AYA Analytica financial health memo March 2018
As of March 2018, this regular podcast is available on our Andy Yeh Alpha fintech network platform.
Tech stock prices tumble due to Trump's criticism of Amazon's tax avoidance, Facebook data breach of trust, and Tesla autopilot incidence.
Share prices tumble for technology stocks due to Trump's criticism of Amazon's tax avoidance, Facebook user data breach of trust, and Tesla autopilot incidence.
President Trump accuses Amazon of unfairly deferring tax payments via its European operational hub in Luxemburg.
This common cross-border corporate scheme can be legitimate, but this scheme rings the alarm bell for the American, British, and other governments in light of borderline tax avoidance.
Also, President Trump complains that U.S. Postal Service cannot make money because it fails to charge higher delivery prices on the single ecommerce giant Amazon.
Meanwhile, Facebook faces the Cambridge Analytica user data debacle, and U.S. senators are likely to grill Zuckerberg in his congressional testimony.
Both these recent Amazon and Facebook crises trigger sharp share price declines among the top tech titans Facebook, Apple, Microsoft, Google, Amazon, Netflix, and Twitter (FAMGANT).
Moreover, Tesla experiences an autopilot incidence in March 2018 where an autonomous car crashes into a nearby barrier before the driver turns off the artificial intelligence software to correct the car path.
This Tesla autopilot car crash aggravates the recent woes of Uber's recent autonomous car accident.
Some tech stocks exhibit double-digits declines due to the recent crises.
CNBC's business anchorwoman Becky Quick interviews Nobel Laureate Joseph Stiglitz on the current Sino-U.S. trade war.
CNBC's business news anchor Becky Quick interviews Nobel Laureate Joseph Stiglitz on the current trade war between America and China.
When America imposes $60 billion tariffs on key Chinese imports such as steel and aluminum, China fights back with $3 billion tariffs on U.S. exports for at least 128 items.
Stiglitz points out that the poor and less economically-privileged Americans with subpar socioeconomic status and educational attainment are likely to suffer due to higher prices of many consumption goods.
Also, most U.S. corporations finance their capital investments with tax-deductible debt, and so tax cuts will largely benefit these large corporations and high net-worth investors in America.
However, the typical U.S. household will face lower purchasing power, and fiscal stimulus may or may not boost real investment and productivity growth.
For this reason, President Trump's economic policy reform may wreak havoc in real macroeconomic activities, especially if GDP per capita growth cannot exceed investor expectations and inflationary pressures in the medium term.
Stiglitz specifically favors globalization and free trade if the U.S. government sets clear limits on product market liberalization.
President Trump imposes punitive tariffs on $60 billion Chinese imports in a brand-new trade war.
President Trump imposes punitive tariffs on $60 billion Chinese imports in a brand-new trade war as China hits back with retaliatory tariffs on $3 billion U.S. exports.
This strategic move hits China for its unfair trade practices with at least 3 major jabs.
First, the Trump tariffs take the form of 25% duties on $60 billion Chinese exports to America.
This first jab is only a fraction of the economic damage that China has done to America by forcibly extracting the intellectual properties of U.S. corporations.
Second, the Trump administration can introduce foreign investment restrictions on Chinese companies.
This prevention can stop Chinese companies from swooping into U.S. competitive advantages.
Third, the Trump administration considers litigation at the World Trade Organization (WTO).
Since the inception of its WTO membership, China has indeed failed to transform into an open democratic society that respects both economic freedom and the rule of law.
Overall, the Trump tariffs signal the dawn of an inevitable Sino-American trade war.
Trump uses the sequential tariff tactics and economic sanctions on China, Iran, and Russia and even some western allies such as Canada, Europe, and Mexico.
These tactical solutions may help dramatically reduce U.S. trade and budget deficits.
Personal finance and investment author Thomas Corley studies and shares the rich habits of self-made millionaires.
Thomas Corley studies and shares the rich habits of numerous self-made millionaires.
Corley has spent 5 years studying the daily habits and routines of self-made millionaires, and then he chronicles these results in his books *Rich Habits* and *Change You Habits, Change Your Life*.
Rich people share common habits, and others can learn from these habits that help enrich their lives.
First, self-made millionaires maintain long-term vision with short-term focus.
They often set bold and lofty life goals, value propositions, and mission statements.
At the same time, the rich focus on both the important and urgent matters that can often lead to positive results.
For instance, these millionaires attend to money matters like value investors who focus on small profitable cash cows with low relative market valuation that invest conservatively in both capital investment and balance sheet expansion.
Second, self-made millionaires cherish and emphasize the importance of self-improvement.
They read books, articles, blogs, and newsletters etc about personal finance, management, and other self-help issues.
This practice allows self-made millionaires to turn unproductive routines into better ones.
Third, self-made millionaires enhance their social integration.
These millionaires like to network with successful people in personal finance, sport, family, or other social events, and their active social engagement extends beyond their inner circle.
In Corley's 5-year study, what self-made millionaires choose not to accomplish is as important as what they choose to accomplish over several years.
Fed Chair Jerome Powell increases the neutral interest rate to a range of 1.5% to 1.75% in his debut press conference.
Fed Chair Jerome Powell raises the neutral interest rate to a range of 1.5% to 1.75% in his debut post-FOMC press conference.
The Federal Reserve raises the interest rate for the sixth time since the Federal Open Market Committee (FOMC) near-zero rate lift-off in December 2015.
In fact, the Fed Chair transition from Yellen to Powell indicates a moderate monetary policy stance from dovish to hawkish in accordance with the recent FOMC minutes.
The Federal Reserve now targets a core PCE inflation rate above 2.1% as the U.S. unemployment rate gradually declines to the lowest level of 3.8% to 4.1% in 17 years.
Most dynamic stochastic general equilibrium (DSGE) New Keynesian macro models suggest that Powell needs to trade off near-full employment with inflationary momentum.
As inflation rises over time, Powell must gradually raise the neutral interest rate to tame upward price gyrations when the U.S. economy operates near full employment.
Former Fed Chair Janet Yellen might prefer to keep the lower interest rate for a longer period of time, whereas, Powell departs from this lower-for-longer dovish and accommodative monetary policy stance in response to FOMC hawks who express deep concerns about high inflation or price instability.
Uber's autonomous car causes the first known pedestrian fatality from a driverless vehicle.
Uber's autonomous car causes the first known pedestrian fatality from a driverless vehicle and thus sets off the alarm bell for artificial intelligence.
An Arizona woman dies in a car accident in the Phoenix suburb of Tempe that involves one of Uber's driverless cars.
As a result, Uber suspends its autonomous car operations in Phoenix, Pittsburgh, San Francisco, and Toronto.
This fatality makes cities less likely to trust Uber and so undermines the generic claim that Uber serves as an autonomous car platform rather than a transportation service provider.
Also, this incidence forces Uber to improve the safety of its autonomous and human-driven vehicles.
Even if Uber can perfect its self-driving technology by mid-2019 (when the company hopes to launch autonomous car services), city governments might not trust the Uber enough to work with autonomous cars.
Stock analysts now downgrade the approximate $70 billion valuation of Uber by BlackRock and Morgan Stanley.
Because Uber delays the launch of autonomous car services after mid-2019, the artificial-intelligence-driven company may postpone its grand plan to go public in the next 18 months.
Facebook faces a major data breach by Cambridge Analytica that has harvested information from 50 million Facebook users.
