Competition Among Luxury Car Brands

   Luxury car brands such as Lamborghini, Rolls Royce, Aston Martin, and Bentley are racing to bring an electric car to market.  With strict regulations and the fossil fuel supply decreasing, the need for a fully electric automobile continues to increase.  Lamborghini has already released a sketch and a scale model of their new  luxury sports car called, "The Lamborghini Diamante."  However this car will not be released to market until 2023.  Also the new raging bull does posses a fully electric engine which has 4 main batteries with a full output of  965 Italian horses prancing underneath the hood just waiting to be unleashed.


  Aston Martin is trying to be the first luxury car manufacturer to bring a fully electric car to market which can perform at high speeds.  There is already an electric car company called Tesla and currently they make electric models but, their cars focus on fuel economy rather than pure performance.  Aston Martin currently has a sedan model called the Rapide which is fully electric and will be brought to market in 2017.  This bold move has attracted the attention of investors which can help Aston Martin to be more profitable in both the long and short term.  This positive shift in demand can increase the firms EBITA (Earnings before interest, taxation depreciation, and amortization) as well.  

http://www.cnbc.com/2016/10/05/aston-martin-ceo-forget-tesla-well-lead-with-ultra-luxury-electric-vehicles.html

Warren Buffet Fires Back at Trump!

   On October 10th Sunday night, Donald trump made a huge accusation about Warren Buffet for not paying his taxes.  Trump also proceeded a step further to state that Warren didn't pay his taxes in an attempt to receive a substantial tax deduction on Berkshire Hathaway during 1995.  Warren fired back at Trump and told him " I have paid my own taxes since the age of 13 from 1944!"  Mr. Buffet also has all 72 copies of his personal tax returns and is more than obligated to share these documents.  However, Donald Trump has not yet released his own tax returns.  

   Warren Buffet's 2015 Tax Return

Adjusted Gross Income: $11.56 Million
Total Reductions: $5.48 Million
Allowable Charitable Contributions: $3.47 Million
Paid Federal Income Tax: $1.85 Million

  Both Donald Trump and Warren Buffet are billionaires and wealthy individuals.  Yet each business  person has a different set of values in terms of saving and investment.  Warren Buffet greatly cares for both saving and investment.  As a key contributor to numerous charities such as "The Giving Pledge" and others, Warren Buffet believes in investing for tomorrow's leaders.  The only question left to ask is "Will Donald Trump ever Release his Tax Returns?"

http://www.cnbc.com/2016/10/10/warren-buffett-fires-back-at-donald-trumps-comments-about-his-taxes.html

Trump's vision for job growth.

Donald Trump says he intends to completely change tax, trade, energy and regulatory policies so as to initiate an era of “unbridled” American growth, promising the greatest  hiring binge ever witnessed  in the country.
This plan looks like it could be hard to execute as the number of unemployed workers is at 7.8 million. He has also said he would cut down on immigration, which would also reduce the worker pool.
To reach his lofty goals, many jobs “would have to come from an increase in labor supply, or an increase in the labor force participation rate” at a level that most economists would consider “pretty far outside the range of credibility,” said Joel Prakken, chairman of Macroeconomic Advisers LLC. 
In order to get the 25 million jobs envisioned by Trump without pushing down unemployment, the participation rate would need to go up to 66.7 percent, based on a model by Macroeconomic Advisers. The particiation rate is currently at 62.8%.
Ironically, Trump can only meet his goal if he "more than doubles immigration," according to Mark Zandi from Moody’s Analytics.
http://www.bloomberg.com/news/articles/2016-09-15/trump-lays-out-economic-vision-for-a-record-decade-of-job-growth

Russia's 'Slow Bleeding' Brain Drain

The Russian emigration may be considered small in terms of population, but the fact of the matter that in recent years there are more and more people leaving. People are leaving Russia due to political reasons and believe that Putin has fixed elections to remain in power and as a result President Putin is losing the trust of his people. The concern is that the individuals that are leaving Russia are the "most educated and successful." While the most recent wave of emigration began due to political reasons it has shifted more toward economic reasons such as better employment opportunities and to pursue higher education. In the long run a wave of immigration of the country's most successful people could start to effect the Russian economy.



