• Sep, 2021
  • 11-09-2021
  • EU fined WhatsApp (FB) $270m for privacy violations

    Someone commented that until it's over a billion or double-digit billions FB will view these fines as costs of doing business, and that the EU is using the company as an ATM.

    #BigTech #EU #Law
     
  • Aug, 2021
  • 30-08-2021
  • Luxury brand loss, China

    45% of luxury spending is by the Chinese consumer, ahead of the US.

    More purchases are within China than before and this trend is expected to continue (rather than go abroad to buy them cheaper).

    The government may be making it sort of culturally taboo to flaunt wealth with luxury purchases. China is cracking down on wealthy spenders.

    4 big luxury stocks, LVMH, Richemont, Kering and Hermes, have lost $85b together in last 2 weeks. Arnot was the world's richest man at the beginning of this month, but his $200b went down $22b and he's now 3rd.

     
  • Aug, 2021
  • 19-08-2021
  • Chip shortage touches Toyota

    Inventory reaching limits (it is suspected the reason), Toyota is cutting N America production from 150k to 90k.
     
  • 60% of Americans paid no federal income tax last year (2020)

    107m households paid none. So around 20m households paid, ti looks like. For reference to a normal year, in 2019 76m households didn't pay any -- it's been around this number for the last decade.

    Tax credits and higher unemployment during the pandemic is the reason. An example is a household that almost reached the income rate where they would pay taxes, but then received a few stimulus payments, which put them into the category of nonpayers.

    Fed income taxes don't include payroll taxes. 80% of households paid at least payroll taxes in 2020.

    The number is expected to go down this year just a few percent (to 57%) and then return to around 40% in 2022, as long as the economy recovers. However, Congress made some changes for 2021 which will have less households paying, such as an increased child tax credit, earned income tax credit, and child and dependent care tax credit (affects millions of families).

    The country is undecided how to deal with tax revenue. In 2020 80% of fed income taxes were paid by the top 20% of earners (30% of fed income taxes were paid by the top 1%, which is up from 25% in 2019). Democrats want high earners to pay more, while Republicans say they already pay quite a bit.


    CNBC: 61% of Americans paid no federal income taxes in 2020, Tax Policy Center says   
  • Aug, 2021
  • 12-08-2021
  • China economics, summer 2021

    We have got more info from the CCP on which sectors they really want to promote, as opposed to those whose recent growth has been seen to cause them problems (as usual for closed, authoritarian governments, this includes industries that control information).

    EV, clean energy, and industrial upgrading have policy tailwinds, according to JPM's Julia Wang.

     
  • Jul, 2021
  • 31-07-2021
  • Breakfast economics

    In the past year, bacon went up 10%, fruit 6%, and just 0.2 and 0.3 for cereal and for coffee (but sugar is up over 3% because its ocean-freight transported). Consumer price index went up 4.2% yoy in April.

    Corn is up 50%, which is 96% of what farmed animals eat in the US, which exports to the world. China is importing a ton to try to build up its hog supply again, while other countries like Brazil and Argentina have recently had drought (which also narrows rivers and reduces transport ability). Also, 10% of US gas is ethanol. Shipping costs are up, too, because of the labor issue. As you see, a lot of the costs in these products involve labor costs.

    Restaurant meals are up 4% in cost. Takeout trays are yet another part of this--prices went up after a Texas storm took out a factory.

    Some economists talk about 'wage price spirals,' where both wages and prices go up in a relationship. It was an issue in the 70s. The Fed says inflation is transitory.

    This was an idea from Wall Street Journal.

     
  • Jul, 2021
  • 22-07-2021
  • Economic concerns raised by former Wells Fargo CEO

    ... Kevin Kovacevich: Inflation (2-3% increase in salary for average worker, and 4-5% inflation on just the basics like food, gas, consumer goods); trillion dollar deficits already and trillion more if Biden admin gets budget passed.

    Markets at all time high. Kovacevich's idea is that the market is priced alright based on where rates are now, but once that changes in the coming year or years the market will look differently.

     
  • Jul, 2021
  • 19-07-2021
  • Tigray war may cost $2.5b according to estimates

    TPLF has conquered most of the north and south of Tigray.

