9bb6523536%3Fs%3D96&#38;r=G" medium="image">
			<media:title type="html">michaelsivy</media:title>
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		<title>How to Help Stay-at-Home Spouses Get Credit Cards Without Risking Our Financial Institutions</title>
		<link>http://business.time.com/2012/11/21/how-to-help-stay-at-home-spouses-get-credit-cards-without-risking-our-financial-institutions/</link>
		<comments>http://business.time.com/2012/11/21/how-to-help-stay-at-home-spouses-get-credit-cards-without-risking-our-financial-institutions/#comments</comments>
		<pubDate>Wed, 21 Nov 2012 16:00:32 +0000</pubDate>
		<dc:creator>Odysseas Papadimitriou</dc:creator>
				<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Financial Regulation]]></category>
		<category><![CDATA[CARD act]]></category>
		<category><![CDATA[cfpb]]></category>
		<category><![CDATA[Consumer Financial Protection Bureau]]></category>
		<category><![CDATA[families]]></category>
		<category><![CDATA[housewife]]></category>
		<category><![CDATA[moms]]></category>
		<category><![CDATA[spouses]]></category>
		<category><![CDATA[stay-at-home moms]]></category>
		<category><![CDATA[stay-at-home-spouse]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=61402</guid>
		<description><![CDATA[A regulation requiring proof of personal income in credit card applications has justly been described as &#8220;anti-housewife&#8221;. The rules hurt the ability of nonworking spouses to access credit and build their own independent credit standing. There is a smart solution to the problem—but it&#8217;s not the one currently being proposed by the Consumer Financial Protection Bureau. Before getting to that, a bit of background is in order. In response to the widespread overleveraging that left much of society teetering on the edge of financial disaster, Congress included an ability-to-pay clause in 2009’s CARD Act. This essentially requires credit card companies to evaluate whether or not one’s independent income and assets enable them to at least make minimum payments on a credit card account. Sounds pretty reasonable: If you want a credit card, you should be pay off the debts incurred with the card. Well, in what some regulators are calling an “unintended consequence,” the law has hampered the ability of stay-at-home spouses to build credit independently, thereby creating quite the stir, especially among women’s groups. Even though the existence of joint credit card applications makes credit cards and their credit building powers attainable for most stay-at home spouses, the Consumer Financial Protection Bureau (CFPB) has succumbed to the pressure of a well-publicized Change.org petition bearing the names of 45,000 people demanding that the rule be altered. The CFPB issued a notice of proposed rulemaking October 17 that, if enacted, would enable all credit card applicants over the age of 21 to “rely on third-party income to which they have a reasonable expectation of access.” (MORE: CFPB Plans to Fix &#8216;Anti-Housewife&#8217; Credit Card Law) Yes, such a system would give stay-at-home spouses better access to credit. But it would also come with unintended consequences of its own. For example, imagine that a credit card company receives applications from the following two married consumers: Consumer A has $50,000 in income and $200,000 in debts Consumer B has $0 in income and $0 in debts Which consumer would be OK&#8217;d for a card?<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=61402&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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	<primary_category>Financial Regulation</primary_category><primary_category_link>http://business.time.com/category/economy-policy/financial-regulation-economy-policy/</primary_category_link>
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			<media:title type="html">TIME.com</media:title>
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		<title>Why So Many Americans Don’t Have Bank Accounts</title>
		<link>http://business.time.com/2012/11/20/why-so-many-americans-dont-have-bank-accounts/</link>
		<comments>http://business.time.com/2012/11/20/why-so-many-americans-dont-have-bank-accounts/#comments</comments>
		<pubDate>Tue, 20 Nov 2012 10:45:17 +0000</pubDate>
		<dc:creator>Michael Sivy</dc:creator>
				<category><![CDATA[Banking]]></category>
		<category><![CDATA[Borrowing]]></category>
		<category><![CDATA[Credit Cards]]></category>
		<category><![CDATA[Decision Making]]></category>
		<category><![CDATA[Economics & Policy]]></category>
		<category><![CDATA[Entrepreneurship]]></category>
		<category><![CDATA[Financial Education]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Financial Regulation]]></category>
		<category><![CDATA[Personal Finance]]></category>
		<category><![CDATA[Planning]]></category>
		<category><![CDATA[Psychology of Money]]></category>
		<category><![CDATA[Saving & Spending]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=61458</guid>
		<description><![CDATA[At a time when you can pay bills online and deposit checks remotely using a cell phone, it’s amazing how many Americans don’t have bank accounts. One in nine households is without a checking account. And almost one-third of the population is underbanked — lacking the full range of basic financial services. Going without such services is not only inconvenient but also expensive. Someone who cashes paychecks or benefit checks at a check-cashing service and pays bills with money orders may end up spending more than $500 a year for transactions that would cost no more than $120 at banks that offer basic checking accounts. “Life is more expensive for people who have less,” says Brian Blake, vice president of CheckSpring Bank, an institution in New York City’s South Bronx that provides banking services to low-income customers. The bank, which is changing its name to Spring Bank, is about to open a second branch in Harlem. “Even in gentrifying neighborhoods, there are lots of people earning less than $15,000 a year,&#8221; says Blake. Not surprisingly, low-income people are the ones most likely to be underbanked, according to FDIC data. Among households with annual incomes of less than $15,000 a year, 28% have no bank account and another 22% have less than a full range of services. Rates of underbanking are similarly high among the unemployed, people without high school degrees and those under the age of 25. In addition, African Americans, Native Americans and Hispanics have higher rates than whites and Asians. Only about 5% of employed middle-class Americans are without bank accounts, but more than 20% use financial services outside the banking system — typically for reasons of convenience. (MORE: A Credit Card Promises to Do the Price-Matching Legwork for You) It’s one thing, of course, for relatively affluent people to pay a fee to cash a check because they are in a rush, and quite another for someone to rely on so-called alternative financial services for all of his or her transactions. Check-cashing services in New York are permitted to<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=61458&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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	<primary_category>Banking</primary_category><primary_category_link>http://business.time.com/category/banking-2/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2012/11/bu000651.jpg?w=240</featured_image>
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			<media:title type="html">BU000651</media:title>
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			<media:title type="html">michaelsivy</media:title>
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