AYA Analytica financial health memo December 2018
As of December 2018, this regular podcast is available on our Andy Yeh Alpha fintech network platform.
House of Representatives considers a government expenditure bill with border wall finance and so sets up a shutdown stalemate with Senate.
The House of Representatives continues to mull over a major government expenditure bill with border wall finance and so sets up a shutdown stalemate with Senate.
As frenetic negotiations continue at Capitol Hill, the House adjourns without a final government expenditure deal.
This impasse leads to a partial government shutdown, whereas, President Trump demands $5 billion for his presidential campaign promise of a Mexican border wall.
The Trump top envoys work hard to broker a last-minute compromise with Democrats and some Republican lawmakers.
The partial government shutdown would disrupt public service operations as many federal employees face furlough and work without pay a few days before the festive Christmas holiday season.
Although many market watchers expect this partial government shutdown to be temporary, this shutdown echoes the prior Trump verbal threat that he *would be proud to shut down the government for better border security*.
Stock market investors respond to this shutdown with negative consequences.
Major stock market indices from S&P 500 and NASDAQ to Dow Jones reach their historical low levels with near-term 5%+ losses in the prior decade.
Several economic media commentators expect the next stock market rally to emerge in light of better investor optimism early-2019.
Federal Reserve raises the interest rate to the target range of 2.25% to 2.5% as of December 2018.
Federal Reserve raises the interest rate to the target range of 2.25% to 2.5% as of December 2018.
Fed Chair Jerome Powell highlights the dovish interest rate hike that the U.S. economy seems sluggish in terms of global real GDP economic growth, employment, and capital investment.
Some economic indicators such as household income and wage momentum soften in the current macro outlook.
Wall Street reacts negatively to the Powell comment about continuing to shrink the Federal Reserve balance sheet.
Several stock market indices slump to the lowest levels in the fiscal year 2018.
Dow Jones declines 352 points or 1.5%; S&P 500 also declines 1.5%; and NASDAQ plunges 2.3% as of mid-December 2018.
The stock market pain extends to global markets: European and Asian stocks exhibit sharp losses around 3% on the next business day.
The Federal Reserve expects to ease the current interest rate hike with no more than 2 to 3 rate increases in 2019.
Powell conveys his unusual dovish tone that the current interest rate hike reflects healthy fundamental recalibration in U.S. financial markets.
This rate hike benefits most savers and traders who rely primarily on dividend and interest income from their stock and bond market investments.
The Internet and telecom conglomerate SoftBank Group raises $23 billion in the biggest IPO in Japan.
The Internet and telecom conglomerate SoftBank Group raises $23 billion in the biggest IPO in Japan.
Going public is part of the key corporate move away from telecommunication toward investing in tech firms through the SoftBank Vision Fund.
SoftBank founder and executive director Masayoshi Son runs this fund that receives steady external finance from Saudi Arabia.
The SoftBank mobile move marks the largest-ever IPO in Japan, but its share price sinks more than 14% to 1,404 yen on the first day of trading on the Tokyo stock exchange.
This sharp share price decline reflects the fact that many stock market investors tend to overvalue IPOs in Japan as overconfident CEOs try to time the stock market by opportunistically offering private equity stakes to retail investors, fund managers, and other institutional investors.
SoftBank billionaire founder Masayoshi Son is one of the wealthiest investors in the world, and he runs the $100 billion SoftBank Vision Fund as a major global tech investment vehicle.
Son maintains good business relations and connections with many unicorn hunters and tech entrepreneurs in Silicon Valley, royal investors in Saudi Arabia, and Internet titans such as Alibaba and Foxconn executive chairmen Jack Ma and Terry Guo in China.
President Trump threatens to shut down the government if Democrats refuse to help approve $5 billion border wall finance.
President Trump threatens to allow U.S. government shutdown in early-2019 if Democrats refuse to help approve $5 billion public finance for the southern border wall.
President Trump hardens his demands for border wall finance when he discusses the topic with the top 2 Senate and House Democratic whip leaders Nancy Pelosi and Chuck Schumer in an Oval Office confrontation after the mid-term elections.
This confrontation devolves into acrimony in light of the gulf between Trump and Democrats over U.S. public finance legislation while President Trump seeks to put a possible compromise further out of reach.
President Trump confronts both Democratic congressional reps to emphasize his clear position that he would be proud to shut down the U.S. government for border security.
However, the border security tax would inexorably exacerbate the current U.S. fiscal deficit and debt dilemma in addition to the $1.5 trillion tax cuts and $1 trillion infrastructure expenditures with $779 billion government deficits as of December 2018.
In effect, President Trump deliberately transforms an initially-proposed private negotiation with Democratic congressional leaders into an open and bitter altercation over his signature presidential campaign promise of the southern border wall.
