Trade between African countries may become freer and grow

All 55 of African countries are planning to form a free trade area, to be called a Continental Free Trade Area (CFTA). This would allow them to trade without charging tariffs (taxes) on imports of each other’s goods.

Their deadline if the end of this year is ambitious considering that they have only begun talking about this seriously two years ago. But it looks like most if not all African leaders may be ready to sign the deal by March next year, which will not be that late. But a total of at least fifteen African countries must actually ratify the trade agreement in order for it to go into effect.

African countries still tend to trade more with European countries than with each other. More than 80% of African countries traded exports go to countries located outside Africa. Most of these exports are not manufacturing or services but agriculture products like crops, oil and precious metals. This does not help Africa develop.

So finally these countries are trying to really band together to trade with one another and raise the amount of this intra-Africa trade. Currently around half of the trade that African countries do with one another is in manufactured goods. Understandably, the idea is to increase the share on trade in these goods. This is how countries can grow faster and better and create more jobs. They get better prices for traded exports that are manufactured than agriculture crops. 

Another motive is to create a regional block of countries that can then have more power in dealing with other regions or large economies on trade negotiations. But it will be the non tariff barriers—like different rules and standards across countries for certain goods such as food products-- that must be removed to really get trade going between these countries and grow their economies. And African countries will miss the revenues that come from collecting trade taxes. Somehow they will have to make up this gap in budget revenue for fiscal policy spending.

 https://www.economist.com/news/finance-and-economics/21732154-they-have-long-traded-world-now-they-want-trade-each

Venezuela’s economy looks to oil for salvation and a new currency

Venezuela’s economy has been suffering for the past several years. While oil has always been a major export for Venezuela, oil now makes up as much as 96% of total exports, according to a recent article in The Economist. This is  because it is so difficult for other businesses to function in this country due to government policies and the chaotic nature of the economy and society under Nicolas Maduro.

Although oil makes up the vast majority of total exports, even oil exports have fallen most recently. This is because oil production fell by one hundred thirty thousand barrels a day over the September to October period. With large supplies of oil provided to China and Russia as a form of payment of interest on loans made by these countries to the Venezuelan state, there is little left over to sell as exports. Another negative impact on oil exports is caused by the drop in the global oil price over the past several years, although it is not as low as it was in 2015, a record low. Because Venezuela is $1.5bn behind on making its payments on loans, the situation does not look it will improve any time soon and it could in fact get worse.

This is a big deal for Venezuela because it is one of the world’s largest oil exporters and reportedly has the largest proven oil reserves in the world. Oil is so important to the economy of Venezuela that its president even resorted to issuing a new digital currency, called the petro, backed by the country’s oil reserves, as well as gas, gold and diamonds.

 https://www.economist.com/news/americas/21731870-government-has-crushed-opposition-dealing-its-creditors-will-be-harder-despotism

https://www.reuters.com/article/us-venezuela-economy/enter-the-petro-venezuela-to-launch-oil-backed-cryptocurrency-idUSKBN1DX0SQ

CVS and Aetna merge, what does it mean for the Pharmaceutical Industry?

CVS and Aetna merged today and it had many people thinking about what this means for the future of the industry. CVS and Aetna have very different business models, with Aetna being an health insurance provider, and CVS being a pharmaceutical/convenience store, this could mean a whole new business model for the company. It also makes you think about why take this large risk when CVS specifically is largely profitable? My answer is Amazon is rumored to get into the pharmaceutical business and now CVS needs a way to differentiate themselves in the market. What other changes do you think will come of this merger, in the industry, or at CVS itself?


https://www.wsj.com/articles/the-cvs-aetna-gamble-a-health-care-giant-not-built-around-doctors-1512411933

McKinsey & Co. senior exec Thomas Barkin named new head of the Federal Reserve Bank of Richmond

With a new head of a regional FED his background will come to the forefront of news.  With his possible connection to bribery in South Africa.  Although there are just references to his name, a couple of big name banks have refused to do business with him and his bank.

