Question: According to MSN: Money, what are seven (7) times you are smart to not pay off your mortgage early?
8 June 2019 FT — Articles to Read
8 June 2019
Question: What University just shut down its part-time real estate programme?
US jobs blow spurs rate-cut debate – Pg. 1
– The US added just 75,000 jobs in May, a sharp slowdown from a month earlier, intensifying debate on whether the Federal Reserve needs to cut interest rates to sustain a decade-long expansion and counter drag from trade conflicts
– …185,000 predicted…
– The unemployment rate held steady at 3.6%, matching its lowest level since 1969, but the disappointing hiring data added to worries about the US economy is beginning to lose momentum as trade tussles with China and other partners dent corporate confidence
– The latest figures and revisions means that monthly job gains have averaged 164,000 in 2019, well below the average gain of 223,000 per month in 2018. Growth in GDP is also showing signs of slowing, ….annualized growth of 1.5%…
Nasa opens space station for business – Pg. 2
– Nasa is opening up the ISS for tourism and commercial marketing, as the US space agency looks to cut spending on the 20-year-old project and free up more money to explore the moon and beyond
– Russia already permits private astronauts and other commercial activities on its segment of the ISS
– Nasa’s latest move throws open the doors of the ISS to private astronauts, manufacturing products that benefit from being made in microgravity environment, and other commercial and marketing activities
– Use of the facility will come at a hefty price. Access to the space station’s “regenerative life support and toilet” will cost $11,250/day, with another $22,500/day for crew supplies such as food, air and exercise equipment
– ….$42 for a kWh of power and $50 to send a gigabyte of data back to earth
– The Trump administration has been looking for ways to reduce government spending of around $3.5bn a year on the ISS
Break-up threat casts shadow over the Valley – Pg. 14
– …the House judiciary committee announced its own inquiry into whether US antitrust laws need to be tightened up to deal with the large tech groups
– The possibilities raised most frequently include declaring some markets off-limits to the biggest tech companies, carving out their most powerful platforms to become separate regulated utilities, and unwinding past acquisitions that raised few concerns at the time they were completed
– Restrict markets they can enter
– Split off platform businesses
– Reverse past acquisitions
Answer: Johns Hopkins University (Prof Note: I am saddened by this news. Some of my best mates were met due to this programme. I was proud to have been part of it from 2006 – 2012 (approximately, long in tooth, do not remember exact dates). I can only hope that I gave as much to this programme as it gave to me. It was a true academic programme in its hey day. I still remember faculty meetings where JG and I would battle over portfolio optimization theory. There were merits in both of our arguments (I was right, damn it! J) I am proud to still be lecturing in the full-time, remaining, real estate programme and the business school but admit a part of me died when I learned the part-time programme was to be no more. MANY great people put much work and effort into this programme. I am not criticizing the decision made by Hopkins, I was not involved in any of these decisions so have no knowledge, but remain saddened by the news. To the many that participated in this programme, I thank you for the countless memories shared and for the memories still to be created from the lifetime relationships.)
4 June 2019 FT — Articles to Read
4 June 2019
Question: What is the fastest growing segment of incarcerated prisoners?
Merged Chinese steelmakers set to exceed output of US industry – Pg. 1
– A planned merger of China’s largest steelmaker and a domestic rival is set to create a group whose combined production exceeded that of the entire US streel industry last year, as Beijing pushes on with efforts to consolidate its vast steel sector
– The two companies had combined crude steel output last year of 87m tonnes, surpassing total US steel output of 86.6m tonnes, …
– That would put the combined group only just behind the world’s top steelmaker, ArcelorMittal, which produced 92.5m tonnes of crude steel in 2018
– China is the world’s top consumer of steel. It used 828m tonnes last year as its own production grew 6.6% to a record 928m tonnes, driven by strong demand from the property sector
– …falling car sales in China have begun to erode steel demand and the possibility of output exceeding domestic demand this year raises the prospect of domestic steelmakers using exports as a pressure valve – something that would depress prices globally
– With demand flagging and iron ore prices rising, European steel producers in particular have been hit. Last week, ArcelorMittal cut production for the second time in a month, complaining of cheap imports from China
– Beijing aims to consolidate its fragmented steel sector so that the top 10 producers account for 60% of steel production, up from 35% now. Beijing has forced steelmakers to cut 200m tonnes of capacity since 2016
Scientists sound alarm on gene-editing technique in babies – Pg. 2
– The technique used by a controversial Chinese scientist to produce the world’s first gene-edited babies significantly increases the risk of dying early, ….
