Home prices in 24 of the nation's top 200 housing markets have hit new peaks or are very close to their previous peak. According to projections and continued increases, economists say many of these cities are likely to hit new peaks this year. While dozens of housing markets are still far below their peak or where they stood prior to the housing bust in 2006, this is a good sign for the economy. This is the beginning of a long process, but a positive beginning stage and secure place for the market to be headed in the future.
http://www.usatoday.com/story/money/business/2013/05/04/house-price-gain-lifts-markets/2130811/
Saturday, May 4, 2013
Friday, May 3, 2013
US spending up
http://www.bbc.co.uk/news/business-22339995
US consumer spending in March exceeded the forecasts unexpectedly. It rose by 0.2% according the commerce department. However, its the slowest increase in a while and marks a 'slowdown' but still was unexpected. Most of the increased spending was on utilities which was due to the extended winter. Consumer spending has helped the US economy absolve a 2.5% annualized rate of growth in the first quarter. There are fears that the spending that had occurred due to weather will be reversed as it gets warmer.
Thursday, May 2, 2013
Development in Africa
http://www.economist.com/blogs/baobab/2013/05/development-africa
This article tells of how Aftrica is one of the fastest developing
nations. Some of Africa’s countries
have been strolling with growth in income per person of more than 5% per year
since 2007. However, one of these countries, Zambia, seems to have been left in
the dust even though the economic growth is present.
A true statement
mentioned in the article is that GDP is not the perfect measurement of living standards.
Things like jobs, governance, health, and inequality are other worthy factors. Once
you look at these indicators, it becomes more apparent that the “well-being in
much of sub-Saharan Africa is lower than it ought to be, given rising average
incomes per person,” as stated in the article.
The article also
said, “Levels of well-being in South Africa are out of whack with its GDP per
head. Kenya and Ghana do a much better job of reaping the benefits of a growing
economy.”
Along with Kenya
and Ghana, many other countries are in Africa that have improved their
well-being the most, but the key to their success is being able to “translate”
their growth into benefiting economic well-being. Zambia was not the best at
doing that. The article doesn’t really specify how the most well off countries
go about doing that, but I am assuming it has mostly to do with the government,
how it acts with its policies, as well as how the public complies and keeps the
economy and its markets going.
Bank of Canada Names New Govenor
http://www.bbc.co.uk/news/business-22392524
The Bank of Canada which is the equivalent to the United States US Federal Reserve has named a new governor Stephen Poloz. Poloz wasn't the expected choice most thought who would replace Mark Carney who is going to go run the Bank of England. Many thought that his senior deputy Tiff Macklem would be chosen, but Stephen Poloz is smart choice having for 25 years in Canadian public service and was the chief executive for Canada's export credit agency. Poloz and six other members make up the committee that decides on the monetary policy of the Bank of Canada. They use a method of general consensus rather than the Fed and Bank of England who vote and present reasons as to why certain measures should be taken. It will be interesting to see if this will have any effect on the Canadian economy, but I believe they will still get by just fine.
The Bank of Canada which is the equivalent to the United States US Federal Reserve has named a new governor Stephen Poloz. Poloz wasn't the expected choice most thought who would replace Mark Carney who is going to go run the Bank of England. Many thought that his senior deputy Tiff Macklem would be chosen, but Stephen Poloz is smart choice having for 25 years in Canadian public service and was the chief executive for Canada's export credit agency. Poloz and six other members make up the committee that decides on the monetary policy of the Bank of Canada. They use a method of general consensus rather than the Fed and Bank of England who vote and present reasons as to why certain measures should be taken. It will be interesting to see if this will have any effect on the Canadian economy, but I believe they will still get by just fine.
For Retailers, Getting Out of Bangladesh isn't so Easy
Link: http://www.businessweek.com/articles/2013-05-02/for-retailers-getting-out-of-bangladesh-isnt-so-easy#r=hp-ls
Bangladesh has carved itself out as a smaller China; a cheap place to send your business's labor. However, this comes with its own set of issues such as incredibly lax regulation. There have been incidents including but not limited to a factory collapse that occurred on April 30th of this year. Some companies like Disney have stated that they want to pull out of Bangladesh, but finding an equally cheap source of labor has proven to be difficult. Other areas with cheap labor like Bangladesh have similarly lax regulations. On Bangladeshi side, textile exports make up around 10% of their GNP, so a full pullout would result in heavy losses which leads to this problem being much more complex than just pulling out.
Bangladesh has carved itself out as a smaller China; a cheap place to send your business's labor. However, this comes with its own set of issues such as incredibly lax regulation. There have been incidents including but not limited to a factory collapse that occurred on April 30th of this year. Some companies like Disney have stated that they want to pull out of Bangladesh, but finding an equally cheap source of labor has proven to be difficult. Other areas with cheap labor like Bangladesh have similarly lax regulations. On Bangladeshi side, textile exports make up around 10% of their GNP, so a full pullout would result in heavy losses which leads to this problem being much more complex than just pulling out.
Unemployment Claims Drop 18,000 in latest week
http://www.usatoday.com/story/money/business/2013/05/02/unemployment-claims-weekly/2128755/
According to the article, new claims for unemployment benefits fell 18,000 in the week ended April 27, to 324,000 from a revised 342,000 the week before. Claims were at their lowest level since January 2008. The 4 week moving average of claims was 342,250, down 16,000 from the previous week revised.
Drops in unemployment claims can be a positive sign that the unemployment right might continue to drop. If people are claiming less unemployment benefits, then they are finding jobs faster and new jobs may be opening up.
According to the article, new claims for unemployment benefits fell 18,000 in the week ended April 27, to 324,000 from a revised 342,000 the week before. Claims were at their lowest level since January 2008. The 4 week moving average of claims was 342,250, down 16,000 from the previous week revised.
Drops in unemployment claims can be a positive sign that the unemployment right might continue to drop. If people are claiming less unemployment benefits, then they are finding jobs faster and new jobs may be opening up.