Another interesting point is that he does not have his higher education degree in economics.  He has his degree in business and law.  Will this have an effect on his work at the FED.  Some believe having a degree in economics should be a prerequisite to having a high position a the FED.  What do you think?

https://www.cnbc.com/2017/12/04/mckinsey-co-senior-exec-thomas-barkin-named-new-head-of-the-federal-reserve-bank-of-richmond.html

Bitcoin Bubble?

https://finance.yahoo.com/news/cryptocurrency-market-cracks-300-billion-060022374.html?utm_content=buffera3451&utm_medium=social&utm_source=facebook.com&utm_campaign=yahoofinance

There has been much talk recently about the Bitcoin Movement, and further cryptocurrency as a whole. Bitcoin has skyrocketed over 1000% in the past year, breaking norms that we typically see in the stock market. The difference here is, bitcoin is not the same as a typical stock. As the stock market is centered around banks, businesses, and federal regulations, the future of bitcoin turns to the people who mine (obtain it) it and the people who buy and sell it day in and day out. A popular term that is used is that bitcoin is in a 'bubble'. We hear this term spoken about a lot revolving around the stock market. Again as mentioned early, the bitcoin market does not behave anything like a typical stock market, so why would we think that bitcoin is in a bubble? This is because of the rapid growth it has seen. If we look at the past year, we can see that everytime the 'bubble' was said to have been popped, it was followed by more rapid growth shortly after. Only time will tell.

US jobless claims post second weekly decline

Last week, the number of Americans filing for unemployment benefits fell for the second straight week as the labor market conditions tightened. Last week was the 143rd consecutive week that claims were totaled under the 300,000 threshold, demonstrating the strong labor market. However, this lower rate in claims is due in part to the fact that claims-taking procedures in the Caribbean have been disrupted after the destruction of infrastructure following Hurricanes Irma and Maria. Despite this disruption, the labor market is operating at near full employment, with the unemployment rate at 4.1 percent, a seventeen year low. While most would agree that a low unemployment rate is a good thing, there are potential problems with it as low as it currently is. 2017 saw 1.5 million jobs added to the employment sector. While it seems illogical that a low unemployment rate could cause problems, the main factor that comes into question is productivity. Eventually, the labor market will reach a point where each job added does not create enough productivity to cover its cost, making any additional jobs after inefficient. This allows the output gap to grow. While a perfect economy could operate at full capacity with no output gap, the United States' rises and falls as the economy does. When there is a positive output gap, the market is overusing resources and becoming inefficient, and this occurs when the unemployment rate is low. Overall, however, it is beneficial and promising that the United States is operating in near full employment.

https://www.cnbc.com/2017/11/30/us-weekly-jobless-claims-nov-25-2017.html

http://www.bbc.com/news/world-latin-america-42217798

https://www.nrdc.org/experts/han-chen/power-shift-new-report-international-coal-vs-re-finance

American Airlines Resolves Problem That Could Have Canceled Thousands of Flights

American Airlines failed to schedule enough pilots for flights during the holiday season. It was said that about 15,000 flights would be affected by the error. American Airlines could have lost tons of money and it could have affected the way people viewed the company. If given the option, people would probably choose to fly a different airline. Currently American Airlines stock is down 2.95%, but there is no proof that this was the cause. It would be beneficial for American Airlines to invest in a better system so that something like this doesn't happen again because they might not be so fortunate the next time.

The U.S. is exporting obesity

 American fast-food culture is making the whole world unhealthier

Left unchecked, rapidly rising obesity rates could slow or even reverse the dramatic gains in health and life expectancy that much of the world has enjoyed over the past few decades. And by forcing its food culture on countries like Mexico and Canada, the US is making the problem worse. As President Donald Trump’s administration throws sharp elbows in trade negotiations and systematically rescinds regulations introduced by President Barack Obama, one casualty is likely to be efforts to fight the global obesity epidemic. Left unchecked, rapidly rising obesity rates could slow or even reverse the dramatic gains in health and life expectancy that much of the world has enjoyed over the past few decades. And by forcing its food culture on countries like Mexico and Canada, the United States is making the problem worse.