– Although the CCR5 mutation prevents the HIV virus from entering human immune cells and therefore protects against Aids, it has the opposite effect on some other pathogens
China’s middle class youth loses faith in American dream – Pg. 3
– For young Chinese wealthy enough to travel, what they find abroad no longer looks as impressive as what they have at home
– Chinese in their teens and twenties have no direct experience of inflation, shortages and corruption that brought their parents’ generation on to the streets. Long commutes, high housing prices, uncertain jobs and a percolating #metoo movement occupy their attention instead
– (Prof Note: After one of my classes yesterday I was able to speak with a young Chinese student. She was happy to be going back to China upon graduation. When I asked why not stay in the U.S. she said she missed China. I asked why. While she mentioned family and friends she also stated, “public transportation and ease of getting food [I assumed she meant deliver]”. Personally, I agreed with her assessment)
Beijing warns students of increased problems travelling to US – Pg. 3
– “Visa issuances for Chinese students studying in the United States have been restricted. The visa review period has been extended, the validity period has been shortened, and the refusal rate has increased”…
– Millions of Chinese have lived or studies in the US, and hundreds of thousands currently attend US high schools, colleges and graduate schools. Application volumes for the top 30 – 50 US institutions are rising steadily
– But even China hawks have been reluctant to block Chinese student visas more broadly because of the importance of the country’s students to US university budgets
Urban Renewal – Pg. 7
– Across the developed world, an urban model anchored around education, rather than commodities, is taking hold, inspired by a US example
– Universities exercise a powerful migratory effect
– Many graduates come from nearby towns, and are more likely to settle in places where they have studied
– In the UK, half of young people do not enter higher education
Big banks gear up for digital coin release – Pg. 12
– Thirteen of the world’s biggest banks are preparing to launch digital versions of big global currencies in 2020 after years of research convinced them that the technology underpinning crypto currencies could be used to make trading less risky and cheaper
– The technology, which is used in blockchain networks, enables participants to share information instantly on an open-access ledger that cannot be altered or erased
– In theory the technology could do away with the need for reams of paperwork and processing, but banks must first confront legal and regulatory hurdles on everything from risk management to privacy before deploying it widely
US downturn risk growing, warns Morgan Stanley gauge – Pg. 19
– The US market cycle has shifted from an expansionary phase to a downturn for the first time since 2007, …
– The Wall Street bank cautioned that a “phase-change” in its gauge has typically pointed to “higher chances of recession or a bear market”
– America’s benchmark S&P 500 index dropped 606%, or 6.4% on a total return basis that includes dividends
Top Fed policymaker pushes banks to step up preparations for Libor’s demise – Pg. 19
– The LIBOR holds huge sway in financial markets, underpinning trillions of dollars’ worth of mortgages, bonds, corporate loans and derivatives – but it was plunged into controversy when it emerged that traders had sought to rig the benchmark for their own benefit
– Libor-linked rates remain embedded in at least $420tn worth of contracts around the world but regulators want to shift to more durable, tamper-proof alternatives
Answer: Women
1 June 2019 FT — Articles to Read
1 June 2019
Question: according to MSN: News, what is the average length of stay in jail?
