Minneapolis Fed gets new head
After 24 years on the job, Federal Reserve Bank of Minneapolis president Gary Stern retired last month. Today it was announced that Narayana Kocherlakota will be his replacement, taking over the position immediately. He will become a voting member of the Federal Open Market Committee in 2011.
Narayana Kocherlakota, 45, is an economics professor at the University of Minnesota and has been on the research staff at the Minneapolis Fed. He is currently writing a book on tax policy. Here are some more news tidbits in the world of credit and cash today.
No more gift card fees from AmEx
CNN Money today reports that American Express will terminate its policy of deducting monthly fees from unused gift cards — starting now! Customer complaints pushed the company to make this change. The company previously deducted $2 from a gift card’s value each month that it went unused.
The new policy will apply to all gift cards, including ones purchased before the policy change. Earlier this year, a law was passed prohibiting credit card company’s from deducting dormancy fees from gift cards unless the cards are dormant for more than a year. That law goes into effect August of next year.
Unemployment still higher than last year
Every city in the United States in August 2009 recorded a higher unemployment rate than it did in 2008, according to Reuters. A total o f 16 states reported an unemployment rate higher than 15 percent. The national unemployment rate in August was 9.6 percent. Normal unemployment is about 5 percent.
The labor Department surveys 372 U.S. cities, and though 11 metropolitan areas reported gains in jobs, the unemployment rate in those areas was still higher than last year. Detroit has the highest unemployment rate in the country, 17 percent.
Projections say gas prices will go up
The the government reported a surprising decrease in gasoline stockpiles today, causing oil prices to jump. Prices went up almost 6 percent, according to CNN Money. That means gas stations will pay more for crude oil in coming months, and gas prices will continue to rise through November.
MF Global energy analyst John Kilduff said the rising price of crude can also be attributed to rising tensions related to Iran.
“The revelation of the Iranian nuclear facility seems to be installing higher and higher floors for oil prices as the situation becomes clearer,” Kilduff said. “If the situation deteriorates and the rhetoric around it becomes more bellicose, prices could reach between $80 and $100 a barrel later this year.”
I’m glad American Express is ceasing its policy of deducting fees on unused gift cards. I don’t like gifts that have time limits on them. It’s stupid. Some people actually use gift cards for emergency purposes, almost like a short term loan.