#AceFinanceNews – UNITED STATES – The US government made enough profit from student loans in the last year to provide full Pell Grants of over $5,600 to 7.3 million students.
But, like many government financial issues, accounting methods complicate the story.
The $41.3 billion student-loan profit for the 2013 fiscal year – which ended on Sept. 30 – is actually down by $3.6 billion from 2012, but still enough to out-profit all but two global companies, ExxonMobil and Apple.
The numbers give pause since estimates show more than $1.2 trillion in student loan debt exists in the US, more than Americans owe on credit cards.
Yet officials and experts point out that there are various ways of accounting for how the US Department of Education runs the student loan program, and that calling this pure profit is misleading.
RT – US Media and News Sources
#AceFinanceNews – UNITED KINGDOM – 22 March – In a dramatic reassessment of UK Student Finance, the government estimates around 45 percent of graduates will be unable to pay back their loans.
The shortfall could cancel out the profits made by the disputed tripling of tuition fees in 2012.
British Universities Minister David Willetts has said that the amount of graduates who will fail to pay back their student loans has greatly exceeded previous estimates.
Before tuition fees were increased threefold in 2012, the government predicted that only 28 percent of loans would ever be paid back.
However, in light of projections for the coming years, the government has reassessed this figure and almost doubled it to 45 percent.
This increase could potentially nullify the 10 billion pounds ($16 billion) in profits made by increasing tuition fees to 9,000 pounds ($15,000) a year in 2012.
If the amount of students unable to pay back their loans grows to 48.6 percent, economists predict the government will start losing more money.
Guardian – Independent – UK News Sources
#AceFinanceNews – WASHINGTON – March 22 – Afghan President Hamid Karzai appreciates the economic help provided by the former Soviet Union to his country in the past.
“The Soviet money went to the right place.
They were efficient in spending their money and doing it through the Afghan government,” Karzai said in an interview with The Washington Post this month.
The newspaper said that the Russian government had drawn up a list of 140 Soviet-era projects which it would like to renovate.
One is the Kabul House-building Factory constructed in the early 1960’s by Soviet specialists, which received a consignment of new equipment worth 25 million U.S. dollars from Russia last autumn.
The Washington Post quoted the head engineer of the house-building factory as saying that “what the Soviets did here was really fundamental.
They were thinking about the long term.”
It also noted that the number of students studying Russian at the Kabul University had doubled over the past two years, and Russia had doubled the number of grants to Afghan students.
The Washington Post (Exclusive)
#AceFinanceNews – MOSCOW – March 22 – A draft law outlining key aspects of the financial system in Crimea and Sevastopol and its operation during the transitional period was submitted to the State Duma, lower house of parliament, on Saturday, March 22.
The draft law, written by Natalia Burykin, Head of the Duma Committee on the Financial Market, and Nikolai Zhuravlev, Deputy Head of the Committee on the Budget and Financial Markets of the Federation Council (upper house of parliament), sets out the terms of operation for banks, non-lending financial institutions, non-bank financial organisations, and cash exchange offices in Crimea and Sevastopol during the transitional period.
The transitional period will continue until January 1, 2015 to solve all issues pertaining to the integration of the new constituent members into the economic, financial, credit and legal systems of Russia, into its government system, as well as issues concerning military duty and military service in the Republic of Crimea and Sevastopol.
Taxes collected in Crimea will remain in its budget until 2015, and Russia will provide financial support to Crimea and Sevastopol in 2014-2016.
Russian Finance News
#AceFinanceNews – MOSCOW – 21 March – Prime Minister Dmitry Medvedev on Friday demanded Ukraine pay back $11 billion that he said Kiev had saved through discounted gas prices in return for hosting a Russian naval base in Crimea.
Ukraine owes the money because Crimea is now part of Russia and the two countries’ 2010 lease agreement was now “subject to annulment,” Medvedev said at a meeting of the Security Council.
“The Ukrainian state saved some $11 billion dollars and accordingly the Russian budget has a missed profit of the same $11 billion,” he warned.
Soon after coming to power in 2010, then president of Ukraine, Viktor Yanukovych, agreed to extend the lease on Russia’s Black Sea Fleet in Crimea that was due to expire in 2017 for 25 years, until 2042.
In return, Moscow agreed to cut natural gas prices for Ukraine by $100 for every 1,000 cubic metres.
Russian Finance and Media Sources
#AceFinanceNews – MOSCOW – March 22. – Russian President Vladimir Putin’s spokesman Dmitry Peskov has said the downgrade of Russia’s rating outlook by the Standard & Poor’s ratings agency was due to a directive rather than objective circumstances.
The downgrade decision “was clearly directive, not objective,” Peskov told journalists Friday, adding that such forecasts reduce the degree of credibility of such agencies.
On March 20, S&P said it revised its outlook on the Russian Federation to negative from stable. The organization also affirmed its ‘BBB/A-2’ foreign currency and ‘BBB+/A-2’ local currency long- and short-term sovereign credit ratings on the country.
“The outlook revision reflects our view of the material and unanticipated economic and financial consequences that EU and US sanctions could have on Russia’s creditworthiness following Russia’s incorporation of Crimea, which the international community currently considers legally to be a part of Ukraine,” S&P said Thursday.
Fitch Ratings on Thursday revised the outlook on Russia’s long-term foreign and local currency Issuer Default Ratings (IDR) to negative from stable and affirmed the IDRs at ‘BBB’.
Ace Related News Reports:
- March 20 – 09.13 GMT – Standard and Poor’s – http://wp.me/pzTwj-2Mf
- March 20 – 11.35 GMT – Fitch – http://wp.me/pzTwj-2Ms
Russian Finance News and Media Sources.
#AceFinanceNews – KIEV – March 22 – Ukraine’s foreign debt in 2013 grew 5.5 percent to $142.52 billion, the National Bank reported.
The government debt grew 9.7 percent to $29.922 billion over the past year, the debts of the country’s banks grew 6.4 percent to over $22.5 billion, the debts of other sectors rose 2.12 percent to $79.4 billion.
In February, the Ukrainian government voiced plans to borrow over $18.9 billion on the domestic and foreign markets in 2014.
#AceFinanceNews – Australia – March 22 – The authorities are considering extradition to the US of an alleged moderator of Silk Road, a website that used to connect those who wanted to buy illegal goods, such as drugs, and pay for them with digital currency, like Bitcoin.
Last December, three men involved with the Silk Road website were charged with conspiracy to engage in drug trafficking, hacking and money laundering.
Extradition of one of them, native Australian Peter Phillip Nash, 41, from Queensland state, has been demanded by the US.