AYA finbuzz financial health memo September 2019
As of September 2019, this regular podcast is available on our Andy Yeh Alpha fintech network platform.
Product market competition and online e-commerce help constrain money supply growth with moderate inflation.
Online e-commerce retailers such as Amazon, Alibaba, and eBay use fast multi-channel pricing algorithms to set the retail prices of consumer goods.
For central bankers and monetary policymakers who often need to monitor transitional inflation dynamism over time, retail prices are subject to more frequent adjustments with less insulation from common nationwide shocks.
Intense product market competition poses a new economic risk that some retailers may institute an innocuous deterioration in product quality instead of upward price revision.
Online retailers can use smart retail-pricing algorithms to take into account energy costs, exchange rate fluctuations, and other fundamental factors that may affect both production and delivery prices.
Product power concentration further empowers the top 10% superstar companies to capture almost 80% of net profits in Corporate America.
These superstar companies retain their competitive advantages over the course of more than one single real business cycle (about 7-to-9 years).
This anti-competitive clout issue calls for tougher antitrust scrutiny for tech titans (Apple, Amazon, Alibaba, Facebook, Google, and Twitter), big biotech bellwethers (Johnson & Johnson, Pfizer, Merck, Abbot, Amgen, and Bristol-Myers Squibb), and telecoms (Verizon, AT&T, Sprint, and T-Mobile).
Volcker, Greenspan, Bernanke, and Yellen contribute to a Wall Street Journal op-ed on monetary policy independence.
These former Federal Reserve chiefs unite together to express their concern that Fed Chair Jerome Powell institutes the recent dovish interest rate decrease in response to a vocal president.
In their joint conviction, the Federal Reserve System and its chair must be able to make monetary policy decisions in the best interests of the U.S. economy.
Also, these monetary policy decisions must be independent and free of short-term political pressure without the threat of either removal or demotion of Federal Reserve leaders for non-economic reasons.
Volcker, Greenspan, Bernanke, and Yellen emphasize the extant congressional checks and balances with respect to the Federal Reserve monetary policy purview.
In recent times, Federal Reserve Chair Jerome Powell and FOMC members approve a quarter-point interest rate decrease to help sustain the current U.S. economic expansion.
This monetary policy decision arises in the broader context of relentless criticisms among the Trump hawkish hardliners.
These hardliners and President Trump himself view the prior U.S. interest rate hikes as headwinds that may inadvertently offset the economic benefits of tax cuts and other fiscal stimulus packages for better infrastructure, investment, and technology.
President Trump praises great unity and progress in the recent G7 summit with respect to Sino-U.S. trade conflict resolution, climate change, containment for Iran, and trade peace with Europe and Japan.
At the G7 summit in France, President Trump asserts that he can engage in direct talks to better resolve climate change issues and economic sanctions on the nuclear nation Iran.
President Trump can meet the Iranian President Hassan Rouhani under the right circumstances.
The Trump administration can further help eradicate environmental degradation on a global scale.
Also, President Trump expects Sino-U.S. trade talks to resume in September 2019.
These fresh negotiations can help assuage the recent bilateral trade escalation with higher tariffs, threats, and other aggressive countermeasures.
Chinese Vice Premier Liu He indicates that China can work together to solve trade problems through consultation and cooperation with a calm attitude.
In addition, the Trump administration achieves trade peace with Japan for better regional trade partnerships.
Moreover, the Trump administration causes France (and other European countries such as Germany and Italy) to agree to legitimate digital tax reprieve for U.S. tech titans such as Apple, Amazon, Facebook, and Google.
Overall, peace and engagement can help resolve complex economic policy issues.
U.S. yield curve inversion can be a sign but not a root cause of the next economic recession.
Treasury yield curve inversion helps predict each of the U.S. recessions since the 1970s.
However, no fundamental reason can help explain whether this inversion causes each recession.
Correlation may not imply causation.
Several stock market analysts focus on the 3 major root causes of an economic recession.
First, the monetary authority tends to institute interest rate hikes to better curtail inflation or money supply growth.
A series of interest rate hikes help prevent macroeconomic instability; otherwise, inflation would become a major source of economic disturbance.
Second, energy prices often increase substantially in the dawn of an economic recession.
