Bitcoin Hits 2018 Low as Concerns Mount on Regulation, Viability

The currency, Bitcoin, reached a record high back in December at
$19,511, but it now has spiraled down and lost half its value, hitting their all time
low for the year this week. This is due to a variety of factors, such as increased
regulations and questions regarding its viability. Government oversight is
expected to increase and there are fears that the price can be easily manipulated
due to hacking. Facebook even banned advertisements for cryptocurrency this
week. India and Japan have already cracked down on cryptocurrencies through
their own national regulations. Bitcoin grew by 1,400 percent last year, becoming
a 200 billion dollar market, yet its recent fall is a big red flag for its future in our
country, as growing skepticism and law enforcement could put a permanent halt
to its growth. My suggestion is if you are a current investor in Bitcoin it might be
time to sell.

https://www.bloomberg.com/news/articles/2018-02-01/bitcoin-extends-record-january-slide-as-concerns-increase

India Wants to Give Half a Billion People Free Health Care

A recent article published by the New York Times reported on a massive overhaul to public health care in India. While the country does have free health clinics, these government-run hospitals suffer from very poor quality, corruption, and long wait times. Indian Prime Minister Narendra Modi has focused much of his policy on addressing the concerns of  the poorer members of Indian society. The new health care proposal would offer 100 million families up to 500,000 rupees (about $7,860) of coverage per year. This amount is enough to cover the equivalent of five heart surgeries within India. According to India's finance minister, this plan would be the largest government-funded health care program in the world, in terms of number of people covered. In a country of about 1.3 billion people, this new health plan could cover a little under half of the population. In 2014, India spent 1.4% of its GDP on health care, compared to China's 3.1% and the U.S.'s 8.3%. 

The new plan does have some critics, however. Several public health care experts have pointed out that it does little to prevent the underlying causes of disease in the first place, such as water and air pollution, malnutrition, poor sanitation, and lack of proper housing. The increased amount of pollution is due in part to the government's strong pro-business policies. It is still unclear how exactly the government plans to pay for the new program, but they are also planning on enacting a tax on capital gains due to India's rising stock market.

https://www.nytimes.com/2018/02/01/business/india-modi-health-care.html?rref=collection%2Fsectioncollection%2Fworld

Columbus, Ohio shortlisted for Amazon HQ2

Amazon has decided to build their second headquarters and Columbus, Ohio has been shortlisted in the top 20 out of a list of 238 cities. The winning city will have an addition of 50,000 jobs and 5 billion dollars in investment. Last year, Columbus was listed in USA's top 45 fastest growing cities so this could really be the boost it needs to become a more popular metropolitan city and stimulate the local economy further.

On the flip side of the coin we can also expect living in the city to become more expensive. The influx of labor may also make the city more congested and commuting times longer. The host city will also give tax benefits to Amazon, but there's a trade off right there- the city may have to cut spending in other services or raise taxes elsewhere.

However, looking at Seattle's example it's safe to say that this will be beneficial to the economy. 

https://www.nytimes.com/2018/01/18/technology/amazon-finalists-headquarters.html

http://money.cnn.com/2017/10/27/technology/amazon-hq2-housing-costs-seattle/index.html

America's Opioid Epidemic

This article combats the assumption that most drug issues in the United States stem from poor economic conditions. Opioid deaths make up 20-50% of all drug related deaths in the US and are accredited as being a large reason our life expectancy numbers have been falling. It was interesting to learn that the opioid crisis functions differently from other drug and alcohol problems. This epidemic, like the title of the article explains, is driven by supply. The country's opioid problem stretches across more demographics because opioid addiction commonly arises from overuse and abuse of prescriptions rather than exposure to poor economic conditions.

https://www.economist.com/blogs/democracyinamerica/2018/01/another-prescription

SEC Weighs a Big Gift to Companies: Blocking Investor Lawsuits

I have seen a lot of articles talking about the U.S economy is back on track, along with the big tax cut for corporations, SEC made a further step for companies that want to go IPOs.
The decision will provide a bonus to promote the economic expansion.

https://www.bloomberg.com/news/articles/2018-01-26/trump-s-sec-mulls-big-gift-to-companies-blocking-investor-suits

Keurig Green Mountain Plans to Buy Dr Pepper Snapple

Keurig Green Mountain, the maker of coffee pod machines, planned to buy the Dr. Pepper Snapple Group in an $18.7 billion deal. Keurig would merge with Dr. Pepper Snapple and create a new firm called Keurig Dr. Pepper. Also, shareholders of Dr. Pepper Snapple would get a cash dividend of $103.75 per share, which is about 8% higher than Dr. Pepper Snapple’s closing share price on Friday. The transaction would be finished by June 30. 

