Obama seeks $310 billion in tax cuts

SINGAPORE (Reuters) - President-elect Barack Obama is seeking as much as $310 billion in tax cuts as part of a massive stimulus plan to counter what senior policymakers warned could be a prolonged period of economic stagnation and deflation.

Obama's plan is the latest in a series of measures aimed at tackling a financial crisis that began with U.S. mortgage defaults in 2007 and has now plunged major economies into recession, reshaped the banking landscape and taken entire countries to the brink of bankruptcy.

Over the weekend, both Janet Yellen, president of the San Francisco Federal Reserve Bank, and Lucas Papademos, vice president of the European Central Bank, highlighted the risks of deflation -- an economically damaging spiral of falling prices and demand.

Investors have, however, begun to make tentative bets that the worst of the turmoil triggered in September by the collapse of investment bank Lehman Brothers is over.

Kicking off the first full week of 2009, they pushed up stocks, the dollar and commodities while selling safe-haven plays such as government bonds and the Japanese yen.

Elsewhere there were signs of greater stability. South Korea, one of those countries that appeared to be on the brink of financial collapse, said its foreign exchange reserves rose in December for the first time in nine months.

Helping increase the appetite for riskier assets, senior Democratic aides said Obama planned to discuss his tax cut and stimulus package plans with Democratic and Republican leaders of the Senate and House of Representatives on Monday.

The tax relief proposals are designed to attract support from fiscal conservatives in Congress, who prefer cutting taxes to increasing federal spending.

Under Obama's proposal, about 40 percent of an economic package worth as much as $775 billion would be in the form of tax breaks for businesses and the middle class, one aide said.

FINANCIAL AND ECONOMIC FIRESTORM

The U.S. economy is in need of drastic measures. U.S. jobs data at the end of the week are expected to show half a million jobs were lost in December alone, pushing the unemployment rate to 7 percent.

"The financial and economic firestorm we face today poses a serious risk of an extended period of stagnation -- a very grim outcome," Yellen, a voting member of the Federal Open Market Committee in 2009, said.

"I'm strongly supportive of a substantial fiscal stimulus package," she said at the annual meeting of the American Economics Association on Sunday.

"If ever, in my professional career, there was a time for active, discretionary fiscal stimulus, it is now."

Even with the Fed's efforts to restore credit flows, an extended period of economic weakness was likely, she added.

Yellen also said the Fed would likely expand its raft of unconventional monetary policy measures now that its benchmark rate has hit rock-bottom. The Fed's target rate is between 0.25 percent and zero.

The ECB's Papademos, meanwhile, said that more interest rate cuts may be needed to support the euro zone economy and keep deflation at bay.

"We will do what is necessary, in terms of the timing and in terms of the size (of interest rate policy action) to ensure that price stability is preserved," he said.

Central banks elsewhere are rushing to reduce interest rates to historically low levels.

The Bank of England is expected to cut interest rates to 1.25 percent this week, taking its base rate to the lowest since the BoE was founded in 1694.

Central banks in South Korea and Indonesia are also expected to lower borrowing costs again this week.

STOCK RALLY CONTINUES

Since hitting multi-year lows in November, stock markets have responded positively to the flood of money pouring into the system from central banks and governments.

Tokyo's Nikkei average ended a shortened session up 2.1 percent, while stocks elsewhere in the Asia-Pacific region gained 1.4 percent by 0337 GMT, hitting a two-month high.

Oil prices gained 1.8 percent, while base metals such as copper and zinc also rose on expectations of a recovery in industrial demand.

Still, some analysts cautioned against expecting a rapid rebound in economic growth.

"It took more than three years for the economy to recover from both the dot.com bust of 2000 and the stock market crash of 1929," Merrill Lynch's U.S. economist David Rosenberg said in a note.

"So, in our view, hopes that the economy is going to recover as soon as mid-year are likely to be dashed in coming months."

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Everything comes down to the two Senate runoffs in Georgia. If we lose both races, we lose the country. Democrats know this and are pouring in millions to usher in a Marxist agenda.