Oil and natural gas prices tend to fluctuate due to geopolitical risks and military confrontations.
Third, stock market analysts expect to see high unemployment, low capital investment, and low industrial production well before a major recession.
In this alternative scenario, subpar labor and capital productivity can cause the economy to slide into at least 2 quarters of negative real GDP growth.
Whether Treasury yield curve inversion serves as a sign but not a root cause of the next economic recession remains open to controversy.
Global stock market investors foresee the harbinger of a major global downturn.
Many stock market investors become anxious primarily due to negative term spreads and negative interest rates worldwide.
As the 10-year Treasury bond yield exceeds the 3-month Treasury bill yield, the U.S. experiences another yield-curve inversion that often serves as a vital economic indicator of the next recession.
In Germany, interest rates become negative across the board from overnight deposits to 30-year government bonds.
Also, negative yields extend to 50-year government bonds in Switzerland.
In terms of asset price normalization, the greenback appreciates substantially against many currencies such as the Chinese renminbi, British pound, Euro, and Japanese yen.
Copper prices decline substantially to reflect a major deterioration in industrial production; gold prices reach their 6-year peak; and the recent Iranian seizure of Gulf oil tankers causes sharp oil price fluctuations.
Pervasive investor fear and anxiety can permeate global asset markets as these economic signals portend a major recession.
Other important economic indicators include sovereign-debt-to-real-GDP ratios, fiscal deficits, and current account deficits.
In this light, Indonesia, Pakistan, South Africa, Turkey, Ukraine, and Venezuela carry the highest risks as the capital outflows substantially exceed the capital inflows of foreign direct investment.
U.S. Treasury officially designates China a currency manipulator in the broader context of Sino-American trade dispute resolution.
The U.S. Treasury classification of China as a currency manipulator suggests that this classification represents another fresh escalation of the current Sino-U.S. trade conflict.
This escalation spooks global financial markets and thus wipes 3.5% from all major U.S. stock market indices such as S&P 500, Dow Jones, Nasdaq, and MSCI USA.
French, German, and other European stock market indices decline by 2.5%-3%.
The next currency battle may turn out to be relentless in the current game of competitive depreciation.
In effect, China allows its renminbi currency to tumble to the psychologically vital 7-yuan per U.S. dollar (or the lowest level in 11 years).
This depreciation may give China an unfair competitive advantage against the U.S. in the current game of chicken in tech, trade, and currency.
However, the recent renminbi currency misalignment may or may not help boost Chinese exports due to global interest rate surprises and competitive prices outside East Asia.
Federal Reserve interest rate cuts may inadvertently give U.S. politicians the impression that monetary policy can help repair the damage of trade policy mistakes.
The law of inadvertent consequences counsel caution.
China allows its renminbi currency to slide below the psychologically important threshold of 7-yuan per U.S. dollar.
A recent currency dispute between the U.S. and China has brought the trade conflict between the G2 superpowers to new extremes.
U.S. Treasury designates China a currency manipulator soon after the Chinese central bank lets renminbi slide to the symbolically important level of 7-yuan to the dollar for the first time in 11 years.
This strategic move represents another escalation as the Sino-U.S. trade relations continue to deteriorate in the meantime.
On the one hand, this recent renminbi depreciation helps render Chinese export prices more competitive and so can contribute to better trade-driven economic prospects.
On the other hand, the renminbi depreciation inevitably exacerbates the monetary severity of 25% Trump tariffs on $250 billion Chinese imports.
As this renminbi depreciation serves as a flexible countermeasure to the 10% Trump tariff on all the other $300 billion Chinese imports, most U.S. stock market indices decline substantially 3%-5% in response to the bilateral tense trifecta of tech, trade, and currency.
Treasury Secretary Steven Mnuchin indicates that the Trump administration can engage with the IMF, WTO, and World Bank to prevent unfair trade competition from China.
Central banks in India, Thailand, and New Zealand lower interest rates in a defensive response to the Federal Reserve recent rate cut.
These central banks attempt to institute interest rate cuts to fend off any economic harm from the current negative spiral of Sino-U.S. trade conflict escalation, Brexit trade and capital exodus, and geopolitical confrontation in the South China Sea.
