Finance

Biden cancels student loans with one week left to his term

Published

4 months ago

January 15, 2025

Business Finance News

More student debt relief is underway as Biden prepares to exit office. (iStock)

As President Joe Biden’s term draws to a close, he has granted federal student loan relief to an additional 150,000 borrowers.

These 150,000 borrowers include almost 85,000 who attended schools that cheated and defrauded their students, 61,000 borrowers with total and permanent disabilities, and 6,100 public service workers. The debt forgiveness now brings the number of students whose student debt has been canceled during his administration to more than 5 million, according to a White House release.

The latest wave of debt relief includes 6,100 borrowers who have had $465 million of debt forgiven through the Public Service Loan Forgiveness (PSLF) program. This is a testament to the potential of such programs to alleviate the burden of student debt.

“Identifying 5 million people for student loan forgiveness means the federal government is finally keeping its promises,” U.S. Under Secretary of Education James Kvaal said. “People who cannot afford their student loans because they are in public service, have disabilities, were cheated by their college, or who have completed decades of payments are now getting the relief they were promised. These permanent reforms will continue for more and more borrowers every year.”

If you want to pay down your private student loan debt, a refinance could help you lower your interest rate and monthly payment. To see if this is the right option, contact Credible to speak to a student loan expert and answer your questions.

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New student loan forgiveness approvals

The Supreme Court previously blocked the Biden administration’s plans for broader student loan forgiveness. In 2023, the court stopped the administration from forgiving $400 billion in debt affecting more than 40 million borrowers.

In August, the Supreme Court shut down another administration proposal to lower monthly payments and speed up loan forgiveness. After the Supreme Court struck down Biden’s student loan forgiveness plan, Biden introduced SAVE. The White House said that the SAVE plan could lower borrowers’ monthly payments to zero dollars, reduce monthly costs in half and save those who make payments at least $1,000 yearly.

The Biden administration withdrew plans for an alternative student debt forgiveness plan in December. Despite losing in the Supreme Court, the administration has forgiven some $183.6 billion in student debt thanks to fixes implemented to process PSLF applications and approve discharges. The total number of borrowers approved for PSLF is now 1,069,000 and $78.46 billion compared to 7,000 borrowers who had received PSLF at the start of the Biden-Harris administration, according to the Department of Education.

Moreover, the administration approved $56.5 billion in debt relief for more than 1.4 million borrowers through Income-Driven Repayment, including the Saving on a Valuable Education SAVE plan. Some borrowers also have access to an extra $900 in Pell Grant funds to pay for school. Additional debt forgiven includes the student debt of borrowers whose schools cheated, saw their institutions precipitously close, or are covered by related court settlements.

Private student loan borrowers can’t benefit from federal loan relief. But you could lower your monthly payments by refinancing to a lower interest rate. Visit Credible to speak with an expert and get your questions answered.

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Debt forgiveness could be blocked forever

Republican Representative Glenn Grothman (R-WI) introduced a bill during the last Congress that effectively blocked any future mass student loan cancelation plans. The Protecting Taxpayers From Student Loan Bailouts Act prohibits the Secretary of Education from issuing regulations or executive actions that increase the costs of the federal student loan program.

The bill was ultimately incorporated into the College Cost Reduction Act, which did not reach a vote on the House floor.

“Congress might still consider taking action to block future administrations from forgiving debts,” Preston Cooper, American Enterprise Institute senior fellow, said in a blog post.

Cooper said that Republicans may not want to risk the chance that the next Democratic administration will successfully pursue a loan cancelation strategy that is less vulnerable to legal challenges.

Borrowers with private student loans could find relief by refinancing to lower their monthly payments. An online tool like Credible can help you compare student loan refinancing rates before you apply to help find the best deal for you.

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Have a finance-related question, but don’t know who to ask? Email The Credible Money Expert at [email protected] and your question might be answered by Credible in our Money Expert column.

Finance

China’s April retail sales growth of 5.1% misses expectations as consumption remains a worry

Published

8 hours ago

May 18, 2025

Business Finance News

Citizens are shopping at a supermarket in Nanjing, East China’s Jiangsu province, on March 9, 2024.

Costfoto | Nurphoto | Getty Images

China’s retail sales growth slowed in April, data from the National Bureau of Statistics showed Monday, signaling that consumption remains a worry for the world’s second-largest economy.

Retail sales rose 5.1% from a year earlier in April, missing analysts’ estimates of 5.5% growth, according to a Reuters poll. Sales had grown by 5.9% in the previous month.

Industrial output grew 6.1% year on year in April, stronger than analysts’ expectations for a 5.5% rise, while slowing down from the 7.7% jump in March.

Fixed-asset investment for the first four months this year, which includes property and infrastructure investment, expanded 4.0%, slightly lower than analysts’ expectations for a 4.2% growth in a Reuters poll.

The drag from real estate worsened within fixed asset investment, falling 10.3% for the year as of April.

