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
Friday, February 2, 2018
Thursday, February 1, 2018
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
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
Wednesday, January 31, 2018
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.
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
Monday, January 29, 2018
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
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
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.
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®ion=stream&module=stream_unit&version=latest&contentPlacement=3&pgtype=sectionfront
https://www.nytimes.com/2018/01/26/business/economy/amazon-finalists-incentives.html?rref=collection%2Fsectioncollection%2Fbusiness-economy&action=click&contentCollection=economy®ion=stream&module=stream_unit&version=latest&contentPlacement=3&pgtype=sectionfront
Sunday, January 28, 2018
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®ion=top-news&WT.nav=top-news
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®ion=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
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
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
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
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
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/
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
Saturday, January 27, 2018
The World Bank Is Remaking Itself as a Creature of Wall Street
Jim Yong Kim, the World Bank's president, is attempting to revitalize the institution with his controversial support of Wall Street. The World Bank, which was once a powerhouse of global finance, is looking for relevance. Kim's unique solution: embracing Wall Street. The model that the World Bank has been following for decades is under strain as some 1.3 billion people still live in poverty, the bank's war chest is depleting by the funds going into developing countries through financial markets. Additionally, the World Bank's biggest benefactor and largest shareholder, the United States, has become it's most vigorous critic. In order to revitalize the World Bank, Kim's mission is to change how the bank operates.
Rather then relying only on contributions from reluctant donor governments, Kim is pushing towards private investors. Sovereign wealth funds, private equity firms and insurance companies. His pitch is that the bank can reap rich returns by putting their money to work alongside the World Bank. Kim's proclaimed dream is to persuade the private sector to help the bank achieve its goal of ending extreme poverty by 2030.
https://www.nytimes.com/2018/01/25/business/world-bank-jim-yong-kim.html?rref=collection%2Fsectioncollection%2Fbusiness
Rather then relying only on contributions from reluctant donor governments, Kim is pushing towards private investors. Sovereign wealth funds, private equity firms and insurance companies. His pitch is that the bank can reap rich returns by putting their money to work alongside the World Bank. Kim's proclaimed dream is to persuade the private sector to help the bank achieve its goal of ending extreme poverty by 2030.
https://www.nytimes.com/2018/01/25/business/world-bank-jim-yong-kim.html?rref=collection%2Fsectioncollection%2Fbusiness
Friday, January 26, 2018
Consumer Confidence Is Lifting the Economy. But for How Much Longer?
This article takes a look into how consumer confidence has played a large role in the US economy's recent expansion. Consumer confidence in the US has risen since the recession in 2008. It was interesting to note that the article mentioned that consumer confidence levels are forecasted to increase in the upcoming year as well. This was tough to believe for me, mainly because of how long we have experienced a bull market. Because of this and the knowledge we have of business cycles, I would expect consumer confidence to decrease at some point in the near future.
It was good to see that the article mentioned that consumer confidence is not the only factor that plays a role in economic growth. I feel that consumer confidence is a good indicator of how the economy will change in the future, but sometimes can be misleading. The author referred to John Maynard Keynes' use of the term "animal spirits," which causes consumers to be overly optimistic in economic decision making. This can potentially be true with respect to the growth of the S&P 500 as of recent.
Overall, this article was really intriguing to see how important consumer confidence really is when it comes to economic growth. The article definitely makes you question how long the trend of economic growth and increasing consumer confidence will last.
https://www.nytimes.com/2018/01/26/business/consumer-confidence-lifting-economy.html
It was good to see that the article mentioned that consumer confidence is not the only factor that plays a role in economic growth. I feel that consumer confidence is a good indicator of how the economy will change in the future, but sometimes can be misleading. The author referred to John Maynard Keynes' use of the term "animal spirits," which causes consumers to be overly optimistic in economic decision making. This can potentially be true with respect to the growth of the S&P 500 as of recent.
