31 July 2019

1) One of the nations largest credit card companies Capital One announced a massive data breach which affects tens of millions of customers. This news has sent its stock down 7%. Most of the data lost to hackers was personal information such as names, addresses, phone numbers and income of consumers and small businesses from 2005 to 2019. About 140,000 Social Security numbers of customers was comprised with 80,000 bank links. This breach is one of the largest yet.

2) China and America have resumed trade talks in Shanghai after a three month suspension. President Trump has criticized China for it’s reluctance to buy U.S. agricultural products, the Chinese using this as a pressure point on Trump with many farmers having previously supported Trump. There are low expectations for a breakthrough in trade talks because the two sides are further apart now than three months ago.

3) American consumer confidence is at the highest level since November negating its June drop. The index rose from June’s 124.3 to 135.7. The index measures consumers’ assessment of the current economic conditions and their expectations for the next six months. Consumers have little concern for trade tensions with China or a slowing economy. This should translate into robust spending in the near future.

4) Stock market closings for – 30 JUL 19:

Dow               ,198.02    down    23.33
Nasdaq       8,273.61    down    19.72
S&P 500      3,013.18    down      7.79

10 Year Yield:    up   at    2.06%

Oil:    up   at    $58.34

30 July 2019

1) The once high flying German Deutsche Bank has run aground rapidly slashing jobs and losing a ton of money. Stock for Germany’s biggest lender is trading at a near all time low. This is a result of poor management and failing to fully clean up its crisis era balance sheet. The banks restructuring efforts have fell short coupled with countless legal black eyes that have all contributed to the bank’s financial woes.

2) The pharmaceutical companies Pfizer and Mylan have announced they are combining to create a global powerhouse in the low price drug market. Pfizer will gain most control of the company with 57% ownership, with Mylan shareholders owning the rest. Both companies lost exclusive manufacture rights from patent expirations, that were big money makers for the companies. Mylan, is the manufacturer of the emergency treatment for allergic reactions, the EpiPen. Mylan has recently been in the news for raising the price of EpiPens by 400%.

3) J.C. Penney, the 117 year old department store chain, is at risk of being de-listed from the New York Stock Exchange. To counter its downward spiral, the company has hired advisers to explore debt restructuring. Penney has $4 billion dollars in debt coming due in the next few years, while its revenues are increasingly being lost to sales on the internet and niche brands. Revenue has fallen over the last three years. The retail giant Sears has suffered similar troubles.

4) Stock market closings for – 29 JUL 19:

Dow                 27,221.35        up   28.90
Nasdaq               8,293.33   down   36.88
S&P 500              3,020.97   down     4.89

10 Year Yield:    down   at    2.06%

Oil:    up   at    $57.13

29 July 2019

1) Newly released reports says that raising the minimum wage to $15 per hour by 2025 will raise the wages for 22.2% of American workers. They claim that 33.5 million workers would experience a $92.5 billion dollar increase in pay or $2,800 per worker. Currently, the minimum wage is $7.25 per hour, but it’s not expected such legislation to increase the federal minimum wage can pass through congress and not be vetoed.

2) China is looking for new markets to sell to. Presently, it has too many factories making too many goods because the trade war has diminished sales to its biggest customer America. China is seeking to create free-trade zones across the Asia-Pacific region in the hopes of opening new markets. Additionally, China is talking with Japan and South Korea to lower trade barriers. The problem is no country can absorb the volume of goods that China sells to America.

3) High tech companies are taking business to Canada and her supple of technology skilled immigrants. Canada has more relaxed controls over entry for workers having the education and skills sought by high tech companies, and therefore provides a base for such companies to expand into. Canada processes work visas for such workers in weeks, while the U.S. is noted for its long delays to grant the needed visas.

4) Stock market closings for – 26 JUL 19:

Dow             27,192.45    up    51.47
Nasdaq          8,330.21    up    91.67
S&P 500         3,025.86    up    22.19

10 Year Yield:    up   at    2.08%

Oil:    down   at    $56.16

The Car – End of the American Dream?

Some claim the personal ownership of automobiles is coming to an end, so will Generation-Z forego the romance of their fathers?