Facebook faces a major data breach by Cambridge Analytica that has harvested private information from more than 50 million Facebook users.
In a Facebook post, Mark Zuckerberg outlines the next steps that the company would take to enhance the artificial-intelligence-driven user data and privacy protection.
Zuckerberg reiterates that he is sorry for Facebook's involvement in the Cambridge Analytica data breach of trust.
Zuckerberg further concedes that Facebook would be open to government regulation.
Prior precedence suggests some plausible regulatory actions against Facebook.
First, Facebook would be viewed as a social media publisher that should be subject to telecommunication rules for online content circulation.
Second, Facebook might have to break up its core franchises such as social media posts, digital advertisements, games, data solutions, and user connections etc.
In recent times, both American and European regulators demand Facebook CEO Mark Zuckerberg and his delegate(s) to testify before Congress.
These unforeseen events might adversely affect Facebook's key performance metrics from active member usage to average revenue per unit (ARPU).
Facebook ads would become less effective with higher average costs, and many small-to-medium business enterprises may suffer as a result.
Due to this fundamental recalibration, Facebook's share performance may exhibit negative volatile fluctuations in the next few months.
The Trump $1.5 trillion hefty tax cuts and $1 trillion infrastructure expenditures may speed up the Federal Reserve interest rate hike.
The Trump administration's $1.5 trillion massive tax cuts and $1 trillion infrastructure expenditures may speed up the Federal Reserve interest rate hike due to robust labor market growth.
The U.S. economy adds 313,000 jobs in early-2018.
This labor market growth is stronger than most macro projections, and the U.S. unemployment rate stays at 4.1% or the lowest level in 17 years.
Also, wages grow at 2.6% and remain a few notches below the prior pace.
Productive progress in U.S. employment and economic output continues without higher inflation near the 2% target.
In accordance with most macro expectations, the Federal Reserve expects to raise interest rate 4 times in 2018 and maybe 3-4 times in 2019.
The current neutral interest rate hike helps attain the congressional dual mandate of maximum employment and price stability.
Senate majority leader Mitch McConnell unveils the new budget deal.
This deal can be sustainable with $15 trillion national debt and $80-$95 billion budget deficit projections over the next 2 years.
A key issue concerns how long Congress should raise the national debt limit, which the U.S. economy may hit as soon as April 2018.
Republicans and Democrats still need to negotiate the exact parameters to reach bipartisan agreement.
From crony capitalism to state capitalism, what economic policy lessons can we learn from Putin's reign in Russia?
From crony capitalism to state capitalism, what economic policy lessons can we learn from President Putin's current reign in Russia?
In the 15 years of President Vladimir Putin's rule, Russia has increased its state control over economic growth that exceeds the average economic growth rate in the immediate post-communist era.
With 1.5% meager economic growth, 15% inflation, and 6% unemployment, the Russian government concentrates both political and economic power in Putin's hands.
This power concentration leads to a highly assertive foreign policy.
Putin uses energy as a diplomatic instrument, and abundant revenue streams from extractive oil industries obfuscate the need for structural economic reforms in Russia.
In recent years, U.S.-driven western countries impose economic sanctions on Russia and have brought about economic stagnation there.
As a result, the Russian economy continues to struggle with few visible traces of economic growth.
As Europe struggles with its own economic projections due to its own macro model deficiencies, Russia shows no signs of diverting from state capitalism without substantive evidence of a more sustainable economic model.
In reality, only greater political competition can induce the Putin administration to change economic course.
However, the current communist political landscape cannot allow for this political competition to flourish in practice.
Hong Kong billionaire Li Ka-Shing announces his retirement in March 2018 with an incredible rags-to-riches life story.
At 89 years old, Hong Kong billionaire Li Ka-Shing announces his retirement in March 2018.
With a personal net worth of $35 billion, Li has an incredible rags-to-riches life story of growing his business conglomerate HK Hutchinson.
His 53-year-old son Victor Li will take over the conglomerate with 323,000 employees across 50 countries worldwide.
The Li business empire ranges from energy to real estate property and technology.
Li is the epitome of hard work and persistence.
From his age 35 to present, Li commits to working 16 hours per day and 7 days per week.
At the same time, however, Li engages healthy exercises daily to stay fit.
Throughout his rags-to-riches life story, Li successfully transitions from dropping out of school as a child to support his family to becoming the first person of Chinese origin to buy one of the British-built Hong Kong companies since the colonial era.
Li pledges to devote the rest of his life to charitable causes.
The Li Ka Shing Foundation continues to invest in education, poverty prevention, and disease eradication etc.
David Solomon succeeds Lloyd Blankfein as the new CEO of Goldman Sachs.
David Solomon succeeds Lloyd Blankfein as the new CEO of Goldman Sachs.
Unlike his predecessors Lloyd Blankfein and Gary Cohn, Solomon has been an investment specialist throughout his professional career.
As an investment banker, Solomon serves as a financial product specialist who underwrites and sells investment-grade corporate debt securities.
Solomon understands financial market development and the key importance of marking-to-market the actual market values of stocks and bonds on the firm's balance sheet (instead of fair values).
Also, Solomon appreciates the intrinsic value of sound and efficient financial risk management.
He can be a safe pair of hands to lead the Goldman franchise in late-2018.
At Goldman Sachs, Solomon advocates for a comprehensive reformation of corporate culture.
He expresses an active interest in keeping the maximum number of work hours between 70-75 hours per week.
Under Solomon's leadership, the bank increases compensation for programmers, modernizes computer systems, institutes video interviews, and maintains smart-casual dress codes.
Apart from his professional commitment, Solomon performs electronic music at nightclubs and music festivals in New York, Miami, and Bahamas.
Spotify releases Solomon's debut single title in early-2018.
As the CEO of Goldman Sachs, David Solomon will be an all-round investment head who understands the importance of work-life balance.
President Trump tweets his key decision to oust State Secretary Rex Tillerson due to intense disagreement over diplomatic affairs.
President Trump tweets his decision to oust State Secretary Rex Tillerson after several months of intense disagreement over diplomatic affairs.
Trump sometimes uses tweets to disparage the former Exxon-Mobil CEO's efforts at international diplomacy.
Also, Trump nominates CIA Director Mike Pompeo to replace Tillerson, and then Deputy CIA Director Gina Haspel succeeds Pompeo as the first woman to lead the Central Intelligence Agency (CIA).
In fact, this strategic Rexit move arises as President Trump is about to embark on historic and high-level direct dialogues with North Korean commander-in-chief Kim Jong Un.
Pompeo may initiate bilateral secret talks with the North Korean dictator to facilitate a smooth and peaceful transition to denuclearization.
Pompeo has yet to demystify when and where the potential Trump-Kim summit may take place.
Moreover, Rexit signals that President Trump often plays hardball on foreign affairs in the midst of substantial geopolitical tension and uncertainty.
Tillerson indeed disagrees with President Trump on several fronts.
First, President Trump insists on withdrawing from the Paris climate change accord, whereas Tillerson suggests that American should commit to staying in this accord.
Second, Tillerson seems soft on President Trump's preference for supporting the current embargo against Qatar in opposition to Saudi Arabia.
This latter geopolitical issue can affect global oil price fluctuations in the medium term.
Third, President Trump and Tillerson further differ in their stances on whether America should pursue diplomatic solutions to denuclearization in North Korea and Iran.
Trump prefers to extend the duration of economic sanctions on these countries in order to reach peaceful resolution, but Tillerson dismisses such brute force.