This acquisition would cause a huge impact on the soft drink market. Since Keurig Green Mountain is the maker of coffee pod machines, it would raise the chance that the new company would launch the new pods which could eventually allow customers make soft drinks at home just like how people make coffee by coffee pod. We will see if this would really happen and if the acquisition is worth.

https://www.nytimes.com/2018/01/29/business/dealbook/keurig-dr-pepper-snapple.html?rref=collection%2Fsectioncollection%2Fbusiness&action=click&contentCollection=business&region=stream&module=stream_unit&version=latest&contentPlacement=1&pgtype=sectionfront

U.S. economic growth slows as imports increase at fastest rate in 7 years

In the article it talks about how economic growth has slowed in the fourth quarter of 2017.  With the rapid rise in imports it is safe to say our net exports has decreased.  With net exports decreasing that means that the dollar strength or the international value of the dollar has increased.  If the value of the dollar increases less people will want to invest in the United States from foreign countries because it has become relatively more expensive.  However, a strong dollar allows U.S. investor money in other countries stronger.  While this may not have a positive effect on GDP, GNP may increase because these companies operated not in the U.S. are owned by U.S. residents.

https://www.nbcnews.com/business/economy/u-s-economic-growth-slows-imports-increase-fastest-rate-7-n841316

Promising Billions to Amazon: Is It a Good Deal for Cities?

Amazon's current search and selection for a second global headquarters is garnering serious attention and critical analysis from economists on how tax breaks end up ultimately impacting the communities bidding for a "jackpot employer" like Amazon. The debate mentioned in the article shows overwhelming support among economists behind the belief that massive tax incentives end up minimizing the potential benefits associated with bringing a global commerce giant to a community. The use of tax incentive programs as a tool to bring businesses to communities rose rapidly in the 1990s as a practice to allure businesses and valuable jobs. With that said, in recent years the practice has slowed down due to communities recognizing the weakening return of proposing such deals. Economists do see value in offering incentives but believe that the use of publicly funded transportation upgrades, job-training programs, or tax credits aimed at revitalizing areas in need of development would be more efficient incentives to benefit the communities proposing deals. Many communities are rolling out large tax breaks for Amazon in hopes of attracting them, but recognizing the needs of their individual communities might play a more key role if they hope for Amazon to ultimately impact their community positively economically.

https://www.nytimes.com/2018/01/26/business/economy/amazon-finalists-incentives.html?rref=collection%2Fsectioncollection%2Fbusiness-economy&action=click&contentCollection=economy&region=stream&module=stream_unit&version=latest&contentPlacement=3&pgtype=sectionfront

Oil Boom Gives the U.S. a New Edge in Energy and Diplomacy

The US has recovered their power in the oil industry in the last year, the main reason for this to happen is that the new president is trying to invest in this type of industries, and this has led to companies making more innovative drilling technologies that reduce their costs and can help them maximize their outputs. The US is getting even more powerful than countries like Saudi Arabia and Russia that have been the biggest players in this industry in the last years. This not only gives the US and economic advantage in the world but also gives them political power because now they are not depending on other producers in order to provide oil, they can put sanctions and can break relations with countries like Saudi Arabia if needed, or have sanctions on Venezuela for the current situation of the country and not need to depend on their oil.

There is also another issue that this has created, and it's about the environment. Since the oil companies are creating new drilling places and are starting to extract more oil in the ones that they already have, they are looking on how much this is going to impact the environment and how much pollution can cause. Also, the government is responsible for this because they have been changing the regulations and the laws, to make it easier for companies to extract more oil and at lower costs. This also brings out the question how involved should be the government be in this? and if they should influence what happens in the market.

https://www.nytimes.com/2018/01/28/business/energy-environment/oil-boom.html?hp&action=click&pgtype=Homepage&clickSource=story-heading&module=first-column-region&region=top-news&WT.nav=top-news

How the Finance Industry Is Trying to Cash In on #MeToo

In the wake of the many sexual misconduct allegations that have recently surfaced, many settlement advance companies have been looking to cash in. Settlement advance companies are similar to payday loan providers and have been met with similar allegations of predatory lending. These companies are always trying to ride the wave of the news cycle to acquire as many customers as they can to take out loans. They have provided funding for ex-NFL players to pursue settlements for the brain damage they suffered during their playing careers and provide continual services for workman's comp claims and other on the job settlements. 

