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For Senate leaders, a mission impossible from Obama
Washington, D.C., Dec 29
Following a Friday meeting with President Barack Obama stands at the lectern to make a statement to reporters after meeting with congressional leaders at the White House in Washington on Friday. Obama held out hope for a last-minute agreement to avoid the fiscal cliff of tax increases and spending cuts after a meeting with congressional leaders, scolding Congress for leaving the problem unresolved until the eleventh hour. congressional leaders, an impatient and annoyed President Barack Obama said it was "mind boggling" that Congress has been unable to fix a "fiscal cliff" mess that everyone has known about for more than a year.
President Barack Obama stands at the lectern to make a statement to reporters after meeting with congressional leaders at the White House in Washington on Friday. Obama held out hope for a last-minute agreement to avoid the fiscal cliff of tax increases and spending cuts after a meeting with congressional leaders, scolding Congress for leaving the problem unresolved until the eleventh hour. — Reuters

RBI defers Basel-III kickoff
Mumbai, December 29
India will start implementing new global capital rules for banks, known as Basel III, from April 1, 2013 rather than the beginning of January, the Reserve Bank of India said in a statement on Friday .

BRIEFLY

EARLIER STORIES

	US lawmakers, Obama in last ditch talks as ‘fiscal cliff’ deadline looms December 29, 2012
	Pvt equity pours money into primary healthcare December 28, 2012
	2% interest subsidy on loans extended to revive exports December 27, 2012
	India, China key to growth as world stares at fiscal cliff December 26, 2012
	Debt-ridden Kingfisher files revival plan with DGCA December 25, 2012
	Govt may offload equity in OIL, NTPC in Jan-Feb December 24, 2012
	Obama tries to rescue fiscal talks for post-Christmas deal December 23, 2012
	S&P expects India to grow at 6.5%, China at 8% in 2013 December 22, 2012

For Senate leaders, a mission impossible from Obama

Washington, D.C., Dec 29
Following a Friday meeting with congressional leaders, an impatient and annoyed President Barack Obama said it was "mind boggling" that Congress has been unable to fix a "fiscal cliff" mess that everyone has known about for more than a year.

He then dispatched Senate Majority Leader Harry Reid, a Democrat, and Minority Leader Mitch McConnell, a Republican, on a mind-boggling mission: coming up with a bipartisan bill to break the "fiscal cliff" stalemate in the most partisan and gridlocked US Congress of modern times — in about 48 hours. Reid and McConnell, veteran tacticians known for their own long-running feud, have been down this road before.

Their last joint venture didn't turn out so well. It was the deal in August 2011 to avoid a US default that set the stage for the current mess. That effort, like this one, stemmed from a grand deficit-reduction scheme that turned into a bust.

But they have never had the odds so stacked against them as they try to avert the "fiscal cliff" — sweeping tax increases set to begin on Tuesday and deep, automatic government spending cuts set to start on Wednesday, combined worth $600 billion.

The substantive differences are only part of the challenge. Other obstacles include concerns about who gets blamed for what and the legacy of distrust among members of Congress. Any successful deal will require face-saving measures for Republicans and Democrats alike.

"Ordinary folks, they do their jobs, they meet deadlines, they sit down and they discuss things, and then things happen," Obama told reporters. "If there are disagreements, they sort though the disagreements. The notion that our elected leadership can't do the same thing is mind-boggling to them."

CORE DISAGREEMENT: The core disagreement between Republicans and Democrats is tough enough. It revolves around the low tax rates first put in place under Republican former President George W. Bush that expire at year's end. Republicans would extend them for everyone. Democrats would extend them for everyone except the wealthiest taxpayers.

The first step for Reid and McConnell may be to find a formula acceptable to their own parties in the Senate.