Zimbabwe After Hyperinflation
http://www.economist.com/news/finance-and-economics/21576665-grubby-greenbacks-dear-credit-full-shops-and-empty-factories-dollars-they
This article talks about Zimbabwe's recovering economy after a period of extreme hyperinflation. During 2008, inflation had reached a point of 231,000,000% and the economy was struggling tremendously as a result. However, Zimbabwe has now begun using the U.S. dollar as their main form of currency, and is beginning to get itself back on track. However, there are still problems that must be resolved. Banks in Zimbabwe are struggling because nobody is willing to deposit money for more than 90 days. Banks do not have very much extra cash or anyone to rely on as a last-resort for funding. Therefore, liquidity is constantly an issue. As a result of all this, banks cannot lend money to people for a very long time either. This is hindering investment because firms and potential homeowners can't find loans, so they can't buy homes or make business investments.
This article talks about Zimbabwe's recovering economy after a period of extreme hyperinflation. During 2008, inflation had reached a point of 231,000,000% and the economy was struggling tremendously as a result. However, Zimbabwe has now begun using the U.S. dollar as their main form of currency, and is beginning to get itself back on track. However, there are still problems that must be resolved. Banks in Zimbabwe are struggling because nobody is willing to deposit money for more than 90 days. Banks do not have very much extra cash or anyone to rely on as a last-resort for funding. Therefore, liquidity is constantly an issue. As a result of all this, banks cannot lend money to people for a very long time either. This is hindering investment because firms and potential homeowners can't find loans, so they can't buy homes or make business investments.
Wednesday, May 1, 2013
Federal Reserve Sticks With Stimulus
http://money.cnn.com/2013/05/01/news/economy/federal-reserve-stimulus/index.html?iid=SF_E_Lead
This article tells of how the FED will continue to purchase $85 billion a month in mortgage-backed securities and Treasuries to stimulate spending in the economy and keep long-term interest rates low. They are doing this to combat the high unemployment rate and low inflation, which were suggested to be the result of cuts in government sopending.
Of course they will slow down or speed up as needed in response to economic activity, but the central bank is quite a ways away from attaining their goal of an unemployment rate of 6.5% or inflation higher than 2.5% a year. The unemployment rate was 7.6% as of late March and inflation is rising only 1% year to year.
The FED's actions have been appreciated in the stock market, stocks having recovered since the crisis, but there is some controversy that the plans will either backfire, causing vigorous rising inflation, or simply not work as Congress tries to combat debt. It was suggested by only one member of the FED that their decisions could potentially cause future economic problems/imbalances.
I think the FED is making a good decision to try and balance out the government spending cuts and to lower the unemployment rate, but is the trade-off (a possible blow to the future) more debtramental than the benefit is helpful?
This article tells of how the FED will continue to purchase $85 billion a month in mortgage-backed securities and Treasuries to stimulate spending in the economy and keep long-term interest rates low. They are doing this to combat the high unemployment rate and low inflation, which were suggested to be the result of cuts in government sopending.
Of course they will slow down or speed up as needed in response to economic activity, but the central bank is quite a ways away from attaining their goal of an unemployment rate of 6.5% or inflation higher than 2.5% a year. The unemployment rate was 7.6% as of late March and inflation is rising only 1% year to year.
The FED's actions have been appreciated in the stock market, stocks having recovered since the crisis, but there is some controversy that the plans will either backfire, causing vigorous rising inflation, or simply not work as Congress tries to combat debt. It was suggested by only one member of the FED that their decisions could potentially cause future economic problems/imbalances.
I think the FED is making a good decision to try and balance out the government spending cuts and to lower the unemployment rate, but is the trade-off (a possible blow to the future) more debtramental than the benefit is helpful?
Fed holds steady on stimulus, worried by fiscal drag
http://finance.yahoo.com/news/no-end-sight-fed-stimulus-040556215.html
"The U.S. Federal Reserve said on Wednesday it will continue buying $85 billion in bonds each month to keep interest rates low and spur growth, and added it would step up purchases if needed to protect the economy." The Fed says the economy is expanding moderately, and that inflation should stay low. While the economy is growing moderately the Fed is worried about growth in the future saying that fiscal policy is hindering growth. Obviously this is not a good sign as we all wish the economy will soon be on the up swing.
"The U.S. Federal Reserve said on Wednesday it will continue buying $85 billion in bonds each month to keep interest rates low and spur growth, and added it would step up purchases if needed to protect the economy." The Fed says the economy is expanding moderately, and that inflation should stay low. While the economy is growing moderately the Fed is worried about growth in the future saying that fiscal policy is hindering growth. Obviously this is not a good sign as we all wish the economy will soon be on the up swing.
Time Warner earnings up
http://money.cnn.com/2013/05/01/news/companies/time-warner-earnings/index.html?iid=HP_River
Media conglomerate Time Warner reported improved quarterly earnings Wednesday. This improved quarterly income was huge after overcoming continued losses from the print unit it plans to spin off. The company whose holdings include Warner Bros. studios, HBO, Turner Broadcasting and CNN, as well as CNNMoney. The big announcement of spinning off Time Inc. unit, publisher of magazines such as Time, Sports Illustrated, and Fortune. With the spin off of Time Inc. will come a cut in employment up to 6%, which will help save money. Time Warner is also profiting a great deal from there successful movie "The Hobbit" and its original series "Game Of Thrones". Will these two successful output of products help Time Warner remain on track to set a new earnings high for the distinguished company? Could Time Warner force other companies such as Comcast or News Corp to go under with its success in the movie and television field?
Media conglomerate Time Warner reported improved quarterly earnings Wednesday. This improved quarterly income was huge after overcoming continued losses from the print unit it plans to spin off. The company whose holdings include Warner Bros. studios, HBO, Turner Broadcasting and CNN, as well as CNNMoney. The big announcement of spinning off Time Inc. unit, publisher of magazines such as Time, Sports Illustrated, and Fortune. With the spin off of Time Inc. will come a cut in employment up to 6%, which will help save money. Time Warner is also profiting a great deal from there successful movie "The Hobbit" and its original series "Game Of Thrones". Will these two successful output of products help Time Warner remain on track to set a new earnings high for the distinguished company? Could Time Warner force other companies such as Comcast or News Corp to go under with its success in the movie and television field?
