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The Markets never lie – and it looks like Wall Street is smiling about Joe Biden
The Markets never lie – and it looks like Wall Street is smiling about Joe Biden It wasn’t just the Joe Biden campaign celebrating after a monumental Super Tuesday – so too was Wall Street. Dow (INDU) futures were last up more than 580 points, or 2.3%, after the former US vice president was projected to win many as nine states including Texas, Virginia and Minnesota. Sanders captured Utah, Vermont and Colorado, and was leading in California. Futures for the S&P 500 (INX) were up 1.8%, while the Nasdaq Composite (COMP) increased 1.9%. Wall Street has been unnerved by prospect that Sanders, who wants to ban fracking, break up big banks and institute a wealth tax, could win the Democratic nomination and eventually the presidency. March 04 – CNN Business But what impact and influence will investors and indexes have on the actual outcome of the primaries? Will voters be convinced or swayed by the markets or is this result simply a by-product of an election result? It is interesting for sure, and if you are a reporter covering this topic – then let our experts help with your coverage. Jeff Haymond, Ph.D. is Dean, School of Business Administration and a Professor of Economics at Cedarville and is an expert in finance and trade. Dr. Haymond is available to speak with media regarding this topic – simply click on his icon to arrange an interview.
It’s here and it’s time America got serious about Covid-19, known as coronavirus. The CDC is working overtime, and leading government health officials are scrambling to ensure hospitals are equipped, front-line health providers are ready and the public is informed. But with any emergency, there comes the risk of misinformation and unnecessary worry. As the new coronavirus outbreak becomes an ever-looming threat in the United States, state infectious disease specialists say the first step to staying safe is this: Remain calm. Also, don’t worry about buying a mask. “You really have to make sure you get the accurate information and not … ‘Lock your doors, close the windows, buy a generator and hope for the best,’” said Dr. Peter Gulick, an infectious disease expert at the Michigan State University's College of Osteopathic Medicine and director of the MSU Internal Medicine Osteopathic Residency program. That’s not only alarmist and bad advice, he said, it’s a waste of energy. The best advice — like these tips from the U.S. Centers for Disease Control and Prevention — is tried-and-true, Gulick said: Wash hands often with soap and water for at least 20 seconds. It’s especially important after using the bathroom, before eating, and after blowing your nose, coughing or sneezing. No soap and water? Use an alcohol-based hand sanitizer with at least 60 percent alcohol. Avoid touching your eyes, nose and mouth with unwashed hands. Avoid close contact with people who are sick. If you’re sick, stay home. Cover your cough or sneeze with a tissue, then throw the tissue in the trash. Clean and disinfect frequently touched objects and surfaces using a regular household cleaning spray or wipe. If you think you’ve come in contact with someone with the virus (there have been no confirmed cases yet in Michigan) contact your health provider immediately. February 26 – The Bridge Regrettably, that too can often lead to financial reactions that can ripple across the economy. Lately, the surging stock market has plunged with worries from investors and Wall Street about how America’s workforce will be impacted if the virus spreads. Friday ended the worst week the stock market has had since 2008. NBC News 6 sat down with the Dean of the Broad College of Business at Michigan State University, Sanjay Gupta, to talk more about the stocks and what to expect after this week. “The stock market is clearly spooked, and it has become nervous with whatever is going on in the business world,” said Gupta. What has ‘spooked’ the business world, is COVID-19. “The coronavirus is quarantined lots of factories, in fact the whole country,” said Gutpa. Gutpa says the halt in Chinese manufacturing also limits businesses and goods here in the United States. “In our day to day lives, either there will be some things that we count on that may not be available. It might be that the priciest of those things that we count on change, or go up dramatically because we are so dependent on a foreign source,” said Gutpa. February 29 – WLNS TV Covering an outbreak like Covid-19 isn’t easy, there are multiple angles to explore and it is vital that only the correct facts are shared by media to the millions of viewers, readers and listeners that are waiting for the latest information – and that’s where our experts can help. Sanjay Gupta is the Eli and Edythe L. Broad Dean of the Eli Broad College of Business. He is an expert in the areas of corporate and individual tax policy issues and finance. Peter Gulick is currently an associate professor of medicine at Michigan State University, College of Osteopathic Medicine, and serves as adjunct faculty in the College of Human Medicine and the College of Nursing. Both experts have already been sought out by the media for their expert insight on this issue – if you are interested in arranging an interview, simply click on either expert’s profile to arrange a time today.
