The Federal Reserve Board Fines Well Fargo $67.8 Million

        In 2015 it was revealed that Wells Fargo had been creating fake deposit and credit accounts under customer’s names without their knowledge or consent. Specifically, it was reported that Wells Fargo had created a total of 2.1 million fake accounts (later amended to 3.5 million in 2017). Ever since this incident consumer trust in Wells Fargo has deteriorated over years. Most recently, the Federal Reserve Board fined Wells Fargo $67.8 million for overly risky practices regarding oversight of its subsidiary banks. Wells Fargo’s lack of oversight enabled foreign banks to process approximately $532 million in transactions between 2010 to 2015, which is a direct violation of U.S. sanctions regulations. The U.S. Department of the Treasury’s Office of Foreign Asset Control will also be imposing its own separate fine on Wells Fargo. Along with the Federal Reserve board, the total fine is estimated to be around $97.8 million. 

Article: https://www.federalreserve.gov/newsevents/pressreleases/enforcement20230330a.htm 

Home Construction is Slowing Down

 After having a strong month of February housing construction has slowed down drastically in March with building permits are down 8.8%. In the housing market, new home construction is a bright spot as more and more people have a demand for new homes. This is a boost for home builders having that there is a shortage for existing homes. 

The problem is that because of an increase in the interest rate, resale inventory as become pricy. There is also a lack of access in electrical transformer equipment making it hard for homebuilders to keep up with demand. People want homes but builders are having a hard time gathering supplies in time. 

Another factor that is hurting the housing market is that everyone that bought a house during covid doesn't want to sell it. People don't want to sell because mortgage rates were about 3% during the pandemic and are now double that. Nobody is selling and this is hurting the housing market.   

https://www.usnews.com/news/economy/articles/2023-04-18/new-construction-softens-in-march-with-permits-down-8-8

 

Ukraine Resumes Electricity Exports Despite Russian Attacks

 Ukraine has once again begun resuming electricity exports after being shut down six months ago due to the invasion of their country by the Russians. Ukrainian Energy Minister Herman Halushchenko announced that all domestic energy consumption demands are now being fully met and that they even have reserves of energy ready to be exported thanks to the hard work of their engineers. 

After attacks by the Russians on the Ukrainian infrastructure forced the Ukranians to stop exporting energy in October, many engineers were forced to risk their lives so their people could at least have some power. Despite their brave efforts, it was still a grueling battle to keep tens of millions of people warm during a harsh winter without electricity. 

With temperatures now rising, there is less domestic demand for energy and more renewable sources to help produce more energy. The first country that will receive these exports will be Moldova. Poland, Slovakia and Romania are also expected to be recipients assuming that Ukraine can handle the demand despite the continued efforts of invasion by Russia. Ukraine will also begin to try to ramp up their post-invasion energy use, in the hopes that they can soon become fully integrated with the European system. 

This is not only a good start for Ukraine, but a move in the right direction for Europe as a whole. 

https://apnews.com/article/russia-ukraine-electricity-exports-kyiv-infrastructure-52ac0192db4f6c1851ee2cb0b5142a63

Trump's legal battle.

To the allegations of hush money, Trump submitted a not guilty plea. Donald Trump, the former president, has been charged with 34 felonies, including violating election laws and falsifying company documents.He is accused of paying Stormy Daniels a hush sum of money prior to the 2016 election. Daniels also alleges having an affair with him. Trump intends to run for president in the upcoming election and claims this is a democratic consipracy to interface his elections. 

Although hush money payments are legal, the prosecutor claimed that Trump falsified his business's record and violated election laws by hiding the payments, which is against the law. If he is found guilty, each charge against him carries a four-year prison sentence.

This case may also have an effect on his chances of receiving the Republican presidential nominee and on his career in politics.

