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Ben Levisohn, Jack Hough and Carleton English discuss the impact of debt negotiations on the markets, Foot Lockers shares and earnings performance as well as the resignation of Morgan Stanleys CEO James Gorman.

The Treasury Deptartment is expected to run out of the cash necessary to fund the federal government’s obligations by June 8 or 9 unless the debt ceiling is lifted, according to a report by Goldman Sachs.

Since the U.S. ran up against its $31.4 trillion debt limit in January this year, the Treasury has been using "extraordinary measures" which are accounting maneuvers that involve shifting funds between certain accounts to pay the government’s bills. Treasury is only able to use the extraordinary measures so long as balances in those accounts remain above $30 billion, at which point it can no longer fulfill all the federal government’s obligations.

Negotiators representing the Biden administration and congressional Republicans have been operating under the assumption June 1 will be the date on which Treasury exhausts its extraordinary measures, which could give lawmakers extra time to finalize a deal if the June 8 or 9 estimate from the Goldman Sachs note pans out. However, the report noted that there’s still a chance June 1 will be the deadline.

"The estimate is subject to substantial uncertainty so there is certainly a chance that receipts could slow more than expected and leave the Treasury short of cash by June 1 or 2," Goldman economists Alec Phillips and Tim Krupa wrote in the note to clients, which Bloomberg first reported.

YELLEN SAYS ODDS OF US PAYING ALL ITS BILLS BY JUNE 15 IS ‘QUITE LOW’ AS DEBT CEILING DEADLINE LOOMS

A report by a pair of economists from Goldman Sachs indicates the Treasury may have until June 8 or 9 until it’s unable to pay all the government’s obligations. (Fox News)

The Goldman Sachs economists noted that on Thursday last week, Treasury’s cash balance was at a little more than $57 billion after it had about $92 billion the day before. The Treasury's cash balances ebb and flow day-to-day based on incoming tax receipts and spending levels as federal bills come due, but the extraordinary measures will eventually be tapped out.

"We are confident that Congress will avoid going past the deadline without action, but there are many paths this could take," wrote the economists, who assigned a 30% chance of the two sides agreeing to a deal this week, along with a 30% chance of a deal "shortly before" the deadline is reached.

"While we expect a deal to occur ahead of the deadline, we also expect a few more twists along the way, and suspect that markets are likely to price in additional risk before the debt limit is finally raised," they explained.

DEBT CEILING DEADLINE IS CLOSER THAN PREVIOUSLY EXPECTED – HERE’S WHY

Treasury Secretary Janet Yellen has said the debt limit needs to be increased by June 1 or the U.S. will face difficult choices about which bills to pay. (Drew Angerer/Getty Images / Getty Images)

Treasury Secretary Janet Yellen said Sunday during an interview on NBC’s "Meet the Press" the likelihood of the U.S. making it to mid-June without the Treasury exhausting its extraordinary measures is "quite low" and that June 1 remains the hard deadline.

"And my assumption is that if the debt ceiling isn’t raised, there will be hard choices to make about what bills will go unpaid," Yellen added without going into specifics.

Senate Minority Leader Mitch McConnell (R-Ky.), Speaker of the House Kevin McCarthy (R-Calif.) and President Joe Biden, meet with other lawmakers in the Oval Office of the White House to discuss the debt limit on May 9, 2023. (Anna Moneymaker/Getty Images / Getty Images)

Negotiations between President Biden and House Speaker Kevin McCarthy, R-Calif., have picked up over the last week after weeks of little movement as the two sides press to strike a deal that staves off the fast-approaching threat of default. 

House Republicans want to see a deal that contains spending caps, particularly on non-defense discretionary spending, while Democrats have been reluctant to agree to budget cuts.

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Biden and McCarthy are scheduled to meet Monday when the president returns from a trip to Japan for the G-7 that was cut short due to the state of negotiations, while staffers from the two sides will meet Sunday night. 

McCarthy has said that a deal in principle would likely need to be reached this weekend to give Congress enough time to turn the deal into legislative text and pass the bill through the House and Senate ahead of the June 1 deadline.

FOX Business’ Stephen Sorace contributed to this report.

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At least 13 people may have taken their own lives linked to Post Office scandal, public inquiry finds

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At least 13 people may have taken their own lives linked to Post Office scandal, public inquiry finds

At least 13 people may have taken their own lives after being accused of wrongdoing based on evidence from the Horizon IT system that the Post Office and developers Fujitsu knew could be false, the public inquiry has found.

A further 59 people told the inquiry they considered ending their lives, 10 of whom tried on at least one occasion, while other postmasters and family members recount suffering from alcoholism and mental health disorders including anorexia and depression, family breakup, divorce, bankruptcy and personal abuse.

Follow latest on public inquiry into Post Office scandal

Writing in the first volume of the Post Office Horizon IT Inquiry report, chairman Sir Wyn Williams concludes that this enormous personal toll came despite senior employees at the Post Office knowing the Horizon IT system could produce accounts “which were illusory rather than real” even before it was rolled out to branches.