http://www.usnews.com/news/best-countries/articles/2016-10-06/countries-with-the-most-russian-emigrants

Brain Drain in Sub Saharan Africa

Brain Drain in Sub Saharan Africa is a rampant problem, and there are many reasons for this current, and constant, problem across Africa. There are many reasons for the loss young human highly skilled labor, from poor economic opportunity to humanitarian violence. This loss of human capital is detrimental to the current and future performance of the already struggling African economies. Without outside intervention, Sub Saharan countries will continue this downward trend.

http://www.usnews.com/news/best-countries/articles/2016-10-07/sub-saharan-africa-bleeds-skilled-labor-as-brain-drain-continues

Rapidly Aging Population in Asia requires Policy Overhaul

The rapidly ageing populations of countries in Asia Pacific require more government policy in order to ensure the well being of all citizens and prevent economic contraction. This shift of demographics is becoming a priority in the region. It is estimated by 2050, there will be 1.2 billion people over 60 living in East Asia and the Pacific which is equivalent to two-thirds of the world's older men and women. The working-age population will be much smaller in proportion to the growing number of older dependents. This shift will cause social and economic implications requiring government policy to prepare for it as much as possible. Eduardo Klien, regional director of HelpAge International for East Asia Pacific elaborated on some of these policies which include "practices such as extending active working life, making older workers more attractive to employers, reforming pension schemes, and shifting the focus of healthcare from hospital care to primary care in order to prepare for the future." Without these accommodating changes, Asia Pacific will lose valuable human resources that contribute much to their economy and community. The general idea seems to be to minimize the burden and maximize the contributions of older people, but how many people will actually support extending the active working life? If this means raising the retirement age, I would not be a fan.

This news seems to imply that the population growth rate is not high enough to balance the aging population. For example, the issue is already severe in Japan where the current population of 127 million is projected to decline by 12 million, or 10% by 2030. The cause of the large aging population was caused by breakneck pace of economic development in recent decades, paired with higher incomes and better education resulting in longer life expectancy and lower fertility rates. This affects the economy because of large and growing expenditures in healthcare and social welfare, costing Japan US$252 billion. A paradigm shift is required in the process of how healthcare, pensions, and long-term care are provided and financed.

http://0-web.b.ebscohost.com.dewey2.library.denison.edu/ehost/detail/detail?vid=0&sid=6fc79670-eb6e-443d-833d-7ee7188da6cb%40sessionmgr1&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=nfh&AN=2W63860188961

If there's a tech skills shortage, why are so many computer graduates unemployed?

If there's a tech skills shortage, why are so many computer graduates unemployed?

In the UK, there seems to be a problem that is inherently contradictory in nature, as 11.7% of computer science graduates are remaining unemployed after six months post-university graduation.  This leads to a question of: Why? To be honest, no one in the UK is entirely sure why computer science graduates' job rate is so low, even when, after a poll, 78% told the poll that they have a shortage of digital skills was holding their firm back. What does this mean?

Some people have perhaps one explanation: universities are not able to provide what people need to be placed all the time.  Big companies have different needs than small companies, and not every University can provide training for both.  In an ever-growing field, the UK will definitely be needing as many well-trained people as they can get.

http://www.techrepublic.com/article/if-theres-a-tech-skills-shortage-why-are-so-many-computer-graduates-unemployed/

Clear Vision, Hazy Path (What's Next Pres?)

           

On October 8,2016 President Barack Obama released his presidential letter to his successor. The letter addresses the unresolved issues the president tackled and now passes along to his future predecessor with wishes of good fortune. Obama writes,"This is the paradox that defines our world today. The world is more prosperous than ever before and yet our societies are marked by uncertainty and unease. So we have a choice—retreat into old, closed-off economies or press forward, acknowledging the inequality that can come with globalization while committing ourselves to making the global economy work better for all people, not just those at the top." It's an interesting letter where the president divulges his take on his term and what he had to address a commander and chief. He writes for us about four crucial areas of unfinished business: A force for good, Restoring economic dynamism, Building a Sturdier Foundation, and A hope for the Future. I'd like to highlight an excerpt of interest, restoring economic dynamism. "First, in recent years, we have seen incredible technological advances through the internet, mobile broadband and devices, artificial intelligence, robotics, advanced materials, improvements in energy efficiency and personalized medicine," remarks Obama. The innovations have helped change the lives of many Americans with leaps and bounds, but in regards to productivity it cannot be said. 

