Month: October 2021

U.S. Economy Grew 2% in Third Quarter

Gross domestic product – the broadest measure of economic performance – grew at a 2% annual rate during the three months through September, the weakest of the recovery, according to an advance estimate released Thursday by the Commerce Department.

Personal consumption grew at a 1.6% pace after accelerating 12% during the second quarter. Businesses have since the reopening of the global economy struggled to keep store shelves stocked due to supply-chain bottlenecks and labor deficiencies. The supply shortages have resulted in higher prices for the consumer.

Core personal consumption expenditures, the Federal Reserve’s preferred inflation measure, increased 4.5% in the third quarter. While that was below the 6.1% increase in the second quarter, it remained well above the Fed’s 2% long-term target.

Increases in private inventory investment, personal consumption expenditures, state and local government spending, and nonresidential fixed investment were partly offset by a drop in residential fixed investment, federal government spending, and exports.

Weaker motor vehicle expenditures subtracted 2.39 percentage points from GDP during the quarter.

Record imports of foreign goods resulted in net exports deducting 1.14 percentage points from growth.

Consumer Alert: DATCP Sees Rise in Antivirus Subscriptions Email Scams

Wisconsin consumers are receiving an increasing number of fake antivirus emails from scammers. In the past year, the Department of Agriculture, Trade and Consumer Protection (DATCP) received three times the number of complaints from consumers who have lost money to this scam as in the prior year.

These emails often falsely claim that the recipient’s subscription to antivirus software has been automatically renewed, and their bank account will be charged several hundred dollars. The email provides a phony customer service number to call and cancel. Scammers wait for people  to call them and take advantage of those who provide their credit card information, account numbers, passwords, and other information. They have also been known to ask recipients to download a file

Reports to DATCP’s Bureau of Consumer Protection indicate that these phony emails have eventually led to scammers accessing victims’ computers through downloaded files, pop-up windows, or web addresses provided over the phone. Once they have access they can install malware, block you from your files, and steal your financial information.

If you receive a similar email, be wary. Delete the email and do not call any numbers provided in the email. If you have an antivirus subscription and have questions about its status, contact the company through a trusted contact method.

Federal Reserve Bank Faces Challenges to Credibility

The Federal Reserve is attempting to tamp down two significant challenges to its credibility as both its handling of inflation and internal ethics face growing scrutiny. 

The central bank is quickly moving to address a scandal involving stock trades made by its top officials. And price increases are running higher and longer than many Fed officials expected, boosting pressure on the bank to slam the brakes on the recovery from the COVID-19 pandemic and back down from a new, more tolerant approach to inflation. 

The Fed last year launched a strategy that allows inflation to rise above the bank’s 2 percent annual target to make up for almost a decade of low price increases and stagnant wages. The new framework was meant to allow wages and employment to rise until inflation was on track to average out near the Fed’s ideal level before the bank hiked interest rates.

Even so, the persistence of high inflation and uncertainty over how long it will last is boosting pressure on the Fed to change course and deviate from its new framework. 

Prices grew by 4.3 percent in the year leading into August, according to the personal consumption expenditures index, the Fed’s preferred gauge of inflation. The consumer price index for September also showed steady increases in food, energy and housing prices, prompting interest rates on bonds to rise as Wall Street braces for higher inflation.

The Fed is almost certain to announce next month its plans to reduce its monthly purchases of Treasury and mortgage bonds, initiated in March 2020 to keep markets flowing, with the economy well into its recovery. Powell reiterated Friday that the Fed does not plan to raise interest rates until the labor market is on track to fully recover from the pandemic.

Announcing a sooner start to interest rate hikes could appease inflation hawks and soothe some concern about rising prices. But experts say it would raise serious doubts about the Fed’s willingness to follow its own rules as it also scrambles to contain the fallout of a trading scandal involving at least two former top officials. 

All Wisconsin Phone Calls will Require Dialing the Area Code

Starting Sunday people in Wisconsin will have to dial local numbers using 10 digits — the area code and the seven-digit phone number.

Currently, people in Wisconsin can place a call to a number in the same area code without dialing the area code. The change will affect both landlines and cellphones and all of Wisconsin’s six area codes, as well as more than two dozen other states that have not already switched to 10-digit dialing.

The change is because the Federal Communications Commission is establishing 988 as the new nationwide phone number for suicide prevention and mental health help.

CDC Expands Eligibility for COVID-19 Vaccine Booster Shots

On Thursday, CDC Director Rochelle Walensky, endorsed the CDC Advisory Committee on Immunization Practices (ACIP) recommendation for a booster shot of COVID-19 vaccines in certain populations.

For individuals who received a Pfizer-BioNTech or Moderna COVID-19 vaccine, the following groups are eligible for a booster shot at 6 months or more after their initial series:

For the nearly 15 million people who got the Johnson & Johnson COVID-19 vaccine, booster shots are also recommended for those who are 18 and older and who were vaccinated two or more months ago.

There are now booster recommendations for all three available COVID-19 vaccines in the United States. Eligible individuals may choose which vaccine they receive as a booster dose. Some people may have a preference for the vaccine type that they originally received and others, may prefer to get a different booster. The CDC recommendations now allow for this type of mix and match dosing for booster shots.


Legislative Leaders Introduce New Congressional and Legislative District Maps

Yesterday, Senate Majority Leader Devin LeMahieu (R-Oostburg) and Assembly Speaker Robin Vos (R-Rochester) introduced the new maps for Congressional, Assembly and Senate districts. (Senate Bill 621/Senate Bill 622) as part of the redistricting process in Wisconsin.

