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Miami Herald
21-06-2025
- Health
- Miami Herald
Fed study blasts few healthcare options in top U.S. tourism states
Romantic getaways. Family memories. Great escapes. We Americans love a good vacation. Don't miss the move: Subscribe to TheStreet's free daily newsletter You might be one of the millions lured this – and every – summer by a bold oceanfront, a lakeside fire pit or leafy mountain paths found in these popular tourism states. Related: Major health care company files for bankruptcy to sell assets Or maybe other seasonal adventures like world-class skiing, lush spring gardens or the simply fabulous foliage each autumn draw you and yours to these renowned venues any time of year. 'Cause there's also a ton of history, culture and sports to explore plus delicious local chow for the foodies. But beyond the cheery facades that welcome visitors are sad and scary realities that full-time residents face regarding year-round healthcare access in their rural communities. A new study by the Federal Reserve Bank of Boston spells out the first-hand accounts of mothers, children, elders and others challenged by distance, income, resources and other economic problems to receive healthcare that so many fellow Americans take for granted. The solutions don't seem to be short-term, straining hopes and accelerating chronic, life-threatening medical crises."Yep. It's a great place to visit but you wouldn't want to live here." Visitors to these states have heard this refrain from locals for decades, all the way back to the last century. Proximity to health care is an increasing concern in rural communities across America. As a result, patient care suffers. So do patients. Greater distances from primary care providers, community hospitals and trauma centers are linked to higher rates of fatal accidents, fatal heart attacks and infant mortality, according to Federal Reserve Bank of Boston senior policy analyst Riley Sullivan. Rural healthcare facilities are finding it more difficult to attract the skilled workforce to fill jobs at every level of skill. Reasons include lack of affordable or available housing and high costs of living magnified by the many, many miles from larger towns and bigger cities. Plus healthcare providers across America maintain that inadequate insurance, Medicaid or Medicare reimbursement rates are leading to major losses at private, public and not-for-profit facilities. Related: Major bankrupt healthcare provider closes distressed hospitals Overall, U.S. hospitals are finding that they have no choice but to cut services due to these acute financial challenges. Some even close because all options have simply run out, leaving their communities in medical deserts facing life-or-death choices 24-7. Boston Fed principal economist and policy advisor Mary Burke, who studies regional labor force participation rates, said all these issues add up to big strains on healthcare systems in Maine, New Hampshire and Vermont. Sullivan's study showed: Northern Light Health, Maine's second-largest health care system, lost a staggering $156 million in 2024. Northern Light Inland Hospital in Waterville (known for its ski resorts) closed earlier this year. In New Hampshire, Catholic Medical Center in Manchester reported monthly losses ranging from "$2 - $3 million," before it was sold in February Vermont, a state-mandated though disputed analysis found that its hospitals will need to find between $700 million and $2.4 billion to break even by 2028. "I think that when you look around the country in rural areas and you find thriving health care systems or hospitals, what you see are thriving communities, where economic development is strong," said Dr. Sunil Eappen, CEO of The University of Vermont Health Network. Economic development is the key to reversing these trends in Vermont and its two northern neighbors. Tourism dollars, though in the millions, just aren't enough. Eappen, also a member of the Boston Fed's Board of Directors, said potential catalysts – including improved infrastructure and more housing – would help stop the bleeding of healthcare access. But ultimately, it all comes down to one thing. "We need another 100-150,000 young people to move in who are working and paying into a commercial insurance population," Eappen said. "We need more people to move in." Related: Major hospital chain owner files for Chapter 11 bankruptcy The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
CNBC
11-06-2025
- Business
- CNBC
A real trade agreement is highly detailed, so things are still uncertain, says Eric Rosengren
Eric Rosengren, Former Boston Fed president, joins 'Money Movers' to discuss the CPI report, Commerce Secretary Lutnick's comments on the U.S.-China trade talks and the economy.