       Why the downfall in productivity? The slow progression is mainly because of a decrease in public and private investment as a byproduct of the financial crisis.

Alongside the productivity decline inequality has risen. As Abraham Lincoln said, “while we do not propose any war upon capital, we do wish to allow the humblest man an equal chance to get rich with everybody else." Upward mobility is harder now because factors like technology, education, and decrease in unions has encouraged this inequality disparity. To exacerbate matters is the decline in labor participation which is a byproduct of the retirement of the Baby Boomers and the pursuit of continuing formal education. Progress is defined by the willingness of ones ability to move forward. The economy needs a boost, hopefully the next president can get it done.

Reference: 

The Economist_Presidential Letter to Successor Briefing

An Online Education Breakthrough? A Master’s Degree for a Mere $7,000

With the rise in demand for master's degree, the tuition of colleges have significantly increased. This has made it difficult for students to be able to afford the cost without ending up with a huge debt. But Georgia Tech has come up with a different approach to solve this issue. It's master's degree program in Computer Science costs mere $7000 while the same program its at competitor colleges cost between  $45000- $60000.

There are a lot of setbacks involved besides the factor of money when it comes to pursuing master's degrees.The article states,"People with jobs and families can’t just pull up stakes and move to Atlanta or Los Angeles for a year or two to study computer science. Nor can they afford to spend $57,000 out of pocket for a credential."

According to the article, "A new study by Harvard economists found that in creating the program, Georgia Tech may have discovered a whole new market for higher education, one that could change the way we think about the problem of college costs." Not only the program at Georgia Tech is cheaper but also exactly like the residential program at the university. The exams and quizzes are graded the same way they are graded in actual classes and also professors can be contacted online.

There has been a debate about higher education in this year's election. Hilary Clinton has proposed  to subsidize public institutions and lower interest rates on outstanding student debt. This will only happen if the colleges will have incentives to follow  But unless these policies are accompanied by strong incentives for colleges to be more like Georgia Tech, the college cost problem will remain.

http://www.nytimes.com/2016/09/29/upshot/an-online-education-breakthrough-a-masters-degree-for-a-mere-7000.html

Public Can't Trust World Leaders

Our people have found it harder and harder to trust our world leaders year to year because of people's beliefs of their "inabilities" to share equal wealth with all of us.  Even the political and economic leaders are aware of this as Germany's finance manager, Wolfgang Schauble said to CNN "You can look all over at the advanced economies -- the British referendum, the campaign in the United States ... more and more people don't trust their elites. They don't trust their economic leaders, and they don't trust their political leaders."  When it is a regular topic to sit around and talk with your friends about how they don't trust their leaders, I think that is how we know we are in trouble.  A lot of these leaders know that we need to make change and make trade between our countries and our people a prominent thing.  Although I don't think it will be the demise of our economy I think it makes it very difficult to grow and prosper when there is no trust in the ones making the decisions.

http://money.cnn.com/2016/10/06/news/economy/imf-lagarde-carney/index.html?iid=SF_LN

Currencies fall

 Sterling hit a 6% fall in two minutes on October 7 (from $1.26 to $1.18).  The Euro faced a very similar jump as well.  This article states that the best explanation would be that the computer programs that automatically generate transactions can have "flash crashes" in the equity markets.  

"Each may have a trigger point which requires the programme to sell an asset (currency, bond or share) when it falls below a certain point, in order to limit losses. These sales drive the price down, which triggers the selling points of other programme and so on. Eventually, the fall is large enough that other elements of the algorithm generate a buy signal. Hence the whole event can be over very quickly."

 

However, there seems to be more problems than just the computer programs because the pound hit a fall when Brexit happened.   The article points out that a decline in the currency is good for exporters and for the "foreign currency earnings of the multinationals listed in the FTSE 100."