 

N.B.A. Blames Economy for Hiring Freeze and Budget Cuts

The N.B.A., citing “economic headwinds,” instructed league office staff on Tuesday to reduce expenses and significantly limit hiring for the rest of the fiscal year. The memo was sent by Kyle J. Cavanaugh, a league executive, and David Haber, the league’s chief financial officer. The memo said the N.B.A. was “facing a very different economic reality than just one year ago.” It continued, “We are seeing significant challenges to achieving our revenue budget with additional downside risk still in front of us.” The N.B.A.’s next fiscal year begins in October, roughly lining up with the start of the 2023-24 regular season. The NBA spokesman did not address which league initiatives would be affected by the cuts or layoffs. The changes come just before the N.B.A. playoffs and a day after the league noted setting a record for attendance and sellouts for the 2022-23 regular season. On April 1, the league and the players’ union announced that they had tentatively reached a new collective bargaining agreement that would go into effect next season. During negotiations, the Boston Celtics’ Jaylen Brown, an executive vice president in the union, told The Times that players wanted “more of a partnership” with the league, including the sharing of more of the N.B.A.’s revenue streams. Last year, N.B.A. Commissioner Adam Silver said the league expected to take in roughly $10 billion in revenue for the 2021-22 season, between sponsors, television deals, attendance, merchandising and other revenue streams.

link: N.B.A. Blames Economy for Hiring Freeze and Budget Cuts - The New York Times (nytimes.com)

The Impacts of War on Yemen's Already Unstable Economy and the Integrative Recovery Approach

In 2014, the rebel group Houthis overtook the Yemeni government in a show of anti-Western sentiment. Since then, 14 percent of Yemeni civilians have been displaced, with countless others dead at the hands of terrorists. This post seeks to outline the impact of these atrocities on people's livelihoods and provide several possible solutions.

Hanna et al. (2021) find that nearly 60 percent of the countries 377,000 deaths have been caused indirectly by lack of access to food, water, and healthcare. Out of these deaths, most of them are children. If the war continues until 2030 (meaning that international intervention is a failure), then there will be an estimated 1.3 million deaths.

Hanna et al. (2021) recommend several strategies to fix the problem in the long term, including the Fragmented Recovery and the Integrated Recovery approaches. In this model, they posit that the Integrated Recovery model is ideal and should be pursued. Where as the Fragmented Recovery approach focuses on symptoms rather than root causes, the Integrated Recovery approach addresses the systemic causes underlying the conflict.

The Integrated Recovery approach involves including more women in the solution making; engaging the international community more effectively; better connecting the public and private sectors; and investing in key Yemeni economic sectors to boost productivity.

The integrative approach has the possibility to improve the lives of women and reduce poverty, which will prioritize sustainable peace and focus on the root causes of the conflict, namely weak institutional governance. While ambitious, Hanna et al. (2021) believe that it is the solution to fix Yemen's worsening social and economic situation.

https://reliefweb.int/report/yemen/assessing-impact-war-yemen-pathways-recovery

NFL Draft

It is no secret that the NFL Draft is a major event for many athletes and tourists. The economic impact this event has on its hosted area is quite astonishing. This draft will take place in Kansas City for the year 2023 and it is expected to see around 350,000 visitors during this period. The city is expecting to see 62 million dollars spent on accommodation, 6 million on transportation, 17 million on foods and beverages, and 8.6 million in general business spending. With high numbers such as these, it has cities like Kansas City considering hosting events in the future like possible World Cup games. Large sporting events have a huge start-up cost, although the overall benefit of these events outway the initial costs. The overall economic impact of major sports events is continuously showing positive outcomes. More visitors to cities means more profit for local businesses and corporations. This is again good for the cities, but it also raises the question of where this money is going. On the exterior large cities might seem nice, although low-income neighborhoods are abundant within these same areas. If large cities were to take more sporting events like World Cup games into consideration would we see a change in something like this or would it only create more problems? It is easy to only focus on the large amount of money that is to come from hosting events. Therefore, there has to be a cost-benefit analysis done when looking to have large sports performances come to your city. There is a great economic benefit when hosting things like the NFL Draft, although many cities choose to keep away from the continuous flow of tourists. 

