Brexit: No deal would be 'hugely damaging' to car industry

Despite the car industry'd concerns about Brexit, a lone of big manufacturers have committed to building more vehicles in Britain since the EU referendum.  The government has also pledged to support the competitiveness of the UK sector after Britain leaves the EU, and has invested twenty million pounds in Burnastion alongside Toyota.  It is said that the industry was a success story and the government is seeking partnership that delivers the maximum possible benefits for both the UK and the EU economies, and maintains the strength of world leading automotive sectors.  Various companies in this sector around the UK and Europe are highly dependent on each other which is why it must be ensured that cross border trade is as free and frictionless as possible post-Brexit. Gains from free trade will bring benefits to UK consumers by lowering prices by 8% and enhancing GDP be around 4% by raising competition and productivity

Trump says US will impose steel and aluminum tariffs

https://www.cnn.com/2018/03/01/politics/steel-aluminum-trade-trump-chaos/index.html

Trump announced after a long going debate that next week he hopes to impose a 25% tariff on steel imports and a 10% tariff on aluminum to boost these struggling domestic industries. This article conveys that this will most likely strain our relationships with steel-producing US allies, and potentially create a trade war with other countries.   There is talk of exempting our trade allies from the tariffs, but it has not been determined whether this will be a caveat of the policy.  Trumps announcement took a huge toll on the stock market.  The Dow took a 500-point dip.  There is also concern that this policy will lead to increased consumer prices for products that are made with manufacturing of steel and aluminum as well as lost jobs. It will be interesting to see to what extent and repercussions this policy will have on our relationships with other countries and if the benefits will outweigh the costs.

New Fed chairman says Amazon helped keep inflation low

Federal Reserve Chairman Jerome Powell stated that he believes Amazon had a large influence on the low inflation rates in the US. Other factors in the inflation levels were believed to be oil prices, e-commerce, and labor slack. I definitely agree with Powell when it comes to e-commerce playing a large role in keeping inflation down. For online retailers, like Amazon, the e-commerce format allows the company to offer lower prices, thus keeping inflation down. It was also interesting to note that Amazon made up 44% of e-commerce sales in the US last year. This is an astounding statistic, and I would predict this market share will decrease in the near future as more companies enter the e-commerce market. I am still not sure whether the emerging e-commerce will be sustainable when it comes to keeping inflation low. I feel like online prices will have to increase at some point in the future. Do you think there are any other factors that have kept inflation levels in the US low in recent years?



https://www.cnbc.com/2018/03/01/new-fed-chairman-says-amazon-helped-keep-inflation-low.html

What the world economy might look like without the US

In this article, Adam Posen, the President of the Peterson Institute for International Economics, is an interview guest for Kai Ryssdal.  Posen published an article describing how the global economy would be much more susceptible to conflict without US economic leadership.

The motivation Posen received to write this article points solely to the Trump administration.  With the Trump administration wanting to withdrawal from the Trans-Pacific Partnership, publicly criticizing the World Trade Organization, and renegotiating NAFTA, it become clear to Posen that this is the direction which the world is heading.

Economies in Asia and Europe are much more greedy than the US.  For years, the US has been towards the top in size of economies, but has not been the bully when it comes to enforcing how they wish to due things.  Rather, they have done exceptionally well in getting everyone to follow the rules as they have done so for so long, resulting in a much richer world over the last 50-60 years.  Without the US, the world could face some sort of massive economic downfall.

https://www.marketplace.org/2018/02/26/world/what-world-economy-might-look-without-us

Here are the funny videos on Sweden that I mentioned in class. Hope you enjoy it

The Daily Show with Jon Stewart
Get More: Daily Show Full Episodes,Political Humor & Satire Blog,The Daily Show on Facebook

The Daily Show with Jon Stewart
Get More: Daily Show Full Episodes,Political Humor & Satire Blog,The Daily Show on Facebook

Venezuela launches oil cryptocurrency

Venezuela has recently become the first nation to institute a sovereign cryptocurrency in the form of the "Petro". The oil-rich South American country continues to face severe economic sanctions imposed on it by the U.S. due to a long history of tense relations, primarily due to Venezuela's socialist government. The Venezuelan government claims that the Petro is designed to address the rampant hyperinflation and devaluation that has been going on for years, while critics argue that it is little more than a last resort cash-grab. The ongoing political and economic crisis within Venezuela is still uncertain, and it remains to be seen whether or not an oil-backed cryptocurrency will be effective.

http://www.bbc.com/news/business-43133853

In Germany’s Car Capital, the Unthinkable: A Ban on Cars

In the industrial city of Stuttgart, the major industry in town is facing one of its largest challenges to date. A German court ruled that the city can legally ban diesel cars to improve the air quality in the city. The city is dominated by car manufacturers like Diamler, which produces Mercedes Benz cars and trucks as well as other vehicles used around the world, and Volkswagen and much of the jobs and notable landmarks in the city are fueled by this industry. While the city has taken strides to improve its air quality, it still lags behind the European standards. 

