12 October 2020

1) With the recession from the Covid-19 came predictions of waves of bankruptcy filings as businesses, large and small, failed. But that wave of bankruptcy has not materialized, and so far, there’s no sign that it will, indeed bankruptcies are down a little from last year. This is a good sign that companies and households are not as stressed as many economist feared. However, bankruptcy filings aren’t a perfect measure of hardship, with many companies barely hanging on, so bankruptcies may still be coming. Many small businesses and households go bust without ever formally filing for bankruptcy.

2) The four massive high tech companies, Google, Amazon, Apple and Facebook are under investigation at Federal and State levels for antitrust. These investigations are spurred by concerns that competition is being stifled by the domination of these companies, but there are concerns that the big tech is trying to also stifle conservative voices. Google is facing a relatively narrow complaint from the Justice Department that it seeks to disadvantage rivals in search and advertising. The focus on Apple is their apps store with accusations that Apple introduces new products and then put out apps that compete with them. Facebook has raised concerns over how they treat some of their app developers on its platform and therefore engaged in unlawful monopolistic practices. Amazon is suspected of conflict of interest in competition with small sellers on its marketplace platform.

3) Silicon Valley companies are thinking about the future of work taking actions from pay cuts to permanent work-from-home as they strive to cope with the coronavirus crisis. The big tech companies have formed various plans for the future of work. Some companies, (Twitter and Slack), said their employees never need to return to the office, while others, such as Microsoft, are adopting a hybrid model where employees report to the office only a few days a week. Amazon and Salesforce are adopting new benefits to help out working parents, such as subsidized back-up childcare and extended paid leave, while Facebook, employees may work from home permanently. However, if they leave the Bay Area for a less expensive city, they’ll may face a pay cut. Silicon Valley may bear little resemblance to the thriving hub before the pandemic. Tech companies have largely shut down their sprawling campuses and asked employees to work from home — in some cases, forever. When those offices reopen office life is unlikely to resemble the past. Companies may change their real estate plans, opting instead for a new type of office, or none at all.

4) Stock market closings for – 9 OCT 20:

Dow 28,586.90 up 61.39
Nasdaq 11,579.94 up 158.96
S&P 500 3,477.13 up 30.30

10 Year Yield: up at 0.78%

Oil: down at $40.52

22 May 2020

1) Again, there is additional unemployment this week with 2.4 million people filing for unemployment benefits this last week. This brings the total U.S. unemployment during the pandemic up to 38 million, with continuing claims at 25.07 million, the highest level on record. The good news is the filings continue to decline from previous weeks. So far, there’s no indications that the easing of the lockdowns is having any effect on the unemployment dilemma.

2) The apparel retailer chain ‘The Gap’ is accelerating its implementation of robots in warehouses to assemble online orders, thus avoiding the use of human contact during the pandemic. The Gap is tripling the number of item picking robots in use to 106 by the fall. With the pandemic forcing the closure of its stores nationwide, their online sales shot up just when social distancing rules reduced their staff. Each robot does the work of four humans in a warehoused that was already highly automated. This is an example of increased automation occurring during times of economic shock, leaving fewer jobs for when the economy improves. These are times when employers shed less skilled workers by replacing them with technology and higher skilled workers thereby reducing their labor cost.

3) The second crisis for the American economy is arriving. The pandemic is having sever consequence for state and local governments with lockdowns eviscerating their finances. Monies needed to pay for public services and infrastructure have withered leaving governments to do triage of the services they provide. Basic services such as police, fire fighting, health, trash and water/sewer services are threatened with curtailment for lack of monies to pay salaries and supplies such as gasoline. Such actions is politically dangerous which can fuel political extremism that threatens democracy. Losses of state and local revenues are estimated to be 15 to 45 percent, or an overall loss of $1.75 trillion dollars a year. With growing doubts of re-employment after the crisis passes, this economic crisis is long term.

4) Stock market closings for – 21 MAY 20:

Dow 24,474.12 down 101.78
Nasdaq 9,284.88 down 90.90
S&P 500 2,948.51 down 23.10

10 Year Yield: down at 0.68%

Oil: up at $33.82

Google Invests $2.4 Billion in Tech Hub Real Estate

By: Economic & Finance Report

It looks as if Google will be investing in NYC for the long term. The search engine giant, is closing in on a lucrative  $2.4 billion dollar real estate building, as an addition to its New York City portfolio.

Axios the online web publication reports that the deal seems to be “the priciest single handed real estate transaction on a building, in the history of New York City”. The building happens to be across the street from Google’s current campus facility, in the Chelsea neighborhood of Manhattan.

Google is not the only online mega company who has its sights on New York City, in early fall September 2017 specifically, Amazon indicated a long term economic contract with NYC, and NYS, to lease properties in the west end of Manhattan, and the borough of Staten Island, for the creation and hiring of 2,000 plus new Amazon employees. -SB

DON’T COUNT NIGERIA OUT….. WORK IN PROGRESS……….

Nigeria economy

By: Economic & Finance Report

As a all around businessman, creator, publisher, founder and writer, columnist and to some degree analyst of the economy and finance (as I see fit); I tend to read articles about the economy, business, finance and real estate in other countries and continents.  I currently read an article on Nigeria about its economic state. The article was in Bloomberg News, which covers much of Nigeria and Africa. 

The article pretty much indicated that Nigeria was on “its knees”, and the economic state was crumbling drastically. Since we are an economic and financial blog site, I would like to throw my “2 sense/cents” if you will (no pun intended).

My thoughts on this matter is that I would tend to agree that many Nigerians are suffering because of how the economy has unfolded in the country; but I would disagree that President Buhari and his administration are the culprits in such an event. We must remember that there are other factors that have also contributed to this scenario (ex. corruption, depleting oil prices/revenue, sabotage of oil pipelines in the Niger Delta, high unemployment of the youth, Boko Haram’s terrorists acts in the Northeast of the country (which has now been subdued by the military) that barely had enough equipment in the beginning to take on Boko Haram, this just to name a few.)

All these factors played roles in recurring events. The Buhari Administration had to deal with this as well as other problems while coming into power; mind you they came into office with currency reserves diminished by more then 50%. This would be a tough task that any administration would have to alleviate. In 2008 the Obama Administration and Congress had similar scenarios as well, in all respect, when the US was in recession.

The Buhari Administration has only been in office for 1 year, and some progress has been made, but to give a small “snapshot” of the state of Nigeria is unfair, especially when the administration is in the beginning stages to restructure the economy as well as change the political culture and climate, when former politicians used to “rob the country clean of its financial resources” through “mind

boggling corruption schemes….

One year for any governance is not attainable in any condition, more time and strategic policies have to be instituted. President Buhari, his close advisors, and national policy experts will have to figure out more creative ways to boost the economic climate within the country. I believe they eventually will.

I say give them more time, just my humble opinion-SB

Bloomberg News Article Below:

http://www.bloomberg.com/news/articles/2016-05-30/lost-year-in-nigeria-under-buhari-leaves-economy-on-its-knees

SAUDI ARABIA RESTRUCTURES ITS STATE OIL FIRM….ARAMCO

Saudi Arabia oil

By: Economic & Finance Report

Aramco state oil firm will be seperated from Saudi Arabia’s  petroleum ministry, and will be provided as a separate entity. The Saudi Arabian king  King Salman promoted Aramco CEO as the new Chairman of Aramco as well as Saudi Arabia’s health minister.

It has been speculated that the King’s son will be in charge of state oil giant Aramco, pretty soon…-SB