Average 401(k) Down $34K This Year: Economists; Kanye West to Buy Social Media Parler | NTD Business

Thanks for watching NTD Business. Coming up... Retirement accounts have taken a beating this year. We tell you why. Rapper Kanye West agrees to buy social media platform Parler. That's after he was kicked off to other platforms. And Chinese leader Xi Jinping tightens his grip over the country. He says he's determined to win a specific war with the United States. With that and much more, coming up on NTD Business. How would you feel about your government being able to control what you spend your money on? Well, an official from the International Monetary Fund says central bank digital currencies could allow governments to do just that, control your spending. IMF Deputy Managing Director Bo Lee says the CBDC could improve so-called financial inclusion through programmability. Here he is at the IMF World Bank meeting Saturday. Spooky. Before joining the IMF, Lee worked for many years at China's central bank, the People's Bank of China. Now he's facing backlash for what he said, including from policy expert Nick Anthony at the Cato Institute, who said that governments have misused these tools in the past. Think Canada's move to freeze protester bank accounts earlier this year. Fed Chair Jerome Powell said last month that a CBDC would not be anonymous like banknotes are. That means those transactions may be public. But on the bright side, Wall Street had a pretty good day today. Recoup some of your losses maybe. The Dow Jones added 551 points, one and nine tenths of a percent. S&P 500 gained 95 points, two and seven tenths of a percent. And the Nasdaq rose 354 points, three and four tenths of a percent today. But if you checked your retirement account lately, you might want to avoid doing that, according to economists at the Heritage Foundation. That's because the average American has lost tens of thousands of dollars in savings thanks to inflation and stock market losses. Stephen Moore and E.J. Antoni say the average 401k plan had around $135,000 at the beginning of the year. But thanks to inflation and negative returns in the stock market, the average 401k plan has lost about $34,000 since the start of the year. That's down more than 25 percent. In their article in the New York Post, they said inflation is hitting more traditional pension funds too. They say pension funds have dropped around 15 percent this year, wiping out the last two years worth of gains. And they were two good years. So inflation has spooked investors, spooked the markets. It's kind of spooked everyone. It's not even Halloween yet. But one congressman has a plan. Get back onto the gold standard. West Virginia rep Alex Mooney has introduced a bill that would peg the U.S. dollar to a certain weight of gold. The idea is to stabilize the value of the dollar. Sounds good for you and me. But it would restrain government spending. Oh no. Since you'd be able to swap your dollars for gold at any point in time, the government would really need to keep plenty of the yellow metal on hand. That could restrain it from running massive budget deficits every year and having to print up new dollars to make up the shortfall. So with us to discuss this new gold standard bill is West Virginia Congressman Alex Mooney. Congressman, it's a pleasure. Thanks for coming on. Great to be with you. So, Congressman, I think a gold standard for anyone worried about inflation or the country's debt is kind of like a dream, right? But how do your colleagues, your big spending colleagues up on Capitol Hill feel about it? Well, I tell you, on the Republican side, there's a lot of support for it. We've seen really back to when Barack Obama was president. That's when I was first elected. The monetary policy games he was playing, quantitative easing is a term where they just add more money into the economy and inflation goes up. And there's the value of the dollar is just sacrificed at the altar of more spending and really transferring of wealth because it steals people's savings. The inflation takes from people's savings. And so I really I wanted to make the point that the dollar is not tied to anything. There's no set value. The federal government can play games with it. If we had the gold standard or frankly, any other kind of standard to tie the dollar just to stabilize it, it'd be great for this country and more fair to all Americans. I think to your point on your bill, you mentioned that since the year 2000, the dollar has lost 30 percent of its value. That's incredible. But Congressman, you've been in the House since 2015. OK, a lot of changes under President Trump. Fiscal responsibility, unfortunately, was not one of those changes. Why should voters think it will be any different this time? Well, I would say both parties, Republicans and Democrats need to control spending. Our debt is 31 trillion. And I can tell you as a member of Congress, I'm just not seeing the discipline to rein that in. And again, that's why forcing the Congress to act in a fiscally responsible manner by having a gold standard so you can't play the games with the dollar bill is a good idea. Frankly, a balanced budget amendment, I think, is very much needed at the federal level. So there are