New job data is helping American markets as 55,000 jobs were added to the private sector during May, while jobless claims fell. Tomorrow’s job data is expected to boost markets higher.
Euro jitters are still around though, and overgrowth in Asia was expected to dampen the markets. World wide factory activity grew this month however, with only Greece and Hungary contracting. India, Japan, Ireland, Turkey, Switzerland and the Czech Republic experienced positive growth from April.
A mix of large retailers like Macy’s, Target, and Gap reported positive growth, but fell just beneath Wall St. expectations.
Meanwhile JP Morgan was fined a record $49 million by the British Financial Services Authority, for not keeping separate its clients monies separate from the firm’s. If these funds aren’t kept separate, then it is impossible for clients to have their funds returned if a bank fails.
It seems as though a double dip recession will be avoided, for now, at least. The Fed will likely keep interest rates at zero until early 2011. Growth continues slowly, and hopes that inflation will rise may promote action on the part of the Fed to raise interest rates.
Market trends are climbing back to normal, but slowly.
After bailing out the banks, governments have kept interest rates low, and as a result, profits have soared. News about the 1st quarter was slightly disappointing today, but 3% growth ain’t bad. Two big factors this week: geopolitical fears coming from the Pacific Rim, and foreign (European) debt.
Many investors worry that if European governments all start closing their fists at once, another recession looms. But the flip side is that if countries like Greece and Spain don’t exercise fiscal restraint, then default and the banks holding that debt will flounder.
The rate of interbank lending (LIBOR) has soared recently. But as banks become more concerned about their lending rates, they may become more reticent to lend, which could mean a freeze in the markets similar to that of 2008.
In general, the ease of recovery has been part of the reason for the volatility of the markets. There will be a time when interest rates return to normal levels, and fiscal policy tightens. This return to normalcy, for many investors, is scary. How it will be effected is still unknown.
And what about deflation? Price to earnings ratios are still higher than they should be, trading at 20 times what earnings actually are.
While profits and interest rates remain good signs, political trouble and financial regulation worries bears. Guess we’ll have to wait and see.
The great CEOs know that in order to be a high-powered executive, you need to stop multi-tasking and tackle one task at a time like a high-powered sniper rifle.
But how to stop multi-tasking? A conference call goes long and you start quietly typing out an email. Or you have several windows open on the computer at once including email, chat, spreadsheets, the web, streaming music, and other documents. Multi-tasking is addictive and seemingly inevitable. So how to kick the habit?
Take Control
The hardest part to quitting your multi-tasking is to apply old-fashioned willpower and just do it. It takes 30 days to form a habit, so after the first month of single-tasking, you’ll have momentum
Batch Your Work
Set a schedule for completing certain kinds of work all at once. Let your colleagues know that you’ll only be answering calls between certain hours, then follow through and set your phone to “Do Not Disturb.” Or decide to hone in on some analysis or writing work and close your email and internet programs. Set yourself up for success by removing as much of the background noise and processes as possible.
“Eat the Frog”
Each day, you have a series of tasks to complete. And there is almost always a big, hard task for the day that you probably dread, like eating a metaphorical frog. But instead of putting it off, do this task first. The rest of your tasks will seem easy in comparison.
You’ll Like It
Staying focused will make you feel effective, because you are effective. You’ll make amazing progress on your projects and stop spending time on time-wasting progress or idle web surfing.
The Dow Jones Industrial Average has given up all of the gains it has made this year over the course of the past couple of weeks. Why? Well, in large part due to fears of a Greek default. But that’s not all. When Germany announced last week that it was banning hedging on Euro-zone government debt, markets tumbled further. A consequent rise in interest rates between Europe’s banks doesn’t bode well for the rest of the world.
China is worried about the astronomical prices of its real estate, and the renmnibi is still highly inflated against the Euro, which China has yet to incrementally attack. If the European situation worsens, more may have to be done sooner.
Deflation, already extant in Ireland and Spain, is causing American fears too. The United States’ G.D.P. remains low, and with cash failing to circulate, the consumer price index (CPI, as a measure of inflation) is continually sliding from its year on year percentage.
While global markets are hoping that deficits are cut, especially in Europe, that fear may lead to more unknown occurrences, which is why the VIX volatility index has reached its highest rate in over a year.
What does it all mean? For right now, things aren’t getting any better. Let’s just hope they don’t get any worse.
United and Continental have merged and will be called United in a deal that will make them the largest airline in the world. Globally, the airline would have a 7% part of the airline market, and 20% domestic share.
For consumers, this means higher airline prices and fewer routes. Over the course of the past decade, however, certain mergers have had to fight with discount airlines like Southwest, and JetBlue, along with other factors that have harmed the industry, like the terrorist attacks of 9/11, rising oil prices, and the recession.
The companies had begun talks in the past, but those deteriorated due in part to United’s weak financial health. In 2008, Continental was on the buying side. The falling through of these talks served as a preliminary to what helped the companies merge so quickly.
The company will be called United, will be based in Chicago – a city that has badly desired a major corporation to call it home – and will be run by United’s chairman for two years, until Mr. Smisek of Continental will man the helm. It will also keep the Continental colors and retain a large presence in Houston. Other airports where the new airline will be prominent include: SFO, Newark, and O’ Hare.
