Hikelandia Inflation

An article from the Economist tracks monetary policy in where they call "Hikelandia", which is Brazil, Chile, Hungary, New Zealand, Norway, Peru, Poland and South Korea. In these countries, central banks have started raising interest rates before and more forcefully than America’s Federal Reserve. They found that there was very little evidence that this lowered inflation rates. Core inflation hit a high of 10% while output is shrinking. Core inflation in Brazil is actually falling, but in Hungary, core inflation rose from 19% to 25% in a five month period. They are estimating that that the prices of more than one-fifth of Hikelandia’s inflation basket are rising by 15% or more.

https://www.economist.com/finance-and-economics/2023/02/02/super-tight-policy-is-still-struggling-to-control-inflation

 

MLB average salary rose 14.8% to record $4.22M last season.

    This season, the MLB's average salary per player increased by 14.8%, it is now at an all-time high of $4.22 million dollars. This is the largest jump in salary since a 17.7% increase in 2000 to $1.61 million. The average had dropped in each of the previous four seasons before 2022, sparking player anger that was expressed by the union during a 99-day lockout that ended last March. Payrolls, which are a more complete reflection on spending, rose 12.6% to $4.56 billion from $4.05 billion. The Mets have boosted their payroll to a projected $370 million, well past the previous record of $297.9 million of the 2015 Los Angeles Dodgers. Some owners are arguing for significant change to lessen payroll disparity when the current labor contract expires after the 2026 season. The MLB has assigned another group this month to examine the economics of the league. MLB had $10.8 billion in revenue last year.

    Union head Tony Clark said, "A salary cap is the ultimate restriction on player value and player salary. We believe in a market system. The market system has served our players, our teams and our game very well." Clark suggested some teams maintain low payrolls as strategy rather than because of lack of revenue. He also goes on to say, 'Can or won't is a valid question to ask when teams in an industry that has grown are still in a world where their payrolls are half of what they may have been 10 or 15 years ago." The level of excitement brought from this past offseason of trades, and signings should only help increase the league earnings, so that is expected to jump as well.

Link: MLB average salary rose 14.8% to record $4.22M last season (ksby.com)

U.S. Economy - America Is Trying to Electrify

As demand for renewable energy increases and people try to transition to more sustainable energy sources, electricians, an essential part of the transition process, are in short supply. The new climate law is expected to increase demand for car chargers and heat pumps, putting several hundred billion dollars worth of incentives into the economy designed to accelerate the energy transition. 

The lack of available electricians is most severe in the Northeast and California, where demand for green energy products is highest, and many electricians have retired during the pandemic. As a result, the average annual electrician salary rose from $50,000 to $60,000, with some electricians raising prices and wages due to labor shortages. Industry analysts say it will be challenging to meet that demand. The current total of over 700,000 electricians is expected to grow only 7% over the next decade, slightly faster than the nationwide average of 5%. 

To help address the shortage of workers, the government is trying to introduce tax credits and incentives for apprentices. Also, product makers are trying to make simpler electrical products that won't require an electrician to install, reducing the demand for electricians. Current owners of Electrical Services groups emphasize the need to train apprentices since their work requires training and specific knowledge. 

Source: https://www.wsj.com/articles/america-is-trying-to-electrify-there-arent-enough-electricians-4260d05b?mod=economy_lead_story 

What war has done to European Economy

 European officials anticipated that 2023 would mark the return of the "old continent" to its previous norm of acceptable growth and inflation below 2%. The economy of Europe is undoubtedly slowing down. However, the new normal is much less appealing than economists had anticipated.

On the plus side, since prices surged last summer, gas is currently less expensive than it was before the conflict. Partly as a result of the abnormally warm weather, governments were not forced to ration energy as had been initially feared. After reaching a record 10.6% in October, headline inflation is now declining.

Neither has industry collapsed due to gasoline prices, as conspiracy theorists prophesied. Since the start of the war, energy-intensive factories in Germany have suffered a reduction in output of a fifth as imports have replaced domestic production. By the end of the year, however, overall production had decreased by barely 3%, in accordance with the pre-pandemic norm. The most recent ifo survey reveals that manufacturers are still confident about the future.

The giant job market in Europe can increase inflation. Pay demands are rising as a result of high costs and labor shortages, which are anticipated to get worse as baby boomers retire and fewer young people join the workforce. After only increasing by 3.3% in 2022 and 2.1% in 2021, salaries in the Netherlands increased by 4.8% in January compared to a year earlier. The unions in Germany's public sector are threatening additional strikes. 

In the year to January, the consumer price index increased by 7% without accounting for food and energy. According to the PMI poll, expenses are rising rapidly for services in particular, which could result in more price hikes. The European Central Bank is thus forced to maintain its high-interest rates. Markets anticipate a summertime increase from 2.5% to 3.7%. So, funding for businesses and people is likely to become more expensive, which would hurt investment. According to the bank's lending survey, credit criteria are already becoming stricter.

https://www.economist.com/finance-and-economics/2023/02/23/what-war-has-done-to-europes-economy

Jobs during "rollin recessions"

 "Rolling recession" is the term being popularly used for the U.S. economic slowdown since early 2022. It also means that easier employment will be available in some industries. Although not being in an official recession, some sectors will feel like they are in a contraction. Economists say that the labor market remains tight compared to pre-pandemic levels, but has seen gradual decreases and will continue to do so for the upcoming months. 

It will be easier to find jobs in government administration, education, and consumer services. Industries like tech, entertainment, information and media, professional services, retail, and financial services will have moderately tighter markets. Extremely tight labor markets include accommodation, oil and gas, hospice and health care. 