things we should do to restrict ourselves and putting in the gold standard bill. I'm a good company. Jack Kemp put it in in 1989. I'm the first member of Congress to put the bill in since Jack Kemp. Ronald Reagan supported the gold standard. Unfortunately, Richard Nixon, a Republican, took us off the gold standard. But all his predictions, the opposite occurred. He predicted more stability, controlling inflation, and the opposite occurred. It was a mistake to go off the standard. And now, of course, you see the rise of cryptocurrencies, frankly, as a result. I think we have the fiscal side, like you mentioned. I think politicians have some part to play in this for sure. The Federal Reserve, at the same time, it's interesting because the Fed's mission at the moment is to harm the jobs market. They want fewer people working. They want wages to come down. This is their fix for inflation. I think your bill, in fact, would actually reduce the number of people working at the Fed somehow, ironically. Are you surprised that the Fed has not been held more accountable, given that inflation is their job after all? Yeah, it is a surprise. They operate with much too much, I guess, power to themselves, frankly. I'm on the Financial Services Committee, and we've seen the growth in the bureaucracy at the Fed and many other places. Lack of accountability, even at Congress. Many of these organizations just tweak the monetary policy in ways that few people can follow and really isn't the way our country was designed to be stable and fair for all with their savings. So we need to regain control of that. Again, the gold standard is just one idea of many to stabilize our economy. Do you ever get the feeling in D.C. that between the federal government and the Fed, there's a kind of a you scratch our back, we'll scratch yours? Because I never hear the Fed criticizing fiscal spending, but I very rarely hear Congress criticizing the Federal Reserve's actions. Yeah, there's a lot of back and forth like that. I mean, they still have to get appointed and confirmed. But the point is, I believe that the legislative branch, the House of Representatives specifically, should be in control of the spending of this country. The U.S. Constitution is a beautiful thing, and it says that all spending and taxation must arrive in the House of Representatives. And to the extent that bureaucrats take that power and start playing fiscal games, whether it's the Fed or, frankly, the president himself, deciding how to spend, it really destroys the foundation of our country where the People's House, the U.S. House of Representatives, elected every two years, we've got an election coming up next month, is reflective of the people's will. You start giving that to unelected bureaucrats, and you have these games and problems and no accountability. And that's not right. I don't care what party you are. That's not right for anybody. Well, Congressman, we'll be following your bill very, very closely. Have a great one, Congressman Alex Mooney from West Virginia. Thank you, sir. You're welcome. And Saudi Arabia's defense minister says he's shocked the Biden administration has accused his country of siding with Russia. Makes things between the U.S. and Saudi Arabia even more tense. As part of OPEC Plus and against President Biden's wishes, Saudi Arabia agreed to cut oil production. That could lead to higher inflation in America right before the midterm elections. If Republicans win enough seats in Congress, it'll be difficult for Biden to advance his agenda for the rest of his term. So Biden said that the Saudis would face punishment and that it's time to rethink U.S.-Saudi relations. The U.S. has partnered with Saudi Arabia for eight decades. That relationship has even involved defense agreements. Now, what could happen if things turn sour? Right now, the majority of all oil transactions worldwide are done with the U.S. dollar, which benefits the U.S. immensely. It creates a massive amount of artificial demand for the dollar, which allows the U.S. government to comfortably print and spend far more than it otherwise could. Holding global reserve currency status is a key reason for American dominance and wealth. And the fact that the world's oil is mostly traded in dollars actually began with Saudi Arabia. That was after President Nixon took America off the gold standard. The U.S. dollar became the floating currency. But quickly afterward, his administration went to Saudi Arabia and negotiated a deal. If Saudi Arabia sold all of its oil only for U.S. dollars, America would provide it with military protection and weapons. Saudi Arabia still buys weapons from the U.S. to this day. Just last year, it accounted for 24% of U.S. arm exports. So, after Saudi Arabia agreed back then, during the Nixon era, other countries followed. And this is why most of the world's oil is traded in the U.S. dollar, creating a lot of artificial demand for the dollar, which keeps it strong, even as the government keeps printing more and more of it. This is one reason why the U.S. can have a $31 trillion national debt, a big military, and so much social welfare. That's despite its big trade deficits. So, if countries stop trading oil in the U.S. dollar, it could threaten the U.S. dollar's