Fed’s attempt to control BTC

According to Forbes, people have been making a comparison between bitcoin and gold. They are saying that based on the grounds of these assets being the “safe-haven” or “disaster hedges” when the economy is in recession. However, bitcoin is neither safe nor will its value maintain as the economy goes awry. Cryptocurrency could lose its value within a matter of seconds with no warning signs. It is unpredictable, and there are very few legal rules and regulations in the market. When was the last time someone rejected gold as a worthwhile asset?

Of course, with more people attempting to make a quick fortune, cryptocurrency has begun to turn more heads. With the global attention on these coins, it is no surprise that the Federal Reserve (Fed) is doing something about them. They have recently announced the increase of the interest rate – as many have long anticipated.

However, some professionals have agreed that this, too will not affect bitcoin significantly.

(Forbes, then, pointed out that increasing the rate would have impacted gold.)

In fact, David Johnson, CEO of Latium, have asserted that, “Bitcoin should move up due to increased clarity from regulators as it moves into a more defined asset class.”

With the predictions from these experts, it seems that Bitcoin continues to be a worthwhile asset. Many are discussing the entities that are bounding and affecting such commodities. The rules that are governing the movement of bitcoin are rather unique as the notion of cryptocurrency is still the first of its kind.

“Bitcoin will move on its idiosyncratic factors,” Arthur Hayes, the CEO and one of the founder of BitMEX, a Seychelles-based cryptocurrency exchange points out – at least for now. Along with Hayes, Mati Greenspan, senior market analyst of eToro has also expressed similar views. “Bitcoin is largely disconnected with any traditional markets and bears absolutely no connection to interest rate outlook at this time.”

Besides, bitcoin was never intended for layman to earn a couple of quick bucks. The cryptocurrency, bitcoin, was initially set to be another currency. In fact, it was intended as the future of currency, a digital version that goes hand in hand with our advancement in science and technology. As we move forward with the process of perfecting Artificial Intelligence (AI) and other capitals that are against the law of nature, cryptocurrency has become the potential substitute of our current medium of exchange. However, many are purchasing bitcoins for a different intention.

“People are buying BTC for all kinds of reasons,” Jeff Bishop, the CEO of Raging Bull stresses. “When you have an asset moving 10%+ in a week on a regular basis, you don’t really consider if the Fed causing 10-year interest rates to over 3% as a major concern,” he explains.

While it may be an easily accessible and flexible option for first-time investors, it is also a risky and ruthless investment. The rules that govern it is not clear or strict, the value could go down without any notice or indication. You could lose your entire investment in a matter of seconds.

In addition, bitcoin wallet has a very strong security. This is because of the existence of many low-profile internet hackers. If you have no knowledge of computer science, how do you defend yourself, or even comprehend the situation? Who would you be going to for assistance?

Conversely, investing in bitcoins could also bring you a lot of benefits. Like the anticipation of the fall, it could also rocket up within seconds. Anyone who invests, regardless of the chosen commodity, should already have the anticipated the possibility of losing their token.

Either way, investing is merely another form of gambling. There is no guarantee.

Featured image via flickr/ fdecomite

Story behind the trend #DeleteFacebook

As a result of last week’s scandal regarding Facebook’s possible leak of our personal information, #DeleteFacebook has become a possible new trend. Rumor has it that Cambridge Analytica LLC, a private British company that utilizes data mining, brokerage and analysis to produce communication strategy for election purposes, was able to acquire personal information of about 50 million Facebook users. Needless to say, users are infuriated about the fact that this was done under wraps without the consent of said users.

Furthermore, it seems that this particular consultation firm has had a business association with President Trump during the presidential campaign two years ago. A simple analysis of the two sentences aforementioned reveals the possible debauchery and corruption that, in turn, leads to this controversy.

On Tuesday, Alexander Nix, the CEO of Cambridge Analytica was let go by the firm after a documentary by Channel 4 went public. In the documentary, Nix was apparently laying claim on their alleged involvement in Trump’s electoral campaign. The consultation company has denied these claims, as expected. Facebook, on the other hand, has placed the entire blame on a “researcher” who supposedly handed the data to Cambridge Analytica while being dishonest to Facebook.

Mark Zuckerberg, Chairman, CEO and co-founder of Facebook and Sheryl Sandberg, the COO have ostensibly been “working around the clock” in response to the problem, as disclosed by Facebook to the media.

“The entire company is outraged we were deceived. We are committed to vigorously enforcing our policies to protect people’s information and will take whatever steps are required to see that this happens,” as stated in the statement issued by Facebook on Tuesday.

Brian Acton is one of the founders of WhatsApp, the messaging application that Facebook had previously procured with $19 billion. He now holds the position of Executive Chairman of Signal Foundation, a non-profit organization in the tech industry. Forbes estimate Acton’s net worth as $5.5 billion. Within the same day the statement was issued, Acton began the trend #deletefacebook through Twitter – openly opposing Facebook. Is there an underlying issue, perhaps private, that goes beyond the surface between Acton and Zuckerberg? Since then, #DeleteFacebook has been trending as users gradually learn about the issue.

Needless to say, all of this has significantly impacted Facebook’s market shares because of the loss of public confidence. Facebook has been criticized repeatedly with regards to the approach they have taken in conjunction with this public relations nightmare. Roger McNamee is a venture-capitalist who is one of the most longstanding investors in Facebook. He has publicly expressed his opinion to CNN in an interview on the same day.

“They haven’t even taken the first step of admitting there’s a problem. If they don’t do something pretty soon, people are going to realize they can’t trust Facebook anymore… and that could threaten them permanently,” he suggests.

He believes that this disaster could potentially “destroy” Facebook and that the firm’s executives are not tackling the issue properly. While he has in his hands, significant Facebook stock, it seems like the top executives in the firm, quoting McNamee, “are not talking to me anymore, so I have to communicate through the press”.

McNamee, who still holds Facebook stock, added that Facebook senior execs “are not talking to me anymore, so I have to communicate through the press.”

On Wednesday, Facebook stock is valued at $164.80 per share. That is a slight decrease of 2 percent. By noon ET, however, there was an overall improvement in the market and Facebook’s stock, too went up by 1.7 percent. Yet again, the stock had hit a huge bump last Friday when the rumor first surfaced. Hence, it is still about 7 percent lower than the initial value overall.

Beginning on Monday, the rating for the Facebook application in the App store has below two out of five stars. However, ninety percent of these reviews have not even remarked on the Cambridge Analytica case as well as the leak of private information, Sensor Tower, mobile-analytics research firm reports. They also indicate that this issue, in addition to the hashtag trend has not affected the number of installs of the application.

The tension between Facebook, in its entirety, with others such as Acton and McNamee is ostensibly high. Why isn’t Facebook handling this situation with a better strategy?

The unaffordable healthcare for Alzheimer’s

Alzheimer’s is one of the diseases that fall under the umbrella term, dementia. The effects are austere. It reduces one’s cognitive responses such that one eventually begins to lose their basic abilities to do even the most fundamental tasks. Out of the blue, it creeps up on you and you slowly begin to question even the most obvious and straightforward things in your life.

First, you find it almost impossible to recall recent events. Then, you start to wonder who the people around you are. Who are these people? The one who keeps calling me dad, what is her name? Are we related to each other? Eventually, that becomes the least of your struggle because you can no longer comprehend anything around you. You no longer know who you are or what your name even is. As time goes on, you lose the most basic human abilities and health care has at that very moment, become your sole reliance. However, what happens when healthcare comes with a price that you just don’t have? (Well, don’t worry because it’s no longer your concern!)

Alzheimer’s disease has been proven to be the most common cause of dementia in the United States. At the moment, there are almost six million Americans who are suffering from that and the statistical data shows that the condition is simply deteriorating. The calculated sum of the healthcare for dementia cases has come to a domineering $277 billion in the United States per year. At first glance, the astronomical figure may seem insanely high but that is not all. The Alzheimer’s Association’s annual report has also taken the liberty to find out the invisible costs. These include the time and effort as well as energy exerted by the patients’ caregivers.

“In 2017, 16 million Americans provided an estimated 18.4 billion hours of unpaid care in the form of physical, emotional and financial support – a contribution to the nation valued at $232.1 billion. The difficulties associated with providing this level of care are estimated to have resulted in $11.4 billion in additional healthcare costs for Alzheimer’s and other dementia caregivers in 2017,” the Alzheimer’s Association reports.

Altogether that makes up about $500 billion, a large portion of the nation’s accumulated wealth. It is no doubt costly to provide for victims of Alzheimer’s disease, or any dementia cases for that matter. On a smaller narrative, each patient requires about $341,000 from the beginning to the end. Of that excessive cost, seventy percent typically come directly out of the families’ pocket. Aside from that, the report has also mentioned that a majority of the people who are providing are women. They are the ones who are looking after their parents, spouses, siblings and even friends who have been taken by dementia.