James Lyman BSAE, BSEE, MSSM

In my youth, the cult of the automobile was integrally interwoven into American culture, almost like a second religion which people constantly talked about, their thoughts dominated by machines ranging in all sorts of sizes, shapes and colors. Americans lived, breathed and slept with dreams about their beloved road machines and how perfect their lives would be if only they could own and drive the cars of their dreams. At casual social gathers, discussions abound over the virtues of one model verses the deficiencies of another. People were committed Ford or Chevy people who would never commit the mortal sin of buying from another car maker, a rivalry akin to loyalties of baseball and football teams, with all the same blind adherence to a maker as found amongst religious fanatics.

But over the years, I seen a decline of this adherence to the cult of automobiles, younger generations less inclined to worship cars as previous generations did, as automobiles took on a sameness forced by the laws of physics and the quest for higher gas milage and safety. The romance of their cars coming to an end … as car prices spired into the wild blue yonder. And I must confess, I was one of the early adherence to this trend considering the automobile to be nothing more than another utility appliance much like my washing machine and refrigerator. Just a machine to perform certain tasks in my life. Indeed, I didn’t even get my first car until I was eight years out of highschool, because I didn’t really need one and my money was going to education. I’m seventy-one years old now, and I’ve only owned three automobiles in my life. A used 1969 Chevelle 300 series deluxe with a 307 V-Eight, column shift and bench seats. I owned and drove it for about 22 years, then got a used Toyota mini-pickup which I drove for about a dozen years. Finally, another Toyota pickup, a cab and a half Tacoma which I’m still driving today. Why? Because I know it’s cheaper to repair than to buy new.

I tell people I’m like that John Wayne line in the movie ‘The Searchers’ where he says “A white man rides a horse until it drops, then a Comanch comes along, gets that horse back up, rides it another twenty miles . . . then eats it!” A technologist equivalent for a Comanche Indian, a machine substituting for a horse. Despite my ambivalence to the cult of the car and my peers, I was rather surprised to recently read articles that the personal ownership of cars is coming to an end, that automobiles are becoming a service rather than a possession. Their premise is that cars are becoming too expensive to own anymore. The average cost for a new car in America is $33,000. For the young and ‘up and coming’ Americans with earnings significant less than their fathers and grandfathers, this makes ownership even more difficult. Couple that with many young people being saddled with large student loans, it’s easy to see their rational.

But in the highly mobile society that America is, this would have little meaning without some alternative, and that alternative is services like Uber and Lyke that provide driving services coupled with the emerging robotic driving systems which can make this premise valid. Once in place, the young people would call up a robot car much as one does today with taxis. Using an app on their smart phones, they could call for a robot car, the phone’s GPS telling the robot car where to go, then minutes later, the robot stops near the person, who gets in. The robot already knows where to go since that was part of the person’s request for a car. Once arriving, the person only has to get out, payment automatically made electronically, leaving the robot to continue on to its next pickup request.

When I was young, my father commented more than once that it would actually be cheaper to use taxis rather than own a car, that if you count everything, the purchase price, loan interest, annual cost of licenses, taxes, insurance, gas, oil and maintenance . . . the total cost of ownership would exceed the taxi fares paid out. So I can see where purchasing automotive services would be cheaper than ownership of a personal car. Those cost would be distributed over many users, especially that $33,000 purchase price. For Americans with little hope of having the financial means of their forefathers, the use of technology to share the cost and thus reduce their living expense might be a viable alternative.

In recent years there has been an upsurge in something called ‘tiny houses’, where people choose a life style living in domiciles of just a few hundred square feet, a small fraction of the sizes of houses they were raised in. This allows the young of limited means to own their own home without the exorbitant cost of a conventional house. Sharing robot automobiles keeps with the strategy of reducing cost to accommodate the reduced earnings that America’s youth are facing.

Presently, automobiles and housing comprise about half of the American economy, so the significant downsizing of either or both implies a considerable change to the economy in general. Add to this the increasing demise of many big box stores, we are left with the question ‘Can our present hyper-consumerism based economy survive?’. More importantly, the real value of Americans is as consumers, so just what is going to be left for America’s Generation-Z in the future? And even more crucially, just how satisfied will they be to accept so much less?