Businesses hesitant to hire in April
http://money.cnn.com/2013/05/01/news/economy/adp-jobs-report/index.html?iid=SF_E_LN
Private sector companies only added 119,000 jobs in April, the lowest number since September, and this only includes the private sector. Once federal job cuts are added into the equation, the total number of jobs added is expected to drop significantly. The expected number of new hires in April was supposed to be 150,000 to keep up to speed, however we fell 31,000 jobs short as a nation. Manufacturers have cut jobs, however the construction sector has added the most jobs. Small businesses with 49 employees and lower are higher the least sue to health care reform. Starting in 2014, businesses with 50+ employees are required to provide health insurance for all employees or face tremendous fines. Health care reform, along with taxes and other government regulations, are expected to be the big three reasons for the slowing down of jobs being added. In addition, the government has cut about 80,000 jobs over the passed 6 months. Right now, the signs are pretty dismal for job additions.
Private sector companies only added 119,000 jobs in April, the lowest number since September, and this only includes the private sector. Once federal job cuts are added into the equation, the total number of jobs added is expected to drop significantly. The expected number of new hires in April was supposed to be 150,000 to keep up to speed, however we fell 31,000 jobs short as a nation. Manufacturers have cut jobs, however the construction sector has added the most jobs. Small businesses with 49 employees and lower are higher the least sue to health care reform. Starting in 2014, businesses with 50+ employees are required to provide health insurance for all employees or face tremendous fines. Health care reform, along with taxes and other government regulations, are expected to be the big three reasons for the slowing down of jobs being added. In addition, the government has cut about 80,000 jobs over the passed 6 months. Right now, the signs are pretty dismal for job additions.
5 hottest stocks markets on the planet
http://money.cnn.com/gallery/investing/2013/04/28/worlds-top-stock-markets/index.html?iid=HP_Highlight
Coming in at number 5, the Philippines earned their first investment grade credit rating at BBB-. Their stocks have been at an all time high since China, along with other investors, have been attracted to the nation, being that the Philippines in virtually resistant to the economic slowdown in China. Kuwait comes in at number 4 with a 23% increase in stock value from last year. Due to strong corporate earnings and Kuwait's plan to invest in infrastructure, stocks are at an all time high. Kuwait also boasts the world's 6th largest oil reserves. Argentina comes in at number 3, however their are still may problems with Argentina. The nation is projected to have a 25% inflation rate, and American creditors claim to still be owed a total of 1.5 billion on defaulted loans. However, the economy is doing so well because the prices became so depressed, investors saw a chance for value and have boosted the stock market. The real estate market has boosted Dubai to the number 2 spot, with investors betting on a boom following the crash of 2009. Japan takes the number 1 spot with new stimulus policies that are expected to pull Japan out of the two decades of deflation it has lived through. Massive fiscal stimulus and aggressive monetary easing have devalued the yen and increased profits. Japan seems like the place to be as the new policy makers seem to have the country headed in the right direction.
Coming in at number 5, the Philippines earned their first investment grade credit rating at BBB-. Their stocks have been at an all time high since China, along with other investors, have been attracted to the nation, being that the Philippines in virtually resistant to the economic slowdown in China. Kuwait comes in at number 4 with a 23% increase in stock value from last year. Due to strong corporate earnings and Kuwait's plan to invest in infrastructure, stocks are at an all time high. Kuwait also boasts the world's 6th largest oil reserves. Argentina comes in at number 3, however their are still may problems with Argentina. The nation is projected to have a 25% inflation rate, and American creditors claim to still be owed a total of 1.5 billion on defaulted loans. However, the economy is doing so well because the prices became so depressed, investors saw a chance for value and have boosted the stock market. The real estate market has boosted Dubai to the number 2 spot, with investors betting on a boom following the crash of 2009. Japan takes the number 1 spot with new stimulus policies that are expected to pull Japan out of the two decades of deflation it has lived through. Massive fiscal stimulus and aggressive monetary easing have devalued the yen and increased profits. Japan seems like the place to be as the new policy makers seem to have the country headed in the right direction.
Companies beginning to question going public
These days, companies are going waiting a couple years longer than they would normally to go public. After Facebooks' botched public debut, companies are waiting until they are, without question, financially stable. High-speed computer trading and trading glitches are being held responsible for the negative effects of companies going public. Also, last week, and errant tweet caused a "flash crash", which sent stocks plummeting for a few minutes before they regained composure. With how technical our world has become these days, risks like these almost outweigh the rewards of going public. Some investment hedge fund managers would advise against companies going public today as they are not convinced that the exchange has fixed the problems which caused Facebook to have such a terrible debut. CEOs also have to worry about activist shareholders, who basically own the company and have playing large roles in the structural changes of public companies. Many say decades ago, CEOs would do whatever they could to not listen to the shareholders and get them out of the way. These days, the companies understand they are owned by them, and have no choice but to listen to what they have to say.
http://money.cnn.com/2013/05/01/investing/companies-ipo/index.html?iid=HP_River
http://money.cnn.com/2013/05/01/investing/companies-ipo/index.html?iid=HP_River
US manufacturing grows in April at slower pace
http://finance.yahoo.com/news/us-manufacturing-grows-april-slower-141408950.html
The manufacturing aspect of our industries has been recently facing one of the slowest growths. There have been reports of manufacturing activity decreasing from 51.3 in March to 50.7 in April. This could've been a result of the hiring rates being at an all time low as well and higher social security taxes. There is visibly less momentum of factory sales. Yet the consumers still believe that positive things will come in the near future such like increased hiring rates with higher pay and even lower gas prices. The economist on the other hand believe that the growth will grow slow this quarter.
The manufacturing aspect of our industries has been recently facing one of the slowest growths. There have been reports of manufacturing activity decreasing from 51.3 in March to 50.7 in April. This could've been a result of the hiring rates being at an all time low as well and higher social security taxes. There is visibly less momentum of factory sales. Yet the consumers still believe that positive things will come in the near future such like increased hiring rates with higher pay and even lower gas prices. The economist on the other hand believe that the growth will grow slow this quarter.