Women take up two-thirds of the portion that is doing the work whereas one-third of that are the children of the patient. Family, friends and other voluntary members make up 83 percent of the total care provided for these patients. Such arduous work will eventually lead to health problems on those who are providing. Requiring more than twenty hours per week on average, the report takes into consideration the possible heart problems and depression that caregivers often suffer from.

“The sooner the diagnosis occurs, the sooner these costs can be managed, and savings can begin,” Keith Fargo of the Alzheimer’s Association has asserted.

Unfortunately, there is no definite cure for Alzheimer’s disease as of yet. Nonetheless, like any other health issues, the early one is diagnosed, the better it will be overall in terms of time, money and energy. Needless to say, if a patient was diagnosed in early stages, say mild cognitive impairment (MCI) for instance, they could reduce the financial burden. This is because they will be able to better prepare themselves for the impending tragedy. In addition, transforming their lifestyles for the better by working out consistently, being on a healthier diet as well as eliminating unhealthy habits like smoking can aid in the situation.

“While current therapies do not prevent, halt or reverse Alzheimer’s disease, they can temporarily improve and prolong cognitive function in many individuals with Alzheimer’s dementia. An early diagnosis also enables potential safety issues, such as problems with driving or wandering, to be addressed ahead of time. When further testing shows reversible or treatable causes (for example, depression, obstructive sleep apnea or vitamin B12 deficiency) rather than Alzheimer’s disease, early diagnosis can lead to treatment and improvement of cognition and quality of life,” the report concludes.

Featured image via flickr/ Pictures of Money

Amazon continues to flourish

For some time now, Alphabet, the parent company of our beloved Google, has been holding the position of the runner-up, right behind Apple Inc. in the global market. In recent events, Amazon.com has just surpassed Alphabet in acquiring the position of the second most valuable company in the world. This is the first of such occurrence. Apple Inc. has been valued at $889 billion for the past two years. As of now, Amazon’s market capitalization is $7 billion ahead of Alphabet, with $768 billion and $761 billion respectively.

This should not come as a surprise since Jeff Bezos, the founder and CEO of Amazon, has recently been proclaimed by Forbes as the wealthiest man in the world. At a net worth of $130 billion, he holds the label of the first and only centi-billionaire in the United States. Over the past 5 years, Amazon has been experiencing a positive growth in market value. At present, it has acquired a growth of 2.69 percent in its stock price as opposed to Alphabet’s 0.39 percent decrease.

In addition to three of these tech giants, Microsoft is also in the game, placing fourth. The company’s market capitalization is valued at $717 billion as of today.

Due to the comparably small gap between the top three firms, any change in positions between them will not bring about too much of a commotion. Besides, with the obvious and consistent growth that Amazon has seen recently, it is highly possible for it to surpass the rests and safely secure the position as the most valuable company across the world.

Amazon has been venturing towards different industries. They range from shopping to banking as well as healthcare. The Motley Fool has even insinuated at the company’s possible endeavor in being a “major hospital supplier”. With Bezos brisk success in recent years, it would not be surprising if they continue to achieve excellence in any possible plans. To put it briefly, a $5,000 investment in Amazon.com from 21 years ago would have gotten you a million dollars today.

On the other hand, Google is seemingly losing its grip as the firm is already anticipating a further decline, particularly in their share of the country’s advertisement industry. At the moment, Google seems to be directing its effort on the invention and production of hardware like speakers, in order to compete with the other tech giants.

For instance, Apple has found its success in various products, ranging from iPhones to Apple watches. Two years ago, Apple had introduced the AirPods, a pair of wireless earphones. This product was a huge success such that its purchasing demand far surpassed the supply. It is not easy and there are hardly any goods or services, that are not necessities, that can achieve that, especially when it is not the most affordable item. However, Apple has always been able to acquire demand for its product since brand loyalty is one of the most significant element that has led to its top spot in the global market. This is clearly evident from the series of Apple products. For instance, the series of iPhone, up till iPhone X, has consumers queueing up to purchase it. In spite of the passing of the late Steve Jobs, Apple is still coming up with each products’ successor. Take the Apple Watch for instance. From its debut in 2015, the Apple Watch has not lost its popularity within the market. From the first, to Series 2 and the latest Apple Watch Series 3. Tim Cook, the CEO of Apple has revealed that the sales of the newest batch are twice the sale of the second batch.

With Apple’s consistent growth, will Amazon be able to surpass its market value or will Apple be able to hold on to the top spot?

Featured image via flickr/ simone.brunozzi

Steve Jobs’ 1973 application

Steve Jobs mementos have always been highly sought after at auctions. In 2014, a buyer paid $40,000 for a signed contract that was dated back to 1978. Then, a magazine with his mere signature was procured at the remarkable price of over $50,0000 last October. There was an auction that took place in the course of 8th March to 15th March, presented by RR Auction. A newspaper featuring the Apple Worldwide Developers Conference from a decade ago containing his signature was placed at a value of $15,000 easily sold for $26,950, a price that is almost twice of its worth. On top of the newspaper clipping, there was also an autographed technical manual of Mac OS X from 2001. Valued around $25,000, the highest bid was placed at $41,806.

Back in 1973, Steve Jobs, the co-founder of Apple had applied for a job through a handwritten form. In time, it has become a valuable piece of artifact that people are willing to pay an astronomical amount to acquire it. This job application was previously taken off the market through Bonhams, the auctioneers of treasured collectibles and such. It was sold for the price of $18,750 in December 2017, just a few months ago. Following that, the item was, once again, up for bid. It was found on RR Auction at an estimated value of $50,000.

It was eventually auctioned off at an incredible price, triple of the estimated value at $174,757. That is a sum of over two hundred thousand in Australian dollars and about £125,416, as reported by RR Auction. Oddly enough, the highest bid for the job application came from London. The bidder has chosen to remain anonymous and the only thing we know at this point is that he or she does their business online.

Who is this mysterious person who paid thrice the amount of the anticipated price? Bobby Livingston, the Executive Vice President of RR Auction suggests that the people who were after the job application are most likely businesspersons in the line of tech industry who have been observing Steve Jobs and the expansion of Apple as well as those who hold a high regard towards his ideology and capability. So far, this piece of history has turned out to be the priciest possession of Steve Jobs within the auction.

“The document to them resonates emotionally about who Steve Jobs was, … Here he was with nothing, and now he’s one of the most important people in the 20th century,” Livingston coherently articulated.

Aside from these autographed items, a number of his personal possessions, including bathrobes, have also been in the market. Few examples of these are his electric razors and leather jacket. A buyer paid $22,400 for the latter.

“Past generations might have collected The Beatles, but in the last 10 years, we’ve seen a huge growth in our technology auctions. There’s a market developing for Steve Jobs and other late-century icons of technology,” Livingston commented with regards to the collectors of Jobs’ possessions.

In this precious job application, we could see that there was nothing exceptional that would have pointed to Jobs’ future success. The company and job position were not even listed on the sheet.

In spite of what you would think, Jobs was an English lit major. He put “reed college” under the address column. At the time of the application, he had just dropped out of Reed College after having enrolled in the Fall term of 1972. However, he was still living in Portland, Oregon, where his campus was located. He remained there for the following year and a half to audit courses. Funnily enough, these courses were on the subjects of calligraphy, dance and Shakespeare.

Next to Driver’s License, he wrote “yes”, but he proceeded to answer with “possible, but not probable” when questioned about access to transportation. He scribbled “electronics tech or design engineer. digital. – from Bay near Hewitt-Packard” under Special Abilities. It was actually Hewlett-Packard. In addition, he expressed his skills with computers and calculators.

Click here to see the actual image of the job application.

As you can see, the entire form was filled with misspelled words and barely any capitalization as needed. It is certainly interesting to see such an ordinary or even below average application. Who would have thought that this young fellow applicant would one day turn out to be a prominent figure in the tech industry, who was also well-known globally? From a nobody to somebody who had, for the most part, changed the world.

The most extraordinary element of this application is still the fact that it was handwritten. Livingston has expressed his excitement towards the outcome of the auction, but he has pointed out the ultimate irony. The world will be losing out on documents like this – handwritten – since we are living in a digital age. Ironically, this change is attributable to the man whose handwriting this belongs to, Steve Jobs himself.

“There are personality traits in his handwriting that because of him and autocorrect, we’re going to lose,” Livingston continued.

Featured image via Wikimedia

Why are the cryptocurrencies crashing?

Within the past weekend, Bitcoin has fallen drastically to $7,335.57, at its lowest on Sunday. Fortunately, as CoinDesk conveys, the value of the cryptocurrency gradually recuperated. By Monday afternoon, the value of Bitcoin picked up again returned to an average of $8,585.

Although we can never know for certain the reason underlying such change, many have pointed to the advertising ban of bitcoin throughout the weekend. Sky News has reported the advertising ban for initial coin offerings, token sales and cryptocurrency wallets all across the world that Twitter has supposedly imposed and will be implemented within a fortnight.