As the Left tries to hide how radical the two candidates really are, Glenn takes us inside the Democrat war room to expose the wolf in pastor's clothing, Raphael Warnock, and America's Justin Trudeau, Jon Ossoff. Socialism, the Green New Deal, and "defund the police" are all on the table. And Glenn warns of what's to come if conservatives don't activate: Chuck Schumer will weaponize the Senate, and the radical Left will launch an all-out assault to ravage the Constitution.

Watch the full special below:

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Sen. Ted Cruz (R-Texas) joined the "Glenn Beck Radio Program" to explain how mail-in ballots are typically disqualified during recounts at a far higher rate than in-person, Election Day ballots, and why this is "good news" for President Donald Trump's legal battle over the election.

"One of the things that gives the greatest cause for optimism is, this election ... there's a pretty marked disparity in terms of how the votes were distributed. On Election Day, with in-person voting, Donald Trump won a significant majority of the votes cast on in-person voting on Election Day. Of mail-in voting, Joe Biden won a significant majority of the votes cast early on mail-in voting," Cruz explained.

"Now, here's the good news: If you look historically to recounts, if you look historically to election litigation, the votes cast in person on Election Day tend to stand. It's sort of hard to screw that up. Those votes are generally legal, and they're not set aside. Mail-in votes historically have a much higher rate of rejection … when they're examined, there are a whole series of legal requirements that vary state by state, but mail-in votes consistently have a higher rate of rejection, which suggests that as these votes begin being examined and subjected to scrutiny, that you're going to see Joe Biden's vote tallies go down. That's a good thing," he added. "The challenge is, for President Trump to prevail, he's got to run the table. He's got to win, not just in one state but in several states. That makes it a lot harder to prevail in the litigation. I hope that he does so, but it is a real challenge and we shouldn't try to convince ourselves otherwise."

Watch the video clip below to catch more of the conversation:

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Fox News senior meteorologist Janice Dean is perhaps even more disgusted with New York Gov. Andrew Cuomo (D) for his coronavirus response than BlazeTV's Stu Burguiere (read what Stu has to say on the subject here), and for a good reason.

She lost both of her in-laws to COVID-19 in New York's nursing homes after Gov. Cuomo's infamous nursing home mandate, which Cuomo has since had scrubbed from the state's website and blamed everyone from the New York Post to nursing care workers to (every leftist's favorite scapegoat) President Donald Trump.

Janice joined Glenn and Stu on the "Glenn Beck Radio Program" Tuesday to ask why mainstream media is not holding Gov. Cuomo — who recently published a book about his leadership during the COVID-19 pandemic — accountable?

"I'm vocal because I have not seen the mainstream media ask these questions or demand accountability of their leaders. [Cuomo] really has been ruling with an iron fist, and every time he does get asked a question, he blames everybody else except the person that signed that order," Janice said.

"In my mind, he's profiting off the over 30 thousand New Yorkers, including my in-laws, that died by publishing a book on 'leadership' of New York," she added. "His order has helped kill thousands of relatives of New York state. And this is not political, Glenn. This is not about Republican or Democrat. My in-laws were registered Democrats. This is not about politics. This is about accountability for something that went wrong, and it's because of your [Cuomo's] leadership that we're put into this situation."

Watch the video excerpt from the show below:

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As America grows divided and afraid to disagree with the Democrats' woke plan for America, Megyn Kelly is ready to fight back for the truth. For nearly two decades, she navigated the volatile and broken world of the media. But as America leans on independent voices more than ever, she's breaking new ground with "The Megyn Kelly Show."

She joined the latest Glenn Beck Podcast to break down what's coming next after the election: Black Lives Matter is mainstream, leftists are making lists of Trump supporters, and the Hunter Biden scandal is on the back burner.

Megyn and Glenn reminisce about their cable news days (including her infamous run-in with then-presidential candidate Donald Trump) and to look into the chaotic and shady world of journalism and the growing entitlement it's bred. For example, many conservatives have been shocked by how Fox News handled the election.

Megyn defended Fox News, saying she believes Fox News' mission "is a good one," but also didn't hold back on hosts like Neil Cavuto, who cut off a White House briefing to fact check it — something she never would have done, even while covering President Obama.

Megyn also shared this insightful takeaway from her time at NBC: "Jane Fonda was an ass."

Watch the full podcast here:

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