It is perhaps fantasy to expect the current U.S. administration to consider any kind of anti-obesity strategy while it is still busy dismantling Obama-era policies. But that is all the more reason why countries entering new trade agreements with the U.S. (for example, the post-Brexit U.K., or post-NAFTA Canada) must be wary of any provisions that tie their hands in the war against obesity.

Bitcoin Futures

According to CNBC, the world's largest futures exchange, the CME, notified the market that it had completed self certification with the Commodity Futures Trading Commission to launch its bitcoin futures contract that will become active on December 18. As a result of this news, bitcoin's price surged because this could potentially be a key part of bitcoin becoming the digital currency of the future. Mainly because it legitimizes bitcoin as an asset class. Bitcoin is currently trading at about 11,495.68 us dollars during the writing of this post.

https://www.cnbc.com/2017/12/01/cme-says-its-launching-bitcoin-futures-on-dec-18.html

https://www.cnbc.com/2017/11/29/bitcoin-surges-through-11000-less-than-24-hours-after-topping-10000.html

Don’t expect strong U.S. hiring to keep up in 2018

Here’s the good news. Tens of thousands of Americans are finding jobs every month. The bad news? A long streak of explosive hiring and job growth has to come to an end soon. It won’t happen right away, though. The U.S. likely added almost 200,000 new jobs in November, according to the latest forecast of economists polled by MarketWatch. How good is that? That’s roughly how many jobs the economy had added each month since 2010, a stretch that has resulted in 17.2 million new positions. The long boom in hiring is reflected in the soaring optimism of Americans. With unemployment at a 17-year low, consumer confidence has rocketed to a 17-year high. The brighter outlook is also evident in a surging stock market that keeps setting record highs. Good things can’t go on forever, however. The unemployment rate has fallen so low, at 4.1%, that companies are running out of people to hire even though demand for their goods and services keep rising. Most economists predict hiring will slow to 150,000 a month or less by the end of 2018. The last time job creation was that slow was in the early stages of the current recover that began in mid-2009. Companies have sought to lure workers, including retired baby boomers, with better fringe benefits, but the shortage is expected to get worse. And that could create a cap of sorts on how fast the economy can grow no matter what Washington does to try to help.“When you have such a tight labor market, that is going to crimp the economy,” said senior economist Jennifer Lee at BMO Capital Markets. “If we see fewer jobs created it won’t be because of slower demand. There’s just not enough workers.”The Trump White House and Republican-led Congress aim to keep the good times rolling with a massive reduction in corporate and personal income taxes. The tax bill could pass as early as this week. Supporters insist lower corporate taxes will boost investment, keep American companies from moving overseas and even lure foreign firms to set up shop in the U.S. Even in the best-case scenario, however, there’s no short-term fix for the growing shortage of labor, especially in an economy that requires workers with higher skills. The labor shortage might have one silver lining, though. After years of holding back, companies are investing more in technology and other equipment in an alternative approach that could allow them to boost production at current staffing levels.“No doubt this is already happening,” said Sam Bullard, senior economist at Wells Fargo Advisors. “That is a trend that is going to continue.”Eventually the investment could make the companies more productive, allow them to pay workers more and drive the U.S. economy to greater heights. The last time the U.S. has grown 3% a year was in 2005. But that day is still well into the future.

https://www.marketwatch.com/story/dont-expect-strong-us-hiring-to-keep-up-in-2018-2017-12-02

Venezuela to launch its own cryptocurrency, the "Petro"

For almost two years , Venezuela has been facing an economic crisis that seems to be getting worse and worse. The desperation it has caused ordinary citizens, is chief among a variety factors that led to several periods of large scale and often violent protests in the country. The Bolivar, (Venezuelan currency) has depreciated about 57% against the dollar in the last month alone. Consequently the national monthly minimum wage has fallen to about $4.30, leaving many struggling for food and other basic necessities.