Another one of those attempts to reprimand cryptocurrency scams, this move is not unheard of. Several tech giants have already imposed strict rules and regulations on these advertisements early on. In the start of the year, Facebook, runner-up to the world’s biggest online advertisement platform, has announced its plan to impose bans on all cryptocurrencies-related advertisements. Its reason for taking such drastic measures is to avoid circulation of “financial products and services frequently associated with misleading or deceptive promotional practices”. Moreover, just last week, Google has announced its plans to reinforce the financial services policy. Hence, advertisements circling cryptocurrencies, and such will be curbed within three months.

“Facebook was previous, but now Twitter is also rumored. Much of crypto(currency) demand is retail, so this may negatively impact demand,” suggests Joe DiPasquale, the Chief Executive Officer of BitBull Capital.

The former statement remains to be unsubstantiated as Twitter has not disclosed anything.

There was considerable news pointing to the high price of mining as the underlying cause of the fall in bitcoin’s value since last week. That was reiterated by DiPasquale, “Now that it’s dropped below that, there’s less incentive for miners to continue to keep machines on unless they are in a lower-cost energy area or have a way of producing at less than cost”.

The mining of bitcoin includes the utilization of certain software and expensive hardware to solve mathematics equations in order to earn bitcoins. With the current rate, they are now looking at a mere $8,000 for one bitcoin. This, in addition to regulatory issues, have largely impacted the value of bitcoin within the past few weeks.

Initially valued at a fine five figures of $11,000 just a couple of weeks ago, a statement issued by the Securities and Exchange Commission (SEC) expressing its concerns over cryptocurrency exchanges as well as the lack of security and privacy on Binance, a Hong Kong-based cryptocurrency exchange momentarily brought down the value of bitcoin.

According to the grapevine, finance ministers of G-20, as well as governors of central banks, have agreed to consolidate in Buenos Aires, Argentina. A G-20 representative has informed CNBC that these discussions will take place in a private and confidential setting before making its way to the press conference.

The Financial Stability Board (FSB) serves as a regulator for G-20 economies all across the world. They have begun to take actions after receiving a number of calls from various countries regarding the security of cryptocurrencies.

“The FSB’s initial assessment is that crypto-assets do not pose risks to global financial stability at this time,” proclaims Mark Carney, Chair of the Financial Stability Board as well as Governor of the Bank of England.

“Even at their recent peak, their combined global market value was less than 1 percent of global GDP,” Carney continues in an effort to juxtapose the size of cryptocurrency investments with the rest of the global financial system.

“The more speculative coins are being hit particularly hard. Liquidity is among their primary features and many of the holders lack long-term conviction, therefore they’re rotating into larger coins with stronger long-term prospects,” asserted by Spencer Bogart, one of the partners of Blockchain Capital.

He underlines the “potential for a liquidity crunch” as phrased by CNBC. He believes that to be the decisive factor for investors to let go of alternative coins and focus on more prominent cryptocurrencies like bitcoin.

Bitcoin was not the only cryptocurrency that had experienced a fall over the weekend. Ethereum went down by an alarming seventeen percent, reaching a nadir of $460.09, as reported by CoinDesk. That, however, is nothing in comparison to Ripple, which has suffered a decreased of fourteen percent to a meek $0.55. Similarly, the value of bitcoin cash and Litecoin have both deteriorated significantly at about ten percent.

While it may seem like bitcoin may be making a comeback, as people lose confidence in these currencies, the value subsequently decreases, too. Should investors pull out now or continue to await more positive results?

Featured image via flickr/ Zach Copley

Mining Cryptocurrency: The Beginner Course

Hello there! We would like to welcome again to our feature on bitcoin and cryptocurrency in general! In our previous installment, we went over the humble beginnings of Bitcoin and cryptocurrency as it ballooned into the pop culture curiosity it has become. In today’s feature, we will be going over the basics of mining cryptocurrency, one of our most requested topics! And what better time than now, cryptocurrency is all the rage, once again!

Screenshot of the Bitcoin client, using crypto...
Screenshot of the Bitcoin client, using cryptocurrency. (Photo credit: Wikipedia)

Much like any other form of currency, you can acquire cryptocurrency via accepting them for a transaction, but there are two much more popular ways to acquire them: purchasing the cryptocurrency through an exchange (paying a different form of currency for the cryptocurrency, usually in the hopes that the prices will rise after the transaction, similar to buying stock), and mining them, which began in 2009.

When you hear “mining” the first thing that often pops into the forefront of your mind is an image of a prospector during the gold rush, journeying west in hopes of discovering gold in the untapped ground. That often leads to organizations buying swaths of land where only they are allowed to mine there, no outside forces can mine there. That actually has quite a few parallels to cryptocurrency, instead of companies buying land to make money off their mining, companies are introducing their own forms of cryptocurrency. And much like gold, cryptocurrency is in a finite quantity, but that is by design of the company, for instance, bitcoin is limited to 21 million total, and we are over half way through that amount.

Also similar to gold miners using tools to mine, cryptocurrency miners use their computers raw power to have the chance to “discover” their loot. In order to acquire the cryptocurrency, miners (or malware software mining on computers without the user’s knowledge) perform algorithms in the hopes of finding an available cryptocurrency. The more power, the better, the more computers, the better.

The software for mining is actually very easy to use, while also being open source, meaning quite literally anyone can download and run it. But what most people do not realize is that miners also require security from outside attacks. Like an outside force sneaking into a gold mining camp under the cover of night, stealing the hard-earned earned gold mined out of the ground, there are those out there who specialize in breaking into the “wallets” of cryptocurrency miners, stealing their prized cryptocurrency. A suitably secure online bank account to house your cryptocurrency is a necessity.

Now, you may be asking, “how can I hope to make any money by myself with so many people out there mining for cryptocurrency such as bitcoin?” and that is a very good question, as acting as a single entity can make it extremely difficult to find cryptocurrency on your own. The way some people get around this is by joining a mining pool, where a group of users pool their computer resources together and share a percentage of the cryptocurrency mined. You may receive less money in the long run, but your chances of success are much higher.

Another popular way to “outsource” the mining of cryptocurrency is to use a Cloud mining service, where you basically rent mining hardware from another location that does the mining for you. There is no guarantee that you will see a return on your investment, but there is no wear and tear on your own hardware through this process.

There are several things to keep in mind if you do decide to mine on your own, such as electricity. While the software and algorithms don’t cause much in the way of damage to your computer, it will, however, take constant electricity to keep your system running, thereby increasing your electricity costs.

Mining cryptocurrency certainly isn’t for everyone, and most people don’t make the kind of crazy money the media likes to attribute to cryptocurrency. Much like other businesses, there are those who are making money hand over fist, and those who make it possible for those big businesses to make money. If you do decide to go at it on your own, there are many different specialized pieces of hardware you can buy to make the process easier, and that will be the focus of our next cryptocurrency feature! Check back in next time where we will go over computer parts, their purposes, their price, and the difference they make!

Apple is dominating the tech industry

Back in 2010, there was a virtual magazine subscription called Next Issue, but was rebranded as Texture by Next Issue Media in 2015. Now, Texture has over two hundred magazines available electronically on most systems including Windows, Amazon, Android and iOS. All it requires users to do is to pay a fixed monthly charge and access to articles from all of the magazines will be available in its entirety.

Initially, the application was created by several large magazine issuers collectively and supported by the financial assistance of external investors at a total sum of $50 million. The main idea was to become the dominant platform for tablet (i.e. iPad etc.) users to subscribe to magazines. Since people have been going onto the internet to do so, Google has been that platform for them.

In an era where smart devices and gadgets have become a necessity, it was assumed that magazines too, like other entities, will be highly sought after in electronic form. However, this plan took a hit when The Daily, a highly popular digital magazine by News Corporation went under. Even so, Texture apparently has had couple hundred thousand of clients by 2016 as disclosed by John Loughlin, the CEO of Texture, initially recounted by The New York Post. If that is the case, why did Next Issue Media let go of Texture?

In recent news, Apple, the iOS devices’ company has announced its official acquisition of Texture. Fortunately for those who are not in possession of an iOS device, Apple has confirmed that Android devices will still be able to get a hold on the application. It seems that Texture employees too, are secured in their current post as Apple has procured the staff in addition to the firm. This leads us to the next question. If Next Issue Media is willing to let Texture go, presumably because of its low demand in the market, why is Apple rushing to acquire it and at what cost?

Moreover, Apple, on its own, already offers digital magazine subscription services online. Hence, for what reason could it be for Apple to bid for another magazine service? Eddy Cue, the Senior Vice President of Apple issued a statement as presented below:

“We’re excited Texture will join Apple, along with an impressive catalog of magazines from many of the world’s leading publishers. We are committed to quality journalism from trusted sources and allowing magazines to keep producing beautifully designed and engaging stories for users.”