Mel Watt Picked For FHFA
President Obama is set to announce the nomination of Mel Watt as the new leader of the Federal Housing Financing Agency. Watt, a congressman from North Carolina, is set to oversee government-controlled Fannie Mae and Freddie Mac which in turn may give the White house more control over housing policy. The FHFA regulates Fannie Mae and Freddie Mac, which together own of guarantee about half of all U.S. home loans with the federal government supports more than nine of ten new mortgages. Watt is the second person President Obama has nominated to replace current leader Edward DeMarco. Joseph Smith, a former nominee, was not able to win Senate confirmation after Republicans questioned his independence from the White House. Many Democrats have argues Fannie Mae and Freddie Mac should be used to advance policies that would aid the broader housing market, and by extension the economy. Republicans are opposed to using mortgage financiers as tools for economic or social policy. Many view new nominee Watt as a potential leader who will go right along with Obama administration requests and for this reason, Watt may find it hard to receive confirmation due to potential Republican opposition.
http://www.huffingtonpost.com/2013/05/01/mel-watt-fhfa-ed-demarco_n_3190105.html?utm_hp_ref=business#slide=1963642
http://www.huffingtonpost.com/2013/05/01/mel-watt-fhfa-ed-demarco_n_3190105.html?utm_hp_ref=business#slide=1963642
Tuesday, April 30, 2013
Chrysler's Poor Earnings a Blip or a Portent
This article goes over how the automobile market's current happenings after the recession. For awhile, Chrysler was posting great profits (net income was nine times higher than it was in 2011) but now there has been a 65 percent drop in earnings. This occurrence was apparently foreseeable as the number of incentives that dealers had to provide in order to curb decreasing demand have been increasing. Ultimately it might just be that automobile demand just cannot be sustained at pre-recession levels. With new outlooks on cars and how often vehicles should be used, unless there is another shift in consumer outlook, there just might not be a need to have a huge output of American cars.
Germany's Economy
The German Economy is still doing very well in the midst of the European Financial crisis. With unemployment down to 6.9%, consumer confidence is on the rise. Germany is the second largest economy is Europe, so this is good news for the entire European Union, which is still struggling to get back on its feet. Consumer confidence is going to be essentially to re-stimulate spending across the entire European Union.
http://www.washingtonpost.com/business/german-consumer-confidence-rises-unemployment-remains-low-despite-european-financial-crisis/2013/04/30/ccfb6f00-b173-11e2-9fb1-62de9581c946_story.html
http://www.washingtonpost.com/business/german-consumer-confidence-rises-unemployment-remains-low-despite-european-financial-crisis/2013/04/30/ccfb6f00-b173-11e2-9fb1-62de9581c946_story.html
Monday, April 29, 2013
Illegal Markets
http://www.economist.com/blogs/graphicdetail/2013/04/daily-chart-19
This article shows estimated values of some of the largest illegal markets in the world. This is a short article but the graphs have some significant economic and ethical implications. The markets listed add up to an estimated $650 billion, drug trafficking being the largest at $320 billion. This results in huge losses for companies on the legitimate side of some of these markets- given that some, obviously, do not have a "legitimate side", like human trafficking for example. The market for counterfeit and pirated goods is estimated at $250 billion annually, meaning that some industries are losing a large chunk of income because of this. For example, things like designer clothing or watches are commonly counterfeited and sold at a much cheaper price than the real product. This causes demand to fall in those markets because people sometimes buy the cheaper, fake product instead of the real thing- leading to a loss in total output. In addition, the government loses tax revenue because people do not pay sales taxes in these markets for obvious reasons (nor do they usually report the income and pay income tax). Economics aside, the size and nature of some of these markets present some pretty serious ethical issues. It's shocking to see that an estimated $32 billion is made in a year from human trafficking, or that there is even a market for human organs. These illegal markets can cause anything from billions in lost profits to ruining peoples' lives, and obviously we should continue to do what we can to fight them.
This article shows estimated values of some of the largest illegal markets in the world. This is a short article but the graphs have some significant economic and ethical implications. The markets listed add up to an estimated $650 billion, drug trafficking being the largest at $320 billion. This results in huge losses for companies on the legitimate side of some of these markets- given that some, obviously, do not have a "legitimate side", like human trafficking for example. The market for counterfeit and pirated goods is estimated at $250 billion annually, meaning that some industries are losing a large chunk of income because of this. For example, things like designer clothing or watches are commonly counterfeited and sold at a much cheaper price than the real product. This causes demand to fall in those markets because people sometimes buy the cheaper, fake product instead of the real thing- leading to a loss in total output. In addition, the government loses tax revenue because people do not pay sales taxes in these markets for obvious reasons (nor do they usually report the income and pay income tax). Economics aside, the size and nature of some of these markets present some pretty serious ethical issues. It's shocking to see that an estimated $32 billion is made in a year from human trafficking, or that there is even a market for human organs. These illegal markets can cause anything from billions in lost profits to ruining peoples' lives, and obviously we should continue to do what we can to fight them.
Fed, Though Falling Short on Jobs, Seen as Unlikely to Do More
http://www.nytimes.com/2013/04/30/business/economy/fed-unlikely-to-expand-asset-purchases.html?ref=business
Although the unemployment rate is slowly declining, the American public is still unsatisfied. As of now, the unemployment rate is sitting at 7.6%. One of the Fed's main goals is to keep unemployment within its natural rate at 4-5%. The Fed has seen an impact on their recent policies however they have determined that they are "pushing the interest-sensitive sector about as far as we’re going to be able to push it at this time." It will be interesting to see in which direction the unemployment rate goes in the near future.
Although the unemployment rate is slowly declining, the American public is still unsatisfied. As of now, the unemployment rate is sitting at 7.6%. One of the Fed's main goals is to keep unemployment within its natural rate at 4-5%. The Fed has seen an impact on their recent policies however they have determined that they are "pushing the interest-sensitive sector about as far as we’re going to be able to push it at this time." It will be interesting to see in which direction the unemployment rate goes in the near future.
Pot Smoke in the Air: A Warning of Trouble?
So, as everyone knows, the marijuana business is now legal in some states but illegal in the overall country. Now banks, facing fees and regulation from the government, won't consort with the "illegal" industry of cannabis growing or any of the actual businesses. This means no credit, no financing, nothing. It is a problem that will eventually lead to the rise of the black market for the drug trade again, not to mention lost profits for the government in taxes, simply because it is federally illegal. If it is federally illegal, should the states have been allowed to vote on it in the first place? Will the government deregulate? All questions yet without answers.