status as the world's reserve currency. But that worst-case nightmare scenario currently seems far away and pretty out of sight. The U.S. dollar is still by far the strongest and most demand currency in the world. The world's central banks, on average, hold a majority at 59% of the foreign reserves in U.S. dollars. The euro, at second place, 21%. Not great. And the U.S. still has the largest economy by far, still a whopping $7 trillion in GDP ahead of China. And even in the worst-case scenario, countries stop trading oil in the U.S. dollar, America still likely to remain the dominant player in the world stage. Owen will keep you updated on President Biden's next Saudi Arabia move. And across the Atlantic, the new British finance minister today reversed nearly all of the Prime Minister Liz Truss' tax plan that sparked market turmoil recently. Is it the country needed to rebuild investor confidence? Antony's fake quarter reports. Britain's new finance minister has taken urgent steps to calm markets. On Monday, Jeremy Hunt put a halt to almost all the tax measures announced three weeks ago. We will no longer be proceeding with the cuts to dividend tax rates, the reversal of off-payroll working reforms introduced in 2017 and 2021, the new VAT-free shopping scheme for non-UK visitors, or the freeze on alcohol duty rates. Hunt says the changes will raise about $36 billion per year. He also reined in a vast energy subsidy plan, which will now be capped from April. Last week had already seen a U-turn on plans to scrap the top rate of income tax. Hunt says the U.K. has to win back investor confidence. No government can control markets, but every government can give certainty about the sustainability of public finances. And that is one of the many factors that influence how markets behave. Hunt took over as finance minister on Friday. Predecessor Kweisi Kwarteng was sacked after his mini-budget sparked turmoil on U.K. markets. Investors feared plans to slash taxes and increase borrowing would leave a huge hole in public finances. The turmoil has left Prime Minister Liz Truss clinging to office barely more than a month after she took the top job. Critics say the near-total reversal of her plans leaves her credibility in tatters. Michael Hewson is chief market analyst at CMC Markets. I mean, it completely undermines her entire leadership platform. Jeremy Hunt has essentially taken up the mini-budget and basically ripped it to shreds, apart from two measures which were already in place. Hunt's full plans are now due to be published at the end of the month. And in U.S.-China competition, it seems like Xi Jinping is determined to win the U.S.-China tech war. During a party congress speech on Sunday, Xi vowed to quote, resolutely win the battle in key core technologies. Accelerate the achievement of a high level of scientific and technological self-sufficiency and self-improvement, gather forces to carry out original and leading scientific and technological research, and resolutely win the battle of key core technologies. His remarks come after a number of recent U.S. tech curbs on China, and could indicate how China plans to deal with the restrictions. Earlier this month, the U.S. Commerce Department imposed sweeping regulations that limit the sale of semiconductors and computer chip-making equipment to Chinese customers. This dealt a blow to the foundation of China's efforts to build its own chip industry. In the U.S.-China tech war, Beijing is actually beating the United States in many ways. And today's Don Ma speaks with Stephen Azzell, he's with the Information Technology and Innovation Foundation. Stephen, good to see you as always. So Xi Jinping said on Sunday to resolutely win the battle in key core technologies and speed up technology self-reliance. Let me just ask you, what does Xi Jinping mean by that? What do you make of this? Well, it's certainly a goal of Xi Jinping and the Chinese Communist Party to control the commanding heights of the modern advanced technology economy. So what he is referring to is Chinese leadership, and to the greatest extent possible, self-dependency, autonomy, and advanced technologies such as semiconductors, artificial intelligence, quantum computing, aerospace, high-speed rail, the whole gamut. Now, should this be of more concern for the U.S. than before? Well, I think the important thing for viewers to understand is that this in no way represents any kind of policy change. They may be now elevating that dynamic in their policy discourse, it is no way a fundamental policy change to what we've seen for the past decade from the CCP. Now, you mentioned this has been China's policy for the past decade. So let me ask, how far away then is China in terms of being self-reliant? Well, when we ask where does China stand relative to the United States and other countries, in some areas, such as in aerospace, commercial, civilian aircraft, they're very far behind. However, in other sectors, like solar panels, like electric vehicles, like artificial intelligence, they are likely on par, if not ahead of the United States. Quantum computing is certainly an area where China has made tremendous strides in the past couple of years in quantum computing and quantum communications. We did a study