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Business

What is former Microsoft CEO Steve Ballmer's net worth?

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Los Angeles Clippers owner Steve Ballmer built his personal fortune during a lengthy stint at tech giant Microsoft.

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Ballmer, 64, joined Microsoft in 1980 as one of the firm’s first employees. In 2000, he replaced Microsoft founder Bill Gates as CEO.

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As of this month, Ballmer has an estimated personal net worth of $71.5 billion, according to Forbes. He ranks as the 11th richest person in the world and the richest team owner in U.S. sports.

Ballmer oversaw massive growth in Microsoft’s profits during his tenure and is credited with guiding the development of key business ventures, such as the Xbox video game platform and the company’s acquisition of Skype. At the same time, Ballmer drew criticism for falling behind rivals such as Apple on key technologies, such as smartphones.

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LOS ANGELES, CA – NOVEMBER 24: Los Angeles Clippers owner Steve Balmer celebrates after the New Orleans Pelicans missed 2 consecutive free throws resulting in all fans to receive a free chicken sandwich at Chick-fil-A, in the second half of the game

He retired as Microsoft CEO in 2014 and stepped down from the company’s board of directors later that year. Ballmer remains the company’s largest individual shareholder.

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Ballmer entered the NBA’s ownership ranks just months after his retirement from Microsoft. He paid a then-record $2 billion to buy the Clippers from previous owner Donald Sterling, who was forced to sell the franchise after he was caught on tape making racist remarks.

Under Ballmer’s watch, the Clippers became an NBA title contender. The franchise acquired superstars Kawhi Leonard and Paul George during the 2019 offseason.

The Clippers are in the process of building at new privately funded arena in Inglewood, California.

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Economy

Here's the timeline for Social Security benefit cuts

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For more than eight decades, the Social Security program has played a critical role in providing a financial foundation for our nation's retired workers. According to the Centers for Budget and Policy Priorities, it singlehandedly pulls more than 15 million retirees out of poverty every year.

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But it's also a program that's facing serious financial hurdles in the years that lie ahead. For each of the past 35 years, the Social Security Board of Trustees report has cautioned that there wouldn't be enough revenue collected over the long run (defined as the 75 years subsequent to the release of a report) to cover all projected outlays, including cost-of-living adjustments. While this doesn't mean bankruptcy or insolvency, it does imply that Social Security benefit cuts may become necessary to maintain program solvency.

How big would these benefit cuts be? Though the answer tends to change every time the U.S. economic outlook is altered or broad-sweeping fiscal measures are introduced, the 2020 report calls for a possible 24% across-the-board reduction to retired worker and survivor payouts. That's not negligible.

The big question is, when might this happen? Let's take a closer look at the timeline of events that could lead to a significant Social Security benefits cut.

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2021: The first year of net cash outflows

You might be surprised to learn that the first in series of events is expected to occur as soon as next year.

The latest trustees report forecast that Social Security would bring in a $4.4 billion net cash surplus in 2020, but see $21.1 billion in net cash outflows in 2021. The last time the program suffered a net cash outflow (i.e., more spending than revenue collected) was all the way back in 1982, the year before the Reagan administration passed the last major bipartisan overhaul of the Social Security program.

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Although the program entered the decade with almost $2.9 trillion in asset reserves (net cash surpluses built up since inception), the projection is that almost $1.1 trillion will be gone by the end of 2029, leaving $1.82 trillion. This net cash outflow is expected to worsen every year this decade.

2034: The OASI exhausts its asset reserves (if treated separately)

Social Security is actually comprised of two trusts:

  • The Old-Age and Survivors Insurance┬átrust, which provides payouts to retired workers and survivors of deceased workers; and
  • The Disability Insurance trust, which supplies payments to workers that are long-term disabled.

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When the Trustees examine the long-term outlook for Social Security, they hypothetically combine the financials of these two trusts into one (known as the OASDI). But if these two trusts were examined individually, the OASI is in far greater danger of exhausting its asset reserves sooner. Based on the latest report, the OASI is expected to deplete its asset reserves by 2034, at which point benefit cuts would become necessary to sustain solvency.