When push comes to shove, compromise may be a better solution to bitter border wall disputes.
Foreign majority owners offer Sprint and T-Mobile to stop using HuaWei critical technologies after the U.S. telecom merger.
T-Mobile and Sprint indicate that the U.S. is likely to approve their merger plan as they take the offer from foreign owners to stop using HuaWei critical telecom technologies.
Their foreign majority owners offer Sprint and T-Mobile to stop using HuaWei telecom technologies, and this offer helps with clearing the U.S. regulatory hurdle for the $26 million T-Mobile-Sprint merger deal.
Washington has thus gone to great lengths to shut out the Chinese 5G corporate pioneer.
The Commerce Department and Committee on Foreign Investment in the U.S. (CFIUS) may approve the T-Mobile-Sprint merger proposal on the clear condition that the new company cannot make use of HuaWei critical 5G wireless telecom technologies to the detriment of U.S. entities.
The foreign majority owners include Deutsche Telekom AG from Germany and SoftBank Group from Japan, both of which use some form of HuaWei wireless gear outside the U.S. telecommunication market.
In light of the Spring-T-Mobile telecom merger and the prior Trump ban on the Broadcom-Qualcomm merger, 5G wireless telecommunication remains part of the U.S. national economic security agenda.
The Spring-T-Mobile merger can further help induce the top wireless carriers AT&T and Verizon into more active pursuit of 5G communication technology.
Positive network effects and externalities can spill over to benefit most American consumers and firms.
Tencent Music Entertainment debuts its NYSE IPO to strike a chord with stock market investors.
Tencent Music goes public and marks the biggest IPO by a major Chinese Internet company since the Alibaba e-commerce debut back in 2014.
Raising more than $1 billion via this massive IPO, Tencent now serves 880 million active freemium users per month, whereas, its premium subscribers make up no more than 5% of the total user base.
CNBC economic news host Jim Cramer suggests that Tencent Music shares are great opportunities for U.S. stock market investors amid uncertain Sino-U.S. trade tension.
Spotify owns 9% equity stakes in Tencent Music Entertainment, which has been profitable since 2016 with a pristine balance sheet and 83% organic revenue growth.
Tencent is a major part of the Chinese micropayment ecosystem because the tech titan allows active users to deliver virtual gifts such as stickers and red packets.
As of December 2018, 9.5 million users spend money on virtual gifts through Tencent, these purchases account for 70%+ of corporate revenue.
With its instant-messenger apps Tencent QQ, WeChat, and Weibo, the Chinese Internet tech titan aims to enrich the digital lives of freemium users via virtual gifts, online music streams, and instant messages.
Apple files an appeal to overturn the recent iPhone sales ban in China due to its patent infringement of Qualcomm proprietary technology.
Apple files an appeal to overturn the recent iPhone sales ban in China due to its patent infringement of Qualcomm proprietary technology.
This recent ban of some older iPhones 6s to X follows a legal request for an injunction by Qualcomm, which has been locked in an arduous lawsuit with Apple in recent years.
Qualcomm alleges patent violations on specific features that let users reformat the size and appearance of photos with freemium apps on a touch screen.
In response, Apple claims that the patents in question cannot cover the latest iOS 12 operating system on all new iPhones Xs, Xs Max, and XR.
This patent lawsuit is one legal battle in a much wider rift between Apple and Qualcomm across jurisdictions from Europe to China and South Korea.
Mainland China, Hong Kong, and Taiwan are the third-largest market for Apple iPhones. This tripartite region accounts for 20% of $266 billion iPhone sales in the fiscal year as of September 2018.
The Qualcomm injunction may inadvertently induce iPhone users to upgrade their smartphones to iPhones Xs, Xs Max, and XR soon because the older models have become unavailable in the Chinese trifecta.
Several Apple upstream suppliers from Foxconn and TSMC to Pegatron and Radiance can benefit much from this complex chemistry.
Google CEO Sundar Pichai makes his debut testimony before Congress.
Google CEO Sundar Pichai makes his debut testimony before Congress.
The post-mid-term-election House Judiciary Committee bombards Pichai with key questions on whether the Internet search company harbors political bias.
Lawmakers further ask him about some recent Google plans to re-enter the Chinese market with its Project Dragonfly and user privacy initiatives.
Pichai pushes back against several allegations and accusation of partisan bias.
He emphasizes the fact that Google provides Internet platforms for both diverse and open perspectives and opinions while there is no shortage of them among Google executives and other employees.
Pichai leads the Internet search platform enterprise without political bias and thus works hard to ensure that all Google software products continue to operate that way.
He also emphasizes the core conviction that any form of political bias would be inconsistent with the main principles and business interests of Alphabet, Google, and their affiliates.
The congressional testimony sheds new light on the Google PageRank black-box algorithm, which takes into account online content curation, backlink creation, and numerous other traffic-driven metrics for efficiently ranking webpages worldwide.