Likewise, CEO of Texture has also issued a statement to express their contentment:

“I’m thrilled that Next Issue Media and its award-winning Texture app are being acquired by Apple. The Texture team and its current owners, Condé Nast, Hearst, Meredith, Rogers Media, and KKR, could not be more pleased or excited with this development. We could not imagine a better home or future for the service.”

In 2014, Apple has taken over Beats, the brand of quality speakers and headphones. In addition to the gadgets and products, Apple had also taken over their music streaming service. With that, they turned it into the current Apple Music, which is as high in demand as Spotify. Within the same year, Apple once again recruited another brand, BookLamp. This application highly resembles Texture such that books are to BookLamp as magazines are to Texture. None of these is new because Apple has always been on the look to expand its empire. Another case in point is Apple’s recent acquisition of Shazam, another music streaming application.

Though we remain to be in the dark regarding Apple’s possible vision for Texture, an article by Ars Technica have made a suggestion. Even though nothing conclusive was disclosed in the statement issued by Apple’s Senior Vice President, arstechnica shed light on the phrase “trusted sources” and suggests that there’s a hidden meaning behind it. The article refers to the present as a time when reporters and publishers have voiced their opinions about large tech companies like Facebook and Google that are believed to have contributed to the biases in media as they are the one who controls the spread of news. Such actions have become noticeable that many heads have been turned and it has become public knowledge to take the content found on these platforms with a grain of salt.

Nonetheless, that is still just an assumption and we can only wait for Apple to announce their plans for Texture, if any, in the future.

On a different note, however, these multinational tech companies have surpassed mere dominance on the web. Just a couple of weeks ago, Jeff Bezos, the co-founder of Amazon has been proclaimed as the richest man in America. With that said, Amazon and Google, as well as Facebook, have provided digital magazine subscription services at one point or another. One way or another, they are further expanding their empires by dominating the market. At the moment, they are still attempting to grab every opportunity available in their industry. What happens when they have completely monopolized the industry? Will they dive into other industries and in turn dominate the world?

These companies are the perfect example of how the capitalist system is helping the rich get richer while the poor continue to suffer. Shouldn’t we be examining this news through a more economic and political aspect?

Featured image via flickr/ Luke Wroblewski

Be Careful with the Cryptocurrency You Invest in

Cryptocurrency has turned a lot of heads in recent years. Despite its original intent to be the future of currency, it has become a promising source of investment for many out there. Cryptocurrency investors are ranging from business professionals to amateurs – thanks to its accessibility. It has become a prospective alternative to other commodities such as stocks, bonds and so forth. What’s more, is that these cryptocurrencies have successfully attained over billions of dollars from investors in these few years. As a result, it has captured worldwide attention from major organizations and media.

Updates about cryptocurrency have surfaced as a consequence of the steep decline and frequent fluctuations in its value. Several media organizations including CNBC have informed the public about the action taken by the SEC towards some of the major firms in the cryptocurrency industry. Since then, SEC have reached out to educate investors about these firms.

SEC have come up with several guidelines for investors to take into consideration. They are urging investors to do some research prior to the transaction. Investors should ask for clarification regarding their criterions in the process of choosing the quality assets. In addition, they should find out the status of the market under the National Securities Exchange. More facts and figures should be acquired from the Financial Industry Regulatory Authority concerning the people behind the market if possible.

“Amid signals that the SEC would check online platforms for violations of registration or exchange rules… some of the markets have requested or received approvals as alternative trading systems,” proclaimed Nick Morgan, one of the partners at Paul Hastings LLP. Morgan was previously part of the SEC senior trial counsel.

“Likewise, the SEC does not review the trading protocols used by these platforms, which determine how orders interact and execute, and access to a platform’s trading services may not be the same for all user,” as disclosed in a statement by the SEC Enforcement and Trading and Markets divisions.

SEC have stepped out to remind investors about the truth behind these platforms. The digital commodities offered by these servers are not endorsed by the SEC, and the list of criterions they follow are not associated to SEC.

“The so-called standards shouldn’t be equated to the listing standards of national securities exchanges,” the regulator reminds investors.

SEC continues to clarify and distance themselves from these servers.

The values of cryptocurrencies have suffered a decline in value, once again, on Wednesday.  Bitcoin value decreased to 7.1%, an improvement from the initial 9%, to $10,030 with Ethereum and Litecoin following behind, as announced by CoinMarketCap. This happened following a warning by the Securities and Exchange Commission concerning potentially unlawful trading websites that does not have regulatory oversight. The chief federal regulator of the United States financial markets has informed the public of the fact that these trading websites are not SEC-registered and regulated.

Bitcoin remains to be the most noteworthy cryptocurrency at this moment.

Cryptocurrency is a highly demanded choice of investment because of its convenience and availability. It allows beginners and youths to invest without feeling restricted by the amount. However, it also belongs to the “high risk high reward” classification. With this new piece of information from SEC, nonetheless, the risk that it entails have become more apparent and severe. Public confidence in cryptocurrency is already quickly slipping away with its severe decline. Will this statement from SEC further affect the demand for cryptocurrency?

There is no such thing as a meaningful Bitcoin price prediction. It just isn’t possible with the current structure. Bitcoin was never really intended to be a store of value. You have separate classes of investors, each with different goals for what Bitcoin should be. Miners and holders want it high, and the currency crowd wants it low. Those forces will pull at each other in unpredictable ways. Besides, the major exchanges and trading platform are all amateur hour, and most have perverse incentives to front run, which can tilt prices even more dramatically. Market manipulation is rampant and structurally impossible to solve short of mass action or outside regulation.

Featured Image via Flickr/Steve Garfield

Jeff Bezos, First Centi-Billionaire in America

Jeff Bezos, the co-founder of Amazon has officially made it all the way to the top of Forbes list of world’s billionaires. Moreover, he has become the first and only person in America to acquire the title of centi-billionaire at a total worth of $127 billion, as determined by the Bloomberg Billionaires Index. He has now surpassed other well-known billionaires, like Bill Gates, the co-founder of Microsoft who is estimated at the worth of $90 billion, and Warren Buffet, the CEO of Berkshire Hathaway. Though Bezos was already a centi-billionaire from the sudden development of the Amazon shares last year, he has already earned about $15 billion more in the start of just this year and is expecting further growth.

This is apparent by the four percent increase – in Amazon stocks – in February when the broader market suffered a decline of four percent.

“Bezos has seen his wealth remain in excess of $100 billion, and with the likes of Bill Gates, Warren Buffett and Mark Zuckerberg also tipped to reach that eye-watering milestone, it seems we’re entering the era of the centi-billionaire,” articulated by Vishal Chhatralia, the Vice President of Digital Operations for RS Components.  

To illustrate the astronomical extent of his wealth, juxtapositions have been made. To begin with, the ratio of a centi-billionaire with exactly $100 billion juxtaposed with an average American’s wealth (based on the country’s Gross Domestic Product) is 1 to 1.8 million. Likewise, the ratio of an average American’s wealth juxtaposed with Jeff Bezos’ fortune is 2.3 million to one.

Capitalism promotes profitability and long term economic expansion. It is the market system that has led to the United States’ success in today’s global market. However, it is also a system that works by merit. Although it can bring about a vast reduction in the unemployment rate that consequently eliminates the costs and wastes in the society, many have brought up the counterargument concerning the increasing gap in wealth inequality. Ultimately, the decision-making power within the market will fall on the top tier of the society, the centi-billionaires and the government, resulting in the negligence of other consumers’ wants and needs. This is a cause of distress because if the gap of wealth inequality gets bigger without a solution, various form of political instability and radicalization of society will be more likely to happen.

Nonetheless, the neoliberal form of capitalism is believed to be the most satisfactory political economic future so far as it is able to solve the demand problem caused by wealth inequality. This is attributable to the increase in state spending following the increase in profit margins as business proprietors dominate the labor industry. Like the conventional capitalist system, this, too, works by merit and though wealth inequality may become an issue, the increased collective spending can act as a counter against it. The strength of continuing the neoliberal form of capitalism, perhaps with some adjustments to it is that it is currently the most efficient system in maintaining a balanced relationship between the society and economy of a nation. Yet again, this system, without its previous function to ensure a stable growth in the economy, will only result in a decline in the living standard of the majority.

Hence, a centi-billionaire’s decision towards the final placement of their fortune can affect the future of many; ranging from an individual to an entire nation. Prospective centi-billionaires such as Bill Gates, Warren Buffet and Mark Zuckerberg have all pledged to return a big portion of their fortunes to the society for the greater good. No such promise has been made by Jeff Bezos. Then again, Bezos and his spouse have been quite the philanthropist for some time now. As alumni of Princeton University, they have previously donated a sum of $15 million to the college. In addition, the United States branch of Reporters Without Borders opened an office in San Francisco, California after receiving a generous donation of $250,000 from Bezos.