The coronavirus will impact these three things in a major way
The coronavirus has already sent ripple effects through the global economy, according to Michael Ehrlich, professor of finance at New Jersey Institute of Technology. Reports of Wall Street reacting, automakers scrambling to avoid major disruptions and the Mobile World Congress cancellation has demonstrated the effects of COVID-19. According to Ehrlich, some of the biggest indirect impacts of the virus will be felt in tourism and travel, supply chain disruption and the flight to quality. Airlines have begun to cut routes to destinations with high risk, and tourism in major European countries have forecasted a decline, as much as 30-40% in France according to a report in Forbes. "We're already seeing people decide to not go on cruise ships or not to travel on airplanes because of the coronavirus," said Ehrlich. Supply chains are being met with challenges due to China's factory shutdowns. "The real impact of where it's going to affect the economy is supply chain. China is the factory of the world, and those factories are being shut down in order to contain the virus and slow down the transmission of the virus," said Ehrlich. Finally, the third impact is a phenomenon called flight to quality. This is when investors move capital from risky investments to safer ones, a reaction when there is uncertainty in international markets. The move, according to Ehrlich, can see investors take up more U.S. stocks, bonds, and dollars that are viewed as more stable long term investments. The downstream effect could lead to a boost in the U.S. economy as it allows national manufacturing sectors to better compete in a marketplace where they are in higher demand. Michael Ehrlich is an expert on financial markets and institutions, with an emphasis on market failures. Simply click on the button below to arrange an interview.
With Brexit looming, more is unknown than known with British economy, trade agreements
Although it has been in the works since June 2016, the transition phase of Great Britain’s decision to leave the European Union (EU) — more commonly known as “Brexit” — is set to take place on Jan. 31. It is a date that will most likely leave a ripple of economic uncertainty in the United Kingdom in its wake as the British prepare for total independence at the end of the year. “Brexit has created so many new unknown variables. It can be profoundly disruptive to England as we know it today,” says Ralf “Don” Keysser, D.B.A., an associate professor in the MBA program at Saint Mary’s University of Minnesota. Keysser predicts a negative short-term impact to the British economy, whereas the long-term perspective is still hard to predict until new free trade agreements with Europe and the rest of the world are established. Keysser does not see a clear-cut benefit to the U.S. establishing a free trade agreement with the U.K., simply based on the lack of British imports in the American market, other than maintaining political closeness. “It’s going to be a shock to the system. England will not be the England that it has been. There’s a lot of speculation, because we’ve never had a country pull out of the EU before, so it’s kind of an unknown. And it’s so highly politicized that it’s hard to get an objective analysis of what it’s going to look like.” Keysser points to a Toyota plant in South Derbyshire that supplies most of its output to countries in the EU through a tariff-free treatment. With Brexit going into effect, the factory may have to vastly reduce its output. Still, the workers in that community overwhelmingly voted to leave the EU. “This is a good example of how people will vote against their economic self-interests for ideological reasons,” Keysser says. “There’s a lot of ideology behind the Brexit vote: anti-immigrant, anti-Europe, pro-nationalist views that very much echoed President Trump’s appeal.” There are a few reasonably good projections, Keysser says, to make about the impact on inflation, unemployment, and economic trends — and none of them look good for Britain. One just has to look at the British pound, which has steadily been losing value to the dollar and euro over the years. In addition, several banks decided to either move from London or expand into other markets within the EU as soon as the Brexit results were announced, which could cost the British capital its status as of the world’s premier financial centers. “I see a gradual diminution of the financial business that’s been a mainstay of London,” Dr. Keysser says. On top of that, there is a real fear of Scotland and Northern Ireland wanting to leave the U.K. in favor of establishing their own independence and returning to the EU. The last time Scotland voted to leave the U.K. in 2004 it only passed 55% to 45%. “That could be the beginning of the end of the United Kingdom as we have known it,” Keysser says. The news might not be entirely bad out of Brexit. For international tourists, especially those from the U.S may be able to take advantage of the dollar’s exchange rate with the declining pound. Do you want to know more about the possible economic ramifications of Brexit? Are you a journalist covering this topic and interested in an interview? That's where we can help. Ralf Keysser, D.B.A., has been an active investment banker and business finance consultant for 35 years. He also serves an associate professor for the MBA program at Saint Mary’s University of Minnesota. To book an interview with him, simply click on his icon above to access his contact information.