All of these geopolitical issues affect international stock market development, economic policy uncertainty, and energy-driven inflation.
The Trump team blocks Broadcom's bid for Qualcomm due to national security concerns and 5G telecom network issues.
The Trump administration blocks Broadcom's bid for Qualcomm due to national security concerns and 5G telecom network issues.
Broadcom makes microchips for broadband communication networks such as wireless broadband telecoms, modems, routers, and switches.
The White House takes an extraordinary action to block this major corporate deal that might inadvertently give China more influence in global technology.
In an executive order, President Trump blocks Broadcom's $117 billion bid for Qualcomm due to national security concerns.
There is credible evidence that Broadcom and its affiliates (such as China's HuaWei and ZTE) might threaten to impair U.S. 5G telecom network dominance and digital supremacy.
For this reason, both Broadcom and Qualcomm must immediately and permanently abandon the takeover proposal.
The Trump administration releases a recent investigation that China's theft of intellectual properties such as U.S. patents, trademarks, and copyrights etc has cost American companies around $1 trillion.
In response, the Trump administration may introduce punitive tariffs on Chinese imports to dramatically reduce bilateral trade deficits.
This deficit reduction can contribute to a better balance in the U.S. congressional budget for better mid-term election results that favor the Trump administration.
Peter Thiel shares his money views of President Trump, Facebook, Bitcoin, global finance, and trade.
Peter Thiel shares his money views of President Trump, Facebook, Bitcoin, global finance and trade etc.
As an early technology adopter, Thiel invests in Facebook and Bitcoin.
The former connects people with better social integration around the world, and the latter provides a new crypto medium of exchange for online payments.
Network effects breed positive feedback loops, whereas, there is a critical inflection point where these network effects fall over into the madness of crowds.
As one of the co-founders for PayPal and Palantir, Thiel thinks it is important to ensure third-party payment security for safer cross-border finance and trade.
Thiel supports President Trump because his economic policy reform helps avoid fake culture wars between different civilizations.
Trump tax cuts and infrastructure expenditures help boost American household consumption, firm production, and financial intermediation.
In light of antitrust investigations into Google and some other Silicon Valley tech firms, Thiel considers these firms in trouble as government regulation looms as a major business risk.
As a serial entrepreneur, Thiel emphasizes the importance of ambition that transcends just making money for a company.
Disruptive innovation not only replaces prior technology, but also significantly improves and enriches the economic lives of others.
President Xi seeks Chinese congressional approval for abolishing his term limits of strongman rule with better trade deals and economic ties.
President Xi seeks Chinese congressional approval and constitutional amendment for abolishing his term limits of strongman rule with more favorable trade deals and economic ties.
Foreign investors now activate their keen interest in Chinese tech titans such as Baidu, Alibaba, and Tencent (BAT).
Baidu specializes in Chinese online search; Alibaba focuses on international e-commerce and fintech solutions; and Tencent derives most revenue from Chinese instant messengers such as WeChat and Tencent QQ, online games, and other entertainment and lifestyle software solutions.
BATs operate as oligopolies with competitive moats that manifest in the form of patents, trademarks, copyrights, and other intellectual properties.
Their high product market concentration serves as a primary explanation for worse income and wealth inequality in China.
President Xi's strongman rule can further entrench these Chinese tech titans with product market dominance.
This new Sino political economy defeats the western purpose of admitting China into the World Trade Organization (WTO) after the post-war collapse of the Soviet Union.
China resists both regional trade integration and global economic order and thus often fails to comply with WTO trade rules on fair trade and intellectual property protection.
Few mainland residents embrace democracy, economic freedom, and the rule of law in China.
White House economic advisor Gary Cohn resigns due to his opposition to President Trump's protectionist tariff stance.
White House top economic advisor Gary Cohn resigns due to his opposition to President Trump's recent protectionist decision on steel and aluminum tariffs.
These steel and aluminum tariffs target Canada, Europe, Mexico, and China.
Some western allies may receive interim exemptions on a case-by-case basis.
Through this abrupt tariff tactic, President Trump seeks to dramatically reduce U.S. trade and budget deficits for better mid-term election results.
The former Goldman Sachs president had strongly opposed trade barriers such as tariffs, quotas, and even embargoes.
Cohn serves as a steady man in the White House and attempts to push President Trump away from some of his most aggressive instincts on trade.
In fact, Cohn would prefer the U.S. to keep the North American Free Trade Agreement (NAFTA).
As a proponent of international free trade, Cohn would support the U.S. to join the Trans-Pacific Partnership (TPP).
In effect, these global free trade movements reflect the collective wisdom and combination of cross-border interests and efforts for fewer trade frictions.
CNBC economic media commentator Larry Kudlow is likely to succeed Cohn as the Director of the National Economic Council.
Kudlow may defend the Trump administration's gradual tariff tactics against China, Canada, Europe, and Mexico.
Trump imposes tariffs on steel and aluminum in a trade war with some exemptions for Canada and Mexico.
Trump imposes high tariffs on steel (25%) and aluminum (10%) in a new trade war with subsequent exemptions for Canada and Mexico.
The Trump administration's Trade Act Section 232 investigation suggests that the main sources of U.S. steel-and-aluminum trade deficits are Canada, Europe, Mexico, and China.
In light of both Section 301 and Section 232 investigations, the steel and aluminum tariffs seem to target China and the European Union.
There are a pair of pertinent problems with imposing tariffs on foreign imports of this nature.
First, this tariff tactic is a massive diplomatic gambit.
In effect, this tactic may create the imminent risk of retaliation from multiple countries.
Second, this strategic move inevitably leads to higher consumer prices from food cans to cars and airplanes insofar as these products involve the use of steel or aluminum.
In fact, these price increases can feed back to fuel higher inflation in America.
Also, American households and firms may experience higher costs and so lower disposable income.
The resultant decrease in aggregate demand can be detrimental to U.S. economic output, employment, and capital investment.
When push comes to shove, the law of inadvertent consequences counsels caution.
Fed's new chairman Jerome Powell testifies before Congress for the first time.
Fed's new chairman Jerome Powell testifies before Congress for the first time.
He vows to prevent price instability for U.S. consumers, firms, and financial intermediaries by gradually raising interest rates to contain inflation.
Several stock market observers and commentators warn of the Yellen-Powell regime switch from dovish to hawkish monetary policy decisions.
However, Powell seeks to balance the need to guard against excessive inflation with the real benefits of allowing the U.S. economy to enjoy the tailwinds of Trump fiscal stimulus, economic output expansion, full employment, and robust wage growth.
The Federal Reserve now explores whether the U.S. unemployment rate can fall to the lowest range of 3.8% to 4.1% in 17 years before inflation starts to accelerate.
In accordance with Powell's congressional testimony, the Federal Reserve's current monetary policy instruments include its gradual upward interest rate adjustment, balance sheet shrinkage, and 2% symmetric core CPI inflation target.
Powell confines his testimony to the dual mandate of both price stability and maximum employment with minimal discussions of distributional economic inequality issues in America.
With respect to financial deregulation, Powell expects to roll back at least some of the more stringent Dodd-Frank rules and stress tests on large banks and other financial institutions.
Buffett discusses Berkshire's cash ambition, its reinsurance business, and his succession plan.
Warren Buffett releases his annual letter to Berkshire Hathaway shareholders as of February 2018.