The stakeholders in the automotive industry are extremely opposed to this ban. This includes management and workers in these industries. The manufacturers that will be most effected have had emissions troubles in the recent history and this new legislation may be a pivital point in their trajectory. Workers at Diamler earn extremely favorable wages and the change to the environment in Germany may lead to less job security and job benefits.

Environmental activists, however, argue that the nations crusade for an environmentally sustainable future should outweigh the short term costs to the stake and shareholders in the industry. Angela Merkel has a goal of cutting carbon emissions by 40% by 2020 and this measure would certainly help. 

This is not the first time that Stuttgart has been on the losing side of an industry shift though. They used to be heavily invested in the watchmaking industry and the only reminants today are the clocks that adorn houses around the city. The Mayor of Stuttgart understands this and is quoted saying, “Economic history is littered with examples where protecting today’s jobs destroys tomorrow’s”.

What do you think about this proposed ban?

Is it the place for the government to step into the economy and ban 1/3 of one of Germany's biggest businesses?

Link to Article

Germany companies that don't try harder at gender equity could be fined millions

Germany has a new concept in order to create equality for women in the corporate world. Their idea is to fine companies up to 10 million euro or 5% of a company's annual turnover if they do not have at least 30% females on their senior management and board members. This a follow up bill that required companies to create goals on the amount of women in senior management, and explain why they did not make their goals if the company didn't make their goal. The issue with this bill was that many companies made a goal of 0% of women in their senior management because none of the current members were planning on retiring. Germany did see an increase in amount of women in senior management roles by 8.4 percentage points from the start of 2016 to 2017, but many are looking for better results. Do you think that the new bill would create positive change? Should changes be made?

https://global.handelsblatt.com/companies/germany-companies-dont-try-harder-gender-equity-fined-millions-891848

It’s only been one year since the Dow hit 20,000; today it’s topping 26,000

          The market has been on a role as of late with only minor blips on the radar.  This article points out that only horrible events could cause a decrease in the stock market.  This means as of late people have confidence in the market and expect it to continue to do well.  It is when people expect the market to do bad is when the market could see a downturn.

          This article also points out that Trump has claimed a lot of this market success as stemming from him.  The president and the stock market have very little to do with each other, as stocks are the values of shares in publicly held companies.  Another aspect to take into account is the business cycle itself.  We have reached a period of good growth, but will it peak and will a correction, or a drop in 10%, occur in the near future?  Only time will tell but in the mean time it is interesting to watch the market rise.

https://www.nbcnews.com/business/markets/it-s-only-been-one-year-dow-hit-20-000-n841066

Why companies are abandoning the NRA

People are pushing companies to cut ties with the powerful gun lobby. Advocates are targeting not weapons makers, but banks, rental car agencies, airlines, insurers and other companies with ties to the NRA.  In many cases, the pressure is working. Delta is ending discounted rates for members of the organization. United Airlines will no longer offer discounts on flights to the NRA annual meeting. Enterprise Holdings, which runs the Enterprise, Alamo and National car rental groups, will end the discount deal it has with the NRA. So will Avis Budget Group, which owns Avis and Budget, and Hertz. Similarly, insurance giant MetLife is ending its discount program for NRA members. The First National Bank of Omaha pledged to stop issuing an NRA-branded Visa card. The National Rifle Association released a statement on Saturday saying companies "have decided to punish NRA membership in a shameful display of political and civic cowardice." At this point, businesses that work with the NRA are putting their relationships with customers at risk. Shares of American Outdoor Brands have dropped 8% since the day after the shooting. Vista Outdoor, which makes guns and ammunition, has declined 7%. Sturm Ruger is down slightly. All while the broader market has risen.

http://money.cnn.com/2018/02/25/news/companies/boycott-nra-companies/index.html?iid=SF_LN

Minimum Wage Hikes Up in Ontario

Ontario, Canada's most populated province saw an in increase in minimum wage from $11.60 to $14. Ontario also happens to be Canada's most industrialized province so a beneficial or deteriorating effect to the economy is going to have an impact on the entire country. This move was made to stimulate the economy by allowing more money in the hands of poorest. However, with increased wages the price of goods and services also go up so we can't be quite sure that this will help decrease the inequality between the rich and the poor. With increased living costs in Ontario, most people earning minimum wage are near the poverty line, I'd be interested to see if this works out for the better or for worse.

http://www.cbc.ca/news/business/minimum-wage-experiment-1.4473095