Makes one wonder what other means might come forth for the young people of America to live and prosper in their new world . . . a world far different from my days of youth.

EFR PODCAST EP. #33: SOCIAL ME-DIA MANAGERS feat. KEITH DORSEY

And Yes We’re Back Like Never Before. It’s the EFR Podcast Show featuring me (Sammy BE/Bizman Bassey) @EcoFireTV, James Lyman @ObsoletePeople & on the boards Jon Don Sterling @TheDramaBlock.

On this episode #33, the group interviewed social media manager Keith Dorsey @YoungGunsCEO. He happens to assist managing the careers of online mega stars such as RobbiiWorld, Hollywood Dollz & Woah Vicky.

Keith came on the show to discuss social media presence, online platforms, attaining a lucrative online following and base, as well as productive advise for young entrepreneurs, trying to thrive in media… This is an episode you got to listen to…..

As always #BEBless #StayBless #GODBLESS #RealRecognizeDeal

Remember that “WE ALL HAVE A VOICE & OPINION, IT’S JUST HOW U USE YOURS”
Check Out Our Online Platforms:

1) www.instagram.com/EcoFireTV (Sammy BE)
www.twitter.com/EcoFireTV

2)www.twitter.com/ObsoletePeople (James Lyman)

3) www.EconomicandFinanceReport.com (Economic & Finance Blog)

4)@Economic-FinanceReport (Podcast/Online Show)

5)www.youtube.com/channel/UCWZo5bug…Nlb2VRfDCQ/videos (EFR.Tv Youtube)

6)www.SammyBuysHomes.com (Real Estate Investment)

7) www.TraderSoul.com (Financial Trading Website)

26 July 2019

1) Tesla, the manufacture of all-electric automobiles, has suffered a worse than expected loss. Additionally, there has been another major management shakeup, all of which is casting doubts on the future of the unique automaker. While Tesla delivered a record number of cars in its second quarter, its stock dropped 14% with a loss of $1.12 per share. Nevertheless, Tesla has opened twenty-five new stores and service centers.

2) Concerns grow that the trade tensions may be pushing U.S. economic growth downwards. Fears that the gross domestic product figures due out this Friday will show business investment has weakened. Additional factors stem from slow global growth and falling oil prices. The gains in jobs and wages are preventing growth from sinking. It’s anticipated that the Federal Reserve will lower interest rates by a quarter point to check softening of the economy.

3) Nissan, the world automobile manufacture, has announced the layoff of 12,500 employees worldwide, or about 10% of its work force. Nissan is striving to rein in the costs increases incurred during the former CEO Carlos Ghosn tenure and alleged financial misconduct. Japan’s number two automaker has suffered a collapse in its quarterly profits, a result of sluggish sales and rising cost. This is another indication of the world’s depressed auto market with other renowned automakers like Ford suffering similar major financial problems.

4) Stock market closings for – 25 JUL 19:

Dow             27,140.98    down    128.99
Nasdaq          8,238.54    down      82.96
S&P 500         3,003.67    down      15.89

10 Year Yield:    up   at    2.07%

Oil:    down   at    $55.91

25 July 2019

1) Boeing Aircraft, the manufacture of the now grounded 737 MAX, has not ruled out further reductions or even shutting down production of its 737 MAX. Boeing had cut production of its best selling jet from 52 per month to 42, a 20% reduction. For its second quarter, Boeing has expended $1.01 billion dollars in cash as a result of the grounding, compared to the $4.3 billion dollars of free cash it had on hand last year. With deliveries on hold, Boeing isn’t receiving payments while also footing the cost of aircraft being stored waiting for re-certification.

2) With the commodity prices of coffee bottomed out and depressed incomes, coffee growers in Guatemala are facing a crisis. This crisis is made worse with threats of tariffs on Guatemala over undocumented migrants. Additional remittance fees and sanctions could spell disaster for Guatemala’s principle export if implemented, which in turn may actually exacerbate the flow of migration as small growers are forced out of business and head north.