Buffett discusses Berkshire Hathaway's cash ambition, its reinsurance business, the recent increase in corporate net worth, and his succession plan
First, Buffett highlights the importance of *float* for insurance companies like Berkshire Hathaway, i.e. the company collects insurance premiums that have not be paid out as claims.
Buffett and Munger can invest the float as these premiums absorb losses gradually throughout the life of each insurance policy.
Because this reinsurance counterbalances long-tail losses, Berkshire can grow its float to extraordinary levels over time.
Second, corporate cash stockpiles surge to $116 billion, so Buffett prefers to maintain this cash position for near-term mergers and acquisitions (instead of dividend payout and share buyback).
However, Buffett considers most recent takeover targets with no sensible purchase prices at the current stage of the real business cycle.
Also, Buffett emphasizes the fact that debt-free investors can better take advantage of short-term stock market crashes such as Black Monday in 1987, the Asian financial crisis in 1997, and the global economic recession in 2008.
Berkshire experiences a one-time hefty increase in net worth by $65 billion or 23% primarily due to the Trump tax cuts.
These tax credits not only strengthen Berkshire's current fortress balance sheet, but also allow Buffett and Munger to cast a wider net of potential M&A deals.
Third, Buffett announces that Berkshire's next CEO will oversee company operations while the other half of this job will be given to stock-pickers who specialize in dynamic asset management.
On the latter investment front, the likely successors are Todd Combs and Ted Weschler.
These high-skill money managers both have successfully grown their assets under management (AUM) to $25 billion in early-2018.
Under this succession plan, Combs and Weschler will thus continue the value investment philosophy in the post-Buffett reinsurance business structure.
Snap cannot keep up with the Kardashians because its stock loses $1 billion market value after Kylie Jenner tweets about her decision to leave Snapchat.
Snap cannot keep up with the Kardashians because its common stock loses market value 7% or $1 billion right after Kylie Jenner tweets about her decision to leave Snapchat.
The root cause of this rare incidence may be Snap's recent redesign, or Jenner's newfound motherhood.
The former can be a real concern that her 25 million Twitter followers share in numerous replies.
These empathetic users aggravate this deep concern about Snap's recent redesign adn thus echoes ambivalent Wall Street investor sentiments.
Several Wall Street stock analysts point out that it can be more difficult for Snap to monetize the Snapchat business model in contrast to ad-income-driven Facebook, Google, and Twitter.
In recent times, Snap initiates some smart strategic moves to draw a clear line between social interactions and media posts and video streams.
In fact, Snap needs to manage this interim transition well as celebrity influencers such as Kylie Jenner are an essential source of high-quality content in the Snap recipe for success.
With 25 million Twitter followers, Jenner carries a great deal of social influence over millennials.
In terms of demographic attributes, the typical Snapchat user is between 18 and 24 years old and tends to have much shorter attention span.
Fed minutes reflect gradual interest rate normalization in response to high inflation risk.
Fed minutes suggest gradual interest rate normalization in response to higher inflation risk.
FOMC members revise up the economic projections made at the previous December 2017 committee forum.
Many financial economists and market watchers expect gradual further hawkish adjustments in U.S. monetary policy.
These hawkish adjustments inevitably entail interest rate hikes that help constrain money supply growth near full employment.
In effect, these gradual hawkish adjustments help better balance the inexorable and mysterious trade-off between inflation and unemployment.
As Treasury bond yields rise in response to this hawkish monetary policy stance, most major U.S. stock market indices such as Dow Jones, S&P 500, and NASDAQ decline as a result.
Several FOMC members remain cautious about high asset valuation and leverage within Corporate America.
Numerous public corporations make productive use of debt and cash stockpiles with generous cash dividends and share repurchases.
Also, excessive cash accumulation, high asset valuation, and incessant corporate debt usage breed financial contagion with little impact on real macro variates such as economic output, employment, and capital investment.
This recent trend may or may not sustain in the long run.
The resultant concern thus signals bouts of potential financial instability outside the financial system.
Andy Yeh Alpha (AYA) AYA Analytica financial health memo (FHM)
AYA Analytica is our online regular podcast and newsletter about key financial news, market insights, economic issues, and stock investment strategies on our Andy Yeh Alpha (AYA) fintech network platform. With both American focus and international reach, our primary and ultimate corporate mission aims to help enhance financial literacy, inclusion, and freedom of the open and diverse global general public. We apply our unique dynamic conditional alpha investment model as the first aid for every investor with profitable asset investment signals and portfolio strategies. In fact, our AYA freemium fintech network platform curates, orchestrates, and provides proprietary software technology and algorithmic cloud service to most members who can interact with one another on our AYA fintech network platform. Multiple blogs, posts, ebooks, analytical reports, stock alpha signals, and asset omega estimates offer proprietary solutions and substantive benefits to empower each financial market investor through technology, education, and social integration. Please feel free to sign up or login to enjoy our new and unique cloud software services on AYA fintech network platform now!!
Please feel free to follow our AYA Analytica financial health memo (FHM) podcast channel on YouTube: https://www.youtube.com/channel/UCvntmnacYyCmVyQ-c_qjyyQ
Please feel free to follow our Brass Ring Facebook to learn more about the latest financial news and stock investment ideas: https://www.facebook.com/brassring2013
Free signup for stock signals: https://ayafintech.network
Mission on profitable signals: https://ayafintech.network/mission.php
Model technical descriptions: https://ayafintech.network/model.php
Blog on stock alpha signals: https://ayafintech.network/blog.php
Freemium base pricing plans: https://ayafintech.network/freemium.php
Signup for periodic updates: https://ayafintech.network/signup.php
Login for freemium benefits: https://ayafintech.network/login.php
We create each free finbuzz (or free financial buzz) as a blog post on the latest financial news and asset investment ideas. Our finbuzz collection demonstrates our unique American focus with global reach. Each free finbuzz provides deep insights into numerous topical issues in global finance, stock market investment, portfolio optimization, and dynamic asset management. We strive to help enrich the economic lives of most investors who would otherwise engage in financial data analysis with inordinate time commitment.
Please feel free to forward our finbuzz to family and friends, peers, colleagues, classmates, and others who might be keen and abuzz to learn more about asset investment strategies and modern policy reforms with macroeconomic insights.
Do you find it difficult to beat the long-term average 11% stock market return?
It took us 20+ years to design a new profitable algorithmic asset investment model and its attendant proprietary software technology with fintech patent protection in 2+ years. AYA fintech network platform serves as everyone’s first aid for his or her personal stock investment portfolio. Our proprietary software technology allows each investor to leverage fintech intelligence and information without exorbitant time commitment. Our dynamic conditional alpha analysis boosts the typical win rate from 70% to 90%+.
Our new alpha model empowers members to be a wiser stock market investor with profitable alpha signals!! This proprietary quantitative analysis applies the collective wisdom of Warren Buffett, George Soros, Carl Icahn, Mark Cuban, Tony Robbins, and Nobel Laureates in finance such as Robert Engle, Eugene Fama, Lars Hansen, Robert Lucas, Robert Merton, Edward Prescott, Thomas Sargent, William Sharpe, Robert Shiller, and Christopher Sims.
Andy Yeh Alpha (AYA) fintech network platform serves as each investor's social toolkit for profitable investment management. AYA fintech network platform helps promote better financial literacy, inclusion, and freedom of the global general public. We empower investors through technology, education, and social integration.
Andy Yeh
AYA fintech network platform founder
Brass Ring International Density Enterprise (BRIDE)
Tech stock prices tumble due to Trump's criticism of Amazon's tax avoidance, Facebook data breach of trust, and Tesla autopilot incidence.