Sir Wyn said: “I am satisfied from the evidence that I have heard that a number of senior, and not so senior, employees of the Post Office knew or, at the very least, should have known that Legacy Horizon was capable of error… Yet, for all practical purposes, throughout the lifetime of Legacy Horizon, the Post Office maintained the fiction that its data was always accurate.”

Referring to the updated version of Horizon, known as Horizon Online, which also had “bugs errors and defects” that could create illusory accounts, he said: “I am satisfied that a number of employees of Fujitsu and the Post Office knew that this was so.”

The first volume of the report focuses on what Sir Wyn calls the “disastrous” impact of false accusations made against at least 1,000 postmasters, and the various redress schemes the Post Office and government has established since miscarriages of justice were identified and proven.

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‘It stole a lot from me’

Recommendations regarding the conduct of senior management of the Post Office, Fujitsu and ministers will come in a subsequent report, but Sir Wyn is clear that unjust and flawed prosecutions were knowingly pursued.

“All of these people are properly to be regarded as victims of wholly unacceptable behaviour perpetrated by a number of individuals employed by and/or associated with the Post Office and Fujitsu from time to time and by the Post Office and Fujitsu as institutions,” he says.

What are the inquiry’s recommendations?

Calling for urgent action from government and the Post Office to ensure “full and fair compensation”, he makes 19 recommendations including:

• Government and the Post Office to agree a definition of “full and fair” compensation to be used when agreeing payouts
• Ending “unnecessarily adversarial attitude” to initial offers that have depressed the value of payouts, ⁠and ensuring consistency across all four compensation schemes
• The creation of a standing body to administer financial redress to people wronged by public bodies
• Compensation to be extended to close family members of those affected who have suffered “serious negative consequences”
• The Post Office, Fujitsu and government agreeing a programme for “restorative justice”, a process that brings together those that have suffered harm with those that have caused it

Regarding the human impact of the Post Office’s pursuit of postmasters, including its use of unique powers of prosecution, Sir Wyn writes: “I do not think it is easy to exaggerate the trauma which persons are likely to suffer when they are the subject of criminal investigation, prosecution, conviction and sentence.”

He says that even the process of being interviewed under caution by Post Office investigators “will have been troubling at best and harrowing at worst”.

Read more:
Post Office inquiry lays bare heart-breaking legacy – analysis

‘Hostile and abusive behaviour’

The report finds that those wrongfully convicted were “subject to hostile and abusive behaviour” in their local communities, felt shame and embarrassment, with some feeling forced to move.

Detailing the impact on close family members of those prosecuted, Sir Wyn writes: “Wives, husbands, children and parents endured very significant suffering in the form of distress, worry and disruption to home life, in employment and education.

“In a number of cases, relationships with spouses broke down and ended in divorce or separation.

“In the most egregious cases, family members themselves suffered psychiatric illnesses or psychological problems and very significant financial losses… their suffering has been acute.”

The report includes 17 case studies of those affected by the scandal including some who have never spoken publicly before. They include Millie Castleton, daughter of Lee Castleton, one of the first postmasters prosecuted.

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Three things you need to know about Post Office report

She told the inquiry how her family being “branded thieves and liars” affected her mental health, and contributed to a diagnosis of anorexia that forced her to drop out of university.

Her account concludes: “Even now as I go into my career, I still find it so incredibly hard to trust anyone, even subconsciously. I sabotage myself by not asking for help with anything.

“I’m trying hard to break this cycle but I’m 26 and am very conscious that I may never be able to fully commit to natural trust. But my family is still fighting. I’m still fighting, as are many hundreds involved in the Post Office trial.”

Business Secretary Jonathan Reynolds said the inquiry’s report “marks an important milestone for sub-postmasters and their families”.

He added that he was “committed to ensuring wronged sub-postmasters are given full, fair, and prompt redress”.

“The recommendations contained in Sir Wyn’s report require careful reflection, including on further action to complete the redress schemes,” Mr Reynolds said.

“Government will promptly respond to the recommendations in full in parliament.”

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Public finances in ‘relatively vulnerable position.’, OBR warns

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Public finances in 'relatively vulnerable position.', OBR warns

The UK’s public finances are in a “relatively vulnerable position”, the government’s official forecaster has warned.

The Office for Budget Responsibility (OBR) cited a drag from successive economic shocks, recent U-turns on spending cuts and higher-than-expected policy commitments.

It sounded alarm over the projected path for debt as a result, in its annual fiscal risks and sustainability report.

It saw total debt above 270% of gross domestic product (GDP) by the early 2070s – up from a current level of 96.5% – declaring that rising debts have led to “a substantial erosion of the UK’s capacity to respond to future shocks”.

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The OBR’s report highlighted damage from the COVID pandemic and cost of living crisis that followed Russia’s invasion of Ukraine.