Bitcoin is illegal in Venezuela, however due to increasing hyperinflation it has become a common means to survival for those who are able to navigate it, allowing the opportunity to buy dollars or goods online. Due to its illegality the police have been making extra efforts to enforce laws against bitcoin as its usage increases in the country.

 Interestingly on December 3 President Nicolas Maduro announced that in response to sanctions imposed by the Trump administration, his regime would be launching the “Petro” Venezuela’s very own cryptocurrency which would be backed by oil, gold, gas and diamond reserves.  He stated “I have thoroughly studied this issue, and I want to announce that Venezuela is going to roll out a new cryptocurrency system based on its oil reserves. Venezuela will create a cryptocurrency —a petrocurrency, the Petro. He added “This will allow us to reach new means of international credit for the country’s economic and social development.” The response from his base was loud cheers, applause and claims that the 21^st century had arrived in Venezuela.

His critics however are not so optimistic, raising concerns about how a crypto currency could be backed by oil reserves if they could not be transferred? Many voicing concern over how a cryptocurrency could be successful despite the country being in default on its loans, in hyperinflation and its oil industry being bankrupt. Furthermore these sanctions issued by the United States and the European Union refusing their citizens and firms from trading with entities associated with the regime are to some extent responsible for the crisis. How then can the Maduro regime expect to convince foreign investors to accept the use of the Petro in their business dealings, if they are to ever get as far as having business dealings at all? 

https://www.cnbc.com/2017/12/03/venezuela-is-launching-a-cryptocurrency-backed-by-oil-gas-gold-and-diamonds.html

Nobel winner says bitcoin 'ought to be outlawed'

A lot of Nobel Prize winners have been threatening bitcoin or saying that it's a something that should be terminated.

Joseph Stiglitz thinks that  bitcoin should be outlawed because it has no societal use or function. Robert Shiller explained that people like bitcoin because the feeling of anti regulation or anti government. It makes the people feel lawless. JPMorgan boss Jamie Dimon thinks that bitcoin will fade, like a trend. 

The point these economists are making, is that bitcoin is extremely unreliable. It has hit a high of selling at 11,000, but it has also before dropped to 2,000. The only reason why Bitcoins are now selling at 11,000 is because big name investors and hedge funds have begin to take an interest and started to invest. 

Bitcoin will only survive if big name companies start gaining massive interest and show Bitcoin as a way to diversify their portfolios. If big name companies loose interest fast, then Bitcoin will slowly die the more people that pull away from it. Also unless Bitcoin finds a way to make it easier to spend or unless more places start offering to take it as a way of trade. 

http://money.cnn.com/2017/12/01/investing/bitcoin-criticism-outlawed/index.html?iid=SF_River

Ron Paul: 'Inflation is all over the place' and it's creating a dangerous distortion in stock market

Former Republican congressman Ron Paul says that inflation is high on his lists of concerns. The Federal Reserve's recent observation is that prices are really low but Paul believes that inflation is a dangerous distortion that could spark a pullback as deep at 50 percent. He says that Bonds are representing inflation and that the super high stock prices represent inflation. These companies are super over valued and wont generate returns like stock holders expect and their stock prices continue to rise. Eventually stock holders are going to realize this and withdrawal their investments and once people start doing this it will spark even more people to pull their money out and the market will fall drastically.

Paul also points to the meteoric rise of cryptocurrencies, particularly bitcoin, could also signal that there is more inflation than people realize. He also points to the fact that in the 1920's the CPI wasn't going up so no one was worried but the stock market went up a lot until it eventually crashed. The Fed currently isn't worried because the CPI isn't rising and they are keeping interest rates low. He believes there is a huge bubble but can't pin point what or when it will actually burst.  Its interesting to see that people are noticing some things that are potentially wrong and are ignoring it so they can soak up the last remains of this economic growth. These potential gray rhinos could be catastrophic and many people will be blindsided by these effects. 