Share prices tumble for technology stocks due to Trump's criticism of Amazon's tax avoidance, Facebook user data breach of trust, and Tesla autopilot incidence.
President Trump accuses Amazon of unfairly deferring tax payments via its European operational hub in Luxemburg.
This common cross-border corporate scheme can be legitimate, but this scheme rings the alarm bell for the American, British, and other governments in light of borderline tax avoidance.
Also, President Trump complains that U.S. Postal Service cannot make money because it fails to charge higher delivery prices on the single ecommerce giant Amazon.
Meanwhile, Facebook faces the Cambridge Analytica user data debacle, and U.S. senators are likely to grill Zuckerberg in his congressional testimony.
Both these recent Amazon and Facebook crises trigger sharp share price declines among the top tech titans Facebook, Apple, Microsoft, Google, Amazon, Netflix, and Twitter (FAMGANT).
Moreover, Tesla experiences an autopilot incidence in March 2018 where an autonomous car crashes into a nearby barrier before the driver turns off the artificial intelligence software to correct the car path.
This Tesla autopilot car crash aggravates the recent woes of Uber's recent autonomous car accident.
Some tech stocks exhibit double-digits declines due to the recent crises.
CNBC's business anchorwoman Becky Quick interviews Nobel Laureate Joseph Stiglitz on the current Sino-U.S. trade war.
CNBC's business news anchor Becky Quick interviews Nobel Laureate Joseph Stiglitz on the current trade war between America and China.
When America imposes $60 billion tariffs on key Chinese imports such as steel and aluminum, China fights back with $3 billion tariffs on U.S. exports for at least 128 items.
Stiglitz points out that the poor and less economically-privileged Americans with subpar socioeconomic status and educational attainment are likely to suffer due to higher prices of many consumption goods.
Also, most U.S. corporations finance their capital investments with tax-deductible debt, and so tax cuts will largely benefit these large corporations and high net-worth investors in America.
However, the typical U.S. household will face lower purchasing power, and fiscal stimulus may or may not boost real investment and productivity growth.
For this reason, President Trump's economic policy reform may wreak havoc in real macroeconomic activities, especially if GDP per capita growth cannot exceed investor expectations and inflationary pressures in the medium term.
Stiglitz specifically favors globalization and free trade if the U.S. government sets clear limits on product market liberalization.
President Trump imposes punitive tariffs on $60 billion Chinese imports in a brand-new trade war.
President Trump imposes punitive tariffs on $60 billion Chinese imports in a brand-new trade war as China hits back with retaliatory tariffs on $3 billion U.S. exports.
This strategic move hits China for its unfair trade practices with at least 3 major jabs.
First, the Trump tariffs take the form of 25% duties on $60 billion Chinese exports to America.
This first jab is only a fraction of the economic damage that China has done to America by forcibly extracting the intellectual properties of U.S. corporations.
Second, the Trump administration can introduce foreign investment restrictions on Chinese companies.
This prevention can stop Chinese companies from swooping into U.S. competitive advantages.
Third, the Trump administration considers litigation at the World Trade Organization (WTO).
Since the inception of its WTO membership, China has indeed failed to transform into an open democratic society that respects both economic freedom and the rule of law.
Overall, the Trump tariffs signal the dawn of an inevitable Sino-American trade war.
Trump uses the sequential tariff tactics and economic sanctions on China, Iran, and Russia and even some western allies such as Canada, Europe, and Mexico.
These tactical solutions may help dramatically reduce U.S. trade and budget deficits.
Personal finance and investment author Thomas Corley studies and shares the rich habits of self-made millionaires.
Thomas Corley studies and shares the rich habits of numerous self-made millionaires.
Corley has spent 5 years studying the daily habits and routines of self-made millionaires, and then he chronicles these results in his books *Rich Habits* and *Change You Habits, Change Your Life*.
Rich people share common habits, and others can learn from these habits that help enrich their lives.
First, self-made millionaires maintain long-term vision with short-term focus.
They often set bold and lofty life goals, value propositions, and mission statements.
At the same time, the rich focus on both the important and urgent matters that can often lead to positive results.
For instance, these millionaires attend to money matters like value investors who focus on small profitable cash cows with low relative market valuation that invest conservatively in both capital investment and balance sheet expansion.
Second, self-made millionaires cherish and emphasize the importance of self-improvement.
They read books, articles, blogs, and newsletters etc about personal finance, management, and other self-help issues.
This practice allows self-made millionaires to turn unproductive routines into better ones.
Third, self-made millionaires enhance their social integration.
These millionaires like to network with successful people in personal finance, sport, family, or other social events, and their active social engagement extends beyond their inner circle.
In Corley's 5-year study, what self-made millionaires choose not to accomplish is as important as what they choose to accomplish over several years.
Fed Chair Jerome Powell increases the neutral interest rate to a range of 1.5% to 1.75% in his debut press conference.
Fed Chair Jerome Powell raises the neutral interest rate to a range of 1.5% to 1.75% in his debut post-FOMC press conference.
The Federal Reserve raises the interest rate for the sixth time since the Federal Open Market Committee (FOMC) near-zero rate lift-off in December 2015.
In fact, the Fed Chair transition from Yellen to Powell indicates a moderate monetary policy stance from dovish to hawkish in accordance with the recent FOMC minutes.
The Federal Reserve now targets a core PCE inflation rate above 2.1% as the U.S. unemployment rate gradually declines to the lowest level of 3.8% to 4.1% in 17 years.
Most dynamic stochastic general equilibrium (DSGE) New Keynesian macro models suggest that Powell needs to trade off near-full employment with inflationary momentum.
As inflation rises over time, Powell must gradually raise the neutral interest rate to tame upward price gyrations when the U.S. economy operates near full employment.
Former Fed Chair Janet Yellen might prefer to keep the lower interest rate for a longer period of time, whereas, Powell departs from this lower-for-longer dovish and accommodative monetary policy stance in response to FOMC hawks who express deep concerns about high inflation or price instability.
Uber's autonomous car causes the first known pedestrian fatality from a driverless vehicle.
Uber's autonomous car causes the first known pedestrian fatality from a driverless vehicle and thus sets off the alarm bell for artificial intelligence.
An Arizona woman dies in a car accident in the Phoenix suburb of Tempe that involves one of Uber's driverless cars.
As a result, Uber suspends its autonomous car operations in Phoenix, Pittsburgh, San Francisco, and Toronto.
This fatality makes cities less likely to trust Uber and so undermines the generic claim that Uber serves as an autonomous car platform rather than a transportation service provider.
Also, this incidence forces Uber to improve the safety of its autonomous and human-driven vehicles.
Even if Uber can perfect its self-driving technology by mid-2019 (when the company hopes to launch autonomous car services), city governments might not trust the Uber enough to work with autonomous cars.
Stock analysts now downgrade the approximate $70 billion valuation of Uber by BlackRock and Morgan Stanley.
Because Uber delays the launch of autonomous car services after mid-2019, the artificial-intelligence-driven company may postpone its grand plan to go public in the next 18 months.
Facebook faces a major data breach by Cambridge Analytica that has harvested information from 50 million Facebook users.
Facebook faces a major data breach by Cambridge Analytica that has harvested private information from more than 50 million Facebook users.
In a Facebook post, Mark Zuckerberg outlines the next steps that the company would take to enhance the artificial-intelligence-driven user data and privacy protection.