However, this testimony leaves open the more urgent questions about the recent Google security breaches, bulk data collection practices, anti-competitive gambits, and potential antitrust regulations.
The recent arrest of HuaWei CFO may upend the trade truce between America and China.
The recent arrest of a HuaWei senior executive manager may upend the trade truce between the Trump administration and the Chinese Xi counterpart.
Canadian policemen detain HuaWei CFO Meng WanZhou in Vancouver at the request of U.S. authorities.
She now faces a bail trial at the British Columbia Supreme Court.
The U.S. and Canadian governments cannot specify what charges Meng faces in the meantime, but her arrest follows reports that the U.S. Justice Department might have to evaluate whether HuaWei has violated American economic sanctions on Iran.
The U.S. authorities now seek her extradition.
This sudden arrest angers the Chinese Xi administration and then raises new doubts about the fragile 90-day trade truce between China and America.
Stock market investors watch closely for additional fallout.
HuaWei makes telecommunication gadgets and smart phones and now orchestrates 5G wireless communication networks worldwide.
Meng is the daughter of the founder of HuaWei, which is a national champion at the forefront of President Xi's efforts for China to be self-sufficient in strategic technologies.
Although the U.S. routinely asks allies to extradite drug lords, arms dealers, and other criminals, it is quite rare for U.S. allies to arrest a major Chinese tech executive.
American China-specialists champion the key notion of *strategic engagement* with the Xi administration.
Several eminent American China-specialists champion the key notion of *strategic engagement* with the Xi administration.
From the Hoover Institution at Stanford to the Asia Society Center on U.S.-China Relations, these specialists contribute to the collective wisdom of a comprehensive report on new U.S. precautions against Chinese efforts that might undermine democratic values.
In promoting constructive vigilance to better balance Chinese influences and American interests, these pundits and experts urge U.S. government agencies, universities, think tanks, and other similar institutions to adopt more aggressive measures in order to prevent the risk of economic espionage by China.
The Chinese communist party-state leverages a broad range of party, state, and non-state agencies to advance its economic interests and influences.
In recent years, the Xi administration has significantly accelerated its investments in critical tech inventions from Internet search and e-commerce to social media and artificial intelligence etc.
China often uses its domestic companies to gain access to foreign critical infrastructure and technology.
The Xi administration has made U.S. corporate access to its massive mainland market almost conditional on strict compliance with mainland regulations that favor both domestic employment and technological diffusion.
This strategic issue calls for serious socioeconomic consideration in light of the interim 90-day trade truce between China and America.
Presidents Trump and Xi agree on an interim trade truce at the G20 summit in Argentina.
President Trump reconnects with Chinese President Xi at the G20 summit in the city of Buenos Aires, Argentina, in late-November 2018.
President Donald Trump and President Xi JinPing, the political leaders of the largest economies on earth, agree to a temporary 90-day trace truce and ceasefire in the current Sino-U.S. trade war.
After the 3-hour dinner discussion at the G20 summit, Trump agrees to maintain the 10% tariffs on $200 billion Chinese goods without raising these tariffs to 25% in the next 90 days.
In exchange, China agrees to purchase substantial amounts of agribusiness, energy, and other goods from America to help reduce the current Sino-U.S. bilateral trade deficit.
Chinese state councilor and foreign minister Wang Yi extends reconciliatory gestures and thus regards the Trump-Xi summit *candid and amicable*.
Wang remains optimistic about further opening up the Chinese market for U.S. multinational corporations from Apple and Microsoft to Ford and Merck etc.
Wang also expects Sino-U.S. trade delegates to step up serious negotiations toward the eventual elimination of all additional tariffs.
However, several stock market analysts and commentators warn that the trade truce may be only an interim tactical solution.
This trade truce can barely be a major business breakthrough on substance, but a new framework for subsequent Sino-American economic dialogues.
Over the steak dinner at G20, Trump and Xi agree on mutual compromises that help pause their unproductive trade conflict.
Both presidents set an ambitious 90-day timeline for Sino-U.S. trade negotiators to reach broader economic agreements.
All major stock market indices worldwide rise in response to the Sino-U.S. trade truce.
Dow Jones, NASDAQ, and S&P 500 reap 3% healthy gains for U.S. stocks.
Chinese, European, and other Asian stock market indices see similar 2%-5% gains as a natural result of investor optimism after the Trump-Xi G20 summit.
Whether the Trump administration continues to contain the economic prowess of *China 2025* remains a complex and mysterious national security concern.
On balance, the Trump administration should downplay the relative importance of seeking diplomatic means to dramatically reduce the current bilateral trade deficit with China.
A more important strategic issue pertains to the fact that several Chinese regulations require U.S. tech titans to transfer critical technologies in the form of both backdoor intellectual property theft and infringement.