Overall, this article was really intriguing to see how important consumer confidence really is when it comes to economic growth. The article definitely makes you question how long the trend of economic growth and increasing consumer confidence will last.
https://www.nytimes.com/2018/01/26/business/consumer-confidence-lifting-economy.html
GDP: Economy grew 2.6% in Q4, less than expected
US GDP grew 2.6% in Q4 of this past year, a slight decline from 3.1% in Q2 and 3.2% in Q3. Economists had expected a 3% growth due to President Trump's success in boosting business confidence through the cutting of corporate taxes, but the increase in consumer spending resulted in a 13.9% increase in imports when compared to Q3, so that jump in imports, ultimately, hurt growth as a whole. The tax cuts imposed by the Trump administration are expected to boost growth in 2018, but continuing the trend of a 3% increase seems to be a bit questionable.
With the holiday season in Q4, this was the driving force behind the increase in imports, so chances are it is still possible for the economy to continue to grow at a 3% rate, because consumers are benefitting from sturdy job and income growth and record stock prices. This was the government's first estimate for economic growth in Q4 and they plan to release two more updated publication in the near future, so time will tell if the 2.6% is as accurate as initially thought.
https://www.usatoday.com/story/money/2018/01/26/economy-grew-2-q-4/1067535001/
With the holiday season in Q4, this was the driving force behind the increase in imports, so chances are it is still possible for the economy to continue to grow at a 3% rate, because consumers are benefitting from sturdy job and income growth and record stock prices. This was the government's first estimate for economic growth in Q4 and they plan to release two more updated publication in the near future, so time will tell if the 2.6% is as accurate as initially thought.
https://www.usatoday.com/story/money/2018/01/26/economy-grew-2-q-4/1067535001/
Trump and Davos: Not Exactly Best Friends, but Not Enemies Either
Donald Trump attended a conference
of the world’s financial and political elite this week in Davos, Switzerland.
The only US President other than Bill Clinton to ever attend the conference,
Trump’s rhetoric of isolationism and his actions of pulling out of the TPP have
left the group of elite worried that the US would end their movement of a
global market. However, this year, the Davos conference welcomed Trump and was
excited about the tax cuts that the Republican party just passed. In comparison
with many political leaders who claim the tax law benefits the wealthy, the
billionaires of Davos applaud it because of its cuts to regulations.
While the tax bill has won over many
of the world’s business elites, other aspects of Trump’s presidency have kept
them concerned. One liberal financial trader called Trump the new wave of
authoritarian ruler, financial leaders from South Africa are reeling from
Trumps disparaging comments earlier this week, and many others are seriously
concerned about the United States “disengaging from the global trade arena.”
While reading, I wondered again
about the perception of the United States abroad, even in circles that Donald
Trump may have previously considered more welcoming towards him, as a former
businessman. I also wonder how much of an effect the unpredictability of Trumps
actions and words will have on the economic standing of the US, even after he
leaves office.
Thursday, January 25, 2018
Venezuela Calls for Early Elections, and Maduro Aims to Retain Control
Politics have a big impact on how an economy operates. Chavez was president from 1999-2013 who was a socialist. He was then succeeded by Nicolas Maduro, another socialist, who won the election narrowly. Throughout this period, the country has had problems with economic crisis, violence and poverty. With less and less national support, Maduro has decided to move the elections up, hurting his opponents. There have been protests, some becoming violent and leading to arrests. With many of Maduro's major opposition either barred from seeking office or in exile along with the change of election date, it seems that Maduro will have little opposition in the coming election.
https://www.nytimes.com/2018/01/23/world/americas/venezuela-election-maduro.html?rref=collection%2Fsectioncollection%2Fworld&action=click&contentCollection=world®ion=stream&module=stream_unit&version=latest&contentPlacement=27&pgtype=sectionfront
https://www.nytimes.com/2018/01/23/world/americas/venezuela-election-maduro.html?rref=collection%2Fsectioncollection%2Fworld&action=click&contentCollection=world®ion=stream&module=stream_unit&version=latest&contentPlacement=27&pgtype=sectionfront
Wednesday, January 24, 2018
Decreasing Amount of Foreign enrollment in U.S Colleges and Universities
So this video discusses the fact that less people from other countries are enrolling at universities in the U.S. The commentators speculate over many things such as sentiment toward the U.S regarding the new government officials in office as well as the new foreign policies that are being put in place.
They also talk about student visas and what may is going on with that program and thus far nothing will change. However, the fact that the question was asked proves that even American are wondering if changes to policies regarding any foreign policy may be changed.