Zuckerberg reiterates that he is sorry for Facebook's involvement in the Cambridge Analytica data breach of trust.
Zuckerberg further concedes that Facebook would be open to government regulation.
Prior precedence suggests some plausible regulatory actions against Facebook.
First, Facebook would be viewed as a social media publisher that should be subject to telecommunication rules for online content circulation.
Second, Facebook might have to break up its core franchises such as social media posts, digital advertisements, games, data solutions, and user connections etc.
In recent times, both American and European regulators demand Facebook CEO Mark Zuckerberg and his delegate(s) to testify before Congress.
These unforeseen events might adversely affect Facebook's key performance metrics from active member usage to average revenue per unit (ARPU).
Facebook ads would become less effective with higher average costs, and many small-to-medium business enterprises may suffer as a result.
Due to this fundamental recalibration, Facebook's share performance may exhibit negative volatile fluctuations in the next few months.
The Trump $1.5 trillion hefty tax cuts and $1 trillion infrastructure expenditures may speed up the Federal Reserve interest rate hike.
The Trump administration's $1.5 trillion massive tax cuts and $1 trillion infrastructure expenditures may speed up the Federal Reserve interest rate hike due to robust labor market growth.
The U.S. economy adds 313,000 jobs in early-2018.
This labor market growth is stronger than most macro projections, and the U.S. unemployment rate stays at 4.1% or the lowest level in 17 years.
Also, wages grow at 2.6% and remain a few notches below the prior pace.
Productive progress in U.S. employment and economic output continues without higher inflation near the 2% target.
In accordance with most macro expectations, the Federal Reserve expects to raise interest rate 4 times in 2018 and maybe 3-4 times in 2019.
The current neutral interest rate hike helps attain the congressional dual mandate of maximum employment and price stability.
Senate majority leader Mitch McConnell unveils the new budget deal.
This deal can be sustainable with $15 trillion national debt and $80-$95 billion budget deficit projections over the next 2 years.
A key issue concerns how long Congress should raise the national debt limit, which the U.S. economy may hit as soon as April 2018.
Republicans and Democrats still need to negotiate the exact parameters to reach bipartisan agreement.
From crony capitalism to state capitalism, what economic policy lessons can we learn from Putin's reign in Russia?
From crony capitalism to state capitalism, what economic policy lessons can we learn from President Putin's current reign in Russia?
In the 15 years of President Vladimir Putin's rule, Russia has increased its state control over economic growth that exceeds the average economic growth rate in the immediate post-communist era.
With 1.5% meager economic growth, 15% inflation, and 6% unemployment, the Russian government concentrates both political and economic power in Putin's hands.
This power concentration leads to a highly assertive foreign policy.
Putin uses energy as a diplomatic instrument, and abundant revenue streams from extractive oil industries obfuscate the need for structural economic reforms in Russia.
In recent years, U.S.-driven western countries impose economic sanctions on Russia and have brought about economic stagnation there.
As a result, the Russian economy continues to struggle with few visible traces of economic growth.
As Europe struggles with its own economic projections due to its own macro model deficiencies, Russia shows no signs of diverting from state capitalism without substantive evidence of a more sustainable economic model.
In reality, only greater political competition can induce the Putin administration to change economic course.
However, the current communist political landscape cannot allow for this political competition to flourish in practice.
Hong Kong billionaire Li Ka-Shing announces his retirement in March 2018 with an incredible rags-to-riches life story.
At 89 years old, Hong Kong billionaire Li Ka-Shing announces his retirement in March 2018.
With a personal net worth of $35 billion, Li has an incredible rags-to-riches life story of growing his business conglomerate HK Hutchinson.
His 53-year-old son Victor Li will take over the conglomerate with 323,000 employees across 50 countries worldwide.
The Li business empire ranges from energy to real estate property and technology.
Li is the epitome of hard work and persistence.
From his age 35 to present, Li commits to working 16 hours per day and 7 days per week.
At the same time, however, Li engages healthy exercises daily to stay fit.
Throughout his rags-to-riches life story, Li successfully transitions from dropping out of school as a child to support his family to becoming the first person of Chinese origin to buy one of the British-built Hong Kong companies since the colonial era.
Li pledges to devote the rest of his life to charitable causes.
The Li Ka Shing Foundation continues to invest in education, poverty prevention, and disease eradication etc.
David Solomon succeeds Lloyd Blankfein as the new CEO of Goldman Sachs.
David Solomon succeeds Lloyd Blankfein as the new CEO of Goldman Sachs.
Unlike his predecessors Lloyd Blankfein and Gary Cohn, Solomon has been an investment specialist throughout his professional career.
As an investment banker, Solomon serves as a financial product specialist who underwrites and sells investment-grade corporate debt securities.
Solomon understands financial market development and the key importance of marking-to-market the actual market values of stocks and bonds on the firm's balance sheet (instead of fair values).
Also, Solomon appreciates the intrinsic value of sound and efficient financial risk management.
He can be a safe pair of hands to lead the Goldman franchise in late-2018.
At Goldman Sachs, Solomon advocates for a comprehensive reformation of corporate culture.
He expresses an active interest in keeping the maximum number of work hours between 70-75 hours per week.
Under Solomon's leadership, the bank increases compensation for programmers, modernizes computer systems, institutes video interviews, and maintains smart-casual dress codes.
Apart from his professional commitment, Solomon performs electronic music at nightclubs and music festivals in New York, Miami, and Bahamas.
Spotify releases Solomon's debut single title in early-2018.
As the CEO of Goldman Sachs, David Solomon will be an all-round investment head who understands the importance of work-life balance.
President Trump tweets his key decision to oust State Secretary Rex Tillerson due to intense disagreement over diplomatic affairs.
President Trump tweets his decision to oust State Secretary Rex Tillerson after several months of intense disagreement over diplomatic affairs.
Trump sometimes uses tweets to disparage the former Exxon-Mobil CEO's efforts at international diplomacy.
Also, Trump nominates CIA Director Mike Pompeo to replace Tillerson, and then Deputy CIA Director Gina Haspel succeeds Pompeo as the first woman to lead the Central Intelligence Agency (CIA).
In fact, this strategic Rexit move arises as President Trump is about to embark on historic and high-level direct dialogues with North Korean commander-in-chief Kim Jong Un.
Pompeo may initiate bilateral secret talks with the North Korean dictator to facilitate a smooth and peaceful transition to denuclearization.
Pompeo has yet to demystify when and where the potential Trump-Kim summit may take place.
Moreover, Rexit signals that President Trump often plays hardball on foreign affairs in the midst of substantial geopolitical tension and uncertainty.
Tillerson indeed disagrees with President Trump on several fronts.
First, President Trump insists on withdrawing from the Paris climate change accord, whereas Tillerson suggests that American should commit to staying in this accord.
Second, Tillerson seems soft on President Trump's preference for supporting the current embargo against Qatar in opposition to Saudi Arabia.
This latter geopolitical issue can affect global oil price fluctuations in the medium term.
Third, President Trump and Tillerson further differ in their stances on whether America should pursue diplomatic solutions to denuclearization in North Korea and Iran.
Trump prefers to extend the duration of economic sanctions on these countries in order to reach peaceful resolution, but Tillerson dismisses such brute force.
All of these geopolitical issues affect international stock market development, economic policy uncertainty, and energy-driven inflation.