"As a trading nation with a current-account deficit, Britain is dependent on the kindness of strangers; the willingness of foreign investors to send capital."

http://www.economist.com/blogs/buttonwood/2016/10/currencies

U.S. Economy, Showing Resilience, Added 156,000 Jobs Last Month

A recent topic that remains popular amongst the U.S, especially in the presidential debates has been about our economy and how it is struggling. However, this doesn't seem to be the case, according to the Labor Department, 156,000 jobs were added during the month of September. An increase in discouraged workers has had people feeling nervous about our economic growth, along with the endless increase of workers entering our labor force. However, this new increase in jobs last month is believed to help the workers newly in the labor force and also encourage discouraged workers to find jobs. Furthermore, over the past 12 months the wage gain has increased by 2.6%, begging the question whether or not the economy should actually be a growing concern. The Federal Reserve has shown no alarm for future inflation, and the unemployment rate is expected to drop to as low as 4 percent come 2018. With a steady increase in jobs each month, and more and more workers joining the labor force, there seems to be little to no real concern for the future, so it is strange that this has been such a heavy topic for people and for the presidential campaign. With the amount of jobs being added each month, the natural unemployment rate should decrease, especially since the increase in jobs is also bringing discouraged workers back into the labor force. Donald Trump continues to criticize our economy and Hilary Clinton's plan, emphasizing on the millions of economically sidelined Americans. While there will always be concern and fear revolving around the economy in the US, results show slight decreases in the unemployment rate, and continued increase, so while many people including Republican presidential nominee Donald Trump continue to raise concern over our current and future economy, it appears to be over exaggerated.

Obama Economy has done better than we thought

Since early 2010 Obama and his team has created over 15 million jobs in the private sector/non-farm jobs.  A lot of people see this as the slowest recovery in our economy since WWII but earlier this year at the state of the union address Obama stated "Anyone claiming that America's is in decline is peddling fiction."  In February 2010 when our employment was at the lowest point after the recession we had under 130 million people employed, even though it has taken 6 years to get to this point it is definitely impressive to see the change.  When CNN stacked him up against past presidents who have done well getting jobs back in our economy he still behind Presidents Clinton (22.9 million jobs) and Reagan (18.1 million jobs), but he's left President George W. Bush (8.2 million jobs) in the dust.  I feel like looking at unemployment and jobs is important because of the debate now and how that is a big topic between the two presidents.  It is also important because we are going to be looking for jobs soon so we should know how the economy is doing and how our chances are of getting a job right after graduation, with what Obama has done hopefully it stays on the upward trend and there are plenty of jobs for us.

http://money.cnn.com/2016/10/07/news/economy/obama-15-million-jobs/index.html?iid=SF_LN

Brazil's Fall

       After hosting the summer Olympics games in the summer of 2016, it is expected that Rio De Janiero and rest of Brasil would jubilant and stable. Well, this is not the case, instead Brasil is attempting to subdue a potential economic and political catastrophe. It is expected that Brasil's economy will shrink by 2.5-3% in 2016 and could return to its old ways of uncontrollable inflation. Brasil's suffering, similar to many emerging economies, is due to the falling global prices in commodities. The Brazilian government did not do itself any favors by higher pensions and higher taxes breaks for selected industries that did not increase productivity. These actions increased the fiscal deficit from 2% to 10% of GDP. The country is in debt by 70% of its total GDP and the interest rates on that debt is at 7%, which is making it difficult to pay off. The Central Bank of Brasil is not having any luck using monetary policy to fight inflation, as higher rates risk destabilizing the public finance by adding to the interest bill. Thus, it seems the only option is to cut government spending and increase taxes.
     It is recommended that Brasil should focus their attention to pensions, with which the minimum pension is equivalent to the minimum wage. The pension rate has risen 90% in real terms over the past decade and as a result, the Brazilians are retiring, on average, a decade earlier than other relatively rich countries. Currently, Brasil pays 12% of its GDP in pensions. Brasil's political, party fragmentation and vote buying will not help the economic situation.



http://www.economist.com/news/leaders/21684779-disaster-looms-latin-americas-biggest-economy-brazils-fall

