Monthly Archives: June 2014

Capital Expenditures May Be Last Cloud Raining on Global Economy

Flickr_-_USCapitol_-_Working_at_the_Capitol_Power_Plant

Investors in publicly-traded companies are eager to see them spend some of the cash amassed since the 2008 financial crisis. Not unlike penny-pinchers that survived the Great Depression, US firms turned to saving during the Great Recession. Standard and Poors (S&P) explains that large firms remain unwilling to part with their proverbial security blanket and pacifier in the form of enormous cash hoards. In its annual capex corporate survey, S&P describes that capital expenditures are the “missing link to a better established and self-sustaining economic recovery.”
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US Moves to Loosen Crude Oil Export Rules

US Inflation - Econedlink

For the first time in nearly 40 years, the Commerce Department ruled that two US companies can export condensate, a type of crude oil previously banned from sale abroad. Insiders explain that shipments are likely to be small, but they could serve as a valuable precedent to allow broad exportation of US unrefined oil products. While this appears as the government playing favorites for now, any move to allow markets to function without government intervention should be viewed as positive.
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Google’s My Business: Revolutionizing B2C Interaction

Earlier this month, we wrote here (http://goo.gl/jKA3oB) about the growing popularity of business review websites looking to compete with the Better Business Bureau, consumers’ traditional go to source for business ratings.

The piece discusses how the internet limits businesses’ reliance on the BBB to mediate customer disputes. Social media outlets including Facebook, Twitter, Foursquare, Angie’s List and Yelp all provide consumers with a platform to voice feedback, positive or otherwise, making any and all voices heard. Due to the popularity of these platforms, search engines may rank their reviews higher than those posted to the BBB profile of a given business. Business owners and consumers prefer these websites for a few key reasons:  they are optimized for mobile phones, their formats encourage positive feedback, and users can post photos while networking with one another.
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Economy Rebounding as Fed Trims Bond Purchases

In its latest meeting, the Federal Reserve noted improvements in both U.S. economic strength and broad labor market while inflation remains in check. The current environment allows the Fed to reduce its monthly pace of asset purchases while maintaining low rates–good signs for the corporate titans of Wall Street and the average Joes of Main Street.
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Manufacturing Data Indicate Growing Strength of U.S. Economy

Upbeat manufacturing data should let business owners start their week bright-eyed and cheery without the usual caffeine. After a slow start to 2014, with GDP growth estimates near a 1% annual rate, current U.S. manufacturing data indicate the economy is getting back on its feet.
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ARMs to Benefit from Loose Monetary Policy

Headlines are telling us the economic impact of single family housing is subdued because first time home buyers are scarce. Perhaps the pool of single professionals, newlyweds and young families is too focused on fixed rate mortgages. Adjustable rate mortgage products knows as ARMs may be discounted by their baby boomer parents as too risky. But today’s move by the European Central Bank (ECB) to cut rates by -0.10 may indicate that stateside interest rates may not increase for the foreseeable future. The deflation risk affecting central bank policy around the developed world should make an ARM a good choice for first time buyers with plans to move up in coming years.
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