Adding to the list is a $33 million donation made to TheDream.US, a scholarship reserved for a thousand immigrant high school students with Deferred Action for Childhood Arrivals status who are receiving tertiary education. His reason for choosing this cause could be traced back to his father. As a sixteen years old Cuban immigrant, his father travelled by himself to the States under Operation Pedro Plan.

All things considered, however, the key aspect to keep an eye on is Blue Origin, Jeff Bezos’ space exploration company. His alleged plan is to support this company by trading off $1 billion worth of Amazon stock annually. Blue Origin centers its research with the goal to acquire technological revolution. Bezos have explained his vision to build an economical space platform to compete with the Internet, despite its current focus on commercial purposes.

“That will be necessary to save the Earth, because without being able to expand into space, human civilization will have to contract,” he justified at a conference held in Los Angeles, California last November.

Featured Image via Wikimedia

Xiaomi: Alternative for Android Smartphones

Attributable to the 21st-century advancement in technology, there are not many folks out there who are not in possession of a smartphone. As a matter of fact, smartphones are no longer considered as a luxury item, instead, they have become a necessity to our generation just like water and oxygen. They are the first thing that we look at every morning and the last thing we have our hands on before we go to bed. As a result, the industry behind all of this technology has skyrocketed in recent years. As the demand for smartphones increases, it should come as no surprise that different brands of suppliers are contending to get ahead.

With the United States’ dominance in the global market, foreign suppliers have long been anticipated to demand entry to the circle. Many have not been able to pass the barriers to entry, in addition to minor factors. This is because the United States has maintained a strict policy in these affairs on the grounds of upholding national security interests. ZTE, one of the smartphone manufacturer that originated from China obtained the position as the third runner-up in the United States market last year. Samsung is another multinational conglomerate company that, as we all know, is a leading smartphone provider.

A recent report from the Wall Street Journal reveals a new player in the competition amidst android smartphone providers across the States. Xiaomi, another multinational firm from China, has made its way into Spain earlier on, after finding success in Southeast Asia and India.

“We’ve always been considering entering the U.S. market,” Lei Jun, the Chairman of Xiaomi, expressed in the event of China’s legislative session that takes place once a year in Beijing, China.

Conversely, Xiaomi is not new to the United States market. They have been the retailer of quality gadgets such as television set-top unit for android, cameras, speakers, headphones and so forth for some time now. Due to the exclusivity of the smartphone market, however, Xiaomi has not been able to navigate through government policies imposed by the United States.

Despite the complicated regulations and proceedings, Jun is determined to overcome these challenges. He insisted that Xiaomi, as a firm, will familiarize themselves with United States rules and regulations in the course of months. At the meantime, they will continue to enhance and upgrade their products based on customers’ demands.

Though this may sound promising, the encounter with Huawei may suggests otherwise. Prior to this, Huawei had introduced its featured smartphone, Mate 10 Pro, in the United States. They were considered as a prospective partner by the local phone service provider, AT&T. In spite of that, their plans ended unsuccessfully due to government interference.

Many people are putting down their iPhones in exchange for Android devices that allow more room for customization. As we look forward to Jun’s promising plans, the anticipation of these smartphones offered by Xiaomi will no doubt be exciting for all the Android users out there! In fact, consumers in Southeast Asia have expressed their approval online since the appearance of Xiaomi gadgets many years ago. With an addition to the competition, other smartphone providers will undoubtedly improve their products in order to keep up. As a consequent to an increased number of substitute products, the manufacturers will have to lower their cost of production in order to compete, which means that the final benefactor in the smartphone market will be the consumers who holds the purchasing power.

The two leading brands, Apple and Samsung, will experience a decrease in value. This is because with more participants in the run for a portion of the pie, their halves become smaller. Replacing the pie with market value shows the loss that Apple and Samsung will suffer from, as more companies get ahead.

Featured Image via Flickr/Jon Russell

Unilever acquires Tazo tea brand from Starbucks for $384 million

Along with releasing their always-anticipated annual holiday cup, Starbucks made another announcement this week as well. The coffee mega-giant is selling their Tazo tea brand to Unilever for $384 million as they say they will be focusing on Teavana as their sole tea brand. The sale includes all recipes, intellectual property and inventory.

Tazo, founded in 1994, was sold to Starbucks just five years later for $8.1 million. The brand is primarily sold in grocery stores. Consumers can buy Tazo as a packaged tea, K-Cup pod or in bottled-form.

Tuesday’s announcement was made as Starbucks released their fourth-quarter results and 2017 financial results. The final numbers came in much lower than Wall Street expected and the markets showed it. Starbucks’ fourth-quarter revenue came in at $5.7 billion. Experts were projecting to see at least $5.8 billion in revenue from the company.

Store sales also lagged behind. The company reported a two percent growth in its global comparable store sales. This number too came in lower than estimated; the Consensus Metrix projected a 3.2 percent growth in that sector.

Although the net income for the quarter also slipped, the outlook wasn’t all that bleak. Starbucks reported a five percent growth in full-year revenue at $22.4 billion.

The sale is perhaps not that surprising, after all, Starbucks announced back in July that it would be closing all 379 brick-and-mortar stores for its other tea brand, Teavana. However, closing down shop for Teavana may have more to do with the changes in how consumers shop than sales. In fact, Starbucks announced that sales for their tea category continue to grow.

“The tea category in Starbucks stores continues to grow double-digits globally,” the company’s announcement read. “With Starbucks well on its way to building the Teavana business to over $3 billion over the next five years.”

Over the past year, Starbucks has sold over $1.6 billion worth of Teavana product in stores. They’ve also launched bottled, ready-to-drink Teavana tea through a partnership with Anheuser-Busch InBev. Next year, the company plans to start selling packaged Teavana teas as well.

In the next five years, Starbucks plans to grow their Teavana line into a $3 billion business.

Kevin Johnson, president and chief executive officer at Starbucks, underscored the importance of Starbucks’ tea category and impressed the company’s desire to focus solely on Teavana.

“Over the past five years, we have established Teavana as our primary global brand focused on the premium tea segment. With our growth strategy for premium tea exclusively focused on Teavana, we are pleased to transition our Tazo business to Unilever,” Johnson had to say about the sale.

And Starbucks should be pleased. As Forbes puts it, the nearly $400 million sale to Unilever “marks a more than 47-times return on investment.”

Unilever is already home to many well-known food and drink brands, like Ben & Jerry’s, Lipton, Pure Leaf, Klondike, Breyer’s and much more. The UK-based consumer products behemoth’s leadership claims that, in addition to beefing up the company’s existing tea brands, the acquisition is targeted at millennials.

“With its strong appeal to millennials, Tazo is a perfect strategic fit for our US portfolio that includes exciting new brands such as Seventh Generation, Dollar Shave Club and Sir Kensington’s,” Kees Kruythoff, president of Unilever North America, commented on the news. “Tazo’s solid position in the fast-growing specialty tea segment, coupled with Unilever’s tea expertise, presents a fantastic growth opportunity.”

The announcement this week follows Unilever’s acquisition of the organic herbal tea brand Pukka Herbs back in September.

Bidding war for Amazon’s second headquarters is underway, here’s who’s on top

The bidding war for Amazon’s second headquarters began on Monday, and several cities have already submitted their proposals. New Jersey has submitted a bid for their city of Newark, offering up what could potentially be the greatest financial incentive for Amazon—$7 billion in tax breaks.

Just last month, Amazon announced a competition to source a location for their second headquarters. Dubbing it “HQ2,” Amazon is looking to spend up to $5 billion building the new hub, which will run in tandem with the Seattle-headquarters. The city lucky enough to land the gig would gain 50,000 jobs with an average salary of $100,000.

On the surface, Newark, NJ would appear to have everything Amazon is looking for. In the suburbs of New York City, Newark benefits from an extensive network of public transportation and even has its own airport. There are 60,000 students studying in six colleges and universities across Newark. This, combined with the proximity to other large metropolises like New York City and Philadelphia, means HQ2 would have an extensive talent network to pool from for future employees. Newark has some prime office space available for development, as well as more affordable housing than New York City or Jersey City.

Monday, New Jersey Governor Chris Christie announced their bid for HQ2. According to Fortune, the proposed $7 billion in tax breaks is broken down between state and city incentives.

The state has estimated that HQ2 could bring a potential $9 billion to the economy. As such, New Jersey is offering $5 billion in tax incentives over the next 10 years, but not before the 50,000 jobs are added. The city of Newark has also proposed a tax incentive, offering $1 billion in local property tax breaks and $1 billion worth of waived wage taxes for Amazon’s HQ2 employees over the next 20 years.

Amazon is allowing cities to submit their proposals through October 19.

Nearby Philadelphia is also reported to be ranked high on Amazon’s list of prospects. The city of brotherly love also proposed a tempting financial incentive, offering 10 years of property tax abatement. However, Fortune stipulates that it is “unclear” what, definitively, Amazon will gain from the plan.