It may be the most wonderful time of the year, but for those delivering packages to houses and homes across America this holiday season it’s also the busiest one. In fact, it’s expected that Amazon alone will ship close to 300 million packages for Christmas. Customers want their purchases quicker and cheaper and it’s changing how the landscape works. It's estimated that free shipping will cost Amazon more than a billion dollars this quarter alone. This explains why shippers are looking at some radical new technologies to cut the cost of the last mile – and this is not just limited to the retail shopping industry. “Technology-driven innovations such as delivery drones or driverless vehicles not only facilitate last-mile delivery, they help with the inclusion of new sets of “customers, especially those in remote locations or rural areas with poor infrastructure, says Morvarid Rahmani, assistant professor of Operations Management at Scheller College of Business at Georgia Institute of Technology. For instance, companies like UPS, CVS, and WakeMed are exploring the idea of drugs and other health-related items being delivered by drones. In a first, collaboration between the FAA and UPS partner Matternet made deliveries from a CVS pharmacy in Cary, North Carolina as well a customer’s retirement community in November. Rahmani thinks this type of delivery shows promise. “Using drones to deliver medical packages can give rural communities access to products and medical supplies, which they would not be able to access otherwise. This delivery model is a way of incorporating social concerns and conditions of underserved populations into business practices. Using drones to deliver medial packages is a great example of collaboration between a governmental agency and for-profit companies, which is toward the dual goals of promoting efficiency and inclusion,” she notes. So, while most consumers are coming to terms with drone technology as a means for the Amazons of the world to replace it’s fleet of trucks, many customers are seeing the future of receiving essential, potentially life-saving drugs to their doorstep. “These technologies enable inclusive retailing and distribution for large (excluded) communities all over the world, says Rahmani. “Successful implementation of inclusive business practices requires collaboration of for-profit firms with the public sector, civil society organizations, and communities”.CBS News - December 15, 2019 Morvarid Rahmani is an Assistant Professor of Operations Management at Scheller College of Business at Georgia Tech. She is an expert in the areas of research is on collaboration in work processes such as new product development, management/IT consulting, and education. Dr. Rahmani is available to speak with media regarding this topic – simple click on her icon to arrange an interview. About Scheller College of Business The Georgia Tech Scheller College of Business is located in a state-of-the-art building in Georgia Tech’s vibrant Technology Square, the core of the Atlanta’s high-tech business community. The College offers an internationally recognized business education, including full-time, evening, and executive MBA options as well as undergraduate and Ph.D. degrees, to approximately 2,000 degree-seeking students each year. Scheller College collaborates across Georgia Tech to offer joint MS degrees in quantitative and computational finance and business analytics. Custom and open enrollment programs for executives and professionals are offered through the Huang Executive Education Center, located within the College. Interdisciplinary centers for teaching and research within the College enrich the educational experience, the campus and the community by providing a direct connection with the real world. They fuel collaborative teaching and research in some of the most relevant areas in business today: leadership, innovation, sustainability, the global enterprise, and business ethics. For more information, contact media@scheller.gatech.edu
Why are the wolves of Wall Street so worried about Elizabeth Warren?
Elizabeth Warren started her campaign for the presidency far from being the front-runner. She trailed the likes of Joe Biden and Bernie Sanders dramatically, often in third place or worse and usually in single digits. But her resolve stood, she provided plans and policy planks. And … she found a target and took aim at the wealthy. All of her ideas that include costly policies about health care and education come with billion- and even trillion-dollar price tags. Usually these concepts are laughed off the debate stage – but Warren carefully and strategically costed them out. And those covering the costs of her ideas are the banks along with the rich and wealthy. Her ideas caught fire with supporters and now Warren is seen as a legitimate contender for the White House. It has some nervous and many taking notice. It’s a role that Ms. Warren unabashedly embraces, as an increasing number of voters, as well as a few veterans of the finance industry, see her as the policymaker who can address the growing wealth gap in the United States and take on the corruption and excess in the business world. Ms. Warren has made battling corporate greed and corruption a central theme of her fiercely populist campaign, mixing anti-elitist oratory with policy plans calling for sweeping new regulations. On Friday morning she released an ambitious proposal to pay for her “Medicare for all” program, with provisions directly affecting Wall Street: aggressive new taxes on billionaires, an additional tax on financial transactions like stock trades and annual investment gains taxes for the wealthiest households. Just hours later she told an audience in Iowa: “Our democracy has been hijacked by the rich and the powerful.” Interviews with more than two dozen hedge-fund managers, private-equity and bank officials, analysts and lobbyists made clear that Ms. Warren has stirred more alarm than any other Democratic candidate. (Senator Bernie Sanders, who describes himself as a socialist, is also feared, but is considered less likely to capture the nomination.) November 04 – New York Times Are you a journalist covering the race for the Whitehouse? Then let our experts help. Dr. Stephen Farnsworth is professor of political science and international affairs at the University of Mary Washington. A published author and a media ‘go-to’ on U.S. politics, he is available to speak with media regarding this topic. Simply click on his icon to arrange an interview.