No slowdown is expected in "recession proof" industries: government, utilities, education and consumer services. Even though the labor market demonstrates strength and overall healthiness, economists still believe in an approximating recession; with no significant impact on labor markets.

https://www.cnbc.com/2023/02/12/heres-where-the-jobs-will-be-during-the-rolling-recessions.html

Europe Has Weathered an Energy Crisis, For Now

 Europe has maneuvered their way through an energy crisis over the last year since the start of the Russian-Ukraine dilemma. For now, a reliance on Russian energy that seemed more like a chokehold a year ago has significantly loosened. Russian gas supplies to Europe have been drastically reduced, and the region seems to be weathering recent bans on most Russian oil without a hiccup. Where do most EU countries rely on their oil and gas now?

Luckily, European nations have made quick decisions on their energy supplies since their former supplier in Russia was hit with many sanctions from the UN. Russia is a large energy (Oil and Natural Gas) supplier. Now, Europe is battling their energy shortages by importing from Qatar, Norway, and the Texas shale oil fields (source rock). 

Representatives have spoke out on behalf of the great EU nations explaining that they may not be out of the woods just yet. Ultimately, as a global society and the overall history of human beings on Earth, we have stumbled upon nothing short of "magic" to a earlier human. We are depleting our ancient energy supplies 10 million times faster than it was sequestered from the time ancient sunlight put in on our planet. Does this pose the question more broad than just the the EU, that are civilizations have become too reliant on this "magical" energy otherwise known as coal, oil, and natural gas? How much is left on Earth (peak oil), and will our renewable energy sources be able to prop up a global economy reliant on constant (infinite growth)? 

Europe has seen only a glimpse into the future...will energy crisis's become common in the near to short-term future?  

XFL looking for a Comeback

 The XFL is looking to make a big comeback in 2023 after having to be bought back to be revived for the second time in only the last three years. 

The first initial purchase of the XFL was done by Vince McMahon, where he was looking to do a massive rebuild with the franchise before getting completely shut down by the covid lockdown in 2020. After have being bought later in the same year of 2020 by Dwyane Johnson, Dany Garcia, and Gerry Cardinale for 15 million dollars, the football league decided to launch its return during this month of February on the 18th.

Without having to be held back by covid, the league is looking to prosper from having no restrictions to attendance and being able to benefit from TV partners who will be paying to broadcast games from the season. The estimated earnings for the XFL in the 2023 season are predicted to be at roughly around 5.2 million dollars. The average price for a ticket to an XFL game is sitting at 51 dollars with the cheapest being 20 and the most expensive being season tickets at 95 dollars, with the average attendance of a game being 10,000 fans. With hopes of having a successful season in 2023 and gaining additional support from sponsors and businesses, the XFL could be looking to opening up an expansion for more teams across the United States.

XFL 2023: Estimated league earnings from ticket sales [update] (msn.com)

Russian Support for Ukranian War is Falling as Economic Troubles Increase

 Approximately 1 year ago, Russia started the war in Ukraine. Almost immediately, other countries bombarded them with economic sanctions to try and hurt their economy. Countries imposed trade sanctions, individual companies pulled out of Russia entirely, and a variety of other things happened.

But now, as the invasion continues, more economic hardships are being felt by citizens, and support for the war is declining quickly. Job loss, lower wages, and food troubles are only some of the difficulties being faced currently. Generally, people just do not have as much money, and they are struggling to make ends meet.

These sanctions, while initially met with some resistance, have now begun to actually take a toll. Not only economically, which would inhibit Russia's ability to produce weapons, but also impacts citizens which decreases support for the war. As the battle continues, we will continue to see how these sanctions affect the Russian population and how much longer the war can really continue.

Russian Support for Putin's War Falling Fast as Economic Fallout Bites—Poll (msn.com)

Spring Break Travel Fares Are Skyrocketing

 If planing to fly over spring break book now. "Already elevated ticket prices are going to climb as people get into the busy travel season, given that demand continues to outstrip capacity". "Hayley Berg, lead economist at travel app Hopper, told FOX Business that demand has already driven airfares on average 10% to 30% higher compared to pre-pandemic times, and it doesn't appear to be letting up either". The average price is 270 dollars per ticket, 20 percent higher than last year and 5 percent higher than pre covid averages. 

This price boost is especially effecting the most popular spring break destinations like Panama City, Mexico, and Europe. "For instance, Europe is up about 15% compared from 2022, though that's far below areas such as the Caribbean, Mexico and Central America, which are up about 60% versus last year and about 30% versus 2019". Prices are expected to continue to rise and it is estimated that by June the average price for a domestic flight will be around 350 dollars. Experts say that prices will likely continue to rise until more low-cost carriers enter the market or there is a drop in the high jet-fuel prices. If you are looking to travel be sure to try and book far ahead of your trip. 

https://www.foxbusiness.com/lifestyle/traveling-spring-break-book-now-hopper

All-Star Economic Impact Roughly $280 Million For Utah

“In terms of the magnitude of All-Star, this is our largest in our history,” Silver said. “They’re estimating the economic impact here in Salt Lake City will be roughly $280 million. That’s an all-time record.” Last season Cleveland reportedly saw an economic impact of $250 million last year, including direct net economic benefit to the city of $141 million.

The average revenue of an NBA franchise was $213.5 million in the 2020/21 season. This is a 19% drop from the season before ($264 million). This alone is exceeding what a franchise makes in a season alone.

“We have an all-time record in terms of hotel nights,” Silver said as part of his praise for the state. “We’re occupying 33,000 hotel nights in the community here, and we have more fan events than any time in history.” The real question is, what does this do for a city? The short term process of growth leads to a city that in the long term will be much larger in scale. With a larger place, that will lead to having more people, businesses are able to grow, more businesses are able to come in, and there's greater infrastructure/ 

https://kslsports.com/498827/adam-silver-praises-all-star-weekend-in-utah/