Moody’s Analytics, a subsidiary of Moody’s Corp. providing economic and capital markets analysis, released a shortlist of cities they expect to be at the top of Amazon’s list. Coming in on top was Austin, TX. Austin was followed by Atlanta, Philadelphia, Rochester, Pittsburgh, New York City and the surrounding metro area, Miami, Portland, Boston and Salt Lake City.

The study first evaluated cities based on their adherence to Amazon’s laundry list of requirements for their new location. It also chose cities based on other economic factors. Other factors included: business environment, human capital, cost, quality of life and transportation.

One city that was absent from Moody Analytics’ list was Chicago, who submitted their proposal on Monday. Although Chicago’s announcement of their eligibility on Monday lacked details, Mayor Rahm Emanuel did release a statement.

“Chicago offers unparalleled potential for future growth for businesses of all sizes and is the ideal place for Amazon to build its HQ2,” the mayor’s statement read. “This bid will demonstrate to Amazon that Chicago has the talent, transportation and technology to help the company as it reaches new heights and continues to thrive for generations to come.”

Other cities have proposed to Amazon before submitting a formal bid. Kansas City’s mayor went on a reviewing spree on Amazon products. Georgia offered up a sizable amount of land totaling to a grand 345 acres; they even said they would name the site after the company, giving birth to the new city of Amazon, GA. A company in Tucson sent Amazon a 21-foot saguaro cactus to their Seattle headquarters.

Although amusing, the LA Times points out that such strategies to catch Amazon’s attention probably won’t amount to much. After all, the retail giant’s detailed seven-page request mostly highlighted financial incentives. Such incentives could materialize in the form of land, tax credits, relocation grants, workforce grants and fee reductions. These would be critical for Amazon, considering such incentives would allow the company to build a new “mega-campus” and offset “ongoing operational costs.”

Oh, and that 21-foot saguaro cactus? Amazon tweeted that they couldn’t accept the gift, “even really cool ones.” It was donated to Tucson’s Desert Museum. Better luck next time, Tuscon.

Featured image via Flickr/Robert Scoble

Nike losing teens in footrace with Adidas, analysts say

The investment bank and asset management firm Piper Jaffray released the findings of their latest biannual “Taking Stock with Teens” Survey, MarketWatch reports, and apparently, Nike is losing touch with teenagers. Instead, the demographic seems to be spending more with Adidas and Amazon.

Before you throw out your swoosh-covered sweats and socks, Nike (NKE) still holds court as the top clothing and footwear brand. The survey does relay that the sportswear giant is among the top brands that experienced the largest declines. Other household names that suffered sharp declines include: Ralph Lauren (RL); Steve Madden (SHOO); Ugg, (DECK); Fossil (FOSL); and Michael Kors (KORS).

Under Armour (UAA)  also took a hit from the survey, with teen males ranking it as the No. 1 brand classified as “old.” According to CNBC, Under Armour only got one vote among upper-income females as a brand favorite. Nike vs. Adidas aside, it actually seems as though the entire athleisure trend is beginning to lose favor with the teenage demographic. Only a third of teens chose athletic apparel as their preferred fashion pick, down 40 percent from last year. The overall trend moved towards festival fashion.

Piper Jaffray polled 6,100 teens across 44 states for the survey. The average participant’s age was 16; the average household income was $66,100.

After examining the results, analysts were most surprised by Nike’s decline compared to Adidas’ (ADS) surge in popularity. Adidas “doubled its mindshare,” going from 2 percent to 4 percent. Even with their rise, Adidas didn’t fully offset Nike’s losses.

“Overall, larger brands are ceding share for small brands,” Piper Jaffray analysts noted.

Analysts highlighted brands like Vans (VFC) and Supreme as rising in popularity.

Other familiar names ranked highly in the survey as well. Starbucks’ (SBUX) siren call resounded with teens from upper-income households (average yearly income of $101,000) as their top restaurant; it also ranked first among teens from median income households, those bringing in $55,000. Netflix (NFLX) chilled at the top for daily video consumption. Snapchat was the fan favorite for top social media platform. Turns out that teens don’t diverge much from their grownup counterparts when shopping, picking Amazon (AMZN) as their online retailer of choice.

One reason why Amazon has consistently ranked as teen’s favorite site for the past three years could simply be that the company knows their customer base well. Recognizing the opportunity to turn teen shoppers into lifelong customers, Amazon just announced that teens between 13 and 17 years old can now shop on their site with a personal login. Parents or guardians will receive an email or text with order details. Parents can then either approve the purchase or even set limits on their child’s spending.

Christian Magoon, CEO of Amplify ETFs, pointed out that Amazon’s strategy to capture a younger demographic was good for the company’s longevity, considering entire households can now be raised using Amazon smart home products.

“Younger generations rebel against things that are static,” Magoon highlighted, reasoning that other retailers should take notes from Amazon’s strategy.

“Amazon continues to innovate and grow,” he continued. “We’re not at peak Amazon. People are still excited about what’s next.”

Overall though, teen spending is down 4 percent compared to last year, CNBC reports. Teen spending accounts for 7 percent of the country’s retail sales, amounting to nearly $830 billion yearly.

Bitcoin plummets as economists, regulators express skepticism of cryptocurrency boom

Bitcoin’s value, which nearly quintupled from the first of the year through the first of September, peaking at $4,950.72 per coin on the latter date, has fallen more than 20 percent this month and over 15 percent in the past seven days, as of 4:15 p.m. EST Wednesday.

The decline comes as a number of regulatory agencies and economic experts around the globe express skepticism regarding Bitcoin and other cryptocurrencies.

China banned Initial Coin Offerings (ICOs)—the means by which creators introduce and raise capital for new cryptocurrency projects—earlier this month, and Chinese news outlet Caixin reported Friday that the country might prohibit cryptocurrency exchanges entirely in the near future, Business Insider notes. 

But, Bloomberg’s Lulu Yilun Chen tweeted Friday that the Chinese government had yet to mandate the shutdown of Okcoin and Huobi PRs, two of the country’s most prominent cryptocurrency exchange platforms.

Some say China will relax the pressure it has placed on the cryptocurrency market once the government has found a viable means of regulating that market.

“China [is] saying, ok, we need to push back on these for now until we figure out how to deal with them,” said Zennon Kapron, director of the Shanghai-based financial technology consultancy Kapronasia, per Reuters, in reference to the country’s ICO ban. Kapron added that he expects the country’s government to eventually ease the ban.

Previous Chinese regulations against cryptocurrencies have proved temporary. The country prohibited the withdrawal of Bitcoin investments in February, but allowed withdrawals to resume in June, Business Insider points out.

Chinese regulators are not the only ones wary of the cryptocurrency boom.

Tuesday, the U.K.’s Financial Conduct Authority released a statement cautioning investors about the risks of ICO investors, Business Insider reports. These risks, according to the FCA, include the lack of regulation governing the cryptocurrency market, the volatility of cryptocurrencies, the potential for fraudulent ICOs, and the experimental nature of cryptocurrency projects.

“ICOs are very high-risk, speculative investments,” the FCA’s warning reads. “You should be conscious of the risks involved … and fully research the specific project if you are thinking about buying digital tokens. You should only invest in an ICO project if you are an experienced investor, confident in the quality of the ICO project itself (e.g., business plan, technology, people involved) and prepared to lose your entire stake.”

Also on Tuesday, Business Insider says, JP Morgan CEO Jamie Dimon predicted an imminent crash of what he sees as the Bitcoin bubble. His prediction, so far, has been self-fulfilling. Dimon said he “would fire any trader that transacted Bitcoin for being stupid” (Business Insider’s paraphrasing).

As of 5:15 p.m. EST, Bitcoin’s value has fallen six percent on Tuesday’s news.

Business Insider notes that early this month, in an interview with Quartz, Yale economics professor and Nobel Prize winning author Robert Shiller, who predicted the crash of the housing and technology markets in his 2000 book “Irrational Exuberance,” called Bitcoin the best example in today’s market of a speculative bubble.

A “speculative bubble” occurs when unrealistic expectations amongst investors of an asset’s future performance drive the market value of that asset beyond any real gains it is capable of accruing.

In the aforementioned book, Shiller argues that the tech bubble formed because “a fundamental deep angst of our digitization and computers” compelled investors to seek a false sense of understanding and comfort by gobbling up tech stocks.

“Somehow Bitcoin…gives a [similar] sense of empowerment: I understand what’s happening! I can speculate and I can be rich from understanding this! That kind of is a solution to the fundamental angst,” Shiller told Quartz.

There is no question that investors have been exuberant about cryptocurrencies this year. ICOs have raised over $2 billion in 2017. The question is whether the exuberance is irrational. As a number of financial experts answer that question in the affirmative, once-exuberant cryptocurrency backers are growing skittish.