But it raised fears that past and current government policies were further harming the sustainability of the public finances.

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The report said that the pension triple lock, for example, was now estimated to cost £15.5bn annually by 2029-30.

That was “around three times higher than initial expectations”, it said.

The lock, which rises each year in line with inflation, wage growth or 2.5% – whichever is higher – had risen by more than the 2.5% base in eight of the 13 years of operation to date, the report stated.

The watchdog said it reflected more volatile inflation than expected.

It also picked up on the latest government U-turns over planned welfare and winter fuel payment cuts in the face of rebellions by Labour MPs.

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Welfare U-turn ‘has come at cost’

The decisions are expected to leave Chancellor Rachel Reeves facing a black hole of £6.75bn while weaker-than-expected economic growth could add a further £9bn to that sum in the run-up to the autumn budget, according to Sky News projections that see a void of around £20bn.

The OBR highlighted future risks from rising defence spending and the impact of climate change.

Public sector pay demands could also prove a drag, with resident doctors voting in favour of strikes over pay.

While ministers acknowledge damage to the public purse from the U-turns, Ms Reeves has repeatedly ruled out a new wave of borrowing to fund a spending spree.

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Could the rich be taxed to fill black hole?

As such, the government has not ruled out the prospect of some form of wealth tax to help meet its commitments despite the top 1% of earners contributing almost a third of all income tax already – on top of other targeted taxes such as capital gains.

The report said: “Efforts to put the UK’s public finances on a more sustainable footing have met with only limited and temporary success in recent years in the aftermath of the shocks, debt has also continued to rise and borrowing remained elevated because governments have reversed plans to consolidate the public finances.

“Planned tax rises have been reversed, and, more significantly, planned spending reductions have been abandoned.”

Shadow chancellor Mel Stride said of the report: “The OBR’s report lays bare the damage: Britain now has the third-highest deficit and the fourth-highest debt burden in Europe, with borrowing costs among the highest in the developed world.

“Under Rachel Reeves’ economic mismanagement and Keir Starmer’s weak leadership, our public finances have become dangerously exposed – vulnerable to future shocks, welfare spending rising unsustainably, taxes rising to record highs and crippling levels of debt interest.

“Labour’s recklessness risks it all – your pension, your job, your home, your savings.”

A Number 10 spokesman said: “We recognise the realities set out in the OBR’s report and we’re taking the decisions needed to provide stability to the public finances.”

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‘Widespread sexual violence’ took place during Hamas’s 7 October attacks, report by Israeli experts says

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'Widespread sexual violence' took place during Hamas's 7 October attacks, report by Israeli experts says

A newly released report led by Israeli legal and gender experts presents detailed evidence alleging “widespread and systematic” sexual violence during the Hamas-led terror attack on 7 October.

Warning: This story contains descriptions of rape and sexual violence

The findings, published by the Dinah Project, argue that these acts amount to conflict-related sexual violence (CRSV), and assert that “Hamas used sexual violence as a tactical weapon of war”.

The report draws on 18 months of investigation and is based on survivor testimonies, eyewitness accounts, and interviews with first responders, morgue personnel and healthcare professionals.

According to the Dinah Project, the documented patterns – such as forced nudity, gang rapes, genital mutilation, and threats of forced marriage – indicate a deliberate and coordinated use of sexual violence by Hamas operatives during the attack.

Reported incidents span at least six locations, including the Nova music festival, and several kibbutzim in southern Israel.

A destroyed car near the police station in Sderot, following the 7 October attacks by Hamas. Pic: AP
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A destroyed car near the police station in Sderot, following the 7 October attacks by Hamas. Pic: AP

One section of the report describes victims “found fully or partially naked from the waist down, with their hands tied behind their backs and/or to structures such as trees and poles, and shot”.

At the Nova music festival and surrounding areas, the investigators found “reasonable grounds to believe” that multiple women were raped or gang-raped before being killed.

The report’s findings are consistent with earlier investigations by the United Nations and the International Criminal Court (ICC).

Read more:
What is the possible Gaza hostage and ceasefire deal?

Israeli soldier describes arbitrary killing of civilians in Gaza

The UN’s Special Representative on Sexual Violence in Conflict previously concluded that there were “reasonable grounds to believe” CRSV took place during the attack.

Pic: AP
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Destroyed vehicles near the grounds of the Supernova electronic music festival. Pic: AP

Significantly, the Dinah Project urges the international community to officially recognise the use of sexual violence by Hamas as a deliberate strategy of war and calls on the United Nations to add Hamas to its list of parties responsible for conflict-related sexual violence.

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The nature and scale of sexual violence on 7 October have been a subject of intense controversy, with some accusing parties of weaponising the narrative for political ends.

This report seeks to confront what its authors call “denial, misinformation, and global silence,” and to provide justice for the victims.

Hamas has denied that its fighters have used sexual violence and mistreated female hostages.

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