U.S. economy continues to expand, but at a slower pace, reaching about 2 percent growth in 2020
INDIANAPOLIS -- The U.S. economy will continue to expand for a 12th consecutive year in 2020, but by only about 2 percent and struggling to remain at that level by year's end. Indiana's economic output will be more anemic, growing at a rate of about 1.25 percent, according to a forecast released today by the Indiana University Kelley School of Business. Over the past year, political dysfunction and international trade friction have disrupted supply chains and eroded both consumer and business confidence. U.S. employment has grown during 2019 but will decelerate throughout 2020, well short of 150,000 jobs per month and possibly to about 100,000 by year's end. A tight labor market will continue to be an issue for many companies. "The total number of job openings in the economy peaked in late 2018," said Bill Witte, associate professor emeritus of economics at IU. "Average hours worked have been flat over the past year, and auto sales have been flat for nearly two years. Given the reliance of the U.S. economy on consumer spending, these are disturbing signs. But they are vague signs, and not enough to convince us that the end of the expansion is in sight. "We expect that growth will be weaker than in the past two years, and this outlook is likely a best-case outcome," he added. "There is massive uncertainty in the current situation." The Kelley School presented its forecast this morning to Indianapolis community and business leaders at IUPUI. The Business Outlook Tour panel also will present national, state and local economic forecasts in seven other cities across the state through Nov. 20. Indiana's more meager economic growth expected in 2020 can largely be attributed to the outsized presence of manufacturing and particularly tight labor markets, said Ryan Brewer, associate professor of finance at Indiana University-Purdue University Columbus and author of the panel's Indiana forecast. Manufacturing contracts more rapidly versus other areas of the economy, and tight labor markets limit employers' capacity to grow, he said. Expectations about business investment have fallen short, and corporations have been buying back stock instead of making capital investments. The trade war with China and slowing global expansion have also affected state manufacturers. The world is about to record its slowest economic growth since the financial crisis of 2009. Next year, global growth is projected at 3.4 percent, with downside risks continuing to build. China and the European Union each face structural issues amid tariffs imposed by the United States. Brexit remains unresolved. Recent data from the Institute for Supply Management showed that manufacturing activity has slowed to its lowest rate since the beginning of the Great Recession. Indiana has sought to diversify its economy in recent decades, but manufacturing output represents nearly 28 percent of gross state product. Indiana continues to lead the nation in manufacturing employment, with more than 17 percent of its jobs in that sector. "Constrained by a historically tight labor market, Indiana is expected to experience slow growth in jobs and gross output, along with the possibility for continued rising wages," Brewer said. "With fewer and fewer available people to hire, tightness of the Indiana labor markets will serve as a drag to output and employment growth." The outlook for the Indianapolis-Carmel-Anderson metropolitan statistical area is slightly better, with expected growth between 1.5 and 2 percent. "Indianapolis continues to draw in talent and investment that should help it exceed the overall state level of growth," said Kyle Anderson, clinical assistant professor of business economics. "However, there is risk that weakness in the broader economy, and especially weakness in manufacturing, could make this forecast too optimistic." Other highlights from the forecast: The national and state unemployment rates will hold steady. The nation's rate could be below 4 percent by year's end, and the state will stay at or below full employment through 2020. Inflation will rise and end 2020 close to the Federal Reserve's 2 percent target. The stock market will struggle to get average returns with headwinds from trade, supply chain disruption and policy uncertainty. Earnings continue to exceed expectations, yet lack of definitive trade consensus continues to drive headwinds. Interest rates will remain low. The 10-year Treasury rate should stay below 2 percent and mortgages below 4 percent. Speculative grade bond yields have been rising, indicating increased risk of insolvency for marginal firms. Entry-level wage growth could cause costs to rise, earnings to fall and growth to stagnate for firms heading into 2020. Energy prices will be relatively stable, with average prices similar to those in 2019. Business investment will remain weak, although a little improved from this year. Housing will achieve a meager increase, ending two years of negative growth. Government spending will grow, but much more slowly than the past year, as the impact of the 2018 budget deal ends. The starting point for the forecast is an econometric model of the United States, developed by IU's Center for Econometric Model Research, which analyzes numerous statistics to develop a national forecast for the coming year. A similar econometric model of Indiana provides a corresponding forecast for the state economy based on the national forecast plus data specific to Indiana. A select panel of Kelley faculty members, led by Indiana Business Research Center co-director Timothy Slaper, then adjusts the forecast to reflect additional insights it has on the economic situation. A detailed report on the outlook for 2020 will be published in the winter issue of the Indiana Business Review, available online in December. In addition to predictions about the nation, state and Indianapolis, it also will include forecasts for other Indiana cities and key economic sectors. Presenting the forecast at the Indianapolis Business Outlook Tour event were Phil T. Powell, associate dean of Kelley academic programs at Indianapolis and clinical associate professor of business economics and public policy; Cathy Bonser-Neal, associate professor of finance; and Anderson.