Australia may be the next to act in accordance with this dovish cycle of international interest rate reductions, and the likely Australian dollar depreciation can help boost Aussie exports worldwide.
On Wall Street, the major U.S. stock market indices such as S&P 500, Dow Jones, Nasdaq, and MSCI USA plummet 3%-5% as a result.
Before the dust settles on Sino-American trade conflict resolution, the Chinese central bank lets the renminbi currency weaken to 7-yuan-per-greenback in more than a decade.
Any further aggressive greenback depreciation or Federal Reserve downward interest rate adjustment may risk upsetting a relatively stable global economic order of low inflation rates, exchange rates, and employment levels in the recent decade after the global financial crisis of 2008-2009.
The negative ripple effects can lead to more economic headwinds and fewer monetary policy levers for many central banks worldwide.
Harvard macrofinance professor Robert Barro sees no good reasons for the sudden reversal of monetary policy normalization.
As Federal Reserve Chair Jerome Powell yields to the persistent demands of a vocal president, the FOMC approves an interim interest rate cut by quarter point to 2%-2.25%.
This interest rate cut represents a clear departure from the current business cycle of interest rate hikes in recent years.
Barro advocates the Taylor monetary policy rule that the nominal interest rate should rise in response to higher inflation and economic output both relative to their targets.
In accordance with this Taylor monetary policy rule, the nominal interest rate normally tends toward a gradual long-term equilibrium path.
In this light, Barro regards the recent interest rate reduction as a major deviation from the prior path of monetary policy normalization.
Federal Reserve Chair Jerome Powell seems to justify the recent rate cut in terms of the fact that U.S. inflation remains low and tame as the economy operates near full employment despite continual trade escalation between the U.S. and China.
Barro indicates the clear and present danger that the recent rate reduction represents a dovish Powell response to many stock market analysts and the Trump administration.
Federal Reserve Chair Jerome Powell announces the monetary policy decision to lower the federal funds rate by a quarter point to 2%-2.25%.
This interest rate cut is the first rate reduction since December 2008.
For most American investors, the rate cut can mean a reprieve in the average cost of capital.
Powell reiterates that this interest rate reduction cannot be misconstrued as a one-time rate cut or the first in a series.
Stock market analysts may view Federal Reserve monetary policy independence and credibility in a negative light as the FOMC approves the rate cut under pressure from a vocal president.
The interest rate cut sends a shiver through global markets, and the intricate nuances of Powell language reverberate in response to persistently low inflation in America.
Powell faces direct and confrontational questions on why an interest rate cut is necessary when the U.S. economy remains robust with high employment.
The current U.S. inflation rate hovers in the reasonable range of 1.5%-1.7% below the 2% monetary policy target, and the current U.S. unemployment rate persists at 3.7% per annum.
The recent interest rate cut may inadvertently limit the Federal Reserve monetary policy adjustments in response to a future financial downturn.
Yale macro economist Stephen Roach draws 3 major conclusions with respect to the Chinese long-term view of the current tech trade conflict with America.
First, the Chinese Xi administration would never lose legitimacy due to subpar 5.5%-6.3% real GDP economic growth.
China still retains more fiscal and monetary policy levers than global economic growth headwinds.
Second, Chinese hardliners remain patient and methodical when they deal with external wildcards.
These external wildcards include U.S. partisanship and economic policy uncertainty, Brexit trade and capital exodus, and diplomatic outrage in the South China Sea.
Third, the 5G tech titan HuaWei is a big deal and national champion for China.
As China seeks to trudge on the long march toward tech supremacy, U.S. trade strategists should consider alternative approaches instead of the current legalistic approach to Sino-U.S. trade conflict resolution.
It would be a symbolic loss of state dignity and sovereignty for China to agree to signing into law U.S. trade terms and conditions on intellectual property protection and enforcement.
Alternatively, U.S. trade reps should focus on direct dispute negotiations between U.S. and Chinese tech corporations through the extant inland and international arbitration tribunals.
This alternative mechanism may nevertheless favor domestic firms in China.
Due to U.S. tariffs and other cloudy causes of economic policy uncertainty, Apple, Nintendo, and Samsung start to consider making their tech products in Vietnam instead of China.
