Monthly Archives: March 2015

Presidential Economic Campaign: Keeping it Real

It’s certainly no easy task presenting the people of America with a realistic economic campaign when running for government. Jeb Bush is no stranger to this challenge. There has thus been speculation on which economic experts may be guiding him for the 2016 campaign. One of these, Jim Donovan Goldman Sachs Managing Director, is said to have been included in Jeb Bush’s “inner circle” of advisers.

Donovan and others like him (such as Justin Muzinich and Bill Simon) may not be his official financial advisers, but if they are going in the same direction, they might be. For example, Bush’s spokeswoman Kristy Campbell said that Bush is “committed to promoting polices that will address the opportunity gap and restore the right to rise for all Americans.” James Donovan, Goldman Sachs, is a National Council co-chair of the American Enterprise Institute which is likewise dedicated to preserving and strengthening the foundations of a free society—limited government, competitive private enterprise, vital cultural and political institutions, and vigilant defense.” The organization seeks to “help establish economic policy and strategies.” In addition, Donovan handled Romney’s personal investments in 2012. So it might make sense.

Moving back to the 2016 elections, it seems that what is really worrying Americans these days is not so much high taxes but the fact that technology is going to replace their skills in the future and put them out of a job. Therefore what will be important for Bush’s campaign is to show – realistically – how to avenge that fear. And he’s doing it. In a speech he delivered in Detroit a couple of months ago Bush asked: “How do we restore America’s faith in the moral promise of our great nation that any child born today can reach further than their parents? This is an urgent issue: Far too many Americans live on the edge of economic ruin. And many more feel like they’re struck in place, working longer and harder, even as they’re losing ground.”

It is these issues that advisers – official or unofficial – need to find potential solutions for. Once these matters are covered, next year Bush may have a real chance of convincing the US population that he can offer an economic environment that is both realistic and worth living in.

Amazon Expands One-Hour Delivery Service

Jeff Bezos, founder of Amazon, at the ENCORE awards. Photo credit: Steve Jurvetson

Jeff Bezos, founder of Amazon, at the ENCORE awards. Photo credit: Steve Jurvetson

Moving another step closer to fulfilling the dreams of the “Now” generation, Amazon announced last week that it will be able to deliver orders within one hour in two new locations. Although some might argue that one hour is technically not “Now,” it certainly comes pretty close, considering the fact that most orders on Amazon are not for anything that couldn’t wait a day or two. Be that as it may, Amazon has already been bringing products to customers in Manhattan within the hour, and will add Miami and Baltimore to the list of “can’t wait” cities.

Amazon already promises same day delivery in nine other markets, places where they already have fulfillment centers. Piper Jaffray, the research firm, created a map to show where all the Amazon fulfillment centers are located, an indication of where the next one-hour delivery service could spring up. The same-day markets include:

•    New York City
•    Atlanta
•    Baltimore
•    Boston
•    Chicago
•    Indianapolis
•    Philadelphia
•    Washington DC
•    Dallas
•    Los Angeles
•    Phoenix
•    San Francisco
•    Seattle

Latin America and its Global Investment Opportunities

growthLatin America is becoming an increasingly attractive economy for outside investors. This is positive news for companies such as Latam Securities that has been providing investment advisory services about investments in fixed-income securities in local and worldwide markets. Company Director Jorge Pepa and CEO Diego Marynberg have been working with these clients in an attempt to provide them “with strategic investment opportunities… concentrated in Latin America — that help them reach their objectives.”

Just recently, an economic summit was held in Egypt which signified the extent to which the country could “cooperate with Mexico and Latin American states,” according to Jorge Alvarez Fuentes, Mexico’s Ambassador to Cairo. Indeed this part of the world – vis-à-vis its business environment has become increasingly “open to the world…encouraging…investment.”

It has been noted by experts in the field that Latin America is a great place in which to invest. The International Data Corporation found that the region “will continue to outpace the global average of roughly 4%, investing $136.3 billion in IT.”