The latter strategic issue persists as a moot question.
Fed Chair Jerome Powell hints slower interest rate increases because the current rate is just below the neutral threshold.
Fed Chair Jerome Powell hints slower interest rate increases because the current rate is just below the neutral threshold.
NYSE and NASDAQ share prices rebound in response to this accommodative monetary policy moderation.
Dow Jones surges about 600 points primarily due to this less hawkish stance.
Wall Street expects the current interest rate hike to taper off.
As a result, the U.S. dollar weakens a little bit relative to the major trade-weighted-average greenback index.
FOMC minutes reveal the high likelihood of another quarter-point adjustment in the federal funds rate in December 2018.
However, some FOMC members propose removing the reference to *further gradual increases* in the target range insofar as the current stock market conditions persist.
The federal funds rate might be near its neutral level such that some further rate hikes might inadvertently slow the current macroeconomic expansion and productivity growth.
Within the target neutral range of interest rates, the U.S. economy can operate with low unemployment (3.7%) with minimal inflationary pressure (2%).
Several FOMC members continue to express their deep concerns about the Sino-U.S. tariff tension, corporate leverage, and public debt accumulation.
The Trump administration should exercise a fair bit of fiscal discipline in taxation and infrastructure with some interim arrangements for Sino-American fair trade.
Federal Reserve publishes its inaugural flagship financial stability report.
Federal Reserve publishes its inaugural flagship financial stability report.
Fed Chair Jerome Powell applauds both low inflation (2%) and low unemployment (3.7%) as evidence of a robust U.S. economic outlook.
Federal Reserve aims to continue the gradual interest rate hike to help the U.S. economy operate near full employment as the inflation rate rises above the symmetric 2% target threshold.
The first-ever financial stability report warns of the economic dangers that lurk in corporate debt.
Investors exhibit a high tolerance for risks in business debt, whereas, the corporate-debt-to-GDP ratio hits the historically high ratio of 0.45 with some signs of deterioration in credit standards.
The same financial stability report finds less worrisome aspects in the U.S. financial system.
Low household leverage better aligns with aggregate income, and the systemically-important financial institutions (SIFIs) carry higher equity capital buffers with liquid assets.
SIFIs have also passed the Federal Reserve annual macro stress tests as of mid-2018.
Moreover, broker-dealer leverage is below the pre-crisis levels; insurers face favorable solvency positions; and money-market funds become less vulnerable to bank runs.
Overall, the U.S. financial system seems sound and efficient, but high corporate leverage may crowd out public debt accumulation.
The Trump administration thus needs a fair bit of fiscal discipline and prudence.
Bank of England publishes its latest insights into the economic impact of Brexit on British real productivity, capital investment, and labor supply.
Bank of England publishes its latest insights into the economic impact of Brexit on the U.K. productivity, capital investment, and labor supply as of 2018Q4.
With a cautious tone, the British central bank suggests that its future interest rate decisions would depend on the trade terms of the U.K. departure from the European Union.
With Brexit, economic policy uncertainty weighs on U.K. economic growth and productivity, and future lower immigration may adversely affect British labor supply and real macro performance.
Brexit imposes financial constraints on both capital investment and labor supply that appear to reinforce the current economic slowdown in the U.K. in light of the neutral interest rate at which the British economy can grow without much inflationary pressure.
Bank of England Governor Mark Carney acknowledges the brutal fact that Britain is not fully prepared for a cliff-edge Brexit.
Carney predicts that the U.K. economy may shrink by 8% in 2019 in the worse-case scenario where Britain leaves the European Union trade bloc with no deal and no transition period to smooth the arduous process.
When push comes to shove, the law of inadvertent consequences counsels caution.
Personal finance author William Danko shares 3 top secrets for better wealth creation.
As the author of the books Millionaire Next Door and Richer Than Millionaire, Bill Danko shares 3 secrets for better wealth creation.
True prosperity is the convergence of good health, wealth, and happiness.
The median net worth of self-made millionaires is about $2 million, and their median age is 50.
Most millionaires are men (90%) and live in happy marriages (93%).
First, most wage-earners should save at least 20% of their income per annum, whereas, most American consumers save only about 5% of their income each year.
Second, each person should be a good steward of his or her resources.
These resources include stable personal relationships and frugal personal habits.
In effect, these behaviors help ensure longer life longevity, more compound time, and higher compound interest.
Third, it is important for most wage-earners to develop multiple streams of passive income.
Fiscal discipline contributes to effective investments in small and profitable value stocks with conservative capital investment growth and low market risk exposure.
Most self-made millionaires share the unique fact that they need no budgets.
These millionaires spend relatively little in comparison to their income due to their fiscal discipline and self-control.
As a result, this frugal habit renders budgets unnecessary.