The Trump team blocks Broadcom's bid for Qualcomm due to national security concerns and 5G telecom network issues.
The Trump administration blocks Broadcom's bid for Qualcomm due to national security concerns and 5G telecom network issues.
Broadcom makes microchips for broadband communication networks such as wireless broadband telecoms, modems, routers, and switches.
The White House takes an extraordinary action to block this major corporate deal that might inadvertently give China more influence in global technology.
In an executive order, President Trump blocks Broadcom's $117 billion bid for Qualcomm due to national security concerns.
There is credible evidence that Broadcom and its affiliates (such as China's HuaWei and ZTE) might threaten to impair U.S. 5G telecom network dominance and digital supremacy.
For this reason, both Broadcom and Qualcomm must immediately and permanently abandon the takeover proposal.
The Trump administration releases a recent investigation that China's theft of intellectual properties such as U.S. patents, trademarks, and copyrights etc has cost American companies around $1 trillion.
In response, the Trump administration may introduce punitive tariffs on Chinese imports to dramatically reduce bilateral trade deficits.
This deficit reduction can contribute to a better balance in the U.S. congressional budget for better mid-term election results that favor the Trump administration.
Peter Thiel shares his money views of President Trump, Facebook, Bitcoin, global finance, and trade.
Peter Thiel shares his money views of President Trump, Facebook, Bitcoin, global finance and trade etc.
As an early technology adopter, Thiel invests in Facebook and Bitcoin.
The former connects people with better social integration around the world, and the latter provides a new crypto medium of exchange for online payments.
Network effects breed positive feedback loops, whereas, there is a critical inflection point where these network effects fall over into the madness of crowds.
As one of the co-founders for PayPal and Palantir, Thiel thinks it is important to ensure third-party payment security for safer cross-border finance and trade.
Thiel supports President Trump because his economic policy reform helps avoid fake culture wars between different civilizations.
Trump tax cuts and infrastructure expenditures help boost American household consumption, firm production, and financial intermediation.
In light of antitrust investigations into Google and some other Silicon Valley tech firms, Thiel considers these firms in trouble as government regulation looms as a major business risk.
As a serial entrepreneur, Thiel emphasizes the importance of ambition that transcends just making money for a company.
Disruptive innovation not only replaces prior technology, but also significantly improves and enriches the economic lives of others.
President Xi seeks Chinese congressional approval for abolishing his term limits of strongman rule with better trade deals and economic ties.
President Xi seeks Chinese congressional approval and constitutional amendment for abolishing his term limits of strongman rule with more favorable trade deals and economic ties.
Foreign investors now activate their keen interest in Chinese tech titans such as Baidu, Alibaba, and Tencent (BAT).
Baidu specializes in Chinese online search; Alibaba focuses on international e-commerce and fintech solutions; and Tencent derives most revenue from Chinese instant messengers such as WeChat and Tencent QQ, online games, and other entertainment and lifestyle software solutions.
BATs operate as oligopolies with competitive moats that manifest in the form of patents, trademarks, copyrights, and other intellectual properties.
Their high product market concentration serves as a primary explanation for worse income and wealth inequality in China.
President Xi's strongman rule can further entrench these Chinese tech titans with product market dominance.
This new Sino political economy defeats the western purpose of admitting China into the World Trade Organization (WTO) after the post-war collapse of the Soviet Union.
China resists both regional trade integration and global economic order and thus often fails to comply with WTO trade rules on fair trade and intellectual property protection.
Few mainland residents embrace democracy, economic freedom, and the rule of law in China.
White House economic advisor Gary Cohn resigns due to his opposition to President Trump's protectionist tariff stance.
White House top economic advisor Gary Cohn resigns due to his opposition to President Trump's recent protectionist decision on steel and aluminum tariffs.
These steel and aluminum tariffs target Canada, Europe, Mexico, and China.
Some western allies may receive interim exemptions on a case-by-case basis.
Through this abrupt tariff tactic, President Trump seeks to dramatically reduce U.S. trade and budget deficits for better mid-term election results.
The former Goldman Sachs president had strongly opposed trade barriers such as tariffs, quotas, and even embargoes.
Cohn serves as a steady man in the White House and attempts to push President Trump away from some of his most aggressive instincts on trade.
In fact, Cohn would prefer the U.S. to keep the North American Free Trade Agreement (NAFTA).
As a proponent of international free trade, Cohn would support the U.S. to join the Trans-Pacific Partnership (TPP).
In effect, these global free trade movements reflect the collective wisdom and combination of cross-border interests and efforts for fewer trade frictions.
CNBC economic media commentator Larry Kudlow is likely to succeed Cohn as the Director of the National Economic Council.
Kudlow may defend the Trump administration's gradual tariff tactics against China, Canada, Europe, and Mexico.
Trump imposes tariffs on steel and aluminum in a trade war with some exemptions for Canada and Mexico.
Trump imposes high tariffs on steel (25%) and aluminum (10%) in a new trade war with subsequent exemptions for Canada and Mexico.
The Trump administration's Trade Act Section 232 investigation suggests that the main sources of U.S. steel-and-aluminum trade deficits are Canada, Europe, Mexico, and China.
In light of both Section 301 and Section 232 investigations, the steel and aluminum tariffs seem to target China and the European Union.
There are a pair of pertinent problems with imposing tariffs on foreign imports of this nature.
First, this tariff tactic is a massive diplomatic gambit.
In effect, this tactic may create the imminent risk of retaliation from multiple countries.
Second, this strategic move inevitably leads to higher consumer prices from food cans to cars and airplanes insofar as these products involve the use of steel or aluminum.
In fact, these price increases can feed back to fuel higher inflation in America.
Also, American households and firms may experience higher costs and so lower disposable income.
The resultant decrease in aggregate demand can be detrimental to U.S. economic output, employment, and capital investment.
When push comes to shove, the law of inadvertent consequences counsels caution.
Fed's new chairman Jerome Powell testifies before Congress for the first time.
Fed's new chairman Jerome Powell testifies before Congress for the first time.
He vows to prevent price instability for U.S. consumers, firms, and financial intermediaries by gradually raising interest rates to contain inflation.
Several stock market observers and commentators warn of the Yellen-Powell regime switch from dovish to hawkish monetary policy decisions.
However, Powell seeks to balance the need to guard against excessive inflation with the real benefits of allowing the U.S. economy to enjoy the tailwinds of Trump fiscal stimulus, economic output expansion, full employment, and robust wage growth.
The Federal Reserve now explores whether the U.S. unemployment rate can fall to the lowest range of 3.8% to 4.1% in 17 years before inflation starts to accelerate.
In accordance with Powell's congressional testimony, the Federal Reserve's current monetary policy instruments include its gradual upward interest rate adjustment, balance sheet shrinkage, and 2% symmetric core CPI inflation target.
Powell confines his testimony to the dual mandate of both price stability and maximum employment with minimal discussions of distributional economic inequality issues in America.
With respect to financial deregulation, Powell expects to roll back at least some of the more stringent Dodd-Frank rules and stress tests on large banks and other financial institutions.
Buffett discusses Berkshire's cash ambition, its reinsurance business, and his succession plan.
Warren Buffett releases his annual letter to Berkshire Hathaway shareholders as of February 2018.
Buffett discusses Berkshire Hathaway's cash ambition, its reinsurance business, the recent increase in corporate net worth, and his succession plan
First, Buffett highlights the importance of *float* for insurance companies like Berkshire Hathaway, i.e. the company collects insurance premiums that have not be paid out as claims.