While members of the Senate, more than members of the House of Representatives, have expressed flexibility on taxes, it's far from a sure thing in a body that ordinarily requires not just a majority of the 100-member Senate to pass a bill, but a super-majority of 60 members. — Reuters

Obama ‘modestly optimisic’ on cliff deal

President Barack Obama held out hope for a last-minute agreement to avoid the "fiscal cliff" of tax increases and spending cuts after a meeting with congressional leaders, scolding Congress for leaving the problem unresolved until the eleventh hour. "The hour for immediate action is here," he told reporters at the White House. "I'm modestly optimistic that an agreement can be achieved," he said. Obama and US congressional leaders agreed Friday to make a final effort to prevent the United States from going over the "fiscal cliff," setting off intense bargaining over Americans' tax rates as a New Year's Eve deadline looms. Obama and lawmakers are working to prevent around $600 billion in combined federal spending cuts and tax increases, a shock economists say could stop the economic recovery in its tracks and perhaps reverberate beyond US shores.

RBI defers Basel-III kickoff

Mumbai, December 29
India will start implementing new global capital rules for banks, known as Basel III, from April 1, 2013 rather than the beginning of January, the Reserve Bank of India said in a statement on Friday .

It said this would align the introduction of the rules with the start of the country's tax year, which runs from April to March.

The central bank gave no other reason for the change.

The new rules have been created by international regulators to strengthen banks after the financial crisis. Under the Basel III regime, India's banks will have to hold core capital of at least seven percent of (risk weighted) assets.

The central bank had originally said in May that implementation of Basel III would begin in January.

The new capital rules for banks are set to be fully implemented by the end of March 2018. — Reuters

investor guidance
Investment in ULIPs best suited for long-term gains
A. N. Shanbhag

I had invested in Unit Linked Insurance Plans in 2009. However,during the past few years I have read about ULIPS not being a good savings option. How can I optimize this investment — should I continue paying the premiums and, if yes, for how many more years? And, if I stop doing so, for how many years should I desist from withdraw the funds?

— Jawahir

Unit Linked Insurance Plans are long-term investments and their real value can only be perceived over a period of 8 to ten years. However, if you aren’t happy with the performance of the particular ULIP that you have invested in, you have two options. The first is to stop investing and let the fund lie dormant. As long as you don’t withdraw the funds, your insurance cover will continue. Plus this will give you the opportunity to recover over time the front-end load that would already have been deducted. The other alternative is to withdraw the entire funds, take the loss and reinvest in an alternative avenue where the chances of growth are far better.

Instead of distributing my assets by making a formal will, I wish to do the same when I am alive. I want to gift some money to my niece who resides in the United States. As an Indian citizen, am I allowed to do this – that is, to transfer funds in the form of a gift to a relative living abroad?

— B.N. Pandey

Indian residents can gift / donate or invest up to US $200,000 per financial year abroad. Hence, an uncle or an aunt who is a resident of India can certainly gift any amount of money up to this limit to their niece. This transaction would not entail any tax liability on the donor so far as Indian income tax laws are concerned.

BRIEFLY

Mumbai
Rupee snaps 3-week slide: The rupee broke its three-week falling trend and appreciated by 29 paise to close at over 1 week high of 54.77 against the US dollar during the shortened week under review following strong local equities amid fresh dollar selling by exporters and some banks. Persistent capital inflows amid weak dollar overseas on concerns over the US ‘fiscal cliff’ also helped the rupee recovery, a forex dealer said.

san francisco, Calif.
Apple to drop patent claims: Apple Inc has agreed to withdraw patent claims against a new Samsung phone with a high-end display after Samsung said it was not offering to sell the product in the crucial US market. Apple disclosed the agreement in a filing on Friday in US District Court in San Jose, California. Representatives for both Apple and Samsung Electronics declined to comment.

san francisco, Calif.
US judge okays Toyota deal: A US judge granted preliminary approval on Friday to Toyota Motor Corporation's US $1.1 billion settlement of a class-action lawsuit brought by consumers who lost value on their cars due to sudden, unintended acceleration.