Penguins on the NYSE floor?
http://dealbook.nytimes.com/2013/04/19/seaworld-c-e-o-hints-at-overseas-ambitions/
As SeaWorld made its debut at the Stock exchange on Friday there was a lot of promise. The stock closed on Friday 13 percent higher than its opening value. But the stock exchange is not the last stop for SeaWorld's expansion plan.James Atchinson, CEO and president of Seaworld, hinted at global expansion of SeaWorld. Currently there are 11 SeaWorlds that are in operation in the United States. Atchinson hinted at going global by saying "It wouldn't be that hard if we decided to bring Shamu to Dubai." In order to raise this kind of capital to build an oversea SeaWorld Atchinson talked about teaming up strategically with a real estate developer. Usually big projects such as this are undertaken with big investors.
Who knows. Mr Atchinson made no imminent declaration of a foreign SeaWorld but it sounds promising. With Blackstone Group know owning SeaWorld the possibilities are endless and there has been plenty of talk about raising capital. Maybe one day this idea will be a reality but for now Shamu will continue to stay in the United States.
1st quarter earnings higher than expected
http://finance.yahoo.com/news/earnings-beating-forecasts-jurys-rest-211325797.html
First quarter earnings for various S&P 500 stocks increased by 3.9%, a significant jump from the expected rate of 1.5%. However, some analysts are concerned that the earnings growth will not continue. This is because revenue is actually expected to fall for the first quarter. Companies mainly increased earnings by cutting expenses, but some experts are skeptical about the long-term sustainability of such growth. It should be interesting to see how this plays out over the rest of the year.
First quarter earnings for various S&P 500 stocks increased by 3.9%, a significant jump from the expected rate of 1.5%. However, some analysts are concerned that the earnings growth will not continue. This is because revenue is actually expected to fall for the first quarter. Companies mainly increased earnings by cutting expenses, but some experts are skeptical about the long-term sustainability of such growth. It should be interesting to see how this plays out over the rest of the year.
Why Rent in New York is so high
As most people know New York City is one of the largest cities in the world. It is an economic epicenter and home to many businesses and corporations. Over the past couple of decades NYC has seen a huge spike in the price of homes. There are many reasons for high home prices in NY, one being that it is an extremely attractive city to live in. There are so many options and jobs that one can do while being in NYC. With falling crime rates and other amenity improvements NYC has only been increasing its attractiveness to home owners. Many people have jobs located in the city and this increases competition for homes. If there is a large demand for homes then prices will be high. Another aspect to consider is that the global rich are usually interested in NYC for what it has to offer. This only further drives up the prices of homes.
As most people know New York City is one of the largest cities in the world. It is an economic epicenter and home to many businesses and corporations. Over the past couple of decades NYC has seen a huge spike in the price of homes. There are many reasons for high home prices in NY, one being that it is an extremely attractive city to live in. There are so many options and jobs that one can do while being in NYC. With falling crime rates and other amenity improvements NYC has only been increasing its attractiveness to home owners. Many people have jobs located in the city and this increases competition for homes. If there is a large demand for homes then prices will be high. Another aspect to consider is that the global rich are usually interested in NYC for what it has to offer. This only further drives up the prices of homes.
Now made in China: Taste: 5 things big in Beijing, headed for Buffalo
http://www.marketwatch.com/story/how-chinese-tastes-are-reshaping-american-malls-2013-04-26
The article talks about the unexpected Chinese products exported to America that many people wouldn't recognize as Chinese. While the "made in China tag is prevalent all over the US, many Americans mistake other Asian companies like Sony, and Toyota as Chinese, while missing the fact that companies such as Volvo are owned by the Chinese.
“Branding was an alien concept in old China,” says Stanley Kwong,
managing director of China Business Programs at the School of Management
of University of San Francisco. “China had been making products for
companies like Wal-Mart and Apple, but has not developed many brands.”
It’s been easier for China to make a product than build a brand, experts
say.
But given China’s size and economic power, experts say it’s only a
matter of time before the country begins exporting its culture and style
as well. Chinese shopping trends have been finding their ways into American Malls, some are just more obvious than others.
Jobs data may improve but underwhelm
http://www.marketwatch.com/story/jobs-data-may-improve-but-underwhelm-2013-04-28?dist=lbeforebell
Labor market growth has been up and down as of late, and the central bank is expected to continue it's recent policies until more steady gains are made.
“Even though this is a marked improvement in the pace of job creation
relative to the meager…jobs added in March, it remains well below the
more buoyant pace earlier this year,” noted TD Securities economists.
On Wednesday, there will be a report just looking at private payrolls,
and economists forecast an April gain of 170,000, compared with 158000 in march. March’s result was far below an average monthly gain of 190,000 over the prior two years. Given jobs trends like these, and other recent negative data, Federal
Reserve officials won’t announce policy changes after meeting on Tuesday
and Wednesday.
The hottest frontier
The African economy is on the rise. Many countries within the continent are seeing a huge increase in annual growth. Countries like Nigeria and Kenya are experiencing markets that have risen more than 50% in the pat year. The sub-sahara regions are undergoing GDP growth rates of more than 5%. The economy in African is defiantly looking up compared to recent years. However, Africa is missing some of the main components for continued growth which are capital and savings. This provides a great market for foreign investors to invest into African markets. This is an opportunity for world investors to make a larger profit investing in African markets. There is a better return then investing at home for these people. African stocks are becoming more stable making for a good market for investors.
A Stiffing Headwind
http://www.economist.com/blogs/freeexchange/2013/04/americas-economy-0
This article talks about the recent economic numbers that have been released. They are actually disappointing. GDP growth rates are still not back to normal, around 2.5%, and unemployment numbers are still not improving fast enough. This means that economists expect us to be still recovering through 2013. It was also talking about how the government needs to start trying to fix the recession instead of messing with the sequester cuts. If our government does not get there act together soon it may take some time before we ever recover.