Every ten years, the U.S. Census Bureau publishes updated information reflecting changes in the population since the previous census. This information is used by states to redraw local, legislative, and congressional districts so that each district has approximately the same number of  people.

The Wisconsin State Legislature, according to their constitutional and statutory duty, has undertaken this task with requests for additional input from numerous public advocacy groups, including the ‘People’s Maps Commission’, and Wisconsinites from across the state. The new district maps are the next step towards crafting final districts which meet every criteria required by state law, the U.S. Supreme Court, Wisconsin Supreme Court, and the Constitutions of the United States of America and the State of Wisconsin.

With the introduction of the maps as legislation, Wisconsinites will now have the opportunity to thoroughly review and give comment on congressional districts, state senate districts, and state assembly districts as part of the public hearing process. That additional input will continue the open, transparent process as bills move through the Legislature.

The Legislature made it very clear through Senate Joint Resolution 63 that the criteria used to create maps are consistent with the traditional and legal frameworks that guide redistricting. The transparent efforts to engage the public and enshrine our intent through an official action of the Legislature is designed to give everyone in Wisconsin confidence in the process and additional opportunity for unprecedented public input.

State of Wisconsin Ends Fiscal Year 2021 with $2.58 Billion Positive Balance

Wisconsin concluded Fiscal Year 2021, which ended on June 30, 2021, with a positive balance of $2.58 billion.  In addition, the state increased its Budget Stabilization Fund (“Rainy Day” Fund) to a record-high $1.73 billion according to the new Annual Fiscal Report released by the Wisconsin Department of Administration (DOA) today.

“A healthy rainy-day fund will help us face tomorrow’s challenges head-on,” said DOA Secretary Joel Brennan. “By prudently managing our way through this crisis, we’ve built the largest Budget Stabilization Fund in state history, making sure we’re ready for future challenges, and securing a strong pandemic recovery for our hard-hit communities, businesses and industries.”

Noteworthy items from the Fiscal Year 2021 Annual Fiscal Report include:

  • The state’s undesignated general fund balance at the end of Fiscal Year 2021 was $2.58 billion, more than double the prior year’s balance of $1.17 billion in Fiscal Year 2020.
  • Wisconsin transferred excess revenues of $967.4 million to its Budget Stabilization Fund, more than doubling the prior year balance. The current Budget Stabilization Fund balance now totals roughly $1.73 billion, the largest in the state’s history and more than five times larger than the balance at the end of Fiscal Year 2018.
  • State general fund tax collections in Fiscal Year 2021 increased by 11.6% over the prior year and exceeded the most recent estimates by nearly $319 million.

The full Fiscal Year 2021 Annual Fiscal Report is available here: 

Biden Administration Scales Back IRS Bank-Monitoring Plan

The Biden administration on Tuesday endorsed a scaled-back version of a proposal that could force banks to turn over customers’ account information to the Internal Revenue Service under growing criticism from banking groups and Republicans.

Under a new plan that Senate Democrats are expected to unveil, banks, credit unions and other financial institutions would be required to report annually on accounts with deposits and withdrawals worth more than $10,000, rather than the $600 threshold that President Biden initially proposed.

Banks are already required to report any transaction that exceeds $10,000 to the Financial Crimes Enforcement Network – part of anti-money laundering requirements.

In a September letter addressed to House Speaker Nancy Pelosi, D-Calif., and Minority Leader Kevin McCarthy, R-Calif., more than 40 banks urged lawmakers to vote against such a proposal, warning it could create a “tremendous liability” for all involved by requiring the collection of financial information for the majority of Americans “without proper explanation of how the IRS will store, protect and use this enormous trove of personal financial information.”

We Energies and WPS Customers Will See Higher Heating Bills

Two of the state’s largest utilities are warning of higher heating bills this winter as natural gas prices have more than doubled since earlier this year. Natural gas has been relatively cheap for years, but prices have surged due to lower supplies and rising demand worldwide.

The price to buy natural gas has spiked from $2.62 per million British thermal unit earlier this year to between $5 and $6 since late September, according to the Energy Information Administration.

In the agency’s winter fuels outlook, the EIA expects nearly half the nation’s households that use natural gas will spend between 22 and 50 percent more on average, depending on whether the winter is colder or warmer than normal. Homes that use propane for heating could see costs rise between 29 and 94 percent depending on the severity of winter weather.

The state’s largest electric and natural gas utility, We Energies, warns the cost to heat homes could go up by $25 per month for residential customers based on a typical winter. Wisconsin Public Service customers could pay $40 more per month.

OSHA Sends Employer Vaccine Rule to White House for Final Review

The Occupational Safety and Health Administration has submitted the text of a new vaccine rule for large employers to the Office of Management and Budget, bringing the emergency standard announced by President Joe Biden last month one step closer to taking effect.

“The Occupational Safety and Health Administration has been working expeditiously to develop an emergency temporary standard that covers employers with 100 or more employees to ensure their workers are fully vaccinated or undergo weekly testing to protect employees from the spread of coronavirus in the workplace,” a Labor Department spokesman said Tuesday.

“On Tuesday, October 12, as part of the regulatory review process, the agency submitted the initial text of the emergency temporary standard to the Office of Management and Budget.”

Once OMB concludes its review of the regulation, the emergency temporary standard will be published in the Federal Register, when it will go into effect.