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.

Markets lurch as Trump talks and NEC director Gary Cohn considers leaving

The euro has been weakened against the dollar since the release of the minutes of the European Central Bank’s last meeting. But the dollar is having its own problems. The dollar has fallen since the Federal Reserve released the minutes of its last meeting in July, during which policymakers expressed concern about weak U.S. dollar inflation.

The recent attack in Barcelona compounded matters for the dollar, as did certain remarks made by President Trump regarding the recent violent white-supremacist rallies in Virginia. In the fallout from this drama, Trump disbanded two advisory councils of prominent businessmen, a move which some people think violates his promise to work alongside industry leaders.

To make matters worse for the dollar, recent speculation rumors that Gary Cohn, current director of the National Economic Counsel, is considering leaving his post. Cohn was one of many business leaders to denounce Trump’s remarks on the violence in Virginia.

Aside from his duties as director of the NEC, Cohn also acts as a particular advisor of President Trump’s on tax reform and spending, as does Treasury Secretary Steve Mnuchin. Cohn previously served as an executive at Goldman Sachs.

Cohn seems to play a key role in keeping the U.S. economy and currency stable. That’s why the rumors circulating about his possible imminent departure caused the markets to lurch. Traders rushed to abandon the dollar for more secure currencies.

An anonymous White House adviser maintains that Cohn will remain and the status quo will not be broken. This news has calmed the markets somewhat.

On Wednesday, the dollar fell O.55 percent to the yen and 0.4 percent to the Swiss franc. The dollar has since gone up incrementally.

On the whole, most analysts don’t seem to see much immediate cause for worry about the U.S. dollar.

Featured Image via Pixabay

Unemployment Claims Drop to Eight-Year Low

According to a report from Bloomberg, over the past month, the number of Americans filing for unemployment benefits has declined, reaching an all-time low in eight years. This trend may indicate that the job market is picking up speed as demand is increasing. This could in turn increase wages and catalyze consumer spending.

A report from Bloomberg states, “The four-week average jobless claims (INJCJC), considered a less volatile measure than the weekly figure, dropped to 297,250, the lowest since April 2006, from 300,750 the prior week.”

“Employment growth remains healthy,” and the reading is “consistent with a strong labor market,” said David Sloan, senior economist at 4Cast Inc., according to Bloomberg.

Some point to the auto industry as contributing to these results as automobile manufactures usually close production during July to revamp for newer models and cars, but this year there were fewer closings due to the growing demand for cars.

“Claims are often volatile in the summer because of the timing of shutdowns at auto plants for retooling, but even so the downward trend in claims is evident and very positive for the labor market and the overall economy,” said Stuart Hoffman, chief economist at PNC Financial Services Group, according to The Wall Street Journal. “The current level of claims is consistent with monthly job growth of above 200,000, and the July employment report should be another strong one.”

It remains to be seen if the economy will have a steady improvement or if this decrease in unemployment benefit applications simply reflects of the seasonal factors that create natural, expected fluxes.