This article talks about the recent economic numbers that have been released. They are actually disappointing. GDP growth rates are still not back to normal, around 2.5%, and unemployment numbers are still not improving fast enough. This means that economists expect us to be still recovering through 2013. It was also talking about how the government needs to start trying to fix the recession instead of messing with the sequester cuts. If our government does not get there act together soon it may take some time before we ever recover.
Spending cuts: Reality of furloughs hits home
http://money.cnn.com/2013/04/25/news/economy/spending-cuts-furloughs/index.html?iid=SF_E_River
We need to stay on this rode for a awhile that's because defense and domestic spending will be subject to even lower spending caps than they are this year and if help lowering our biggest cost in government spending that it will help save a lot. The sequester that went into effect on March 1 for 2013 required agencies for the most part to make across-the-board cuts without discretion, in essence cutting funding for the best and most essential functions by the same amount as everything else. Helping the work force not get laid off and have different plans for the companies that need help so that everyone is not at a dead end.
We need to stay on this rode for a awhile that's because defense and domestic spending will be subject to even lower spending caps than they are this year and if help lowering our biggest cost in government spending that it will help save a lot. The sequester that went into effect on March 1 for 2013 required agencies for the most part to make across-the-board cuts without discretion, in essence cutting funding for the best and most essential functions by the same amount as everything else. Helping the work force not get laid off and have different plans for the companies that need help so that everyone is not at a dead end.
Sunday, April 28, 2013
Warren Buffett checks in on his Coke investment
This is an article from The USA Today - interesting read on Buffet and his love for Coca-Cola. Seeing the volatility of so many of today's tech stocks, Buffet reminds investors at the annual shareholders meeting why coke makes sense (In fact, Berkshire's stake in Coke is second only to Buffett's position in Wells Fargo (WFC) stock. And the investment has been profitable for Buffett and other investors. Shares of the company have jumped 16.8% year-to-date, and more than 57% the past three years). He explains how it is important to invest in a company that you know will be there in the future. As a matter of fact, staple companies such as Coca-Cola, P & G, and GE have always experienced great financial support from Buffet.
Additionally, Buffet seems to give his best shot of injecting some consumer confidence into our economy. "In my life time, since 1930, real GDP per capita in the United States has gone up 6-to-1. We have not lost the secret sauce. (And) that's the kind of future I see ahead ... (it's why) you want to own businesses that are going to participate in that future."
Austerity in Greece causes increasing divisions among MPs
Greek Parliament has seek to cut 15,000
government jobs by the end of next year, as a condition for a new trench of
loans worth 8.8 bn euros. European leaders will be meeting on Monday to discuss
the release of 2.8bn euros (the remaining 6bn will be paid by the 13th
of May). The bill passed by 168 votes to 123, displaying an increasingly
divided parliament. As the bill was being discussed, demonstrations took place
outside the government building calling for an end to austerity measures and
condemning the overturning of a law that guaranteed government servants a job
for life. Austerity in Greece has been reaching its limits, causing now nothing
but increasing unemployment, civil unrest and divisions among government
representative, which could potentially destroy the political integrity of
Greece and plunge its society into chaos and anarchism in the case of a fall of
the democratic regime by divisive forces within then leadership strata.
China launches coordinated Cyber attacks
http://www.theatlantic.com/china/archive/2013/04/is-the-specter-of-a-cyber-cold-war-real/275352/
The recent article from the Atlantic discusses the cyber attacks that originate from China. The article gives the cyber attacks the monomer of a cyber Cold War. The economic implication of these attacks are particularly interesting. The companies targeted are from industries that the Chinese have highlighted in their five year plans. This is also revealing of why state sponsored companies are the giants of industry in China and why the US and other foreign countries can be skeptical about doing business with these companies. An example of such transactions was when Canada oil company NEXEN was sold to a Chinese state sponsored company. This deal gave China access to the oil sand facilities and Alberta. While this moved helped sure up China's energy needs which should help reduce tensions in Asia, it was also met with huge amounts of skepticism by the Canadian government.
The recent article from the Atlantic discusses the cyber attacks that originate from China. The article gives the cyber attacks the monomer of a cyber Cold War. The economic implication of these attacks are particularly interesting. The companies targeted are from industries that the Chinese have highlighted in their five year plans. This is also revealing of why state sponsored companies are the giants of industry in China and why the US and other foreign countries can be skeptical about doing business with these companies. An example of such transactions was when Canada oil company NEXEN was sold to a Chinese state sponsored company. This deal gave China access to the oil sand facilities and Alberta. While this moved helped sure up China's energy needs which should help reduce tensions in Asia, it was also met with huge amounts of skepticism by the Canadian government.
UK´s economic recovering at very slow pace
Fitch credit rating agency has downgraded the UK from
AAA to AA+ after noticing trends of a weakening economy and fiscal outlook. Opposition
states that “This is another humiliating blow to a prime minister and
chancellor who said keeping our AAA rating was the number one test of their
economic and political credibility” (Ed Balls, Labour’s shadow chancellor and previous
(IMF) January forecast of 1% growth was slashed to 0.7% projected growth in
2013. This fall in economic outlook, however, is disputed by some who say that
they are signs of a slowly recovering economy. With the current plan, Britain
has demonstrated flexibility and increased its credibility in the international
setting, allowing it to borrow at a very low interest rate, which should
increase investment and heal the economy. SO far, it is too early to tell is
the current recovery plan is working, but time to consider a different approach
for faster economic growth might be needed in the near future.
Many questions, few answers in Pilot Flying J case
Pilot Flying J, the nations largest truck stop chain, may be indicted for their role in an alleged scheme to defraud trucking companies out of millions of dollars in diesel fuel rebates. Basically the sales team created a system of intervention when a rebate check was scheduled for departure to an "unsophisticated" company. From the top of the corporate ladder, allegedly, came news that deemed the company unworthy of the full rebate.The FBI has already raided headquarters and taken items such as laptops and recorded training videos, but it will probably be months before any verdicts are made.