    Ethiopia is one of Africa's largest aid recipients. The US alone contributed a billion in 2020, and therefore has some leverage. Investing in Ethiopia right now comes with significant reputational risks, making companies more reluctant to submit massive investment bids.

    Ethiopia is finishing their dam and stressing tensions with Egypt and Sudan. The dam fits in with Abiy's plan to lift Ethiopians into a higher economic class. Sudan might benefit from a huge energy production facility on it's border for it's own energy needs.

    Getting ahead of things, but if Egypt was to take up a campaign against Ethiopia, due to the huge distance, it would have to use Sudan.

     
  • OPEC reached a deal to increase 400k barrels per day to production

    Oil was down about 2.5% (although the Dow was down 2% on inflation, stagflation, and Delta variant concerns) and oil company stocks more than that. Natural gas was up less than a percent.

    However, projections have it that demand will want 1m or more barrels more per day next year, assuming no more lockdowns.

    US producers could surge new production and crash the market. But no one wants to invest in new exploration. Most companies are hedged at a $50 range.

     
  • Jul, 2021
  • 09-07-2021
  • Alibaba wants to compete with Amazon in shipping

    Arguably, this is the one real strength Amazon currently has, as it's catalog seems less and less impressive.

    Alibaba already has good warehousing and distribution, as shown in how it handles China's 'Singles' Day.'

    Ali also has a payment company and other businesses that help speed up shipping.

    For delivery, Ali depends on partnerships with airlines and ground-based delivery co's (DHL).

    Ali wants to expand the products it offers to its 190 countries and charge $3 per year for fast (like 2-day) shipping. Amazon currently charges between $13 and $130 per year, depending on location (India, UK).

    Ali's product prices are comparatively cheaper than Amazon, because Ali has direct access to the Chinese producers.

    Ali sells a lot of alleged counterfeits, though, which hurts the real companies. Amazon also has faced these criticisms, but less so.

     
  • Jun, 2021
  • 29-06-2021
  • Americans overwhelmingly don't want to go back to their jobs this year

    A recent poll found almost 100% of people don't want to return to the office after being in their homes over the past year. They prefer the life of spending more time with friends and family. They're considering finding a new job.

    There are also more jobs available then ever. 9.3m jobs in April.

    People are asking whether the stimulus so far or the stimulus expected in the future have contributed to people not wanting to get jobs, but data doesn't seem convincing one way or another.

     
  • Jun, 2021
  • 27-06-2021
  • China industrial profits slowing, reportedly

    Their numbers are still growing, but according to analysts the growth is slowing, comparing the same month in different years. China's economy is still projected to grow 8% in 2021: strong growth.

    Also, small company profits are growing less than those of bigger companies.

    Rising commodity prices are squeezing profits for downstream companies, accounting for some of the slowdown in profits.

     
  • Jun, 2021
  • 16-06-2021
  • Tech subsidies ending, but damage might already be done

    For years, maybe since around 2012 people were not paying the 'true price' for tech commodities, but now that the tech subsidies are ending, they might have already killed all their competition, leaving consumers with higher prices and less selection.

    The most commonly cited example is Uber. Years ago, you could get an Uber for less than a yellow cab. Real businesses can't compete with artificially low prices, so many of the taxis have gone out of business, and now there's just Uber and only a few cabs in some areas, but at Uber prices double or triple what they were when Uber was 'competing' with its competitors.

     
  • Nord Stream 2 almost finished, despite US sanctions along the way

    The U.S. will have a hard time competing with Russian gas anyway, in serving Europe. Russian gas is cheaper and is said to be greener.

  • Jun, 2021
  • 14-06-2021
  • Lordstown Motors CEO and CFO have resigned

    ... amid shortselling investigation, but having more to do perhaps with the company saying they had 'substantial doubt' they could continue next year. Shares were down 10%.

     
  • Jun, 2021
  • 13-06-2021
  • Turkey has approved development of a new canal beside the Bosporus

    The Bosporus is Turkey's, but due to the 1936 Montreux Convention it can't allow non-Black Sea State navy ships to pass through, and it can't charge for the passage of civilian vessels during peacetime. The new Istanbul Canal would not have such restrictions.