Hard Brexit 'could cost financial sector £38bn'

This article speaks about the effects that could occur if the UK quits the EU single market to regain control of immigration. According to the article, the financial industry could lose up to £38 billion and up to 75,000 jobs. Management consultancy Oliver Wyman, modelled several possible outcomes for the UK financial services industry after Brexit, in his report.He stated that the UK might retain access to the European Economic Area on similar terms which would enable them to continue trading across the bloc without the need for individual country licences. This would be less costly as it would only cost the industry up to 4,000 jobs and £2billion of revenues a year. The other scenario is that the UK could quit the bloc "without any regulatory equivalence", costing the industry up to £20bn and 35,000 jobs and further impact from related business could cause a further 40,000 jobs and £18 billion. However, Kevin Dowd, an economics professor at Durham University and member of campaign group Economists for Brexit, believes that the UK being held back by leaving the single market makes no sense. He claims that "most of our financial services business is actually outside the EU, and our share of business with the EU is declining anyway". Also, the UK Treasury said it was working to ensure companies continued to have access to the single market as they prepare for negotiations to leave the EU.

http://www.bbc.com/news/business-37560471

Misery for tourists as 'flash crash' means that the pound is now worth less than the euro at airports as sterling reaches a 31-year low

This article talks about the depreciation of the British Pound Sterling, reaching levels lower than the Euro, along with holidaymakers being offered as low as 0.97 Euros. There was a point in July 2015, where 1 pound converted to 1.44 Euros, making it financially worthy for British residents, holding the pound, to vacation in different parts of Europe that uses the Euro. But the British pound sterling endured an overnight 'flash crash' triggered by a suspected 'rogue algorithm' sending it plummeting to a 31-year low against the US dollar.

The British pound has partially fallen because it has imported more than it has exported, and to fill in the trade deficit requires foreign investors to put money into the UK. International worries over Brexit result in slow investments, along with a slow anticipated future resulting in the depreciation of the British pound. Interest rates i.e. The Bank of England’s decision to cut interest rates, along with the US federal reserve gradually raising interest rates has put upward pressure on the value of the dollar, and pushes the British Pound Sterling down.

The depreciation of the pound would cause full year earnings to decrease from 300 million to 285 million pounds. Output could only muster a slight rebound to 0.2% in August, while industrial production posted a worse –than-expected fall of 0.4% over the period.

Foreign companies listed in London have their shares increased due to the depreciation of the pound, since it boosts their earnings when they are translated back into the British Pound. Therefore, amidst the disadvantage posted to those British citizens travelling abroad for a vacation, foreign companies or people living abroad and entering Great Britain have a great advantage since they can get more of the British Pound when transferring their local currency. Since it becomes cheaper to buy goods and services locally in Britain, this would only benefit foreign countries due to their stronger currency, and ability to buy more of the British pound when converting it from your local currency.

The fall of the British pound also implies to trade in goods and services. As the value of the British Pound falls, imports become more expensive for British locals, therefore, inflation should increase, while exports become valuable for foreign buyers. As prices rise, exports > imports, thereby reducing the trade deficit.

Thereby, the depreciation does pose a misery to tourists in foreign countries, that possess the British Pound due to its lower value, but it does eventually reduce the trade deficit, moving it into a surplus into the distant future.

Link: http://www.dailymail.co.uk/news/article-3827050/Bank-England-probes-flash-crash-pound-plunges-6-against-US-dollar.html

Another reference: http://www.telegraph.co.uk/business/2016/10/06/sterling-falls-to-record-low-against-top-trading-partners/

Concern as Venezuela Refuses to Accept Aid

This article talks about the economic and political problems that Venezuela is going through. They talk about hyperinflation since a three digit inflation is expected for this year and how this is affecting the economy and the money liquidity because people don't want to have any cash. Since other countries like the US and other Latin-American countries like Peru, Argentina, Colombia, Chile, have noticed this they are trying to get the president of Venezuela to accept help from them so they can get out of the crisis. But the president Nicolas Maduro is not letting them help because he doesn't want other countries to get involved, and also he want to keep them apart because he believes that letting other countries will take his power away and would make him lose the country. The other countries are concerned because of the risk that this crisis turns into an uncontrolled chaos, and that is why the want to get involved. The US tried to convince Maduro when he had the meeting with the Secretary of State John Kerry, but they couldn't get him to accept the help from them, so we will see what else are the other countries going to do in order to convince Maduro and be able to help Venezuela get out of the crisis.