Puerto Rico has suffered a lot of damage from the recent hurricanes of 2017. They have been without power, their economy has taken a hit and there are thousands of abandoned dogs roaming the streets. As the economic crisis got worse many people could not afford to care for their dogs. The total amount of strays is still unknown but there was a documentary in 2010 about the problem that was called “100,000” for a reason. Puerto Rican culture does not neuter dogs so these strays dogs continue to breed and make the problem worse. One woman rescued over 1,100 abandoned animals in Puerto Rico last year. There is a stretch of sand and jungle in Puerto Rico called dead dog beach where people go and dump their dogs. I think there needs to be a requirement to get dogs neuter and have fewer restrictions on veterinary licenses in order to help remedy the situation. I know as humans it’s easy to only care about ourselves but I feel no living entity to should have to suffer and the dogs in Puerto Rico are definitely suffering.

http://money.cnn.com/2016/03/20/news/economy/puerto-rico-crisis-stray-dogs/index.html

The end of labor growth

In November, the American economy supplemented 200,000 fresh jobs. This amount of jobs have been added consistently after 2010. As a result, the total number of jobs added to the economy reaches 17.2 million new jobs. Additionally, consumer confidence escalated levels that have not been reached in 17 years. Along the same lines, the stock market keeps ascending to record high levels.

Although the demand for goods and services keeps climbing, companies are desperate to find people to hire. The consistent energy of the economy seems to be pushing itself to its limits. Economists are not expecting jobs creations to increase in 2018, not because companies are not hiring workers, but because there will not be people to take these jobs. This is as worst as it can get. The economist Jennifer Lee states, "If we see fewer jobs created it won't be because of slower demand. There's just not enough workers." In other words, the economy is making progress and does not show any indications of slowing down.

https://www.marketwatch.com/story/dont-expect-strong-us-hiring-to-keep-up-in-2018-2017-12-02

US President’s Mental Health in Question

https://www.cnbc.com/2017/12/01/psychiatrists-warn-trump-becoming-more-mentally-unstable.html

Psychiatrists all over the United States are banding together to request a mental health assessment on president Trump. They believe stresses such as a decrease in popularity, the tension with North Korea, and his campaigns contact with Russia are all causes of his recent impulsive behavior. He has been acting out in anger, and using racial and sexist slurs in his responses lately.

They also stated that institutionalization is a common response to these behaviors.

If these psychiatrists are correct in their assumptions, this could greatly affect the confidence of consumers and investors. If we were to abruptly lose a leader, that would facilitate great insecurity of the future for consumers. And when things are unsure in an adverse way, people tend to tighten their spending. Could this lead to even lower inflation, or even deflation ? 

Economy Has Room to Grow. Here's Why.

The evidence that the U.S. economy has been accelerating is thinner than the headlines shout. But with the rest of the world economy improving and a possible tax-cut jolt coming soon, the good news is there is room for a pickup in growth.

In the years since the financial crisis, the U.S. economy has been in a deep rut: Growth averaged just 2.1% a year from the end of the recession to the first quarter of this year, making it the most tepid expansion on record. But lately GDP has perked up, growing at a 3.1% rate in the second quarter and 3.3% in the third. Put that together with steady hiring and an ebullient stock market, the economy looks very strong.

But much of the strength in GDP over the past two quarters wasn’t actually the result of stronger domestic demand. Instead, the growth was driven by a narrowing of the trade deficit and an increase in inventories, both of which will likely prove temporary. Absent trade and inventory swings, demand grew at an average rate of 2.4% over the past two quarters, matching the average pace over the previous four quarters.

