Must-Read Money Stories for Tuesday, Feb. 28

by February 28, 2017
Tesla's stocks plunged nearly 5 percent on Monday following fears over delays in its Model 3. Photo taken from Pixabay.

Tesla’s stocks plunged nearly 5 percent on Monday following fears over delays in its Model 3. (Photo taken from Pixabay)

Trump plans to spike defense budget, cut others

The Washington Post reports that President Trump is set to propose a federal budget that drastically increases defense-related spending by $54 billion while cutting other federal agencies by roughly the same amount, says an administration official. According to the White House, the proposed defense budget will increase by 10 percent. Additionally, the president will request $30 billion in supplementary military spending for the fiscal year 2017. Without providing specifics, the administration said that most other discretionary spending programs will be slashed in order to pay for the defense increases.

Buffett’s $1 trillion target for Apple in sight

Warren Buffet’s $1 trillion target for Apple is in sight, according to the New York Times. Buffet, the Berkshire Hathaway boss, continues to buy stock in Apple—whose market capitalization at Friday’s closing was $717 billion—and thinks it may become the first company ever with a 13-digit valuation. Analysts think that Apple’s revenue will increase a fairly modest 6 percent this financial year.

Tesla plunges again on Model 3 fears

Reuters reported that shares of Tesla dropped on Monday after a downgrade by Goldman Sachs. That brings the company’s decline to 11 percent since its quarterly report last week, which stoked fears about how much cash the company was plowing into its Model 3 sedan. The electric carmaker’s stocks were down 4.83 percent to $244.52 in morning trade on Monday. However, even taking into account the recent drop, Tesla stock has surged more than 30 percent since early December and is up 14 percent so far in 2017.

Gates on universal basic income: not yet

Bill Gates says that he isn’t opposed to giving people money for free—particularly as a means to lift them out of poverty. But he doesn’t think the world is ready for universal basic income (UBI) just yet. Business Insider reported that Gates was answering questions on the subject in a Reddit Q&A on Monday. UBI is a system of income distribution in which everyone receives a set amount of money regardless of job or income level. Proponents argue that it could close gaps in equality, as everyone’s basic needs would be met. Gates says he sees a day in the future when the world will be able to afford the plan.

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