Is the bubble bursting – and does America need to prepare for an economic slowdown?
With every news story about trade, tariffs, interest rates, global instability and political chaos…comes with it a hint that each incident could take a toll on America’s economy. And it seems that sub-plot may be slowly becoming a self-fulfilling prophecy for the current administration in Washington. A recent article in Forbes pointed out that most key indicators seem to be pointing down. Trump’s monthly job results are decelerating Trump’s job growth falling short of Obama’s last six years Wage growth is the lowest in a year September quarter GDPNow forecast lower than June’s 2.0% result It seems as if all of these ingredients combined, a slow down and potential recession or worse could be looming. Are you a journalist covering the short and long-term outlook of America’s economy? If so, let our experts help with your stories and coverage. Jeff Haymond, Ph.D. is Dean, School of Business Administration and a Professor of Economics at Cedarville and is an expert in finance and trade. Dr. Haymond is available to speak with media regarding this topic – simply click on his icon to arrange an interview.
Inverted yields and a potential recession – are rocky times ahead?
Everything seemed to be going swell. Unemployment was low, the number of jobs was high and the economy seemed to be roaring. Until last week. Yields on two-year and 10-year Treasury notes inverted early Wednesday, a market phenomenon that shows investors want more in return for short-term government bonds than they are for long-term bonds. It's the first time that has happened since the Great Recession and it can be an indication that investors have lost faith in the soundness of the U.S. economy. - USA Today, Aug. 14, 2019 Inversions are usually the canary in the coal mine when it comes to recessions. In fact, this very same incident has occurred in the previous nine recessions since the mid-1950s. How bad will this recession be? Is there any way to reverse course? Is this simply an American issue or will it spread globally? Compared to 2008 – how bad of a situation are we in? There is a lot of speculation and questions being asked. If you are a reporter covering the economy and need an expert to help guide you through the situation and provide accurate information on the state of America’s economy – that’s where we can help. Dr. Simon Medcalfe is a highly regarded finance expert and the Cree Walker Chair in the Hull College of Business at Augusta University. Medcalfe is available to speak with media regarding the economy and its outlook – simply click on his icon to arrange an interview.
Are Germany’s economic walls crumbling? Let our experts explain the potential consequences.
As the saying goes … where there’s smoke, there is usually fire. And as trade wars, Brexit and overall global uncertainty crash like waves across the planet – there might be another sure sign we are headed for a global economic slowdown. Germany, the engine that runs Europe, may very well be in recession. “A technical recession is defined as two consecutive quarters of negative growth, and Germany saw a 0.1% drop in the April-to-June period. In its monthly report, the Bundesbank said that with falling industrial production and orders, it appears the slump is continuing during the July-to-September quarter. “The overall economic performance could decline slightly once again,” it said. “Central to this is the ongoing downturn in industry.” Deutsche Bank went further Monday, saying “we see Germany in a technical recession” and predicting a 0.25% drop in economic output this quarter.” August 20 – Associated Press So, what will this mean for the EU, and economies far and wide? Do Americans need to be concerned? Is this just a stumble or is the world about to fall into another economic collapse? If you are a reporter covering the economy and need an expert for your stories – let us help. Jeff Haymond, Ph.D. is Dean, School of Business Administration and a Professor of Economics at Cedarville and is an expert in finance and trade. Dr. Haymond is available to speak with media regarding this topic – simply click on his icon to arrange an interview.