https://www.wsj.com/articles/economy-has-room-to-grow-heres-why-1512309600

Venezuela unveils virtual currency amid economic crisis

http://www.bbc.com/news/world-latin-america-42217798



Nicholas Maduro, the Venezuelan President, announced that Petro, the new cryptocurrency, will be created. 
Venezuela has been pressurized economically by the US and the EU. Their economy is also staggering severely, due to reducing oil prices. They owe a debt of around $140 billion to foreign creditors as well. The Bolivar (Venezuelan currency) value is dropping on top of the two bad news. President Maduro's attempt is to ease the economic crisis his country is facing at the moment. 
However, if Petro is relying on its country's remaining resources, which, in my opinion, is not that abundant, will not influence the Venezuelan economy greatly. It just seems to be a blunt statement made out of desperation. Simultaneously, bitcoin value has gone up. Perhaps the Venezuelan President got a great idea by finding out that bitcoin is the new real deal. Its greatest advantage is that it does not follow the rules of the standard currencies, which always change in value due to economic situations and relations between countries. Petro value, according to President Maduro, will be based on oil, diamond, and gold reserves that Venezuela owns. How will he be able to create a mechanism to make Petro valuable, when Venezuela cannot get a hold of that much on its own? If he is serious about the plan, there has to be a very well-thought method to make Petro a precious currency. 
I am curious of how President Maduro is going to pull out the creation of a new cryptocurrency. As much as it sounds preposterous when Venezuela is in a pickle, I am interested to see if the new virtual money will save the country.

American Airlines’ New Rule on Smart Bags: Battery Must Be Removable

American Airlines aid that they will not allow passengers to check or bring a smart luggage unless they remove the batteries that fuel the high-tech features. The rules will take effect on January 2018. Ross Feinsteinm Spokesman for the airline stated, “We’ve looked at the prevalence of these bags as they most likely are going to be a hot item, no pun intended, this holiday season,” he said. “We have nothing against a smart bag, we understand customers like them,” but the airline also has to make sure they are safe to transport”

Federal Aviation Administration already ban passengers from carrying lithium batteries in their checked bags to avoid any smoke or fire in the cargo area and for that reason, American Airlines will only allow smart luggage onboard if the battery can be disconnected.

https://www.cntraveler.com/story/american-airlines-smart-luggage-ban 

Are we on the verge of another stock market crash?

Predictions that there may be a stock market crash are increasing in number. The OECD (organization for Economic Cooperation and Development) recently joined the club to warn that financial asset prices have increased rapidly and risk a sudden and rapid downturn because they are so overly valued.  While the US GDP is expected to grow by 2.5% next year, this kind of steady growth is out of synch with the surging stock market prices and other asset prices. The stock market is not likely to continue down this road.

In fact, the chief economist at the OECD said the economic cycle may be near its peak right now for the global economy. A Reuters article reported that OECD economists are saying that global economic growth may peak at its eight year high next year. According to a Wall Street Journal article, the OECD thinks the US and the Eurozone may be at a seven year high for their GDP growth. Without a significant increase new business investment in all of these countries, economic growth cannot continue at a strong pace, according to the OECD chief economist

It’s also concerning that interest rates are so low right now because that means it would be difficult to  expand monetary policy by further reducing rates to get GDP to increase—if there is an economic downturn that needs this kind of policy action. Hopefully, the global economy is not headed into a financial crisis as it did ten years ago.

https://www.bloomberg.com/news/articles/2017-11-28/oecd-warns-markets-too-optimistic-as-global-economy-peaks-jajgbey4

https://www.reuters.com/video/2017/11/28/oecd-growth-to-peak-in-2018-economy-flyi?videoId=373063954

https://www.wsj.com/articles/oecd-sees-global-economic-growth-reaching-seven-year-high-1511863206

CVS to Buy Aetna for $69 Billion in a Deal that May Reshape the Health Industry

https://www.nytimes.com/2017/12/03/business/dealbook/cvs-is-said-to-agree-to-buy-aetna-reshaping-health-care-industry.html


----------------

CVS Health announced that they had agreed to buy Aetna for approximately $69 billion. This is phenomenal, as Aetna is one of the largest, and affordable health insurers.This is phenomenal in most people's lives, since they both are large providers of service and medical items for the public. The change this unity would bring in the hectic situation of fluctuating medicare policy would be huge.

