Posts belonging to Category Personal Finance



Nigeria and India, champions of the extreme poverty in the world

Nigeria overtakes India

Nigeria has overtaken India as the country with the largest number of people living in extreme poverty, with an estimated 87 million Nigerians, or around half of the country’s population, thought to be living on less than $1.90 a day. The findings, based on a projection by the World Poverty Clock and compiled by Brookings Institute, show that more than 643 million people across the world live in extreme poverty, with Africans accounting for about two-thirds of the total number.

In Nigeria, as with other countries on the continent, that figure is projected to rise. “By the end of 2018 in Africa as a whole, there will probably be about 3.2 million more people living in extreme poverty than there are today,” the researchers write.
Despite being the largest oil producer in Africa, Nigeria has struggled to translate its resource wealth into rising living standards.

Economic Ponzi Scheme

Financial disaster is quickly forgotten

Consider two economic systems. In one, consumers work for employers to produce products and services. The employees are paid wages and salaries, and business owners earn profits. They use much of that income to purchase the goods and services produced by the economy. They save the remainder. A certain portion of the output represents “investment” goods, which are not consumed, and the portion of income not used for consumption – what we call “saving” – is used to directly or indirectly purchase those investment goods. There may be some goods that are produced and are not purchased, in which case they become unintended “inventory investment,” but in a general sense, this first economic system is a well-functioning illustration of what we call “circular flow” or “general equilibrium.” As is always the case in the end, income equals expenditure, savings equal investment, and output is absorbed either as consumption or investment.
The second economic system is dysfunctional. Consumers work for employers to produce goods and services, but because of past labor market slack, weak bargaining power, and other factors, they are paid meaningfully less than they actually need to meet their consumption plans. The government also runs massive deficits, partly to supplement the income and medical needs of the public, partly to purchase goods and services from corporations, and partly to directly benefit corporations by cutting taxes on profits (despite being the only country in the OECD where corporations pay no value-added tax).

https://www.seekingalpha.com/

The richest families in the world

33 rich people listed by the Sunday Times

The Sunday Times has published its much-anticipated Sunday Times Rich List for 2018, which ranks the wealthiest people in Britain, as well as the rest of the world— and it gives readers a sneak peek into the net worth of some of the world’s most successful entrepreneurs, self-made billionaires, and family groups.

https://www.businessinsider.com/

Five top stock ideas

Big gains

Morgan Stanley revealed its favorite stock picks to its clients, predicting big gains for several stocks this year.

These are “the firm’s best stock recommendations,” Morgan Stanley’s research team wrote Wednesday. “Selection criteria is simple – stocks that we expect to outperform the market in the next 3-6 months based on specific catalysts such as a change in industry fundamentals, a positive EPS surprise, or new product introduction.”

https://www.cnbc.com/

Medicare for All

Poll Says Majority of Americans Prefer ‘Medicare For All’ Health Care

A growing number of Americans now support the idea of federally-funded healthcare, according to a new poll conducted by Gallup measuring response to each of the three remaining Presidential candidates’ proposed healthcare policies.

When presented with three different scenarios for the future of the Affordable Care Act (ACA), based on the candidates’ positions, 58 percent of U.S. adults favored Sen. Bernie Sanders‘ idea of replacing the law with a single-payer, federally-funded healthcare system that provides insurance for all Americans.

For this poll, Gallup surveyed a random sample of 1,549 adults between May 6 and May 8 of this year about which of the three candidates’ healthcare policies they preferred, without using any of their names. The majority expressed a preference for Sanders’ proposal to replace the ACA with some form of the “Medicare for All” system, compared to Democratic front-runner Hillary Clinton‘s proposal to maintain the ACA and presumptive GOP nominee Donald Trump‘s proposal to repeal it.

http://abcnews.go.com

Amazon is Eyeing the Banking Industry

How Amazon is planning to break into Wall Street

Banks have been warily watching Amazon.com Inc. for signs it would threaten their world. The tech giant’s latest move looks more like an opportunity — at least for one of them. A proposal to start offering a product similar to checking accounts is “for now not showing any signs of disrupting the industry,” Brian Foran, an analyst at Autonomous Research, said in a note to clients Monday. “While the ‘Amazon effect’ has dictated trading in several sectors, for banks it seems a much tamer story.”