2065: The DI depletes its asset reserves (if treated separately)

By comparison, the DI Trust has a considerably longer runway before it runs into trouble. The 2020 trustees report opines that the DI Trust won't exhaust its asset reserves until 2065, which is actually 13 years later than what was projected in the 2019 Trustees report.

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According to the newest report, this change stems from a historically low rate of disability insurance applications and benefit awards, as well as reduced disability incidence rate modeling over the long run.

2035: The likeliest year when benefit cuts will be needed

Now, for the bottom line of when Social Security benefit cuts are likely. Since revenue collection can be diverted to the OASI or DI via congressional action, as necessary, the combination of the OASDI is expected to completely exhaust its almost $2.9 trillion in asset reserves by 2035.

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In spite of the DI trust's 45-year runway before it runs out of its net cash surpluses, the DI Trust only accounts for $95.2 billion of the $2,897 billion that's currently held in asset reserves. Thus, the DI Trust would only add about a year of cushion to the OASI's funding shortfall.

If Congress were to fail to act by raising additional revenue and/or reducing outlays, this 24 percent reduction for retired workers and survivors would be expected to take place in roughly 15 years.

But wait — there’s more

Then again, the trustees' report is just one educated group's opinion of what might happen with the most successful social program in the United States.

One thing that the Trustees report doesn't take into account is the impact of the coronavirus disease 2019 pandemic. Since Social Security's primary source of revenue is the 12.4% payroll tax on earned income, and the unemployment rate has skyrocketed from a 50-year low of 3.5% to a nearly nine-decade high of 13.3% in a couple of months, there's little question that the program's near-term income-collecting capacity has been harmed by COVID-19.

Worse yet, the coronavirus pandemic is unlikely to allow the U.S. economy to bounce back at the flip of a switch. This means long-lasting negatives for Social Security.

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In a recently released analysis using the Penn Wharton Budget Model from the University of Pennsylvania, Social Security's projected asset reserve depletion has been moved forward by two to four years, depending on the pace of the economic recovery. If the U.S. economic recovery is swift and V-shaped, Social Security will exhaust its asset reserves by 2034 instead of 2036, as the PWBM had previously forecast. But if it's a slower U-shaped recovery, Social Security could burn through its nearly $2.9 trillion by 2032, a full four years earlier than originally expected.

Keep in mind that these estimates are taking into account a large number of dynamic variables, including birth and mortality rates, net immigration, fiscal and monetary policy, the inflation rate, and economic growth forecasts, to name a few. They're not perfect or set in stone.

But one consistent message the American public has seen from these forecasts is that the need for possible Social Security benefit cuts is closing in, and lawmakers are running out of time to implement an effective fix.

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World News

State Pension UK: How much the Triple Lock provides pensioners in retirement

State Pension is an amount provided by the government to individuals who have given years of National Insurance (NI) contributions. The sum is offered to pensioners by the Department for Work and Pensions (DWP), which manages eligibility, amount and payment dates. The Triple Lock system is one which was developed in order to protect the pension sum for future pensioners.

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The system is a guarantee for the basic State Pension, to ensure it rises annually.

This figure rises by a minimum of either 2.5 percent, the rate of inflation or average earnings growth – whichever is largest of these.

In the most recent tax year, this sum rose by 3.9 percent, in line with average earnings across the UK. 

However, before the Triple Lock was introduced in 2011, the State Pension sum simply rose in line with the Retail Price Index – a measure of inflation. 

This was usually lower than the Triple Lock sum currently offered. 

The Triple Lock is widely welcomed as it sees the pension rise significantly when compared to other areas of life.

In the years between April 2010 and April 2016, the Institute for Fiscal Studies said the State Pension value increased by 22.2 percent.

This was compared to the growth in prices of 12.3 percent over the same period of time. 

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But how much are pensioners entitled to under the current scheme? 

On the basic State Pension, the maximum a person can expect to receive is £134.25 per week, if they have 30 years or more in NI contributions. 

Those who are claiming the new State Pension sum, however, are required to have a minimum of 10 years in NI contributions, and could receive a maximum of £175.20. 