The urban survey-based unemployment rate in April eased to 5.1% from 5.2% in March.

The data came against the backdrop of trade tensions between China and the U.S.

U.S. President Donald Trump placed tariffs of 145% on imports from China that came into effect in April. Beijing retaliated with tariffs in kind, with 125% levies on American imports.

Trade-war fears have receded after a meeting of U.S. and Chinese trade representatives in Switzerland earlier this month led to a lower set of levies between the world’s two largest economies.

Beijing and Washington agreed to roll back most of the tariffs imposed on each other’s goods for 90 days, allowing some room for further negotiation to reach a more lasting deal.

That prompted a slew of global investment banks to raise their forecasts for China’s economic growth this year while paring back expectations for more proactive stimulus as Beijing strives to reach its growth target of around 5%.

This is breaking news. Please check back later for updates.

Finance

Scott Bessent calls Moody’s a ‘lagging indicator’ after U.S. credit downgrade

Published

20 hours ago

May 18, 2025

Business Finance News

Treasury Secretary Scott Bessent said in an interview on NBC News’ “Meet the Press” that Moody’s Ratings were a “lagging indicator” after the group downgraded the U.S.’ credit rating by a notch from the highest level.

“I think that Moody’s is a lagging indicator,” Bessent said Sunday. “I think that’s what everyone thinks of credit agencies.”

Moody’s said last week that the downgrade from Aaa to Aa1 “reflects the increase over more than a decade in government debt and interest payment ratios to levels that are significantly higher than similarly rated sovereigns.”

The treasury secretary asserted that the downgrade was related to the Biden administration’s spending policies, which that administration had touted as investments in priorities, including combatting climate change and increasing health care coverage.

“Just like Sean Duffy said with our air traffic control system, we didn’t get here in the past 100 days,” Bessent continued, referring to the transportation secretary. “It’s the Biden administration and the spending that we have seen over the past four years.”

The U.S. has $36.22 trillion in national debt, according to the Treasury Department. It began growing steadily in the 1980s and continued increasing during both President Donald Trump’s first term and former President Joe Biden’s administration.

Bessent also told moderator Kristen Welker that he spoke on the phone with the CEO of Walmart, Doug McMillon, who the treasury secretary said told him the retail giant would “eat some of the tariffs, just as they did in ’18, ’19 and ’20.”

Walmart CFO John David Rainey previously told CNBC that Walmart would absorb some higher costs related to tariffs. The CFO had also told CNBC separately that he was “concerned” consumers would “start seeing higher prices,” pointing to tariffs.

Trump said in a post to Truth Social last week that Walmart should “eat the tariffs.” Walmart responded, saying the company has “always worked to keep our prices as low as possible and we won’t stop.”

“We’ll keep prices as low as we can for as long as we can given the reality of small retail margins,” the statement continued.

When asked about his conversation, Bessent denied he applied any pressure on Walmart to “eat the tariffs,” noting that he and the CEO “have a very good relationship.”

“I just wanted to hear it from him, rather than second-, third-hand from the press,” Bessent said.

McMillon had said on Walmart’s earnings call that tariffs have put pressure on prices. Bessent argued that companies “have to give the worst case scenario” on the calls.

The White House has said that countries are approaching the administration to negotiate over tariffs. The administration has also announced trade agreements with the United Kingdom and China.

Bessent said on Sunday that he thinks countries that do not negotiate in good faith would see duties return to the rates announced the day the administration unveiled across-the-board tariffs.

“The negotiating leverage that President Trump is talking about here is if you don’t want to negotiate, then it will spring back to the April 2 level,” Bessent said.

Bessent was also asked about Trump saying the administration would accept a luxury jet from Qatar to be used as Air Force One, infuriating Democrats and drawing criticism from some Republicans as well.

The treasury secretary called questions about the $400 million gift an “off ramp for many in the media not to acknowledge what an incredible trip this was,” referring to investment commitments the president received during his trip last week to Saudi Arabia, Qatar and the United Arab Emirates.

“If we go back to your initial question on the Moody’s downgrade, who cares? Qatar doesn’t. Saudi doesn’t. UAE doesn’t,” he said. “They’re all pushing money in.”

When asked for his response to those who argue that the jet sends a message that countries can curry favor with the U.S. by sending gifts, Bessent said that “the gifts are to the American people,” pointing to investment agreements that were unveiled during Trump’s Middle East trip.

Sen. Chris Murphy, D-Conn., criticized Bessent’s comments about the credit downgrade, saying in a separate interview on “Meet the Press.”

“I heard the treasury secretary say that, ‘Who cares about the downgrading of our credit rating from Moody’s?’ That is a big deal,” Murphy said.

“That means that we are likely headed for a recession. That probably means higher interest rates for anybody out there who is trying to start a business or to buy a home,” he continued. “These guys are running the economy recklessly because all they care about is the health of the Mar-a-Lago billionaire class.”