As the recession ends, consumer confidence is widespread. For some, however, there was never a recession. In China and India, optimism remains at an all time high. The effects of globalization that were expected early last decade, that of outsourcing these growing countries to even cheaper labor, has produced the opposite effect. Companies like Brazil’s Embraer, a jetliner corporation, buys its component parts from Western countries, and assembles its products at home.
China and India lead the pack, as college graduates, graduate degrees, and satisfaction with life has risen dramatically over the past ten years. This is in large part thanks to a new sort of innovation, one that leaves many Western countries scratching their heads about how to remain competitive. New design methods that allow for even more widespread accessibility, especially among an emergent consumer class. Simpler and cheaper is the new “new and improved” and these once third world countries are showing everyone how to do it, from cars to computers. Population booms expect more than 5 billion Asians by 2050, and a doubling of Africa’s denizens, from 1 billion in 2010 to 2, over the next 40 years. Competing on a global scale is what these emerging market companies are after, and not only are they achieving it, but they in fact, are leading the way.
With the annual collection of world leaders for Washington’s Spring Business Conference looming next month, and recent numbers for the first quarter already in, the recession is over and recovery has officially begun. China’s economy has grown by over 11% since a year ago, Singapore’s grew an astounding 32% last quarter, the U.S. had 3% growth, but Europe, one of the world’s most important economic regions, had just 1% growth.
Part of the problem is Greece. Just days after a European bailout was arranged, doubts about Greece’s ability to recover and potentially defaulting are rampant. Because the $16 billion allocated to Greece will be paid at near market value, the country is subject to all of the jolts of the market without an interest rate ceiling. While this flaw is being currently addressed, other economies like Portugal, Italy and Spain also look weak in comparison to Northern European countries. Over the past decade, these countries saw prices and wages rise more quickly than the euro-area average and ran up huge debts. Now their recovery is stilted as the rest of the European economy is ready to grow, without the deficits that hamper these countries.
Another part of the problem is that European consumers are not spending money. Germany’s reliance on exports is a good example of how not enough purchasing power is being exercised.
On April 7th, British Airlines and Iberia inked a merger deal to become the world’s sixth largest airline in revenue. A day later, United Airlines and US Airways resumed talks that failed in 2000 and 2008. If these two were to merge, they would become the world’s 4th largest airline behind Lufthansa, Air France, and Delta.
These mergers come during a decade of losses for the battered airline industry, which suffered from a spike in oil prices in 2008, and the weakness of the travel industry in 2009. With global economies rebounding, there are hopes that eliminating competition will send air fares higher. When Delta and Northwest merged in 2008, Delta effectively became the nation’s largest airline. This success has partly prompted these talks.
In the past, these deals have been difficult to pull off due to labor contracts. US Airways, while one of the weaker American airlines, has a key hub in Phoenix, which competes directly with Southwest. Southwest was the only large scale airline to turn a profit last year. United, which has a strong presence on the East Coast with hubs in L.A., San Francisco, Chicago, Denver, and Washington, would benefit from the Southwestern exposure.
Although a deal is not expected to go through for weeks, it at all, this merger signals that the world of airline travel is changing.
In March, residual signs of a market turnaround continued as unemployment held steady at 9.7%. The total number of jobs gained was 162,000, a dramatic raise since the market began shedding jobs almost two years ago. About a third of the added jobs come from the U.S. census, which has taken many employees under its wing full time, albeit for just a couple of months.
In order to sustain growth, the job market must create at least 100,000 jobs every month. The government predicts that the unemployment rate will stay roughly in the nines all year, and that it will take until 2016 for the unemployment rate to drop back to the pre-recession rate of around 5%.
Although the unemployment rate is finally dropping, it is still 1.8% higher than it was last year at this time. Economists, however, say that this is a good sign of economic recovery. The report also showed that the average rate of pay dropped .1 both for all employees to $22.47 and for nonsupervisor employees to $18.90.
Meanwhile, President Obama is in Charlotte, N.C. today to promote his job creation plan as Democrats prepare for midterm elections this November. Congress is attempting to submit a bill that will promote job growth by offering tax breaks to small businesses that begin hiring.
Google has redirected its Chinese users to a Honk Kong search engine to avoid the censorship of mainland China in a move that underscores the Internet giant’s volatility in the Communist country. Google has accused China of blocking users access to Google.cn, the search engine’s Chinese website. Although Google has a relatively large presence in China at 36% of the search engine market with 600 employees, the country accounts for just 2% of their total revenue.
In Hong Kong, laws are looser than in mainland China, and Google has seized upon this fact to continue allowing their Chinese users to have unmediated access to the Internet. The Chinese government can deny its citizenry access to this site at any time, as they have control over all of the .cn domains.
Already China has expressed “discontent and indignation” at Google for its attempts to allow for freedom of speech and Internet access. This bold move may relay to other companies working within China a message about how, and whether or not, to continue providing China with its own unique set of provisions. It remains to be seen whether Chinese officials will block access to the Hong Kong site.