These firms have always faced criticism for their practices but their aggressive marketing into sexual misconduct cases has brought this conflict back into the spotlight for the time being. Since these companies are technically not giving loans, but rather "advances", they are allowed to charge exorbitantly high interest rates. These rate vary from case to case but can reach as high as 100%. While this may seem unreasonable, they only collect payments for cases that are won. Consumer advocacy groups argue that these rates are unfair and many customers do not truly understand the terms of the advance when they take it but the companies argue that they provide funding to these plaintiffs that would otherwise have to hire much less experienced attorneys that may not be able to get ideal settlement results.

The CEOs of these companies have different views of what is morally acceptable in situations like these. For example, Legal Bay's CEO Christopher R. Janish says that his marketing campaign  "... really is more of a public awareness and branding thing" but others like T. Thomas Colwell of Trimark Legal Funding believe that companies that ride these new cycle waves are just being "opportunistic". I personally believe that when taking out a loan of any kind a borrower should fully understand the terms before they enter into an agreement and that those in need of legal funding will probably come out ahead by utilizing the funds. I believe that we need to pursue as many of these cases of misconduct as we can and if finances are getting in the way of women coming forward, I support these organizations because of the opportunities that they give to the people who may not have them otherwise.


Link to NYT Article

President Trump's remarks to Davos

President Trump visited the World Economic Forum in Davos this week to discuss his vision for America's participation in global trade in the upcoming years. He was praised for sticking to a script during his initial remarks, remarking about how the tax plan was good for the American economy and how he is (in theory) in favor of free trade agreements as long as they favor the USA. However, during the question and answer program, he veered off-message, talking about how Hillary Clinton's election would have hurt the US economy and talking strongly about the need for American goods to prevail and the need to withdraw from trade agreements.

This article is relevant to the class because it shows two of the subsets of systems within free market capitalism - free market capitalism using globalization as a means to grow vs free market capitalism determined to be idealistic.





https://www.politico.com/story/2018/01/26/trump-davos-speech-america-first-371243

Why America's economy is so healthy?

The US economy is growing at a steady rate. Consumer confidence has been met with optimism. Figures indicate that the US economy grew 2.3 percent in the year of 2017 which was higher than the growth of the previous year. The Trump administration delivered a major tax cut for corporations, business, and individuals which has incentivized the “Producers” and the “Manufacturing” sector to stimulate and optimize growth within their businesses. Also, foreign investors like “Samsung” are launching operations in the United States considering the market conditions of the US economy and producer-friendly policies. The global resurgence of the economic regions of the world such as Asia, Europe, and Latin America has in fact enhanced the US economy. Demand for US goods has overall increased and a weak dollar has aided in American exports abroad because they have now become more affordable.  There has been an increase in employment opportunities for the manufacturing sector with the manufacturing sector adding 200,000 jobs. 2017 has had a positive outlook economically for the US.  
http://money.cnn.com/2018/01/26/news/economy/us-global-economy-2017/index.html