    It is expected to be around 45km long, 21m deep, and 360-275m wide (top and bottom) and cost $15b. It will sit around 30km west of the Bosporus Straight, and will be spanned by 6 bridges, all high enough to clear the largest ships (which will cost another $1.4b).

    Currently, ships have to wait around 14 hours to enter the Black Sea due to congestion of the Bosporus. Estimates have it that revenue from the canal could amount to $8b per year eventually, if vessels decide to pay, which it is uncertain they will. Turkey will also be able to send dangerous cargo on a route further away from the city center.

    Istanbul citizens polled in 2020 opposed the project (80% opposed) due to environmental and other effects they will be faced with. It's also opposed by Russia which sees the potential ability of US and NATO warships to enter the Black Sea as a national security threat. 104 former Turkish naval officers also publicly opposed the project (the next day 10 were arrested).

      
  • Between 2019 and 2020, toy sales were up 16%, and figures appear to be up even more for the current year.

    Hasbro, as the biggest maker of board games, stood out because they saw a lift to their entire business, as did the makers of Lego.
  • Lots of talk about billionaires not paying taxes

    No one knows how the journalists at ProPublica got hold of tax records for several years for some of the richest Americans.

    Bezos, Musk, Soros, Buffet, etc., paid what appear to be small dollar figures in income tax for certain years (some years $0, some years around $70k were the most quoted figures, dating back to the year 2011). This is because they don't generally make income (particularly when you're talking about each year). Instead, they hold assets. Their largest asset is generally company stock, which is only taxed if it is sold (capital gains). Some years, they need to raise cash and so they take loans against their assets. This is not taxable.

     
  • Jun, 2021
  • 12-06-2021
  • El Salvador adopts Bitcoin

    The country doesn't have their own currency and uses USD. This means they can't print money, and that can be an issue when you're a net importer like El Salvador is (they could run out of dollars without the ability to print).

    They also have high unemployment, and 70% of the population doesn't have a bank account, and many Salvadoreans receive money from relatives working in more prosperous countries (about 25% of Salvadoreans live outside the country, and the money they send accounts for 20% of El Salvador's GDP). Money transfers are always a challenge with conventional institutions, and can involve high fees for each transfer (sometimes as high as 10%, which is of course good for banks).

    The bill passed Congress (62 out of 84 votes) to make El Salvador first country to accept crypto as an official method of payment ('unrestricted legal tender') beside the USD.

     
  • May, 2021
  • 20-05-2021
  • Bitcoin drops 30%

    Basically all crypto dropped significantly, after months of increased speculative buying.

    Other factors in the drop: further talk of regulation, ESG (energy use) concerns regarding mining, and China cracking down on crypto.

    In somewhat related crypto news, Bitmix reportedly ceased operations, not long after the tentative conclusion of the DarkSide pipeline hack. Bitmix was a crypto money laundering service used by ransomware hackers.

    Musk tweeted a "diamond hands" image, signifying he wasn't selling.

    About a month later, Musk tweeted a more positive comment on energy concerns with crypto mining, causing Bitcoin to rise from around $35k to around 40k.



     
  • May, 2021
  • 08-05-2021
  • Corn, soy, wheat prices up

    The reasons include China buying more because the country is rebuilding its hog herd after major losses in 2019 and last winter (African Swine Fever); draught in Brazil and ongoing dry conditions in the U.S (two major suppliers); and traders trying to hedge inflationary risks.

    The robust Chinese demand is expected to continue for 2-4 years. Additionally, rising incomes in developing countries could keep food prices moving upward.

    There isn't much alternative (such as rice and wheat) to feeding livestock good grains (corn and soy beans) when a livestock economy is focused on maximizing gains and quality, as China's is.

    Offsetting factors to inflation in food prices have started to be seen in more elastic demand factors, such as Chinese animal protein demand, where indications are consumers are starting to pull back due to prices. Also, the supply side, if robust enough, could put downward pressure on prices. We'll see how robust U.S. production turns out to be this year in the June Acerage Report, as the U.S. is still planting this years crops.

    Rice prices aren't up in the same way because stocks have been built up over the past few years.


    USDA Acreage Reports
     

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