The Triple Lock Mechanism has come under threat recently after reports the scheme could be axed to cover the cost of coronavirus. 

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While Prime Minister Boris Johnson previously said he would meet all manifesto commitments, the Treasury has been urged to scrap the scheme.

It is estimated the UK spends about £4billion each year on pension upratings, and it has been suggested this money could be better spent levelling out the mounting costs of the pandemic. 

Former Pensions minister Sir Steve Webb said the government may find reviewing the pension safeguard as “irresistible” as it struggles to meet record levels of borrowing. 

Sir Steve said: “From the government’s point of view, a period of negative inflation when prices are actually falling would be the ideal time to justify not sticking to the 2.5 percent floor implied by the triple lock.

“Once the rule had been broken once, it would be more likely to be abolished for future upratings.

“A time when prices are falling could be the perfect opportunity for the Chancellor and he may find the temptation to tackle the triple lock to be irresistible.”

Think tank the Social Mobility Foundation has instead suggested an alternative system, which it says may aid in spreading the effect of the COVID-19 crisis equally across all generations.

The so-called double lock could see the 2.5 percent option removed from the guarantees, leaving two options: the rate of inflation and average earnings growth. 

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Markets

Stocks tumble as coronavirus spike taints US reopening

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Stocks tumbled Wednesday as new COVID-19 cases in the U.S. rebounded to highs not seen since the peak of the outbreak, raising fresh doubts about the strength and longevity of an economic recovery.

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The country reported 34,700 new cases of the virus on Tuesday as cases surged in states that reopened early from lockdowns intended to curb the disease's spread. Higher numbers have been reported on only two other days: April 9 and April 24, when a record 36,400 cases were logged.

The Dow Jones Industrial Average dropped 233 points, or 0.89 percent, while the broader S&P 500 and the tech-heavy Nasdaq Composite fell 0.68 percent and 0.33 percent, respectively.

The new coronavirus data came just a day after Dr. Anthony Fauci, head of the National Institute of Allergy and Infectious Diseases, told a House committee that the next few weeks may be critical in combatting a spike in states such as Arizona and North Carolina as businesses and recreational gathering spots nationwide resume operations.

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"Getting back to normality is going to be a step-by-step process and not throwing caution to the wind," he said. "Plan A, don't go into a crowd. Plan B, if you do, make sure you wear a mask."

In the health care sector, hospital operators such as HCA Healthcare and Community Health Systems were under pressure after a federal judge ruled in favor of a Trump administration plan requiring them to disclose the actual costs of routine tests and procedures, an initiative meant to lower prices for patients. An appeal is planned.

In transportation, Fiat Chrysler and General Motors, two of the Big 3 U.S. automakers, were ordered by a federal judge to meet and settle a lawsuit over whether one company got a competitive edge when union leaders were showered with cash and other perks.

GM has accused Fiat Chrysler of racketeering, saying the rival won labor concessions during contract talks because United Auto Workers officials were bribed with money from a job training center.

U.S. District Judge Paul Borman ordered GM chief executive Mary Barra and her Fiat Chrysler counterpart, Mike Manley, to meet in person by July 1 “to reach a sensible resolution of this huge legal distraction."

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In Silicon Valley, where Apple and Amazon helped drive the Nasdaq to its 21st record close of the year on Tuesday, the iPhone maker was under pressure after wire services cited a report in Politico on a potential investigation of its App Store by the U.S. Department of Justice and state attorneys general.

Social media giant Facebook, meanwhile, risks losing advertising from ice-cream maker Ben & Jerry's as companies ramp up pressure over misinformation and hate speech on the platform and its competitors, the Wall Street Journal reported.

In commodities, West Text Intermediate crude oil, the U.S. benchmark, tumbled 1.6 percent to $39.74, while gold dropped 0.2 percent to $1,778 an ounce.

Equity markets were lower across the board in Europe, with Britain's FTSE falling 2.06 percent and France's CAC 40 and Germany's DAX each down 1.82 percent.

In Asia, China's Shanghai Composite rose 0.3 percent, while Japan's benchmark Nikkei and Hong Kong's Hang Seng dropped 0.07 percent and 0.5 percent, respectively.

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