U.S. warns investors over Venezuela's 'petro' cryptocurrency

On Monday, January 8th, Venezuela's socialist Madura regime announced that it would be issuing a petroleum backed cryptocurrency to solve Venezuela's hyperinflation woes. Imposition of sanctions by the United States and the bolivar's rapid decline to all-time lows relative to the dollar has made it impossible for Venezuela to refinance its debt burden. Following the advice of a cryptocurrency consulting agency, VIBE, Maduro will issue 100 million of this new cryptocurrency, the petro, backed by an equivalent number of barrels of oil, as an extension of Venezuela's credit. To circumvent U.S. sanctions which probit the purchase of newly issued Venezuelan debt, Maduro is moving to capitalize on the success of other cryptocurrencies such as bitcoin and etherium.  U.S. banks continue to grow more cautious of dealing in Venezuela as involvement with the sanctioned country exposes U.S. persons to serious legal risk. The new token will initially be offered 60% discount from the current $60.40 price of oil in private placements starting February 15th.  It will then be offered up to the public on exchanges, while the rest will be shared between the government and VIBE, leaving no more coin to be mined in the future. This will give the Venezuelan government and VIBE great power to affect the price and supply of its new token. The government will move to accept tax payments in petros while PDVSA, the state oil company, will integrate with cryptocurrencies in its dealings with foreign companies. As the rapid adoption of cryptocurrency continues, developers continue to utilize the blockchain technology in a multitude of use cases. Given block chains support of user anonymity, the petro will most likely decrease the transparency of the Venezuelan government and its creditors. Whether or not Venezuela's congress will approve the use of the petro proposed by the Maduro regime is yet to be seen. The propping tactic used by Maduro, however, is blatant and unlikely to improve relations between the U.S. and Venezuela.

https://www.reuters.com/article/us-venezuela-economy-cryptocurrency/u-s-warns-investors-over-venezuelas-petro-cryptocurrency-idUSKBN1F52AB

Super Bowl Commercial Prices

      During that past years Super Bowl commercials have been increasing year to year.  This year a 30 second ad price is worth $5 million for a spot on February 4th.  But it really is worth the price for the companies paying for the ad.  The Super Bowl is the gets roughly 114 million people and some are watching just for the commercials.  They are known to be very funny and people just love seeing what new ads companies put out for the Super Bowl.  With over 114 million people watching, the VP of Ad Sales at NBC Sports Group hoped that February 4th will set a record for single-day revenue for a single company.  That is just crazy to think about how much a sports event can do for a company who will usually make a lot more than $5 million from the 30 seconds people will see.  Everyone always looks forward to the Budweiser, Doritos, and Coca-Cola commercials so it will be interesting to see what they put up with the $5 Million for the 30 second ad.  It also will be interesting to see if this years Super Bowl will get the same viewing number with all of the kneeling issues the NFL has been dealing with so I guess we'll just have to wait and see if the $5 million was really worth it after all.

http://www.businessinsider.com/super-bowl-commercials-cost-more-than-eagles-quarterback-earns-2018-1

THIS IS THE XFLLLLLLLLLLLLLLLL

In recent news, the XFL is back. Vince McMahon, CEO of WWE, is giving the XFL a second chance. By doing this he is taking a crack at the monopoly we have come to love as the National Football League. The article stated that this comeback will be funded by McMahon himself as he sold 3.34 million shares of his WWE stock. This is worth about 100 million dollars. This time the league will be taking two years to get everything set up and promised "The new XFL is an exciting opportunity to re imagine America's favorite sport." The league is directed to take a more family oriented approach compared to its predecessor. Ultimately I think this is something that is much needed in the football world. NFL ratings have been on a decline and the NFL is very slow to innovate. 

https://www.cbssports.com/wwe/news/this-is-the-xfl-again-controversial-football-league-set-to-return-in-2020/

Walmart enlists help from Japan in fight with Amazon

In the U.S., Walmart will sell Rakuten's Kobo e-readers, which are similar to Amazon's Kindle. The Kobo platform, created by a Canadian company that Rakuten bought in 2011, currently offers readers millions of titles. Walmart is showing up late to the e-book party. Amazon has built a dominant position in the market since first launching the Kindle more than 10 years ago. A report published last year by industry monitoring group Author Earnings estimated that 80% of spending on e-books in the U.S. goes through Amazon.  Japan's online grocery market could be more lucrative for Walmart.Home to more than 75 million online shoppers, the country has the world's third biggest ecommerce market after the U.S. and China.

http://money.cnn.com/2018/01/26/technology/walmart-rakuten-ebooks-japan/index.html

Inside Amazon Go: the store of the future

Amazon open its first public automated shopping space in Seattle last week. They use cameras and sensors to detect what food the customers have taken from the shelf and will then be atomically charge to the customers card when they walk out. Customers will need an Amazon account, smartphone and the Amazon Go app. I think that Amazon has really thought about the future and I can see many people using this to avoid long lines at checkout.

http://money.cnn.com/2018/01/26/technology/amazon-go-store/index.html