Axios
05-06-2025
- Business
- Axios
Tariffs are raising prices, surveys show
Tariffs raise prices. It's textbook economics, and we're starting to see it happen now, anecdotally at least. Why it matters: To put it mildly, Americans dislike high inflation. It's politically toxic, as Democrats recently learned. The big picture: Tariffs are happening fast, and they're a moving target. Yesterday's 25% is today's 50%. Increases have yet to show up in the official inflation data. State of play: Surveys and anecdotes about price increases are piling up. "Tariffs have increased the cost of doing business," a firm in transportation and warehousing said in the comments of yesterday's Institute for Supply Management report on activity in the service sector. The Beige Book, a collection of nationwide business anecdotes published by the Federal Reserve, said prices increased at a "moderate pace" since its last report in April. One standout anecdote: A clothing retailer told the Boston Fed it took a "rare step" to re-tag its inventory "with higher prices to cover the cost of tariffs, and those items will hit store shelves this summer." Tariff-related price hikes appear to be hitting the shelves at Walmart and Target, Business Insider reported this week. Employees have been posting pictures of certain products showing sharp increases. Zoom in: About three-fourths of companies said they were either fully or somewhat passing along higher tariffs by raising prices, per a survey of businesses out Wednesday from the New York Fed. The survey was conducted among manufacturers and service firms early last month, before President Trump lowered tariffs on Chinese imports to 30% from 145%. While this is a regional survey of New York and New Jersey firms, the authors indicated that these are trends observed nationwide. The intrigue:"A significant share" of firms surveyed said they raised prices of goods and services unaffected by tariffs, as a way to spread higher costs across inventory, or to take advantage of customer expectations that prices are rising. It's not a new phenomenon. After the first Trump administration raised tariffs on washing machines, the price of dryers — unaffected by tariffs — increased as well, while companies took advantage of the moment. A significant point of contention during the high inflation of 2022 was whether businesses were "taking price," or using the moment to fatten their profit margins at a time when consumers expected to pay more. "A big increase in the tariff level is a perfect opportunity for companies to use a price shock to raise prices," Alex Jacquez, an economist who served in the Biden White House, said on a press call Wednesday. Nearly everyone has heard about the tariffs. "People are primed to expect prices to go up," he said. Reality check: Tariff policies will increase inflation by 0.4 points in 2025 and 2026, "reducing the purchasing power of households and businesses," per the latest estimates from the Congressional Budget Office out yesterday. That's not nothing, but it's not near what we saw in 2022 and 2023. The other side: There are some, particularly in the Trump administration, who argue the costs of tariffs are outweighed by the benefits, like returning production back to the U.S., creating better jobs, and strengthening supply chains. Between the lines: Higher prices are going to hit differently than they did when inflation spiked in 2022. Back then the economy kept chugging along thanks to an overheated labor market, which gave companies the freedom to keep raising prices, and people had jobs and could afford to pay. The cushion is missing now, former Fed economist Claudia Sahm wrote on Substack. And that could make it harder to raise prices, she said.