How iTunes crushed music sales.
http://money.cnn.com/2013/04/25/technology/itunes-music-decline/index.html?iid=HP_LN
Apple's famous Music Store-iTunes has been in business for 10 years and it has changed the music industry. After a decade, it has reduced music sales in the US from $11.8 billion (2003) to $7.1 (2012). The interesting fact is, during that period of time, people bought so much more music than in the past. In 2000, the US consumed 943 million CD albums without digital sales. But by 2007, digital singles proved to be superior with, 819 sales, to the CD with just 500 million. However, music sales still decreased because iTunes made music cheaper. Steve Jobs- Apple CEO was able to sell a digital album for $10 and any track for $0.99.
Apple's famous Music Store-iTunes has been in business for 10 years and it has changed the music industry. After a decade, it has reduced music sales in the US from $11.8 billion (2003) to $7.1 (2012). The interesting fact is, during that period of time, people bought so much more music than in the past. In 2000, the US consumed 943 million CD albums without digital sales. But by 2007, digital singles proved to be superior with, 819 sales, to the CD with just 500 million. However, music sales still decreased because iTunes made music cheaper. Steve Jobs- Apple CEO was able to sell a digital album for $10 and any track for $0.99.
Greek economy receives 8.8 billion euro bailout
http://www.cnn.com/2013/04/28/world/europe/greece-bailout-layoffs/?hpt=hp_t3
This article discusses the most recent bailout for Greece in their economic crisis. In order to secure 8.8 billion euro bailout they were forced to agree to reduce the number of government workers by 15,000. The reduction of Government spending may have been a stipulation of the bailout because government spending could be crowding out private investment. The article also discusses how the reduction in the government workforce will contribute to the 27% unemployment rate and likely lead to more violence in the country. Radical political factions are seeing a rise in Greece, both from the left and the right, as the economy has failed to recover thus far in the crisis.
This article discusses the most recent bailout for Greece in their economic crisis. In order to secure 8.8 billion euro bailout they were forced to agree to reduce the number of government workers by 15,000. The reduction of Government spending may have been a stipulation of the bailout because government spending could be crowding out private investment. The article also discusses how the reduction in the government workforce will contribute to the 27% unemployment rate and likely lead to more violence in the country. Radical political factions are seeing a rise in Greece, both from the left and the right, as the economy has failed to recover thus far in the crisis.
The Capitalist Manifesto
http://www.economist.com/news/books-and-arts/21576372-how-get-india-moving-again-capitalist-manifesto
This article talks about India and how they need to start heading in the right direction economically. India needs more market liberalisation to promote economic growth. A few years ago, with its economy expanding at an annual rate of nearly 10%. But policymakers have grown complacent. They assumed rapid growth would continue, but did nothing to foster it. The result is that India now putters on at less than half what it could achieve. The article also discusses how rapid expansion has brought India immense gains, and why more change is needed.
Hyperinflation in Zimbabwe
http://www.economist.com/news/finance-and-economics/21576665-grubby-greenbacks-dear-credit-full-shops-and-empty-factories-dollars-they
This article talks about how Zimbabwe, since long, is facing the problem of hyper inflation and its consequences on the economy and currency. Inflation in Zimbabwe is extremely high and reached an absurd 231,000,000% in 2008. The article also talks about how people have lost confidence in the domestic currency and the US Dollar is the common medium of transactions. Serious steps need to be taken for Zimbabwe to maintain its macro-economic structure.
McDonalds university?
http://www.economist.com/news/international/21576656-degree-burgerologyand-job-too-fries
The McDonalds university in Great Britain is a university where you learn the ins and outs of being a manger at a fast food restaurant and all of the stress and people management skills are needed. It usually entails a lot of student that have low self esteems and poor qualifications for real college but have a large work ethic and are willing to get their hands dirty. With the way the corporate ladder is set up in McDonalds people can work their way up and down the ladder with hard work no matter the education level or set up. This university could be just what the economy needs to grow.
The McDonalds university in Great Britain is a university where you learn the ins and outs of being a manger at a fast food restaurant and all of the stress and people management skills are needed. It usually entails a lot of student that have low self esteems and poor qualifications for real college but have a large work ethic and are willing to get their hands dirty. With the way the corporate ladder is set up in McDonalds people can work their way up and down the ladder with hard work no matter the education level or set up. This university could be just what the economy needs to grow.
Greece firing 15,000 government workers
http://www.cnn.com/2013/04/28/world/europe/greece-bailout-layoffs/?hpt=hp_t3
According to the article the Greek government has agreed to fire 15,000 government workers. This has been done in order to secure a further 8.8 billion euros in the bailout packages from the European Union and the International Monetary Fund. This is a part of the series of budget cuts that have been implemented in the troubled nation. Increases in taxes and cuts in fiscal spending has led to unemployment and has not resulted in any economic growth. These austerity measures have been highly unpopular in the general public and ave led to many protests.
Furthermore, the sacking of public officials would be met with outcry because the Greek constitution as guaranteed permanent employment to a government employee. However, the bailout package is very important for Greece and it is in Greece's best interest to go ahead with the decision despite its unpopularity.
According to the article the Greek government has agreed to fire 15,000 government workers. This has been done in order to secure a further 8.8 billion euros in the bailout packages from the European Union and the International Monetary Fund. This is a part of the series of budget cuts that have been implemented in the troubled nation. Increases in taxes and cuts in fiscal spending has led to unemployment and has not resulted in any economic growth. These austerity measures have been highly unpopular in the general public and ave led to many protests.
Furthermore, the sacking of public officials would be met with outcry because the Greek constitution as guaranteed permanent employment to a government employee. However, the bailout package is very important for Greece and it is in Greece's best interest to go ahead with the decision despite its unpopularity.
Spain's unemployment rate jumps to 27 percent
http://www.aljazeera.com/news/europe/2013/04/2013425849503846.html
More than six million Spaniards were out of work in the first quarter of this year, raising the jobless rate in the euro zone's fourth biggest economy to 27.2 percent. The number of unemployed climbed by 237,400 people to 6.2 million, as the Spanish economy contracted by 1.37 percent since last year. The office of the prime minister of Spain is expected to unveil new package of reforms to revive the economic activity. Spain is one of the largest economies in The Euro zone crisis, which has had lots of unemployment and economic losses. In France, the second biggest euro zone economy, official data to be released later on Thursday are also expected to show a record number of jobless workers.