Andy Yeh Alpha (AYA) AYA Analytica financial health memo (FHM)
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House of Representatives considers a government expenditure bill with border wall finance and so sets up a shutdown stalemate with Senate.
The House of Representatives continues to mull over a major government expenditure bill with border wall finance and so sets up a shutdown stalemate with Senate.
As frenetic negotiations continue at Capitol Hill, the House adjourns without a final government expenditure deal.
This impasse leads to a partial government shutdown, whereas, President Trump demands $5 billion for his presidential campaign promise of a Mexican border wall.
The Trump top envoys work hard to broker a last-minute compromise with Democrats and some Republican lawmakers.
The partial government shutdown would disrupt public service operations as many federal employees face furlough and work without pay a few days before the festive Christmas holiday season.
Although many market watchers expect this partial government shutdown to be temporary, this shutdown echoes the prior Trump verbal threat that he *would be proud to shut down the government for better border security*.
Stock market investors respond to this shutdown with negative consequences.
Major stock market indices from S&P 500 and NASDAQ to Dow Jones reach their historical low levels with near-term 5%+ losses in the prior decade.
Several economic media commentators expect the next stock market rally to emerge in light of better investor optimism early-2019.
Federal Reserve raises the interest rate to the target range of 2.25% to 2.5% as of December 2018.
Federal Reserve raises the interest rate to the target range of 2.25% to 2.5% as of December 2018.
Fed Chair Jerome Powell highlights the dovish interest rate hike that the U.S. economy seems sluggish in terms of global real GDP economic growth, employment, and capital investment.
Some economic indicators such as household income and wage momentum soften in the current macro outlook.
Wall Street reacts negatively to the Powell comment about continuing to shrink the Federal Reserve balance sheet.
Several stock market indices slump to the lowest levels in the fiscal year 2018.
Dow Jones declines 352 points or 1.5%; S&P 500 also declines 1.5%; and NASDAQ plunges 2.3% as of mid-December 2018.
The stock market pain extends to global markets: European and Asian stocks exhibit sharp losses around 3% on the next business day.
The Federal Reserve expects to ease the current interest rate hike with no more than 2 to 3 rate increases in 2019.
Powell conveys his unusual dovish tone that the current interest rate hike reflects healthy fundamental recalibration in U.S. financial markets.
This rate hike benefits most savers and traders who rely primarily on dividend and interest income from their stock and bond market investments.
The Internet and telecom conglomerate SoftBank Group raises $23 billion in the biggest IPO in Japan.
The Internet and telecom conglomerate SoftBank Group raises $23 billion in the biggest IPO in Japan.
Going public is part of the key corporate move away from telecommunication toward investing in tech firms through the SoftBank Vision Fund.
SoftBank founder and executive director Masayoshi Son runs this fund that receives steady external finance from Saudi Arabia.
The SoftBank mobile move marks the largest-ever IPO in Japan, but its share price sinks more than 14% to 1,404 yen on the first day of trading on the Tokyo stock exchange.
This sharp share price decline reflects the fact that many stock market investors tend to overvalue IPOs in Japan as overconfident CEOs try to time the stock market by opportunistically offering private equity stakes to retail investors, fund managers, and other institutional investors.
SoftBank billionaire founder Masayoshi Son is one of the wealthiest investors in the world, and he runs the $100 billion SoftBank Vision Fund as a major global tech investment vehicle.
Son maintains good business relations and connections with many unicorn hunters and tech entrepreneurs in Silicon Valley, royal investors in Saudi Arabia, and Internet titans such as Alibaba and Foxconn executive chairmen Jack Ma and Terry Guo in China.
President Trump threatens to shut down the government if Democrats refuse to help approve $5 billion border wall finance.
President Trump threatens to allow U.S. government shutdown in early-2019 if Democrats refuse to help approve $5 billion public finance for the southern border wall.
President Trump hardens his demands for border wall finance when he discusses the topic with the top 2 Senate and House Democratic whip leaders Nancy Pelosi and Chuck Schumer in an Oval Office confrontation after the mid-term elections.
This confrontation devolves into acrimony in light of the gulf between Trump and Democrats over U.S. public finance legislation while President Trump seeks to put a possible compromise further out of reach.
President Trump confronts both Democratic congressional reps to emphasize his clear position that he would be proud to shut down the U.S. government for border security.
However, the border security tax would inexorably exacerbate the current U.S. fiscal deficit and debt dilemma in addition to the $1.5 trillion tax cuts and $1 trillion infrastructure expenditures with $779 billion government deficits as of December 2018.
In effect, President Trump deliberately transforms an initially-proposed private negotiation with Democratic congressional leaders into an open and bitter altercation over his signature presidential campaign promise of the southern border wall.
When push comes to shove, compromise may be a better solution to bitter border wall disputes.