Formula E Electric Cars Race Through Miami

The first Formula E electric car race took place in Miami last Saturday, showcasing the potential for more energy efficient vehicles.

"Spark-Renault SRT 01 E (Formula E)" by Smokeonthewater - Own work. Licensed under CC BY-SA 3.0 via Wikimedia Commons - http://commons.wikimedia.org/wiki/File:Spark-Renault_SRT_01_E_(Formula_E).JPG#/media/File:Spark-Renault_SRT_01_E_(Formula_E).JPG

“Spark-Renault SRT 01 E (Formula E)” by Smokeonthewater .Licensed under CC BY-SA 3.0 via Wikimedia Commons –

“Formula E will pioneer technology which will be used on normal road cars,” said Richard Branson, British entrepreneur and owner of the Virgin Racing team. “I hope 10 years from now the smell of exhausts from cars will be a thing of the past as much as the smell of cigarettes in restaurants.”

Branson’s Virgin Group sponsored a two-car team for the race.

Globally Miami is the fifth of an eventual ten cities that will host races for what will hopefully be the first of many years to come of Formula E racing championships. The cars that participate are low-slung, open-wheeled and fast, capable of up to 136 miles/hour.

The FIA, Federation Internationale de l’Automobile organizes these and Formula One races. They attract sponsors like tire manufacturer Michelin and delivery service company DHL. The hope is that large companies will help electric cars to develop into more mainstream vehicles.

“The technology improves unbelievably once these large companies start investing in research,” said Pier Luigi Ferrari, the managing director of DHL motorsports.

Alibaba Expanding to California in a “Very Strategic” Move

Silicon Valley by  Revol Web

Silicon Valley by Revol Web

China’s gargantuan e-commerce company Alibaba is opening a cloud computing hub in Silicon Valley, its first such center outside of China. The move is in synch with their global ambitions despite tough competition in their niche.

The California hub is at an undisclosed exact location, kept secret for security reasons.  It is situated somewhere in the hi-tech capital fondly referred to as Silicon Valley, denoting an area south of San Francisco. Alibaba enters an already crowded marketplace dominated by such on-line giants as Amazon, Microsoft and Google.

The data center, Alibaba’s Aliyun cloud division, will first provide service to Chinese companies that have branches in the US. Included are retail, internet and gaming companies. In the future the center will seek out US companies that would like to expand out to the Chinese market.

Ethan Yu, an Alibaba vice president in charge of the firm’s international cloud business explained:

“This is a very strategic move for us,” Yu said. “International expansion is actually a company strategy in the coming few years. Eventually we may expand to other regions, for example the East Coast or middle part of the U.S., if our customers have the demand for that.”

Yellen Tells Congress: Financial System Safer Now than Before the Financial Crisis

Official portrait of Federal Reserve Chairman  Janet Yellen.

Official portrait of Federal Reserve Chairman Janet Yellen.

Speaking before the House Committee on Financial Services last week, Janet Yellen, head of the Federal Reserve, testified that the US financial system is much safer today than it was in 2007 when the most recent economic decline commenced.

“I believe the financial system is much safer. There is twice as much high-quality capital among the largest firms now than there was before the crisis,” Yellen said at the twice-annual House discussion on monetary policy and the economy.

Yellen said that the Fed now conducts “stress tests” to evaluate whether large financial institutions will be able to survive through hard economic times.  The Federal Reserve Bank of St. Louis said that the number of US banks has shrunk in recent years, but the banks that remain are larger. They asserted that in 2011 the five largest US banks controlled 48 percent of total assets. The largest bank among them is JPMorgan Chase Bank with $1.8 trillion of assets.

Federal Reserve Governor Daniel Tarullo said in February 2014 that more work was needed to end the belief that the largest of the banks are “too big to fail,” and to also work to lower risks to the US financial system.