Featured image via Wikimedia Commons

Centene to acquire Fidelis Care for $3.75 billion

Centene, the United States’ largest Medicaid managed care provider, announced Tuesday that it has reached a “definitive agreement” to acquire Fidelis care for $3.75 billion, USA Today reports. 

The deal is scheduled to close in early 2018. It awaits the approval of various New York regulators, who will, among other things, evaluate it for compliance with the NY Not-for-Profit Corporation Law.

With the acquisition, Centene expects to generate $60 billion in annual revenue in 2018 and $100 million in savings by 2019. The firm reported $40.6 billion in annual revenue in 2016. Based in St. Louis, the company ranks among the largest publicly held companies in Missouri in terms of revenue.

Centene hopes to maintain a debt-to-capital ratio of 40 percent in the 18 months following the acquisition.

Managed care providers like Centene and Fidelis Care function as intermediaries between federal and state governments—which fund Medicaid programs—and Medicaid beneficiaries. The State pays such companies a premium in exchange for providing the services to which a beneficiary is entitled. USA Today describes managed care providers as the “private market option for Medicaid recipients.”

Fidelis works with 70,000 health care providers to provide health insurance plans to 1.6 million New York residents. The company brought in $4.8 billion in revenue in the first six months of 2017, according to Centene’s announcement.

Centene serves more than 12.2 million members in 28 states, but prior to the Fidelis acquisition has no presence in New York state. The deal will give Centene a leadership position in that state’s managed care market, the second-largest such market in the nation, according to Centene’s statement. The company is already the leading Managed Care Organization (MCO) in the other three largest MCO markets in the country: California, Florida and Texas.

Centene partners with healthcare providers at the state level to offer care tailored toward the needs of a given community.

“We believe our over 30 years of experience, our local approach to the provision of healthcare, and our expertise and capabilities in caring for underserved populations will support the next generation of leadership in government programs in New York State,” said Michael F. Neidorff, chairman, president and CEO of Centene. “We look forward to partnering with the state of New York’s healthcare professionals as we continue to deliver on our mission of transforming the health of the community, one person at a time.”

Fidelis shares Centene’s emphasis on local involvement and affordable care for as many people as possible. The former company’s website says: “From the beginning, Fidelis Care has worked to be part of the social fabric of local communities, impacting people’s lives with one of the most basic human rights – access to quality, affordable health coverage and care.”

“Centene’s and Fidelis Care’s missions are fully aligned in terms of promoting health through high quality, accessible care and services for all and advocating for health policy that accords true dignity and respect for all people, especially the underserved,” says Neidorff.

Fidelis Care CEO Patrick J. Frawley says his company’s “mission and values” are its “foundation,” and that Centene shares those values.

According to a CBSNews report, The Archdiocese of New York, a key Fidelis backer, said the “uncertain regulatory environment” in the U.S. in part motivated the sale. Washington’s sluggishness in replacing the Affordable Care Act has been widely publicized. 

CBS further notes that the Archdiocese plans to use proceeds from the sale to establish a healthcare foundation that will “operate in conformity with Catholic values.”

Founded in Milwaukee in 1984, Centene has been publicly traded since December 2001. Its market capitalization is $14.2 billion.

As of 2:34 EST Monday, the company’s shares have risen 7.2 percent on news of the Fidelis acquisition.

Featured image via Pixabay

Equifax stares down almost two dozen class actions after cyberattack

Credit reporting and monitoring company Equifax is facing at least 23 proposed class action lawsuits in the wake of its announcement Thursday that a cyber attack compromised the personal information of up to 143 million Equifax customers, USA Today reports.

Various law firms have filed suits in 14 different states as well as D.C., according to USA Today. More suits will likely come. Victimized customers may receive a pretrial settlement from Equifax, and/or may be entitled to some portion of any financially pejorative judgment levied against the firm.

“Equifax probably injured 143 million people, which is kind of a record…with 143 million people it doesn’t surprise me there are already 23 suits,” said John Coffee, who directs the Center on Corporate Governance at Columbia Law School.

USA Today notes that the number of people the breach potentially victimized represents 44 percent of the U.S. population.

“Assume that if you’re an American with a credit card or a mortgage, your data has been leaked,” Zach Whittaker, security editor for CBS’s ZDNet, tweeted.

Hackers carried out the attack from mid-May through July, seizing customers’ names, social security numbers, birth dates, addresses and, in some cases, driver’s license numbers. Equifax says it became aware of the breach in late July. The company alerted the public of the incident on September 7. In the interim, Equifax hired third-party consultants to investigate the crime and provide suggestions as to how the company might bolster its cyber-defenses.

Many of the lawsuits take issue with the lag time between Equifax’s discovery of the attack and the firm’s notification of the public. USA Today says one suit calls the delayed disclosure “willful, or at least negligent.” Another argues that the delay “deprived [consumers] of their opportunity to meaningfully consider and address issues related to the potential fraud, as well as to avail themselves of the remedies available under the FCRA (U.S. Fair Credit Reporting Act) to prevent further dissemination of their private information.”

The company would presumably argue that it was justified in assessing the nature and extent of the attack before alarming the public.

A third suit notes that Equifax fell victim to similar attacks earlier this year, as well as in 2013 and 2016. Therefore, said suit argues, Equifax “knew and should have known of the inadequacy of its own data security.”

Other filings take aim at TrustedID, an Equifax service that provides identity theft protection and credit monitoring. One document says the company “failed to disclose to consumers that it owned TrustedID,” and baited customers into signing up for the service.

To help customers identify whether their information was compromised by the attack, Equifax is offering free TrustedID service to all U.S. customers

New York Attorney General Eric Schneiderman, who is investigating the Equifax case, took issue with a clause in the agreement Equifax requires TrustedID members sign. The clause in question says that in signing up for TrustedID, a user waives his/her “right to bring or participate in any class action…or to share in any class action awards.”

“This language is unacceptable and unenforceable,” Schneiderman tweeted Friday. “My staff has already contacted @Equifax to demand that they remove it.”

Equifax subsequently explained that the waiver does not prohibit TouchID members from participating in class actions regarding the cyber security incident.

In addition to Schneiderman, other government entities are pursuing the Equifax case. USA Today obtained a copy of a letter Senators Omin Hatch and Ron Wyden, both of whom hold key positions on the Senate Committee on Finance, sent to Equifax requesting details about the attack and the manner in which the company is handling it.

The letter requests a timeline of the breach and asks how Equifax is identifying affected customers and what measures the company is taking to limit consumer harm. The document also asks Equifax to clarify the amount of information that was compromised.

Legal arguments must take place before the proposed suits achieve class action status. If the court grants class action status, USA Today says, a “federal panel on multi district litigation” will likely consolidate the suits into a single case, then assign that case to a judge, who would, in turn, appoint one law firm or a group of law firms as plaintiff counsel.

At the market’s close Tuesday, Equifax stock has dipped 18.7 percent since the original announcement. 4.7 percent of the drop has come since Monday morning when news of the proposed class actions broke.

Featured image via Pixabay

Harvey and Irma combined could prove more expensive than Katrina

Moody’s Analytics estimates that Irma will cost the U.S. economy between $64 billion and $92 billion, CNN reports. Insured losses resulting from the storm will range between $20 billion and $40 billion, the firm said.

Moody’s estimated Harvey-related costs between $86 billion and $108 billion, CNBC notes.

Harvey and Irma will likely cost a combined $150 billion to $200 billion, Moody’s chief economist Mark Zandi says, per CNN.

Hurricane Katrina cost the U.S. about $160 billion (adjusted for inflation) when that storm hit in 2005. It was the most expensive natural disaster in U.S. history. Irma’s and Harvey’s combined economic damage will likely exceed the Katrina figure.

Irma has crippled Florida’s tourism industry, turning much of the state into the kind of water park nobody wants to see. Miami and Tampa saw four feet of storm surge, and three to five feet of storm surge, along with a foot of rain, inundated Jacksonville. The extent of the damage to business operations remains largely unknown but is presumably considerable.

Meanwhile, oil refinery operations in Texas continue to reel in the wake of Harvey. About 13 percent of the United States’ refinery capacity remains offline in Texas, according to CNN.

Last Thursday, the federal government said joblessness claims rose by 62,000, to 298,000, in the days following Harvey, CNBC notes.

The two storms together could cost the U.S. between $20 billion and $30 billion in economic output, Moody’s said per CNBC. The firm has dropped its third-quarter forecast of the nation’s GDP growth by half a percentage point, to 2.5 percent.

Zandi notes that the recovery of the nation’s economy will depend on the speed with which Florida and Texas can revive their tourism and oil industries, respectively, but says he expects the rebuilding effort to provide an economic boost that will put the U.S. economy back on track by the year’s end.

“The longer-term economic impact of the storms should be nil,” said Zandi per CNN.

William Dudley, the president of the New York Federal Reserve, echoed Zandi’s analysis. While natural disasters such as Irma and Harvey disrupt industry, create scarcity and raise prices in the short-term, the rebuilding effort boosts the economy, he said per CNBC.