The current exodus of foreign direct investment poses an imminent threat to the Chinese economy, employment, national income, and industrial production.
The new economic forecasts suggest subpar 5.5%-6.3% real GDP growth for China.
When U.S. trade envoy Robert Lighthizer and Treasury Secretary Steven Mnuchin return from Shanghai bilateral trade negotiations with little progress, President Trump adds a new 10% tariff on all the other $300 billion Chinese imports before the next round of Sino-American trade negotiations in September 2019.
The bellicose Trump administration accuses Chinese delegates of trying to halt a major bilateral trade deal ahead of the U.S. presidential election in 2020.
As the Trump administration threatens with new tariffs in the next negotiations, the recent escalation narrows the path of least resistance to a major trade deal.
Beijing and Washington harden their trade positions, and political dynamism further complicates the chances of bilateral trade compromise.
Later the Trump administration defers the 10% tariff on $300 billion Chinese imports to December 2019 (after the annual sales season from Halloween to Christmas).
Most current artificial intelligence applications cannot figure out the intricate nuances of natural language and facial recognition.
These intricate nuances represent a major persistent challenge to most recent artificial intelligence applications such as Apple Siri, Amazon Alexa, and Google Assistant etc.
For instance, artificial intelligence applications often cannot decipher puns, jokes, sarcastic remarks, and other more complex conversations.
Also, artificial intelligence applications often cannot distinguish delicate facial expressions such as surprise and confusion, fear and anxiety, or hubris and hysteria.
Many artificial intelligence machines learn from big data to predict specific human emotions, actions, and interactive outcomes via neural networks.
Emotion recognition technology analyzes facial expressions to infer how humans feel, and this technology can create $25 billion business opportunities by 2025.
Tech titans such as Facebook, Apple, Microsoft, Google, and Amazon (F.A.M.G.A.) lead these tech advances in artificial intelligence.
New specialty startups such Kairos and Affectiva also take part in this fresh direction.
Emotion recognition can often help promote products and services, and this technology can be useful in job recruitment, fraud, and crime prevention.
Many lean enterprises seek to capture this tech niche, and these enterprises have yet to close the gap between artificial intelligence and universal intelligence.
AYA finbuzz podcast September 2019
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Product market competition and online e-commerce help constrain money supply growth with moderate inflation.
Online e-commerce retailers such as Amazon, Alibaba, and eBay use fast multi-channel pricing algorithms to set the retail prices of consumer goods.
For central bankers and monetary policymakers who often need to monitor transitional inflation dynamism over time, retail prices are subject to more frequent adjustments with less insulation from common nationwide shocks.
Intense product market competition poses a new economic risk that some retailers may institute an innocuous deterioration in product quality instead of upward price revision.
Online retailers can use smart retail-pricing algorithms to take into account energy costs, exchange rate fluctuations, and other fundamental factors that may affect both production and delivery prices.
Product power concentration further empowers the top 10% superstar companies to capture almost 80% of net profits in Corporate America.
These superstar companies retain their competitive advantages over the course of more than one single real business cycle (about 7-to-9 years).
This anti-competitive clout issue calls for tougher antitrust scrutiny for tech titans (Apple, Amazon, Alibaba, Facebook, Google, and Twitter), big biotech bellwethers (Johnson & Johnson, Pfizer, Merck, Abbot, Amgen, and Bristol-Myers Squibb), and telecoms (Verizon, AT&T, Sprint, and T-Mobile).
Volcker, Greenspan, Bernanke, and Yellen contribute to a Wall Street Journal op-ed on monetary policy independence.
These former Federal Reserve chiefs unite together to express their concern that Fed Chair Jerome Powell institutes the recent dovish interest rate decrease in response to a vocal president.
In their joint conviction, the Federal Reserve System and its chair must be able to make monetary policy decisions in the best interests of the U.S. economy.
Also, these monetary policy decisions must be independent and free of short-term political pressure without the threat of either removal or demotion of Federal Reserve leaders for non-economic reasons.
Volcker, Greenspan, Bernanke, and Yellen emphasize the extant congressional checks and balances with respect to the Federal Reserve monetary policy purview.
In recent times, Federal Reserve Chair Jerome Powell and FOMC members approve a quarter-point interest rate decrease to help sustain the current U.S. economic expansion.