More than six million Spaniards were out of work in the first quarter of this year, raising the jobless rate in the euro zone's fourth biggest economy to 27.2 percent. The number of unemployed climbed by 237,400 people to 6.2 million, as the Spanish economy contracted by 1.37 percent since last year. The office of the prime minister of Spain is expected to unveil new package of reforms to revive the economic activity. Spain is one of the largest economies in The Euro zone crisis, which has had lots of unemployment and economic losses. In France, the second biggest euro zone economy, official data to be released later on Thursday are also expected to show a record number of jobless workers.
China to buy 60 Airbus planes from France
http://www.aljazeera.com/news/asia-pacific/2013/04/201342593155160420.html
The article talks about how French President Francois Hollande begins two-day visit to China in bid to bolster economic ties. President Francois became the first president to visit china since Chinese President Xi Jinping became the head of state last month. The announcement came in on the first day of the visit, which is focused on enlarging and expanding trade relations between China and France. The majority of the planes will be built in the Boeing plant 160km outside China's capital. France accounts for 1.3 percent of china's exports. The visit from the french president came as the french officials saw the trade deficit with China of $34bn last year unsustainable. there are high hopes that French nuclear giant Areva and the Chinese energy group CNNC will sign letters of intent on the construction of a nuclear waste treatment facility. Also, the french Carmaker Renault hopes to progress negotiations on a proposed factory at Wuhan that would produce 150,000 vehicles per year. The visit is expected to vastly boost trade between the two countries.
The article talks about how French President Francois Hollande begins two-day visit to China in bid to bolster economic ties. President Francois became the first president to visit china since Chinese President Xi Jinping became the head of state last month. The announcement came in on the first day of the visit, which is focused on enlarging and expanding trade relations between China and France. The majority of the planes will be built in the Boeing plant 160km outside China's capital. France accounts for 1.3 percent of china's exports. The visit from the french president came as the french officials saw the trade deficit with China of $34bn last year unsustainable. there are high hopes that French nuclear giant Areva and the Chinese energy group CNNC will sign letters of intent on the construction of a nuclear waste treatment facility. Also, the french Carmaker Renault hopes to progress negotiations on a proposed factory at Wuhan that would produce 150,000 vehicles per year. The visit is expected to vastly boost trade between the two countries.
Samsung rings up record quarterly profits
http://www.aljazeera.com/news/asia-pacific/2013/04/201342653621483160.html
This article talks about how Samsung profit sales are through the roof as they set a new record for profit in the first three months of the year. In their earnings report, the South Korean giant reported a $6.4 Billion profit, up 41.6 percent. The earnings figures were released on the same day as the new version of Samsung's flagship smartphone, the Galaxy S4, went on sale in South Korea ahead of a planned global roll-out. However the company is expected to suffer from the Sanctions on Iran, which will hurt the company's profits as it prevents them from providing services in Iran. Also, samsung is expected to experience stiffer competition in the near future due to expansion of low to mid end smart phones market.
This article talks about how Samsung profit sales are through the roof as they set a new record for profit in the first three months of the year. In their earnings report, the South Korean giant reported a $6.4 Billion profit, up 41.6 percent. The earnings figures were released on the same day as the new version of Samsung's flagship smartphone, the Galaxy S4, went on sale in South Korea ahead of a planned global roll-out. However the company is expected to suffer from the Sanctions on Iran, which will hurt the company's profits as it prevents them from providing services in Iran. Also, samsung is expected to experience stiffer competition in the near future due to expansion of low to mid end smart phones market.
US economy growth rate misses expectations
http://www.aljazeera.com/news/americas/2013/04/201342614326535652.html
This article talks about the US economy growth in the terms of GDP. The economists had estimated a three percent growth in the quarter, but the GDP had growth of only about two percent. This lack of expected growth is partly due to the slow performance of farming industry, which had a decline in output due to droughts throughout the United States, and partly because households cut back on saving to fund their purchases after incomes dropped at a 5.3 percent rate in the first quarter. The drop in income was the largest since the third quarter of 2009. The saving rate fell to 2.6 percent, the lowest since the fourth quarter of 2007, from 4.7 percent in the fourth quarter of 2012. The news will encourage the Federal Reserve to maintain its monetary stimulus. The US central bank, which meets next week, is widely expected to keep purchasing bonds at a pace of $85bn a month.Although government spending, which fell to a 4.1 percent annual rate, tax increases and federal budget cuts could slow growth later this year. Consumers managed to step up their spending despite the return of a two percent payroll tax and higher petrol prices. Despite the spike in petrol prices, inflation pressures were benign in the first three months of the year. An inflation gauge in the government's GDP report rose at a 0.9 percent rate, the smallest increase since the second quarter of 2012. The personal consumption expenditure index had increased at a 1.6 percent pace in the fourth quarter. Business spending on equipment and software slowed sharply, growing at an only three percent rate after a brisk 11.8 percent pace in the fourth quarter.
This article talks about the US economy growth in the terms of GDP. The economists had estimated a three percent growth in the quarter, but the GDP had growth of only about two percent. This lack of expected growth is partly due to the slow performance of farming industry, which had a decline in output due to droughts throughout the United States, and partly because households cut back on saving to fund their purchases after incomes dropped at a 5.3 percent rate in the first quarter. The drop in income was the largest since the third quarter of 2009. The saving rate fell to 2.6 percent, the lowest since the fourth quarter of 2007, from 4.7 percent in the fourth quarter of 2012. The news will encourage the Federal Reserve to maintain its monetary stimulus. The US central bank, which meets next week, is widely expected to keep purchasing bonds at a pace of $85bn a month.Although government spending, which fell to a 4.1 percent annual rate, tax increases and federal budget cuts could slow growth later this year. Consumers managed to step up their spending despite the return of a two percent payroll tax and higher petrol prices. Despite the spike in petrol prices, inflation pressures were benign in the first three months of the year. An inflation gauge in the government's GDP report rose at a 0.9 percent rate, the smallest increase since the second quarter of 2012. The personal consumption expenditure index had increased at a 1.6 percent pace in the fourth quarter. Business spending on equipment and software slowed sharply, growing at an only three percent rate after a brisk 11.8 percent pace in the fourth quarter.
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