Some worry that the two giants' integration may limit the choices of the customers, since Aetna insurance users would have to use the CVS services to receive most of the benefits. However CVS Health and Aetna both said they will focus on transforming their clinics and pharmacies into  community based healthcare centers, which lets the customers use their goods and services at a much less cost.

According to what CVS and Aetna is indicating, the change they are intending to make seems to be very positive for the majority of the people in the US, since healthcare is getting more expensive. Healthcare, also is one of the components that take up a significant portion of the GDP. I hope this coalition of two large companies that work on health brings beneficial deals for the public. Their goal fits the purpose of healthcare, which is to help and cure whoever is sick, regardless of how rich or poor you are. I think America needs such changes right now. The current policies are not very much in favor of medical, education and foreign entities. I hope these two companies bring health care closer to the citizens. not further away from them.

Strategist Jim Paulsen says prepare for a stock market correction in 2018

https://www.cnbc.com/2017/12/02/strategist-jim-paulsen-says-prepare-for-a-stock-market-correction-in-2018.html

This article gives the opinion of a famous and respected investment strategist, Jim Paulsen. Paulsen, like many other analysts, believe the market as well as the economy are due for a correction. This article is very timely because we had just heard from three economic experts at the economic outlook conference. While all of those panelists had positive outlooks on the economy going into 2018, they also had warned of a potential correction or pullback from the intense growth we have been facing.

Since 2007-2008, our economy has been recovering, very strongly. We have hit new highs in the stock market almost monthly, unemployment is at some of its lowest rates in decades, and while the Fed worries about inflation, the lower prices are actually positive to consumers in the short run. Recently, investors have worried about a correction in the market due to the over-inflated stock values, index prices, and other indicators. Also, many believe an asset bubble is forming, one that is similar to the housing bubble in '07. 

Paulsen has suggested people start to reallocate their funds amongst their portfolio. It is time to move money out of riskier investments, and into safer, less volatile investments. He says that people shouldn't worry to much about the stock market right now and still believes we will see growth in values and stock prices well into early parts of 2018. However, people cannot get complacent as a correction is almost inevitable. Every 8-15 years the market experiences a correction in share prices. We are approaching that time and all of the other indicators have pointed that a correction is pending.

The problem is, no one knows when the correction will happen. No one knows how big or how small the correction people. Lastly, people don't know what industries, sectors, or firms will get hit the hardest. Paulsen says to rebalance some of your sector exposures and to allocate funds to safer sectors that can still perform in an economic downturn or correction. 

What do you guys think? Do you think the market is heading for a correction? If so, how hard will the market be hit? 

Major automakers post mixed November US sales results

The automobile industry had a tough time in the month of November seeing sales drop as they try to boost their numbers right before the end of the year. The month of December will be a big month for the auto industry as this usually is a busy time for them but with numbers dropping throughout the month of December it will be interesting to see how the markets will be. General motors reported a 2.9 percent decrease in sales but crossovers and SUV sales have risen. With Fiat Chrysler Automobiles also taking a 4 percent decrease in sales, it was strange to see ford motor company have a rise in overall sales of 6.7 percent. Ford also reported having a sales increase with there small SUV's and crossover vehicles. Price competition between auto makers should still be fairly strong in the month of December and into 2018.

https://www.cnbc.com/2017/12/01/major-automakers-post-mixed-november-us-sales-results.html