This monetary policy decision arises in the broader context of relentless criticisms among the Trump hawkish hardliners.
These hardliners and President Trump himself view the prior U.S. interest rate hikes as headwinds that may inadvertently offset the economic benefits of tax cuts and other fiscal stimulus packages for better infrastructure, investment, and technology.
President Trump praises great unity and progress in the recent G7 summit with respect to Sino-U.S. trade conflict resolution, climate change, containment for Iran, and trade peace with Europe and Japan.
At the G7 summit in France, President Trump asserts that he can engage in direct talks to better resolve climate change issues and economic sanctions on the nuclear nation Iran.
President Trump can meet the Iranian President Hassan Rouhani under the right circumstances.
The Trump administration can further help eradicate environmental degradation on a global scale.
Also, President Trump expects Sino-U.S. trade talks to resume in September 2019.
These fresh negotiations can help assuage the recent bilateral trade escalation with higher tariffs, threats, and other aggressive countermeasures.
Chinese Vice Premier Liu He indicates that China can work together to solve trade problems through consultation and cooperation with a calm attitude.
In addition, the Trump administration achieves trade peace with Japan for better regional trade partnerships.
Moreover, the Trump administration causes France (and other European countries such as Germany and Italy) to agree to legitimate digital tax reprieve for U.S. tech titans such as Apple, Amazon, Facebook, and Google.
Overall, peace and engagement can help resolve complex economic policy issues.
U.S. yield curve inversion can be a sign but not a root cause of the next economic recession.
Treasury yield curve inversion helps predict each of the U.S. recessions since the 1970s.
However, no fundamental reason can help explain whether this inversion causes each recession.
Correlation may not imply causation.
Several stock market analysts focus on the 3 major root causes of an economic recession.
First, the monetary authority tends to institute interest rate hikes to better curtail inflation or money supply growth.
A series of interest rate hikes help prevent macroeconomic instability; otherwise, inflation would become a major source of economic disturbance.
Second, energy prices often increase substantially in the dawn of an economic recession.
Oil and natural gas prices tend to fluctuate due to geopolitical risks and military confrontations.
Third, stock market analysts expect to see high unemployment, low capital investment, and low industrial production well before a major recession.
In this alternative scenario, subpar labor and capital productivity can cause the economy to slide into at least 2 quarters of negative real GDP growth.
Whether Treasury yield curve inversion serves as a sign but not a root cause of the next economic recession remains open to controversy.
Global stock market investors foresee the harbinger of a major global downturn.
Many stock market investors become anxious primarily due to negative term spreads and negative interest rates worldwide.
As the 10-year Treasury bond yield exceeds the 3-month Treasury bill yield, the U.S. experiences another yield-curve inversion that often serves as a vital economic indicator of the next recession.
In Germany, interest rates become negative across the board from overnight deposits to 30-year government bonds.
Also, negative yields extend to 50-year government bonds in Switzerland.
In terms of asset price normalization, the greenback appreciates substantially against many currencies such as the Chinese renminbi, British pound, Euro, and Japanese yen.
Copper prices decline substantially to reflect a major deterioration in industrial production; gold prices reach their 6-year peak; and the recent Iranian seizure of Gulf oil tankers causes sharp oil price fluctuations.
Pervasive investor fear and anxiety can permeate global asset markets as these economic signals portend a major recession.
Other important economic indicators include sovereign-debt-to-real-GDP ratios, fiscal deficits, and current account deficits.
In this light, Indonesia, Pakistan, South Africa, Turkey, Ukraine, and Venezuela carry the highest risks as the capital outflows substantially exceed the capital inflows of foreign direct investment.
U.S. Treasury officially designates China a currency manipulator in the broader context of Sino-American trade dispute resolution.
The U.S. Treasury classification of China as a currency manipulator suggests that this classification represents another fresh escalation of the current Sino-U.S. trade conflict.
This escalation spooks global financial markets and thus wipes 3.5% from all major U.S. stock market indices such as S&P 500, Dow Jones, Nasdaq, and MSCI USA.
French, German, and other European stock market indices decline by 2.5%-3%.
The next currency battle may turn out to be relentless in the current game of competitive depreciation.