Source:

• Palmer, T. (2022, November 2). NFL Draft, World Cup each expected to generate $100m-plus in economic impact. KSHB 41 Kansas City News. Retrieved April 7, 2023, from https://www.kshb.com/sports/nfl-draft-world-cup-each-expected-to-generate-100m-plus-in-economic-impact#:~:text=%E2%80%94%20Both%20the%202023%20NFL%20Draft,according%20to%20Kansas%20City%2C%20Missouri.  

Chat GPT and the Economy

We have all heard by now about the artificial intelligence chatbot platform, Chat GPT. It has been quite a revolutionary development in the AI industry, but what impacts does/will it have on our economy? Many fear that the program will replace some jobs or even industries. However, it opens doors to completely new industries. AI Chatbots can lead to improvements in sustainability, education, science, entrepreneurship, and personal finance. 

It is unknown how large the effect will be, but it is undeniable that we will definitely see a change in our economy due to this technology. However, it is also important to make sure chatbots are used ethically and that any biases are eliminated from systems. 

https://innotechtoday.com/chat-gpt-is-just-the-beginning-of-the-ai-economy/

Elite Women Changing Basketball for Themselves

Women's basketball has never been big in todays society. Whether it is NCAA or WNBA, there has always been a big difference between its partnered men sports. As March Madness comes to an end, we have  witnessed a shift in women's basketball as it continues to get bigger and bigger. 

Well before last weekend, it was clear that the NCAA Division I women's basketball tournament of this year would go down in history. Discussions over the best player have been blooming. The level of play is really high. Most significantly, there are more viewers than ever before.It’s worth celebrating that viewership for women’s basketball is skyrocketing, even though eyes on the men's game has declined.

ESPN said viewership for the women’s Sweet 16 was up 73% compared to last year, averaging 1.2 million viewers per game. Elite 8 viewership was up 43% for an average of 2.2 million per game.

Not only are more people watching the women's game at home, but it will also cost more money to attend the women's Final Four in person than the men's Final Four. The lowest price for tickets to both women's games on StubHub as of Thursday was $428 before fees, while the lowest price for both the men's games was $68.

Meanwhile, secondary market prices for the women's semifinal and final in Dallas this weekend more than doubled compared to 2022 figures, according to ticketing technology company Logitix. The price per ticket for the semifinal was $367, up 120% over 2022. And the price for the final was $351, up 103% over the prior year.

Secondary market prices for the men's semifinal was down 26% from last year to $819 and down 28% for the final to $415.

The demand for women's sports is increasing, which is fantastic and shows that if you invest in it, fans will come.

Social Security Benefits Cut Off

     Social Security Benefits are forecasted to runout in 2031. Social Securities are paying out more in benefits than it is collecting in pay roles and interest. As the baby boomers continue to age there are fewer people working and fewer people paying into the system. The trust fund is going to run out cash for the system in about ten years. If this happens, everyone that relies on social securities checks will have theres cut by about 23%. So, do we need to raise taxes or cut benefits or higher the retirement age to help this foreseeable crisis?

    Politicians have not been looking into this whatsoever. Apparently it is way too far down the line to focus into for a parties four year term. Economists say the sooner we focus upon this crisis the sooner it gets solved. The later we got focus upon this crisis the worse it will get and the harder it will be to solve. 

    Most economists suggest not to look into something directly, but to look at all aspects. For example, instead of cutting out a big chunk of retirement (401k), cut a little from retirement, raise taxes a little and increase payroll. Maybe you even decrease benefits from upper class people. If wealthy people already have a lot of money in their retirement, why do they need social security?

To conclude, Social Security benefits and medicare is something retirees rely on. We cannot just take that away from them. This matter needs to be dealt with sooner than later.

https://www.npr.org/2023/03/31/1167378958/social-security-medicare-entitlement-programs-budget