looking specifically at where the U.S., China, and Europe stand vis-a-vis national capacity and artificial intelligence last year. What we found was that China has surpassed Europe. It's probably behind the United States still, especially when you look at their high-quality AI researchers and publications. However, they're ahead of the United States in AI in areas such as level of venture capital investment, level of new tech startups, and kind of having access to data sets. So it's case by case across advanced technologies. But across the board, China has closed the gap considerably with the U.S. and other countries in their competitiveness in a large number of advanced digital technologies, but also biopharma and high-speed rail and other areas like that. Just one last thing, Stephen. What do you see happening if, let's say, China becomes self-reliant or if China wins the tech battle? What would that result in? In our view, when we see the rich tapestry of science and knowledge and talent that, by definition, goes into innovating at the leading edge of fields from biopharmaceuticals to aerospace to semiconductors, the nations that succeed are ones that really tap into this rich global base of knowledge and talent and intellectual property. If it's really China's goal to become totally autonomous, totally dependent, and if they cut themselves off from other foreign sources of knowledge and know-how, I think in the long run, it won't serve China's own interest. What China is trying to do is position itself in a way that significantly reduces dependence upon other nations, including the United States. And so, in that way, there's nothing that Trump or the Biden administration did with export controls or any list that accelerates that because China desired those policy outcomes already. Thank you very much, Stephen Ezell, Information Technology and Innovation Foundation. Always a pleasure. Thank you, Don. Quick break, but if you have any news tips or feedback for the show, please email us, business at ntd.com. Welcome back. The rapper Ye, formerly known as Kanye West, plans to buy the free speech platform Parler. Comes after recent controversial comments have gotten him banned from multiple other social media apps. Anthony Sean Marshall has more. Rapper Ye, formerly known as Kanye West, is buying social media platform Parler. That's according to the company's official blog. Ye had this to say about social media in a recent interview with Tucker Carlson. There's a group mob. It's like liberal Nazis that will go up and attack you. Parler is keeping quiet about the cost of the deal. I spoke with the CEO of a social media platform for opinions, Jonathan Brodsky of YouNow. So hopefully he didn't buy a whole app just so he never has to be deplatformed. But he's buying a service that has pretty limited downloads. It competes with Twitter. It competes with True Social. It competes with a wide variety of other sites like TikTok and my own YouNow. And whether or not they can really compete hinges on what he's going to invest in it and what his actual vision is. The move comes after Ye was locked out of his Twitter and Instagram accounts for making anti-Semitic remarks. The CEO of Parliament Technologies, George Farmer, told Fox Business that Ye said it was a mistake. Brodsky gave his opinion on Ye's recent bans for speech violations. If Kanye had said what he said on Twitter, live on YouNow, we would have issued a ban as well. It would fall under our hate speech category. So I welcome him to do this. I just hope he's really welcoming of everybody out there. The parlor announcement included this quote from Ye about free speech. In a world where conservative opinions are considered to be controversial, we have to make sure we have the right to freely express ourselves. Sean Marshall, NTD News. And a special provision in workers' employment contracts called Training Repayment Agreement Provisions, or TRAPS, are drawing scrutiny from U.S. regulators and lawmakers. TRAPS have been around since the late 1980s. They've been primarily used for high-wage positions in which workers receive valuable training. The International Brotherhood of Teamsters says that training repayment demands are particularly egregious in commercial trucking. TRAPS have also had a large impact on nurses. National Nurses United found that 34 percent of the nurses they surveyed were required to pay employers for the cost of the training as if they left their jobs before a certain time. Many nurses said they were not told about the training repayment requirement before beginning work. The Consumer Financial Protection Bureau has begun reviewing the practice. The retail giant announced that it's selling over-the-counter hearing aids for the first time in the company's history. The devices can be purchased without a doctor's exam or a prescription. It comes in the aftermath of the Food and Drug Administration's new rules regarding hearing aids. The FDA says their policy will make hearing aids more accessible to the general public. Officials say they'll be available to U.S. shoppers who are at least 18 years old with perceived audio issues. The aids cost between $199 and $999 per pair. That's all for today. Thank you for watching. We'll see you tomorrow.