In effect, China allows its renminbi currency to tumble to the psychologically vital 7-yuan per U.S. dollar (or the lowest level in 11 years).
This depreciation may give China an unfair competitive advantage against the U.S. in the current game of chicken in tech, trade, and currency.
However, the recent renminbi currency misalignment may or may not help boost Chinese exports due to global interest rate surprises and competitive prices outside East Asia.
Federal Reserve interest rate cuts may inadvertently give U.S. politicians the impression that monetary policy can help repair the damage of trade policy mistakes.
The law of inadvertent consequences counsel caution.
China allows its renminbi currency to slide below the psychologically important threshold of 7-yuan per U.S. dollar.
A recent currency dispute between the U.S. and China has brought the trade conflict between the G2 superpowers to new extremes.
U.S. Treasury designates China a currency manipulator soon after the Chinese central bank lets renminbi slide to the symbolically important level of 7-yuan to the dollar for the first time in 11 years.
This strategic move represents another escalation as the Sino-U.S. trade relations continue to deteriorate in the meantime.
On the one hand, this recent renminbi depreciation helps render Chinese export prices more competitive and so can contribute to better trade-driven economic prospects.
On the other hand, the renminbi depreciation inevitably exacerbates the monetary severity of 25% Trump tariffs on $250 billion Chinese imports.
As this renminbi depreciation serves as a flexible countermeasure to the 10% Trump tariff on all the other $300 billion Chinese imports, most U.S. stock market indices decline substantially 3%-5% in response to the bilateral tense trifecta of tech, trade, and currency.
Treasury Secretary Steven Mnuchin indicates that the Trump administration can engage with the IMF, WTO, and World Bank to prevent unfair trade competition from China.
Central banks in India, Thailand, and New Zealand lower interest rates in a defensive response to the Federal Reserve recent rate cut.
These central banks attempt to institute interest rate cuts to fend off any economic harm from the current negative spiral of Sino-U.S. trade conflict escalation, Brexit trade and capital exodus, and geopolitical confrontation in the South China Sea.
Australia may be the next to act in accordance with this dovish cycle of international interest rate reductions, and the likely Australian dollar depreciation can help boost Aussie exports worldwide.
On Wall Street, the major U.S. stock market indices such as S&P 500, Dow Jones, Nasdaq, and MSCI USA plummet 3%-5% as a result.
Before the dust settles on Sino-American trade conflict resolution, the Chinese central bank lets the renminbi currency weaken to 7-yuan-per-greenback in more than a decade.
Any further aggressive greenback depreciation or Federal Reserve downward interest rate adjustment may risk upsetting a relatively stable global economic order of low inflation rates, exchange rates, and employment levels in the recent decade after the global financial crisis of 2008-2009.
The negative ripple effects can lead to more economic headwinds and fewer monetary policy levers for many central banks worldwide.
Harvard macrofinance professor Robert Barro sees no good reasons for the sudden reversal of monetary policy normalization.
As Federal Reserve Chair Jerome Powell yields to the persistent demands of a vocal president, the FOMC approves an interim interest rate cut by quarter point to 2%-2.25%.
This interest rate cut represents a clear departure from the current business cycle of interest rate hikes in recent years.
Barro advocates the Taylor monetary policy rule that the nominal interest rate should rise in response to higher inflation and economic output both relative to their targets.
In accordance with this Taylor monetary policy rule, the nominal interest rate normally tends toward a gradual long-term equilibrium path.
In this light, Barro regards the recent interest rate reduction as a major deviation from the prior path of monetary policy normalization.
Federal Reserve Chair Jerome Powell seems to justify the recent rate cut in terms of the fact that U.S. inflation remains low and tame as the economy operates near full employment despite continual trade escalation between the U.S. and China.
Barro indicates the clear and present danger that the recent rate reduction represents a dovish Powell response to many stock market analysts and the Trump administration.
Federal Reserve Chair Jerome Powell announces the monetary policy decision to lower the federal funds rate by a quarter point to 2%-2.25%.
This interest rate cut is the first rate reduction since December 2008.
For most American investors, the rate cut can mean a reprieve in the average cost of capital.
Powell reiterates that this interest rate reduction cannot be misconstrued as a one-time rate cut or the first in a series.