On the bright side universities and organizations are advertising to other countries that they are welcome in to U.S higher education. Many universities are sending out "you're welcome here" messages across the world to help change some of the negative sentiment for the U.S. Hoping that this will get students to enroll in U.S colleges.
https://www.bloomberg.com/news/videos/2018-01-23/foreign-enrollment-drops-at-u-s-colleges-and-universities-video
They also talk about student visas and what may is going on with that program and thus far nothing will change. However, the fact that the question was asked proves that even American are wondering if changes to policies regarding any foreign policy may be changed.
On the bright side universities and organizations are advertising to other countries that they are welcome in to U.S higher education. Many universities are sending out "you're welcome here" messages across the world to help change some of the negative sentiment for the U.S. Hoping that this will get students to enroll in U.S colleges.
https://www.bloomberg.com/news/videos/2018-01-23/foreign-enrollment-drops-at-u-s-colleges-and-universities-video
Trump's Tariffs on Solar Mark Biggest Blow to Renewables Yet
This week President Trump approved a
four-year tariff starting at 30% on internationally manufactured solar
equipment. The United States solar industry relies heavily on imported parts
for their installations, so this tariff will affect this 28 billion dollar
industry tremendously. The industry is now projecting a 23,000-person job loss
this year. Trump argues this tariff is targeted at China, one of the key solar
panel manufacturers and to level the playing field for domestic manufacturers. This
move by Trump poses a trade risk as foreign nations could now establish new
trade barriers, and I assume have a variety of repercussions on many different national industries.
This
is not the first act by President Trump to hurt the renewable energy market, as
he has already pulled out of the Paris agreement, as well as dropped
regulations on power plants. With the threat of climate change looming on the
horizon, and countless studies validating its existence, I believe these
current acts are inhibiting innovation and growth in a key sector. Renewable
energy not only is an opportunity for job growth but also to reduce our carbon
footprint, which looks to be linked to the rise in current natural disasters we
have been facing. Our nation is lagging an incredible amount when compared to
other countries investing in research and development in renewable energy such
as Japan and the U.K; only time will tell how impactful this is on our economy
and our place on the global market.
https://www.bloomberg.com/news/articles/2018-01-22/trump-taxes-solar-imports-in-biggest-blow-to-clean-energy-yet
Friday, January 19, 2018
South Korea considers shutting down domestic cryptocurrency exchanges
The article stated that South Korea is trying to maintain a clear currency market by shutting down local virtual currency exchanges like bitcoin. The government is concerned with the risks and uncertainties brought by those virtual currencies. The opinions on cryptocurrency tradings are divided in the government and raised huge reactions among market due to the long-term impact on the form of future currencies.
Friday, May 12, 2017
LNG could be the next big thing
Could Liquid Natural Gas be the next big thing? A deal by the Trump administration has lead many to believe that it could be. The deal could open the door to massive export of LNG to China which would allow the United States to become a net exporter of the good.
The could provide a place for U.S. shale producers to dump the excess that has accumulated due to a second boom in the shale industry. This would provide higher prices that would let profit margins raise for these companies and help provide more jobs across the country.
As long as Trump does not alter the deal and China doesn't add tariffs due to Trump wanting to change our trade deals with them. This could be a really good deal for the U.S. companies.
https://www.bloomberg.com/politics/articles/2017-05-12/trump-s-china-deal-gives-u-s-lng-a-boost-without-changing-rules
The could provide a place for U.S. shale producers to dump the excess that has accumulated due to a second boom in the shale industry. This would provide higher prices that would let profit margins raise for these companies and help provide more jobs across the country.
As long as Trump does not alter the deal and China doesn't add tariffs due to Trump wanting to change our trade deals with them. This could be a really good deal for the U.S. companies.
https://www.bloomberg.com/politics/articles/2017-05-12/trump-s-china-deal-gives-u-s-lng-a-boost-without-changing-rules
The U.S. economy is back on track
After the most recent jobs report the economy seems to be back on a steady growth path. Also on top of the jobs report we have reports on consumer spending increasing most recently. This gives the CPI a slight boost. The thing people need to be asking themselves is although theses numbers are increasing are they indicating a future slow down? The stock market is at record high and job growth has been huge allowing for unemployment to be around 4.5%.