“The long-run effect of these disasters unfortunately is it actually lifts economic activity because you have to rebuild all the things that have been damaged by the storms,” Dudley said in a live interview with CNBC.

He added: “I would expect that by the time we get to the end of the year and early 2018, the transitory negative effects of this storm I think will be over and we actually will start to see some of the benefits of the rebuilding efforts in terms of boosting the economy.”

Recovery efforts following a natural disaster create jobs, compel the government to increase infrastructure spending, and bring other economic stimuli.

For instance, Congress and President Trump agreed last week to raise the debt limit for three months to facilitate relief efforts in the wake of the storms, and the House approved $7.85 billion aid package for Harvey relief last Tuesday, the New York Post reports.

According to Reuters, Vice President Mike Pence said Sunday that the government would use all of its resources to aid Irma victims.

While the storms’ long-term impact on the economy at large may be negligible or even positive, their financial impact on a small scale can, of course, be devastating. Irma and Harvey have destroyed homes, businesses, valuables and other crucial assets.

“Think of the wealth destruction created by these hurricanes,” said Dan North, chief economist for Euler Hermes, North America, per CNBC.

In discussing Irma relief, President Trump was quick to point out that human considerations outweigh economic ones. “Right now, we are worried about lives, not cost,” he said, per Reuters.

Irma’s death toll in the U.S. rose to 12 Monday, ABC News reports. The Associated Press reported last Thursday that Harvey has killed 70. The hardship the storms have brought is incalculable; as one small example, Irma left 2 million Floridians without power. They regained power Tuesday morning.

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Markets rise as Irma weakens, North Korea anniversary passes without nuke test

Markets around the world are rising as Florida missed the worst of Irma this weekend, and as North Korea’s founding celebration, which took place Saturday, did not include a missile test, Reuters reports.

Irma hit the Florida keys Sunday as a Category 4 hurricane, then came into Miami, damaging several buildings and creating a storm surge that caused flooding in the downtown area of the city, The Wall Street Journal reports. The full extent of the damage remains unknown, as many of the hardest-hit areas are still inaccessible. The Journal points out that the National Weather Service expects severe conditions to persist in central and western Florida.

Irma continues to lose strength, The Washington Post notes. By Tuesday, experts expect it to weaken to a tropical depression. But, the storm remains capable of producing hurricane-force gusts, and will likely create a “life-threatening” storm surge, cautions the National Hurricane Center. A storm surge warning is in effect across much of the Atlantic and Gulf coasts.

The Post cites a National Weather Service tweet that says Irma’s storm surge produced record flooding in downtown Jacksonville Monday morning.

Nonetheless, Floridians caught something of a break over the weekend. On Friday, the Journal says, some models projected that the storm would hit Miami and east coast Florida head-on—instead, the storm turned toward the gulf coast.

“For now, we’re seeing a bit of a relief rally [in the market]. It does appear that the worst-case scenario for Florida has been evaded,” said Peter Cardillo, chief market economist at First Standard Financial in New York, per Reuters.

Meanwhile, North Korea tested no missiles over the weekend, though, according to the New York Times, leaders did hold a massive gala for the country’s nuclear scientists Saturday, in conjunction with national anniversary celebrations.

Last Sunday, North Korea successfully detonated its sixth nuclear bomb.

The MSCI AC World Equity Index, MIWD00000PUS, which tracks 2,400 stocks in 47 countries, according to Reuters, surged to a new high Monday morning, and as of 1:27 Eastern Monday. DXY, an index that compares the U.S. dollar to six other currencies, has jumped 33 cents (0.36 percent) since 11:59 p.m. Sunday. DXY is recovering after having hit a two-and-a-half-year low Friday.

Meanwhile, stock markets in Tokyo had their best session since June, according to Reuters. Relief about the situation in North Korea, as well as a weakening yen, spurred the surge.

In the U.S., shares are up one percent across Wall Street, Reuters says. As of 2:30 p.m. EST Monday, the DOW Jones Industrial Average has risen 260.19 points (1.19 percent) since it closed Friday. The S&P 500 has jumped 1.06 percent since Friday’s close, and now sits at 2487.67.

Demand for gold is falling, as investors are, according to Reuters, more inclined to assume risk given the relative stability of the U.S.’s relationship with North Korea and the relatively mild damage Irma wreaked upon Florida. As of 2:47 Eastern Monday, one troy ounce of gold is worth $1330.61, a decrease of $10.64 (0.8 percent).

Oil investments are falling out of favor as well, as the market frets over Irma’s and Harvey’s impacts on the supply of oil in the U.S., which Reuters says consumes more oil than any other nation.

“Brent crude oil futures for November delivery LCOc1 were down 66 cents [1.23 percent] at $53.12 a barrel, while benchmark U.S. West Texas Intermediate crude CLc1 declined by 33 cents [0.7 percent] to $47.15,” Reuters writes.

Jim Paulsen, chief investment strategist at the Leuthold Group in Minneapolis, said that a weaker dollar, along with lower interest rates, will provide more fuel to the U.S. economy in the near future.

“We are massively stimulating this economy that’s already doing pretty well,” he said. “That’s likely to accelerate an already-good economy even further the next 12 months.”

Featured image via Wikimedia Commons

Carpooling service Via closes investment round, plans U.S. and oversea expansion

Carpooling service Via just completed a funding round, the proceeds of which the company intends to use to expand its service in the U.S. and to establish a presence in Europe, TechCrunch reports. Via will begin London operations in the near future, and Paris service soon after.

The amount of the funding round remains undisclosed, but a source told TechCrunch the number was $250 million.

Prior to the investment round, Zirra estimated the company’s value between $450 million and $500 million, TechCrunch notes. Following the round, then, Via could be worth as much as $750 million.

Via provides carpool service to riders seeking a cheaper alternative to operations like Uber and Lyft. A single Via vehicle carries up to five passengers at a time, so customers can book rides for as little as $5 plus tax. An algorithm determines routes in real-time as customers request rides, so unlike conventional public transit systems, Via is not constrained by a preset schedule. The company’s website says the average wait time is five minutes.

Today, Via runs 24-hour service in its hometown of New York City and also operates in Washington, D.C. and Chicago. TechCrunch says the service gives about one million rides per month.

In addition to running its own operation, Via licenses its platform to other transportation companies, including Arriva—a subsidiary of German-based railway company Deutsche Bahn AG—which operates buses, trains, and other mass transit options across 14 countries in Europe, and Keolis, a subsidiary of France-based SNCF, which offers similar service worldwide.

Daimler AG, which owns Mercedes-Benz, led Via’s most recent funding round, and the two companies plan to intensify their partnership. In addition to its contribution to the funding round, Daimler will provide $50 million towards a joint venture project with Via.

The two companies have been collaborating for years, TechCrunch notes. In late 2015, Via joined forces with Mercedes-Benz Research and Development North America, Inc. to launch a pilot program in Orange County, CA, a suburb of Los Angeles. Mercedes provided Via with Metris passenger vans for that trial program.

Daimler and Mercedes will likely provide vehicles for Via’s European expansion as well. The partnership with Via will give Daimler a ready-made sales connection and will provide a platform through which Daimler can develop and test vehicles optimized for carpooling.

As tech-based transportation start-ups change the way consumers approach moving around, automakers are seeking the most efficient ways to adapt to the changes in the industry.

“One big question is, ‘what is the right vehicle?’” Via CTO and co-founder Oren Shoval told TechCrunch “There are the seating arrangements, how you connect the sensors, what kind of door it should have. This is a big piece of mobility.”

Shoval adds that the Via-Mercedes partnership will streamline and solidify Via’s service. “We also believe that the vehicles in the network, at the end of the day, it’s not just an app but a whole service that you are getting. It makes sense to have these things converge,” said Shoval.

Volker Mornhinweg, head of Mercedes-Benz Vans, echoed Shoval’s sentiment that the partnership would improve Via’s service, and added that the collaboration was important to Daimler’s long-term strategy in the changing transportation sector.

“Via is one of the most successful providers in the growing ride-sharing sector while Mercedes-Benz Vans has the perfect vehicles that are being continuously optimized for this job,” he said. “By deepening our cooperation with Via, we are thus taking the next logical step in the context of our strategy for the future and are expanding our range of new mobility services.”

Daimler launched Car2Go, which allows users to rent cars parked in various places around a city and then return those cars to one of many drop zones around town, in 2008. Now, Car2Go operates in 26 cities across North America, Europe and Asia, and serves 2.5 million registered members.

Daimler, in tandem with Audi and BMW, bought GPS mapping service Here in late 2015 and has independently acquired a number of ride-sharing companies, including Germany’s MyTaxi, the U.K.’s Hailo, and Taxibeat in Greece. All three of those services have merged under the MyTaxi umbrella since Daimler acquired them.

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