3) The food giant Kraft Heinz, faced with a large corporate debt, has been exploring methods to pay down that debt by selling off some of its brands, so it can focus on its staple brands such as Heinz ketchup. But the sale of Maxwell House coffee, Breakstone’s sour cream and cottage cheese and Plasmon baby food, has glean lukewarm response from potential buyers. For years, the giant has been run by a ‘cost focused’ management team, but now management considers the company should be driven more by growth. The soup giant Campbell soup faced the same problems earlier this year.

4) Stock market closings for – 24 JUL 19:

Dow              27,269.97    down    79.22
Nasdaq           8,321.50          up    70.10
S&P 500          3,019.56          up    14.09

10 Year Yield:    down   at    2.05%

Oil:    up   at    $55.94

24 July 2019

1) Technology displacement is graphically illustrated by the print news media with over 2,000 newspapers having closed in the last fifteen years. Once among the largest employers in America, new technologies have continually reduced the work force of newspapers, especially after World War II with the rapid expansion of the electronic news media. Almost all the newspapers in America have financial troubles leaving their future in doubt. The electronic news media has also suffered massive loss of jobs over the decades as new technologies allow operations with fewer people.

2) Over production of eggs has created an oversupply of the food stuff, forcing prices down until producers are losing money. Exports have been down 12% further aggravating the oversupply situation, with the average cost for a dozen eggs now $1.20, which is 26% lower than a year ago. But experts consider the price has reached its low and will soon start creeping up.

3) California’s wine industry is suffering from the trade war with China imposing a 93% tariff on American wine products. This tariff has pushed the price of wine out of reach for most of China’s population, thus drastically reducing exports. This has dropped U.S. wine exports to China by 25% in 2018 with California accounting for more than 90% of America’s wine sales overseas. China is America’s fifth largest market.

4) Stock market closings for – 23 JUL 19:

Dow              27,349.19    up    177.29
Nasdaq           8,251.40    up      47.27
S&P 500          3,005.47    up      20.44

10 Year Yield:    up   at    2.07%

Oil:    up   at    $57.17

23 July 2019

1) Despite the world wide forces that normally pushes oil prices higher, the oil markets remain surprisingly flat. Available oil has dropped with the embargos on Venezuela and Iran, plus tensions over the Strait of Hormuz which would have normally pushed oil prices up. But at the same time, consumption has dropped with China leading the way, plus U.S. oil production continues to creep up. The International Energy Agency recently cut its expectations for global demand for 2019 and 2020.

2) Ford Motor Company stumbles in its attempt for global growth, in particular in trying to expand its market in China. Ford’s auto sales in China are down 27% for the first six months. Ford is being threatened by much improved Chinese’s domestic brands, resulting in a speedy and deep decline in Ford’s sales in China. So Ford is now counting on introducing new-models to revive its sales. Auto sales in China are softening as the Chinese economy slows and with the uncertainty over trade relations with America.

3) American farmers now facing a third obstacle to profits with a stifling heat wave spreading across the continent this summer. First, farmers faced the trade war with China imposing counter tariffs which dropped the demand for food products from one of their biggest customers. Then torrential rains flooded farmland delaying planting of crops and harvesting. Now droughts threaten to severely limit production and harvests. Many farmers may be facing financial disaster by the end of this year, not having the monetary resources to hold out for a better next year.

4) Stock market closings for – 22 JUL 19:

Dow             27,154.20    down    68.77
Nasdaq         8,146.49    down    60.75
S&P 500        2,976.61    down    18.50

10 Year Yield:    up   at    2.05%

Oil:    up   at    $55.74

ETSY BUYS REVERB FOR PRICEY $275 MILLION….

IMAGE CREDIT: Reverb.com

By: Economic & Finance Report

Etsy has stated that it will be aquiring Reverb for $275 million. Reverb is the musical instruments online platform.

Reverb considered to be one of the world’s leading marketplaces for musicians; was created in 2012, in Chicago, IL. The platform is one of the leading musician websites, curated for musicians by musicians.

Etsy which is based in NYC, has recently been aquiring new media businesses but nothing of an aquisition in this caliber. With this acquisition new things shall arise in the music front. -SB