CNBC
30-05-2025
- Business
- CNBC
Ron Insana: Private credit industry poses a familiar risk as investors chase returns
A crisis in the world of private credit may not unfold in the near term, but investors should think about what may happen when the next recession comes along. The Boston Federal Reserve recently published a paper exploring whether or not the surge of dollars into private credit will eventually pose systemic financial risk to the lending industry. While the paper didn't directly answer the question posed, it's important that it was asked at all. The private credit asset class has swelled to about $1.7 trillion . Firms in the industry provide loans to businesses in an environment where banks had pulled back from lending in the face of regulatory constraints. Recently, however, banks have begun providing financing to those same private credit firms in the form of lines of credit. Those lines of credit help smooth out the distribution of capital as private credit firms take time to draw down the investments made by their limited partners. "Our analysis of Federal Reserve and proprietary loan-level data indicates that the growth of private credit has been funded largely by bank loans and that banks have become a key source of liquidity, in the form of credit lines, for [private credit] lenders," the Boston Fed said in its report. "Banks' extensive links to the PC market could be a concern because those links indirectly expose banks to the traditionally higher risks associated with PC loans," the Boston Fed added. Rising risk in the event of delinquencies Banks may expose themselves to rising risk over time if private credit firms take on less secure loans than the banks would normally fund. Ultimately, this could have an adverse effect on the banks' balance sheets. Typically, this becomes more obvious when the economy slows or tips into recession, pushing up both delinquencies and defaults. There are additional questions not yet posed by the Boston Fed's study. For instance, are big banks using leverage to enhance the returns on the credit lines they are extending to private credit vehicles? A similar question can be asked of the private credit firms: Are they using additional leverage so that their investors will reap higher rates of return than would otherwise be available? If the answer is yes, we may be staring at a smaller version of the Global Financial Crisis one day in the future. A familiar story One seasoned lawyer I spoke with, who assists in structuring private credit deals, tells me that the collateral for the bank lines of credit being handed out are the very loans made by the private credit firms. Worse yet, many of these vehicles are so-called " covenant-lite loans " meaning that the lending terms are less stringent than those of more conventional loans. Stop me if you've heard this story before: Leverage on top of leverage, along with lax lending standards and the prospect of financial deregulation could end badly for both banks and investors. By extension, financial markets could also suffer under the very systemic risk the Federal Reserve Bank of Boston is questioning. That can be quite a toxic brew if private credit firms and banks are all doing the same thing at the same time. It would be similar to what financial firms did with collateralized debt obligations prior to the real estate and credit crisis of 2008. For now, there is one meaningful difference: Most private credit loans currently being made are at the top of the capital structure. In other words, these loans made by the private credit firms are collateralized by the hard assets of the borrower. That's known as senior secured debt. That mitigates risk as lenders can seize and sell assets to cover the credit they had extended to firms. With so much "dry powder" in the private credit space, eventually lenders will be reaching for yield by making loans to lower quality borrowers. Those are the loans that go bad quickly during a downturn. Rather than being a diversifier of risk, even if they are syndicated to a wide swath of investors, these loans turn into transmission wires of trouble and travel up the entire financial daisy chain. This is an area that will require constant scrutiny from regulators at the Fed, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency and other supervisory powers. The additional risk here is that those very supervisory functions so critical to the safety of the banking system and financial markets are being gutted. We've seen this movie before. Excess capital eventually chases too few deals. Lots of leverage to enhance returns enhances risk, especially as regulators fail to see Wall Street's excesses. This is my first discussion of risk in the private credit space, and the questions being posed will be deemed absurd by executives in the private credit world. Hold onto your wallets: Not everything is as secure as it may seem. —Ron Insana is a CNBC contributor.
Yahoo
14-05-2025
- Business
- Yahoo
Consumers have 'breathing room' as tariffs take time to hit
Consumer spending is holding up as tariff impacts have yet to hit wallets. Morning Consult chief economist John Leer explains why shoppers haven't changed behavior despite rising trade tensions. To watch more expert insights and analysis on the latest market action, check out more Catalysts here. Hey John. I you know, uh it's amazing what a difference a week makes in terms of trade talks and negotiations. It looks really constructive. But my question for you is, how do we factor in the the chance that these trade talks could fall apart just as quickly as they came together? And at what point does the consumer just get fatigued and change their behavior permanently because of that? They don't know when it's gonna happen. I mean, how do you, how do you calculate for that? I mean, it's a great question. I think thus far, what we've seen from consumers is some reticence to dramatically change their behaviors in response to trade negotiations, tariff negotiations, right? Because announcing 145% tariff uh on Chinese-made goods is not the same as in fact, paying 145% more the next day. Companies have ways of working around things. We also know from our our small business survey that we run with the Boston Fed that small businesses were very reluctant to immediately pass on those elevated costs that were gonna do so over a period of two plus years. So I think from the perspective of consumers, they're sitting back and they're saying, well what does this mean for me and my pocketbook? Um the the expectations of tariffs, I think wrongfully were over uh, you know, I think people wrongfully thought tariff announcements and tariff expectations were immediately gonna affect consumer's pocketbooks. That didn't happen, and so we've got some breathing room right now. And I expect consumers to go back uh and spend.