Buffett and Munger can invest the float as these premiums absorb losses gradually throughout the life of each insurance policy.
Because this reinsurance counterbalances long-tail losses, Berkshire can grow its float to extraordinary levels over time.
Second, corporate cash stockpiles surge to $116 billion, so Buffett prefers to maintain this cash position for near-term mergers and acquisitions (instead of dividend payout and share buyback).
However, Buffett considers most recent takeover targets with no sensible purchase prices at the current stage of the real business cycle.
Also, Buffett emphasizes the fact that debt-free investors can better take advantage of short-term stock market crashes such as Black Monday in 1987, the Asian financial crisis in 1997, and the global economic recession in 2008.
Berkshire experiences a one-time hefty increase in net worth by $65 billion or 23% primarily due to the Trump tax cuts.
These tax credits not only strengthen Berkshire's current fortress balance sheet, but also allow Buffett and Munger to cast a wider net of potential M&A deals.
Third, Buffett announces that Berkshire's next CEO will oversee company operations while the other half of this job will be given to stock-pickers who specialize in dynamic asset management.
On the latter investment front, the likely successors are Todd Combs and Ted Weschler.
These high-skill money managers both have successfully grown their assets under management (AUM) to $25 billion in early-2018.
Under this succession plan, Combs and Weschler will thus continue the value investment philosophy in the post-Buffett reinsurance business structure.
Snap cannot keep up with the Kardashians because its stock loses $1 billion market value after Kylie Jenner tweets about her decision to leave Snapchat.
Snap cannot keep up with the Kardashians because its common stock loses market value 7% or $1 billion right after Kylie Jenner tweets about her decision to leave Snapchat.
The root cause of this rare incidence may be Snap's recent redesign, or Jenner's newfound motherhood.
The former can be a real concern that her 25 million Twitter followers share in numerous replies.
These empathetic users aggravate this deep concern about Snap's recent redesign adn thus echoes ambivalent Wall Street investor sentiments.
Several Wall Street stock analysts point out that it can be more difficult for Snap to monetize the Snapchat business model in contrast to ad-income-driven Facebook, Google, and Twitter.
In recent times, Snap initiates some smart strategic moves to draw a clear line between social interactions and media posts and video streams.
In fact, Snap needs to manage this interim transition well as celebrity influencers such as Kylie Jenner are an essential source of high-quality content in the Snap recipe for success.
With 25 million Twitter followers, Jenner carries a great deal of social influence over millennials.
In terms of demographic attributes, the typical Snapchat user is between 18 and 24 years old and tends to have much shorter attention span.
Fed minutes reflect gradual interest rate normalization in response to high inflation risk.
Fed minutes suggest gradual interest rate normalization in response to higher inflation risk.
FOMC members revise up the economic projections made at the previous December 2017 committee forum.
Many financial economists and market watchers expect gradual further hawkish adjustments in U.S. monetary policy.
These hawkish adjustments inevitably entail interest rate hikes that help constrain money supply growth near full employment.
In effect, these gradual hawkish adjustments help better balance the inexorable and mysterious trade-off between inflation and unemployment.
As Treasury bond yields rise in response to this hawkish monetary policy stance, most major U.S. stock market indices such as Dow Jones, S&P 500, and NASDAQ decline as a result.
Several FOMC members remain cautious about high asset valuation and leverage within Corporate America.
Numerous public corporations make productive use of debt and cash stockpiles with generous cash dividends and share repurchases.
Also, excessive cash accumulation, high asset valuation, and incessant corporate debt usage breed financial contagion with little impact on real macro variates such as economic output, employment, and capital investment.
This recent trend may or may not sustain in the long run.
The resultant concern thus signals bouts of potential financial instability outside the financial system.
Andy Yeh Alpha (AYA) AYA Analytica financial health memo (FHM)
AYA Analytica is our online regular podcast and newsletter about key financial news, market insights, economic issues, and stock investment strategies on our Andy Yeh Alpha (AYA) fintech network platform. With both American focus and international reach, our primary and ultimate corporate mission aims to help enhance financial literacy, inclusion, and freedom of the open and diverse global general public. We apply our unique dynamic conditional alpha investment model as the first aid for every investor with profitable asset investment signals and portfolio strategies. In fact, our AYA freemium fintech network platform curates, orchestrates, and provides proprietary software technology and algorithmic cloud service to most members who can interact with one another on our AYA fintech network platform. Multiple blogs, posts, ebooks, analytical reports, stock alpha signals, and asset omega estimates offer proprietary solutions and substantive benefits to empower each financial market investor through technology, education, and social integration. Please feel free to sign up or login to enjoy our new and unique cloud software services on AYA fintech network platform now!!
Please feel free to follow our AYA Analytica financial health memo (FHM) podcast channel on YouTube: https://www.youtube.com/channel/UCvntmnacYyCmVyQ-c_qjyyQ
Please feel free to follow our Brass Ring Facebook to learn more about the latest financial news and stock investment ideas: https://www.facebook.com/brassring2013
Free signup for stock signals: https://ayafintech.network
Mission on profitable signals: https://ayafintech.network/mission.php
Model technical descriptions: https://ayafintech.network/model.php
Blog on stock alpha signals: https://ayafintech.network/blog.php
Freemium base pricing plans: https://ayafintech.network/freemium.php
Signup for periodic updates: https://ayafintech.network/signup.php
Login for freemium benefits: https://ayafintech.network/login.php
We create each free finbuzz (or free financial buzz) as a blog post on the latest financial news and asset investment ideas. Our finbuzz collection demonstrates our unique American focus with global reach. Each free finbuzz provides deep insights into numerous topical issues in global finance, stock market investment, portfolio optimization, and dynamic asset management. We strive to help enrich the economic lives of most investors who would otherwise engage in financial data analysis with inordinate time commitment.
Please feel free to forward our finbuzz to family and friends, peers, colleagues, classmates, and others who might be keen and abuzz to learn more about asset investment strategies and modern policy reforms with macroeconomic insights.
Do you find it difficult to beat the long-term average 11% stock market return?
It took us 20+ years to design a new profitable algorithmic asset investment model and its attendant proprietary software technology with fintech patent protection in 2+ years. AYA fintech network platform serves as everyone’s first aid for his or her personal stock investment portfolio. Our proprietary software technology allows each investor to leverage fintech intelligence and information without exorbitant time commitment. Our dynamic conditional alpha analysis boosts the typical win rate from 70% to 90%+.
Our new alpha model empowers members to be a wiser stock market investor with profitable alpha signals!! This proprietary quantitative analysis applies the collective wisdom of Warren Buffett, George Soros, Carl Icahn, Mark Cuban, Tony Robbins, and Nobel Laureates in finance such as Robert Engle, Eugene Fama, Lars Hansen, Robert Lucas, Robert Merton, Edward Prescott, Thomas Sargent, William Sharpe, Robert Shiller, and Christopher Sims.
Andy Yeh Alpha (AYA) fintech network platform serves as each investor's social toolkit for profitable investment management. AYA fintech network platform helps promote better financial literacy, inclusion, and freedom of the global general public. We empower investors through technology, education, and social integration.
Andy Yeh
AYA fintech network platform founder
Brass Ring International Density Enterprise (BRIDE)
We should not conform to this world, but we should allow the renewal of our minds to transform us, so that we can prove what is the good, acceptable, and perfect will of God.
Romans 12: 2
Comments
Post a Comment