Bitcoin Reaches all-time high

Today, Bitcoin hit its all time high of a value of $11,773.83.  I really do not understand that much of Bitcoin but it has been very fun to watch the growth over the past couple months.  Even from the past week its value has plunged 20% last week and bounced back this week to hit over 11,700.  According to Michael Novogratz he believes that by the end of 2018 Bitcoin will reach and estimated value of around $40,000.  I really find that estimate very hard to believe.  From what I know about Bitcoin I know that people stop finding a use for Bitcoin/ if it gets regulated in the future I see the value significantly going down because people will not see a use for it when there are already enough ways to buy things over the internet.  In my opinion if Bitcoin does end up taking off to what some think will happen it will eventually put physical currency like coins and bills out of society.  That is very weird to think about because the physical currency is something we have been using for over 150 years and to think that it could be completely irrelevant.  I would love to here all of your opinions on what you think of Bitcoin and whether or no you think I am correct saying that it could put physical currency out of the loop.

https://www.cnbc.com/2017/12/03/bitcoin-hits-all-time-high-above-11700-as-recovery-accelerates.html

The rich get richer, and millennials miss out

Buoyant financial markets indicate that global wealth increased by 6.4% in one year since last June.The fastest pace since 2012, and there have been 2.3 million new millionaires added to the currents according to the Credit Suisse Research Institute’s global wealth report. The highlight of this report however, the sharp divide between the wealthy and the poor. The top 1% own more than half of all global wealth.

Americans dominate the ranking of millionaires 43% of the global total. Japan and Britain each see drops in millionaires due to depreciation of their national currency. The biggest wealth gains proportionally happened in Poland, Israel, and South Africa thanks to stockmarket and currency increases. On the other end of the spectrum, Egypt lost nearly half of its wealth in dollar terms. Switzerland remains the country with the biggest mean and median wealth per person.

The unfortunate part is the wide generational gap: millennials as in those who reach adulthood in the current millennium, are falling behind in wealth stakes. Americans between the ages of 30-39 are projected to have amassed 46% of less wealth than the same group 10 years prior. Experts are blaming higher students debts and housing ladder difficulty as reason millennials have not formed a nest egg. This might pose the issue of when baby boomers seek retirement and sell their assets, millennials might not be able to afford them.

https://www.economist.com/news/finance-and-economics/21731434-more-half-global-wealth-owned-top-1-rich-get-richer-and

Withdrawal from NAFTA would damage Texas’s economy

Abandoning NAFTA would trigger disastrous consequences for Texas workers and businesses throughout the state. Over the past two-decades, NAFTA has powered the growth of Texas’ economy. Almost one million jobs in Texas are supported by trade with Mexico and Canada. In 2015, Texas exported more than $125 billion in goods to Mexico and Canada. This means that the economic activity in Texas is supported by exports to countries like Mexico and Canada.

In San Antonio, Texas, trade is crucial for the city’s well-being, accounting for nearly 10 percent of the city’s economic activity.

In the rail industry, Texas takes a critical role in the supply chain as it serves their customers and makes sure their products move seamlessly throughout the United States. U.S. companies rely on Texas to get their goods from point A to point B safely and on time. Texas’ business depends on trade 42 percent of rail carloads and NAFTA has been a key element in growing that percentage.

Last year, 42,000 employees transported more than 9.7 million units of goods across the United States. With NAFTA, customers gained access to new markets in Canada and Mexico, increasing the number of goods they exported and imported.

Withdrawing from NAFTA would result in new taxes in the form of tariffs levied on goods exported to Mexico and Canada, reducing the competitiveness of U.S. products in Mexican and Canadian markets.

In 2014, NAFTA supported more than 12 million U.S. jobs across all 50 states. In Texas alone, trade with Mexico, its largest partner, supported nearly 400,000 jobs in 2014. And these are comparatively well-paying jobs, with estimates showing that more export-intensive industries pay workers 16 percent more than less export-intensive ones.

The ongoing NAFTA negotiations do provide the opportunity to strengthen and modernize the agreement, bringing it into the 21st century. To ensure NAFTA continues to serve U.S. interests, the country should look to include provisions that promote e-commerce and digital trade, strengthen intellectual property and help businesses of all sizes gain access to Mexican and Canadian markets.

http://www.mysanantonio.com/opinion/commentary/article/Withdrawal-from-NAFTA-would-damage-Texas-s-12399375