Stock market analysts may view Federal Reserve monetary policy independence and credibility in a negative light as the FOMC approves the rate cut under pressure from a vocal president.
The interest rate cut sends a shiver through global markets, and the intricate nuances of Powell language reverberate in response to persistently low inflation in America.
Powell faces direct and confrontational questions on why an interest rate cut is necessary when the U.S. economy remains robust with high employment.
The current U.S. inflation rate hovers in the reasonable range of 1.5%-1.7% below the 2% monetary policy target, and the current U.S. unemployment rate persists at 3.7% per annum.
The recent interest rate cut may inadvertently limit the Federal Reserve monetary policy adjustments in response to a future financial downturn.
Yale macro economist Stephen Roach draws 3 major conclusions with respect to the Chinese long-term view of the current tech trade conflict with America.
First, the Chinese Xi administration would never lose legitimacy due to subpar 5.5%-6.3% real GDP economic growth.
China still retains more fiscal and monetary policy levers than global economic growth headwinds.
Second, Chinese hardliners remain patient and methodical when they deal with external wildcards.
These external wildcards include U.S. partisanship and economic policy uncertainty, Brexit trade and capital exodus, and diplomatic outrage in the South China Sea.
Third, the 5G tech titan HuaWei is a big deal and national champion for China.
As China seeks to trudge on the long march toward tech supremacy, U.S. trade strategists should consider alternative approaches instead of the current legalistic approach to Sino-U.S. trade conflict resolution.
It would be a symbolic loss of state dignity and sovereignty for China to agree to signing into law U.S. trade terms and conditions on intellectual property protection and enforcement.
Alternatively, U.S. trade reps should focus on direct dispute negotiations between U.S. and Chinese tech corporations through the extant inland and international arbitration tribunals.
This alternative mechanism may nevertheless favor domestic firms in China.
Due to U.S. tariffs and other cloudy causes of economic policy uncertainty, Apple, Nintendo, and Samsung start to consider making their tech products in Vietnam instead of China.
The current exodus of foreign direct investment poses an imminent threat to the Chinese economy, employment, national income, and industrial production.
The new economic forecasts suggest subpar 5.5%-6.3% real GDP growth for China.
When U.S. trade envoy Robert Lighthizer and Treasury Secretary Steven Mnuchin return from Shanghai bilateral trade negotiations with little progress, President Trump adds a new 10% tariff on all the other $300 billion Chinese imports before the next round of Sino-American trade negotiations in September 2019.
The bellicose Trump administration accuses Chinese delegates of trying to halt a major bilateral trade deal ahead of the U.S. presidential election in 2020.
As the Trump administration threatens with new tariffs in the next negotiations, the recent escalation narrows the path of least resistance to a major trade deal.
Beijing and Washington harden their trade positions, and political dynamism further complicates the chances of bilateral trade compromise.
Later the Trump administration defers the 10% tariff on $300 billion Chinese imports to December 2019 (after the annual sales season from Halloween to Christmas).
Most current artificial intelligence applications cannot figure out the intricate nuances of natural language and facial recognition.
These intricate nuances represent a major persistent challenge to most recent artificial intelligence applications such as Apple Siri, Amazon Alexa, and Google Assistant etc.
For instance, artificial intelligence applications often cannot decipher puns, jokes, sarcastic remarks, and other more complex conversations.
Also, artificial intelligence applications often cannot distinguish delicate facial expressions such as surprise and confusion, fear and anxiety, or hubris and hysteria.
Many artificial intelligence machines learn from big data to predict specific human emotions, actions, and interactive outcomes via neural networks.
Emotion recognition technology analyzes facial expressions to infer how humans feel, and this technology can create $25 billion business opportunities by 2025.
Tech titans such as Facebook, Apple, Microsoft, Google, and Amazon (F.A.M.G.A.) lead these tech advances in artificial intelligence.
New specialty startups such Kairos and Affectiva also take part in this fresh direction.
Emotion recognition can often help promote products and services, and this technology can be useful in job recruitment, fraud, and crime prevention.
Many lean enterprises seek to capture this tech niche, and these enterprises have yet to close the gap between artificial intelligence and universal intelligence.
AYA finbuzz podcast September 2019
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!!
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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.
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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)
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