Amazon is in talks with JPMorgan Chase & Co. and Capital One Financial Corp. about the product, people familiar with the matter said Monday. The targets are millennial consumers, the people said, asking not to be identified because the discussions are private. The strategy could help Amazon lower fees it pays to financial firms and give it a bigger window into customers’ income and spending habits. The Wall Street Journal reported the talks earlier Monday.

http://www.bloomberg.com…  March 07, 2018

Bull Market Heading for Major Correction in 2018, Bank of America Says

The bull market is showing signs of cracking

Bank of America Corp. (BACGet Report) says signs are growing that the eight-year-old bull market in stocks and risky assets could soon come to an end. And, as with all late-stage bull markets, the trick for investors is in getting the timing right. The Standard & Poor’s 500 Index, a key benchmark for U.S. stocks, could peak at 2,863 during the first half of 2018, Bank of America analysts predicted in a report. That’s 8% above current levels.

But the second half could bring mostly gloom for investors, as the Federal Reserve tightens financial conditions by raising interest rates and shrinking its balance sheet. Volatility — a measure of the size of daily price swings — could rise from this year’s unusually low levels. Inflation is likely to increase. Yields on corporate bonds could widen relative to those of U.S. Treasuries — an indicator of fading investor confidence in companies’ ability to repay their debt. “Signs of bubble-like behavior abound,” according to the report, which cited examples like record-high art prices, soaring Bitcoin prices and a 100-year-bond sale by Argentina, the South American nation that has defaulted on its debt eight times in the past 200 years. Next year “could represent the move toward euphoria, which typically heralds the end of a bull market.”

http://www.the street.com…  March 05, 2018

Stocks or Bonds: What Happens When Rates Rise?

Basic rules

Although there are no specific rules about how bonds and dividend-paying stocks respond to rising interest rates, there are some broad tendencies you may want to consider, suggests Mary Ann Bartels, head of Merrill Lynch Wealth Management Portfolio Strategy.

With bonds, the “coupon rate” is the interest rate that an issuer uses to calculate regular interest payments to investors. The longer the term of a bond, the higher the coupon is likely to be; you’re paid more to wait longer to get your principal back. Higher risk, too, affects the coupon, with high-yield bonds from less solid companies offering more generous interest payments than you’ll get from higher-rated corporations or from U.S. Treasury bonds.

http://www.ml.com…  Febuary 23, 2018

Despite Trump’s attacks, Obamacare sign-ups dip only slightly

Millions of Americans opted to sign up for coverage on the exchanges for 2018 anyway

Some 11.8 million people selected plans on the federal and state-based exchanges, down 3.7% from last year, according to the National Academy for State Health Policy. The data, released Wednesday, provides the first look at sign-ups for 2018 nationwide. Just over 8.7 million people signed up on the federal exchange, while a little over 3 million picked plans in the 11 states and District of Columbia, which run their own marketplaces. Obamacare advocates had feared that sign-ups would plummet after the Trump administration cut the open enrollment period in half, slashed advertising by 90% and reduced support for enrollment assistance. Also, insurers hiked premiums for many plans amid the uncertainty in Washington, D.C. and President Trump’s elimination of funding for Obamacare’s cost-sharing subsidies. However, in a strange twist, richer federal premium subsidies actually made coverage more affordable for many people.

http://money.cnn.com...  Febuary 08, 2018

The store of the future

Inside Amazon Go

Long lines at checkout are common at grocery stores. But at Amazon’s new cashier-free store, you’ll only need to worry about clumps of tourists. The small test store in Seattle, which opened to the public for the first time on Monday, could be what automated shopping spaces will look like in the future. It uses cameras and sensors to detect what food you’ve taken from a shelf, then automatically charges you when you walk out. I stopped by to try out the store, located in the base of Amazon’s corporate skyscraper, on Thursday morning. Three days after its grand opening, the massive lines had mostly disappeared. There were only a handful of shoppers inside at 10:15 a.m., but business picked up at lunchtime and there was a short line to enter.

To walk in, you need a few things: an Amazon account, a recent smartphone, and the Amazon Go app. You enter the 1800-square-foot space through six high-tech turnstiles. Open the app and wave a code on your screen above a gate to open it. It’s a familiar experience to anyone who has ridden a subway or used a mobile boarding pass at the airport.

http://www.cnn.com…  January 29, 2018