The stage is set for a hard reset to come. The better question is are we ready for it? We can barely keep the government open for months at a time if we have another recession can we take it?
https://www.bloomberg.com/news/articles/2017-05-12/it-s-back-to-steady-for-u-s-economy-as-retail-sales-cpi-rise
The stage is set for a hard reset to come. The better question is are we ready for it? We can barely keep the government open for months at a time if we have another recession can we take it?
https://www.bloomberg.com/news/articles/2017-05-12/it-s-back-to-steady-for-u-s-economy-as-retail-sales-cpi-rise
Sunday, May 7, 2017
The world’s most valuable resource is no longer oil, but data
This article discusses the emergence digital data as the most
valuable resource in the digital world. The world’s most powerful companies with
control of enormous amount of data such as Google, Facebook, Apple and
Microsoft have been benefitting from using data they possess to enhance their
profit. These companies collectively racked up over $25 billion net profit in
the first quarter of 2017. Virtually all the revenue growth in online
advertising goes to Google and Facebook. The companies with vest data surveillance
also have control over new entrants in the industry. They are constantly monitoring
startups and buy them out if they are considered to be posing threat in the
future. This raises questions on antitrust issues. Because the nature of the
cases that are different from industrial era, different approaches to antitrust
issues have been suggested.
Thursday, May 4, 2017
America's food-truck industry is growing rapidly
In 2008, Roy Choi began selling $2 Korean barbecue tacos from a kitchen on wheels. Since then the food truck industry has grown to a $1.2 billion industry. America now has over 4,000 food trucks and the industry revenue growth rate is at 7.9%. But patchwork and local regulations create more popular areas for food trucks than others. The article mentions that Portland, Oregon has an estimated 500 trucks roaming the city. In Chicago, they don't allow trucks to set up shop within 200 feet of brick-and-mortar restaurants.
Many restaurateurs are complaining that food trucks are taking away their business but in a report from 2010 in Seattle, it concluded that the restaurants there have grown by 16% in spite of a thriving food truck scene there.
It's interesting to see how society has changed to doing things on the go including getting food on the street on the way to work or back home. I would think that this industry would be be promoted by governments because it gets people on their feet and outside.
http://www.economist.com/blogs/graphicdetail/2017/05/daily-chart-3
Monday, May 1, 2017
SpaceX Prices its Way to More Business
As we discuss, in our study of economic systems, the different roles of governments around the world, it is interesting to peer into a particular industry that was at the forefront of the sociopolitical battle between the world's largest superpowers in the 1980s. The United States government faced off in an all-out race to space with its ideological foil -- the Soviet Union. In that time, space was an industry that was only operated by large governments and included very little, if any, participation from private firms.
Although the Untied States seemingly "won" the space race, the current technology and launch capabilities possessed by the government have actually regressed from their peak. Thankfully, for the sake of human exploration and perhaps the survival of our gene pool, private companies are stepping in to fill this void left by government. Originally, the United States relied solely on the United Launch Alliance, a partnership formed by Boeing and Lockheed Martin to supply the government, but now have another private partner in SpaceX. Headed by billionaire entrepreneur, SpaceX is working to bring down the cost of space exploration in order to facilitate a mission to mars. In the short run, the American people are benefiting from a more efficient use of their tax dollars and in the long run, they might have the opportunity to vacation on Mars.
https://www.bloomberg.com/news/articles/2017-05-01/spacex-launches-sensitive-mission-for-military-nails-landing
Although the Untied States seemingly "won" the space race, the current technology and launch capabilities possessed by the government have actually regressed from their peak. Thankfully, for the sake of human exploration and perhaps the survival of our gene pool, private companies are stepping in to fill this void left by government. Originally, the United States relied solely on the United Launch Alliance, a partnership formed by Boeing and Lockheed Martin to supply the government, but now have another private partner in SpaceX. Headed by billionaire entrepreneur, SpaceX is working to bring down the cost of space exploration in order to facilitate a mission to mars. In the short run, the American people are benefiting from a more efficient use of their tax dollars and in the long run, they might have the opportunity to vacation on Mars.
https://www.bloomberg.com/news/articles/2017-05-01/spacex-launches-sensitive-mission-for-military-nails-landing
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