Foreign majority owners offer Sprint and T-Mobile to stop using HuaWei critical technologies after the U.S. telecom merger.
T-Mobile and Sprint indicate that the U.S. is likely to approve their merger plan as they take the offer from foreign owners to stop using HuaWei critical telecom technologies.
Their foreign majority owners offer Sprint and T-Mobile to stop using HuaWei telecom technologies, and this offer helps with clearing the U.S. regulatory hurdle for the $26 million T-Mobile-Sprint merger deal.
Washington has thus gone to great lengths to shut out the Chinese 5G corporate pioneer.
The Commerce Department and Committee on Foreign Investment in the U.S. (CFIUS) may approve the T-Mobile-Sprint merger proposal on the clear condition that the new company cannot make use of HuaWei critical 5G wireless telecom technologies to the detriment of U.S. entities.
The foreign majority owners include Deutsche Telekom AG from Germany and SoftBank Group from Japan, both of which use some form of HuaWei wireless gear outside the U.S. telecommunication market.
In light of the Spring-T-Mobile telecom merger and the prior Trump ban on the Broadcom-Qualcomm merger, 5G wireless telecommunication remains part of the U.S. national economic security agenda.
The Spring-T-Mobile merger can further help induce the top wireless carriers AT&T and Verizon into more active pursuit of 5G communication technology.
Positive network effects and externalities can spill over to benefit most American consumers and firms.
Tencent Music Entertainment debuts its NYSE IPO to strike a chord with stock market investors.
Tencent Music goes public and marks the biggest IPO by a major Chinese Internet company since the Alibaba e-commerce debut back in 2014.
Raising more than $1 billion via this massive IPO, Tencent now serves 880 million active freemium users per month, whereas, its premium subscribers make up no more than 5% of the total user base.
CNBC economic news host Jim Cramer suggests that Tencent Music shares are great opportunities for U.S. stock market investors amid uncertain Sino-U.S. trade tension.
Spotify owns 9% equity stakes in Tencent Music Entertainment, which has been profitable since 2016 with a pristine balance sheet and 83% organic revenue growth.
Tencent is a major part of the Chinese micropayment ecosystem because the tech titan allows active users to deliver virtual gifts such as stickers and red packets.
As of December 2018, 9.5 million users spend money on virtual gifts through Tencent, these purchases account for 70%+ of corporate revenue.
With its instant-messenger apps Tencent QQ, WeChat, and Weibo, the Chinese Internet tech titan aims to enrich the digital lives of freemium users via virtual gifts, online music streams, and instant messages.
Apple files an appeal to overturn the recent iPhone sales ban in China due to its patent infringement of Qualcomm proprietary technology.
Apple files an appeal to overturn the recent iPhone sales ban in China due to its patent infringement of Qualcomm proprietary technology.
This recent ban of some older iPhones 6s to X follows a legal request for an injunction by Qualcomm, which has been locked in an arduous lawsuit with Apple in recent years.
Qualcomm alleges patent violations on specific features that let users reformat the size and appearance of photos with freemium apps on a touch screen.
In response, Apple claims that the patents in question cannot cover the latest iOS 12 operating system on all new iPhones Xs, Xs Max, and XR.
This patent lawsuit is one legal battle in a much wider rift between Apple and Qualcomm across jurisdictions from Europe to China and South Korea.
Mainland China, Hong Kong, and Taiwan are the third-largest market for Apple iPhones. This tripartite region accounts for 20% of $266 billion iPhone sales in the fiscal year as of September 2018.
The Qualcomm injunction may inadvertently induce iPhone users to upgrade their smartphones to iPhones Xs, Xs Max, and XR soon because the older models have become unavailable in the Chinese trifecta.
Several Apple upstream suppliers from Foxconn and TSMC to Pegatron and Radiance can benefit much from this complex chemistry.
Google CEO Sundar Pichai makes his debut testimony before Congress.
Google CEO Sundar Pichai makes his debut testimony before Congress.
The post-mid-term-election House Judiciary Committee bombards Pichai with key questions on whether the Internet search company harbors political bias.
Lawmakers further ask him about some recent Google plans to re-enter the Chinese market with its Project Dragonfly and user privacy initiatives.
Pichai pushes back against several allegations and accusation of partisan bias.
He emphasizes the fact that Google provides Internet platforms for both diverse and open perspectives and opinions while there is no shortage of them among Google executives and other employees.
Pichai leads the Internet search platform enterprise without political bias and thus works hard to ensure that all Google software products continue to operate that way.
He also emphasizes the core conviction that any form of political bias would be inconsistent with the main principles and business interests of Alphabet, Google, and their affiliates.
The congressional testimony sheds new light on the Google PageRank black-box algorithm, which takes into account online content curation, backlink creation, and numerous other traffic-driven metrics for efficiently ranking webpages worldwide.