link: http://www.nytimes.com/2016/09/28/world/americas/venezuela-refuses-us-aid.html?rref=collection%2Ftimestopic%2FUnited%20States%20Economy&action=click&contentCollection=timestopics&region=stream&module=stream_unit&version=latest&contentPlacement=1&pgtype=collection

UNEMPLOYMENT IS DOWN: WHY AREN’T AMERICANS BUYING THE GOOD NEWS?

http://www.newyorker.com/business/currency/unemployment-arent-americans-buying-good-news

The article "UNEMPLOYMENT IS DOWN: WHY AREN’T AMERICANS BUYING THE GOOD NEWS?" from The New York Times talks about the economic situation America is in right now. Fired by a statement made by the president Barack Obama, who mentioned how healthy the economy of the country is, Vauhini Vara gives us her opinions and views. Her main concern is if the downfall of the unemployment rate is beneficial for the American economy. She explains that even though the unemployment rate has fallen, the discouraged worker rate risen. Basically she sums up that the unemployment rate is the right way to measure the health of an economy. The American economy might be stronger the last few years but it still is not strong enough.

Oil Prices are responding to Supply and Demand

Jason Bardoff, Director of Columbia University Centre on Global energy Policy concluded that the oil market is behaving like a normal market. Supply for example a year ago in Saudi Arabia refused to allow OPEC to try to raise prices by pumping less crude, they hoped that a low price would drive competitors out of business.The geopolitical tensions that sometimes play havoc with oil prices has been absent since OPEC has more or less abandoned its quotas. Demand is also behaving normal. Oil prices is boosting consumption to a degree. Drivers are opting for larger more full guzzling vehicles for SUVs in America and China.One big question is if they quickly ramp up production if oil prices spike. They think it wont happen so quick because the banks may be reluctant to fund more of their wells causing constant production.
http://www.economist.com/news/finance/21678198-once-prices-are-responding-supply-and-demand-not-opec-why-market

Industrial Robots will replace manufacturing jobs

As technology advances, productivity grows due to larger efficiency of robots over humans. 85% of job losses are due larger to machines replacing humans but due to this, productivity as increased drastically. Over the last 20 years, manufacturing output as increased by almost 40% and the annual added by U.S. factories have reached a record of 2.4 trillion. Obviously, this will increase unemployment but manufacturing employees are now better educated, earning more and producing more. Unemployment would be a short term effect but not a long term effect because the average age of a manufacturing worker is 45 which shows that the younger generations are having less interests in these jobs. New jobs would also be created for a more educated and skilled workforce which manufacturers will need to create, program and maintain the robots. As a result, both the manufacturers and workers benefit in the long run.

Presently, there is negativity on this issue because people are scared of losing their jobs but it has always been like this in the market. Advances in technology are vital for the economy to improve. People see only the short term effects like how it causes unemployment but do not focus on the long term effects like how it creates better jobs, increases productivity, efficiency and safety. They forget to realize that technology is meant to make our lives better and easier not worse and harder.

Link: https://techcrunch.com/2016/10/09/industrial-robots-will-replace-manufacturing-jobs-and-thats-a-good-thing/

Angela Merkel to ban EU migrants claiming unemployment benefits in Germany

--Angela Merkel is moving to ban EU migrants from claiming unemployment benefits for five years amid growing tension over her government’s open door immigration policy.

The German chancellor’s cabinet is preparing to vote on plans for a new law that would restrict migrants’ rights to claim cash from the state.

The proposal is remarkably similar to the one David Cameron demanded ahead of the Brexit vote earlier this year.After intense negotiations, the UK was eventually offered an “emergency brake” on migration which created a seven year window in which new EU arrivals could be denied benefits.

