Chicago Fed Letter
Over the past two decades, guarantees that protect variable annuities’ balances when their underlying investments perform poorly have become quite popular. Collectively, these guarantees can pose a sizable risk to life insurers. This article explores the different types of variable annuity guarantees, the extent of the risk they pose to insurers, and the practices used by insurers to mitigate against such risk.
The 11th annual Community Bankers Symposium, cosponsored by the Federal Reserve Bank of Chicago, the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC), was held at the Chicago Fed on November 18, 2016. This article summarizes key presentations and discussions at the event.
After 35 years without significant changes to the federal tax code in the United States, tax reform is back on the legislative agenda. Both the congressional Republican delegation (the House GOP) and the Trump administration (the administration) have released draft proposals for tax reform. And both focus heavily on reform of corporate income taxation. The reason for this is quite simple: Increased globalization has made it easier for multinational enterprises to shift their reported profits around the world in order to pay less in taxes. This has led to concerns about the erosion of the U.S. corporate tax base, with reductions in corporate tax rates (as well as a move from a residential to a destination-based tax system) seen as one way of encouraging corporations to pay taxes here.
Women contribute a large fraction of aggregate labor hours, earnings, and labor force participation. Yet, many models used to study the effects of government policy ignore gender differences and use data on men only. These models are used extensively for examining the effects of government policies and programs—including Social Security, taxation, and welfare programs. Before evaluating how people respond to such policies, it is important to construct a reliable model of how people behave and why.