However, this testimony leaves open the more urgent questions about the recent Google security breaches, bulk data collection practices, anti-competitive gambits, and potential antitrust regulations.
The recent arrest of HuaWei CFO may upend the trade truce between America and China.
The recent arrest of a HuaWei senior executive manager may upend the trade truce between the Trump administration and the Chinese Xi counterpart.
Canadian policemen detain HuaWei CFO Meng WanZhou in Vancouver at the request of U.S. authorities.
She now faces a bail trial at the British Columbia Supreme Court.
The U.S. and Canadian governments cannot specify what charges Meng faces in the meantime, but her arrest follows reports that the U.S. Justice Department might have to evaluate whether HuaWei has violated American economic sanctions on Iran.
The U.S. authorities now seek her extradition.
This sudden arrest angers the Chinese Xi administration and then raises new doubts about the fragile 90-day trade truce between China and America.
Stock market investors watch closely for additional fallout.
HuaWei makes telecommunication gadgets and smart phones and now orchestrates 5G wireless communication networks worldwide.
Meng is the daughter of the founder of HuaWei, which is a national champion at the forefront of President Xi's efforts for China to be self-sufficient in strategic technologies.
Although the U.S. routinely asks allies to extradite drug lords, arms dealers, and other criminals, it is quite rare for U.S. allies to arrest a major Chinese tech executive.
American China-specialists champion the key notion of *strategic engagement* with the Xi administration.
Several eminent American China-specialists champion the key notion of *strategic engagement* with the Xi administration.
From the Hoover Institution at Stanford to the Asia Society Center on U.S.-China Relations, these specialists contribute to the collective wisdom of a comprehensive report on new U.S. precautions against Chinese efforts that might undermine democratic values.
In promoting constructive vigilance to better balance Chinese influences and American interests, these pundits and experts urge U.S. government agencies, universities, think tanks, and other similar institutions to adopt more aggressive measures in order to prevent the risk of economic espionage by China.
The Chinese communist party-state leverages a broad range of party, state, and non-state agencies to advance its economic interests and influences.
In recent years, the Xi administration has significantly accelerated its investments in critical tech inventions from Internet search and e-commerce to social media and artificial intelligence etc.
China often uses its domestic companies to gain access to foreign critical infrastructure and technology.
The Xi administration has made U.S. corporate access to its massive mainland market almost conditional on strict compliance with mainland regulations that favor both domestic employment and technological diffusion.
This strategic issue calls for serious socioeconomic consideration in light of the interim 90-day trade truce between China and America.
Presidents Trump and Xi agree on an interim trade truce at the G20 summit in Argentina.
President Trump reconnects with Chinese President Xi at the G20 summit in the city of Buenos Aires, Argentina, in late-November 2018.
President Donald Trump and President Xi JinPing, the political leaders of the largest economies on earth, agree to a temporary 90-day trace truce and ceasefire in the current Sino-U.S. trade war.
After the 3-hour dinner discussion at the G20 summit, Trump agrees to maintain the 10% tariffs on $200 billion Chinese goods without raising these tariffs to 25% in the next 90 days.
In exchange, China agrees to purchase substantial amounts of agribusiness, energy, and other goods from America to help reduce the current Sino-U.S. bilateral trade deficit.
Chinese state councilor and foreign minister Wang Yi extends reconciliatory gestures and thus regards the Trump-Xi summit *candid and amicable*.
Wang remains optimistic about further opening up the Chinese market for U.S. multinational corporations from Apple and Microsoft to Ford and Merck etc.
Wang also expects Sino-U.S. trade delegates to step up serious negotiations toward the eventual elimination of all additional tariffs.
However, several stock market analysts and commentators warn that the trade truce may be only an interim tactical solution.
This trade truce can barely be a major business breakthrough on substance, but a new framework for subsequent Sino-American economic dialogues.
Over the steak dinner at G20, Trump and Xi agree on mutual compromises that help pause their unproductive trade conflict.
Both presidents set an ambitious 90-day timeline for Sino-U.S. trade negotiators to reach broader economic agreements.
All major stock market indices worldwide rise in response to the Sino-U.S. trade truce.
Dow Jones, NASDAQ, and S&P 500 reap 3% healthy gains for U.S. stocks.
Chinese, European, and other Asian stock market indices see similar 2%-5% gains as a natural result of investor optimism after the Trump-Xi G20 summit.
Whether the Trump administration continues to contain the economic prowess of *China 2025* remains a complex and mysterious national security concern.
On balance, the Trump administration should downplay the relative importance of seeking diplomatic means to dramatically reduce the current bilateral trade deficit with China.
A more important strategic issue pertains to the fact that several Chinese regulations require U.S. tech titans to transfer critical technologies in the form of both backdoor intellectual property theft and infringement.