Slowdown fears rise on Trump threat to hit Mexico with tariffs – Pg. 1
– The president’s decision to subject Mexican imports to a 5% levy on June 10, with potential increases to follow, threatened to sap economic momentum and corporate confidence in the US and worldwide, coming on top of worsening trade relations between the US and China
– Global stock markets slid on the news, compounding the biggest pullback since the market volatility of last year that was seen them shed more than 6% in May
– The Mexican peso dropped as much as 3.3% as recession fears rose in a country that sends 80% of its exports to its northern neighbor. As investors sought safety in government bonds, Germany’s benchmark 10-year Bund yield fell as much as 2.6bps to minus 0.020% – its lowest level since German reunification in 1990,…
– In a further sign of the trade tensions, China announced it would establish a list of foreign companies that harm the “legitimate rights and interests” of Chinese groups
– The US economy grew at a 3.1% annualized pace in the first quarter, but was set to slow in the second quarter
Crowding prompts anger over Everest management – Pg. 2
– While UK-based Jagged Globe charges upwards of 45,490 (sterling) per person for an Everest expedition, new, mainly Nepalese groups have undercut the market in the past five years, charging as little as $25,000 to take dozens to the top at a time
– Some operators have clients who only learn how to use their equipment at the foot of the mountain
– Currently, almost anyone can climb Everest. A permit costs $11,000, there is no limit on how many are issued and no mountaineering experience is required
– (Prof Note: I proudly summited Kilimanjaro. I believe the price, 10 years in the past, was $5,000. The peak is about 10,000 feet below Everest and Kilimanjaro’s peak is a hair under 20,000 feet. Personally, I have felt the altitude at Lake Titicaca (12,500 feet) and, while I was slothy, navigated Cuzco and Machu Picchu without much difficulty. If you are healthy, I highly recommend Kilimanjaro, if for nothing else, to experience the limits of one’s own body. I remember resting at Stella Point which is 600’ from Uhuru peak (summit of Kilimanjaro). I sat down to rest. When it was time to get up I realized I could not get up. The Porter asked if I wanted to forgo Uhuru Peak (the summit). No way I was not making it to the summit. With ZERO loss of pride, I started to crawl. The porter helped me up and I realized I could only raise my foot, i.e. could not create forward motion. For the next 600’ I would raise one foot and the porter pushed me forward upon it creating forward motion. I raised the other foot and we continued this way for 600’, finally making the summit. It is absolutely a life experience worth having. For me, less so for the accomplishment of the summit (though that is wonderfully prideful) but more so to understand human limits.)
Fed nominee hits at bank’s Soviet-style market power –Pg. 4
– Judy Shelton….has attacked the central bank for wielding undemocratic, Soviet-style powers over markets and suggested it should not even be in the business of setting interest rates
– Ms Shelton did postdoctoral research on the Soviet economy at Stanford University’s Hoover Institution
– …possible nomination suggests that Mr Trump is in no mood for a less controversial pick for the US central bank, and wants a disruptive candidate to argue for unorthodox policies within the Fed
– She said the Fed should continue to reduce its balance sheet below the $3.5tn target set by Jay Powell, …
– She also said the Fed had become so influential that it unnaturally drove investment decisions and affected financial markets
– Ms Shelton has long been sympathetic to the gold standard, which the US abandoned in the 1970s in favour of a flexible exchange rate for the dollar
– Her bit dream is a new Bretton Woods-style conference….to reset the international monetary system, replacing the current regime, mostly based on floating currencies
Brazil and Mexico contract as low commodity prices take toll – Pg. 4
– Latin America’s two biggest economies contracted in the first quarter of 2019, setting the stage for a gloomy year in a region trying to recover from low commodity prices and weak productivity
– Brazil’s GDP fell 0.2% in the first three months….
– In Mexico, the region’s second-biggest economy, a weak service sector dragged growth down, also by 0.2%
– …Venezuela falling deeper into one of the biggest slumps in Latin American history as US sanctions and a collapse in oil production bite, ….
– Brazil’s contraction raised fears that Latin America’s biggest economy could return to recession less than three years after emerging from a deep downturn
US anti-abortion laws test CEOs’ activist reputation – Pg. 12
– Georgia’s Republican governor on May 7 signed into law a ban on abortions after a doctor can detect a foetal heartbeat, which can be about six weeks into a pregnancy. Critics have argued that women are often unaware they are pregnant at that stage. The law would take effect in 2020 if it survives court challenges
– (Prof Note: I have attempted to have two discussions with two highly intellectual groups/people on this subject. The result of both attempts was that this is a highly emotionally charged issue and that it was safer that I simply have no opinion. I am saddened by this. The question I have posed to both sets (note: I posed a question; I did NOT take a position) is, “If the woman has the right to abort, why does the man not have the right to financially “abort” his financial responsibility in cases of consensual intimacy? Would this not create a truer equality for both sexes on this issue?” I want to be clear, I have NOT stated a position, I know it is best for me not to have one (and safer), but I really would like to better understand the issue my question raises. Again, stated with complete fear and do not wish any reprisals, I am NOT stating any personal position, but am stating an intellectual curiousity.)
Investors take flight from riskier US corporate debt as trade war fears grow – Pg. 15
– The average yield premium, or spread, above Treasuries on high-yield bonds has soared 68bps to 4.5% in May, reflecting rising perceptions of risk. The US junk bond market is on course for its first month of negative returns this year
Answer: 25 days