The idea was strongly opposed by many European leaders who feared it would contradict the EU’s free movement rules.As a result, the restrictions were only permitted to be brought into force in extreme circumstances.

But it seems mounting discontent with Merkel’s open door immigration policy has forced Germany to look into implementing a similar rule.The planned law would stop new EU arrivals from claiming money if they do not have a job or have not acquired rights to the payments in a previous job.

Officials said the change was aimed at making sure people who moved to the country were actively looking for work and not just living off benefits. Merkel’s party has been under pressure from the anti-immigration AfD, finishing behind them in recent state elections in the chancellor’s Mecklenburg-Western Pomerania constituency.

The plans to restrict migrant benefits look like a move to win back working class voters amid waning support.


Find the whole article: EU'VE GOT TO BE JOKING Angela Merkel to ban EU migrants claiming unemployment benefits in Germany – months after Britain was forced to beg EU for the same right

Sterling Takes a Pounding

According to this article by the Economist, the British Pound's quick but significant depreciation last week is cause for concern on a number of fronts. The sudden dip has largely been blamed on computer algorithms reacting to a speech by French president Francois Hollande pushing for a "hard Brexit". Although this speech was of little true policy implication, the algorithms compounded selling after selling of British Pounds, causing the currency's value to plummet overnight. That being said, hypersensitive algorithms are not the only cause for concern on the part of the British. Brexit, compounded by a generally anti-immigrant and increasingly anti-business tone of the Conservative Party has many investors worried. While some have brought up the fact that currency devaluation can be good for trade, unless a currency is overvalued to begin with, devaluation can cause harmful shift in the international terms of trade. Britain is also a net borrower, meaning its economy is dependent on the money of foreigners seeing British markets as appealing, a fact that could compound the effects of any anti-business policies implemented in the coming future. So although this one blip may be just that, Britain is hardly out of hot water yet, and may actually be in store for far worse in the coming months. All this could also have implications for the US, as we have economic ties with England and the EU.

Link: https://www.economist.com/blogs/buttonwood/2016/10/currencies

What Went Awry at Wells Fargo? The Beaten Path of a Toxic Culture

Wells Fargo recently discovered some of the bank's employees opened bank and credit card accounts for customers without their knowledge in attempt to meet aggressive sales goals. 5,300 low-ranking workers have since been fired for what the bank's chief executive declared as an ethical lapse. However, current and former employees cited an environment in which managers checked with staff members several times a day to monitor progress toward sales quotas. When sales targets were met, they were rewarded with hefty bonuses. This type of environment seems to more common than people think. Similar unethical actions have been noted at Volkswagen, General Motors and the Department of Veterans Affairs. Management in all  of these cases expressed dismay but after closer investigation, blame was placed on the company culture.

What management doesn't know is employees often will react to the signals they receive from management. Some signals include how compensation and recognition are done, or which metrics managers obsess over, the types of questions they ask their employees and so on. Theses signals have the ability to shape organizational culture and employee behavior in unintended ways.

Organizations are often surprised when they find out their employees have gone against the company's values. This article states that until business leaders start paying attention to these subtle workplace signals they will continue to be surprised by what their employees are motivated to do. I don't know that this necessarily justifies what they did, but it could be something to consider.

U.S. Economy, Showing Resilience, Added 156,000 Jobs Last Month

Over 156,000 job positions were created in September, according to the Labor Department. This is enough to accommodate new entrants to the labor force and entice back worlds who dropped out after the Great Recession. The unemployment has rose slightly from 4.9 percent to 5 percent; however, this is generally because more people are now included in the labor force. Still, the number of jobs are continuing to rise with no evidence of it ending suddenly. The average earning increased by 0.2 percent, for a 12 month total of 2.6 percent. Yet, the typical workweek grew a little as well.

Though all numbers are looking good, they did not reach the numbers expected, therefore the Federal Reserve is expected to delay raising interest rates until the end of the year. This gives policy makers time to consider the October and November job reports, and whether to tighten monetary policy. After falling for 23 consecutive months, with 223,000 jobs cut during that time, employment in the oil sector was finally flat last month. Overall, it will be interesting to see if the gain in payrolls have slowed down the pace of recruiting, or not.

Link to article.