The latter strategic issue persists as a moot question.
Fed Chair Jerome Powell hints slower interest rate increases because the current rate is just below the neutral threshold.
Fed Chair Jerome Powell hints slower interest rate increases because the current rate is just below the neutral threshold.
NYSE and NASDAQ share prices rebound in response to this accommodative monetary policy moderation.
Dow Jones surges about 600 points primarily due to this less hawkish stance.
Wall Street expects the current interest rate hike to taper off.
As a result, the U.S. dollar weakens a little bit relative to the major trade-weighted-average greenback index.
FOMC minutes reveal the high likelihood of another quarter-point adjustment in the federal funds rate in December 2018.
However, some FOMC members propose removing the reference to *further gradual increases* in the target range insofar as the current stock market conditions persist.
The federal funds rate might be near its neutral level such that some further rate hikes might inadvertently slow the current macroeconomic expansion and productivity growth.
Within the target neutral range of interest rates, the U.S. economy can operate with low unemployment (3.7%) with minimal inflationary pressure (2%).
Several FOMC members continue to express their deep concerns about the Sino-U.S. tariff tension, corporate leverage, and public debt accumulation.
The Trump administration should exercise a fair bit of fiscal discipline in taxation and infrastructure with some interim arrangements for Sino-American fair trade.
Federal Reserve publishes its inaugural flagship financial stability report.
Federal Reserve publishes its inaugural flagship financial stability report.
Fed Chair Jerome Powell applauds both low inflation (2%) and low unemployment (3.7%) as evidence of a robust U.S. economic outlook.
Federal Reserve aims to continue the gradual interest rate hike to help the U.S. economy operate near full employment as the inflation rate rises above the symmetric 2% target threshold.
The first-ever financial stability report warns of the economic dangers that lurk in corporate debt.
Investors exhibit a high tolerance for risks in business debt, whereas, the corporate-debt-to-GDP ratio hits the historically high ratio of 0.45 with some signs of deterioration in credit standards.
The same financial stability report finds less worrisome aspects in the U.S. financial system.
Low household leverage better aligns with aggregate income, and the systemically-important financial institutions (SIFIs) carry higher equity capital buffers with liquid assets.
SIFIs have also passed the Federal Reserve annual macro stress tests as of mid-2018.
Moreover, broker-dealer leverage is below the pre-crisis levels; insurers face favorable solvency positions; and money-market funds become less vulnerable to bank runs.
Overall, the U.S. financial system seems sound and efficient, but high corporate leverage may crowd out public debt accumulation.
The Trump administration thus needs a fair bit of fiscal discipline and prudence.
Bank of England publishes its latest insights into the economic impact of Brexit on British real productivity, capital investment, and labor supply.
Bank of England publishes its latest insights into the economic impact of Brexit on the U.K. productivity, capital investment, and labor supply as of 2018Q4.
With a cautious tone, the British central bank suggests that its future interest rate decisions would depend on the trade terms of the U.K. departure from the European Union.
With Brexit, economic policy uncertainty weighs on U.K. economic growth and productivity, and future lower immigration may adversely affect British labor supply and real macro performance.
Brexit imposes financial constraints on both capital investment and labor supply that appear to reinforce the current economic slowdown in the U.K. in light of the neutral interest rate at which the British economy can grow without much inflationary pressure.
Bank of England Governor Mark Carney acknowledges the brutal fact that Britain is not fully prepared for a cliff-edge Brexit.
Carney predicts that the U.K. economy may shrink by 8% in 2019 in the worse-case scenario where Britain leaves the European Union trade bloc with no deal and no transition period to smooth the arduous process.
When push comes to shove, the law of inadvertent consequences counsels caution.
Personal finance author William Danko shares 3 top secrets for better wealth creation.
As the author of the books Millionaire Next Door and Richer Than Millionaire, Bill Danko shares 3 secrets for better wealth creation.
True prosperity is the convergence of good health, wealth, and happiness.
The median net worth of self-made millionaires is about $2 million, and their median age is 50.
Most millionaires are men (90%) and live in happy marriages (93%).
First, most wage-earners should save at least 20% of their income per annum, whereas, most American consumers save only about 5% of their income each year.
Second, each person should be a good steward of his or her resources.
These resources include stable personal relationships and frugal personal habits.
In effect, these behaviors help ensure longer life longevity, more compound time, and higher compound interest.
Third, it is important for most wage-earners to develop multiple streams of passive income.
Fiscal discipline contributes to effective investments in small and profitable value stocks with conservative capital investment growth and low market risk exposure.
Most self-made millionaires share the unique fact that they need no budgets.
These millionaires spend relatively little in comparison to their income due to their fiscal discipline and self-control.
As a result, this frugal habit renders budgets unnecessary.
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