Timing & trends

10 Reasons Why Productivity Is Declining

Economists debate whether the decline in productivity is real. It is real, let’s investigate 10 reasons why…

Facebook a Productivity Killer

Google searches are indeed a time-saver. But what the hell is “produced” by them. And where do the searches and Facebook playing take place?

At work perhaps. After discussing the above Brookings did come to this conclusion: “In large part, the productivity slowdown—and the associated productivity paradox—are real.”

It never explained why. Rather Brookings remains puzzled: “While recent research suggests that mismeasurement, although sizable, does not explain most of the observed decline in productivity, it must be noted that there remain unknowns and gaps in data.”

Real or Imagined

The National Bureau of Economic Research (NBER) asks Is the U.S. Productivity Slowdown a Mirage?

Labor productivity in the United States—defined as total output divided by total hours of labor—has been increasing for over a century and continues to increase today. However, its growth rate has fallen. One explanation for this phenomenon focuses on measurement difficulties, in particular the possibility that current tools for measuring economic growth do not fully capture recent advances in the goods and services associated with digital communications technology.

One reason some analysts believe that labor productivity is understated is that price inflation may be overstated for digital goods and services.

As with Brookings, the NBER concludes there is some mismeasurement but fails to figure out why.

As an aside, the NBER group is the official arbiter of recession dates in the US….CLICK for complete article

Drone Deliveries Just In Time For Christmas

If you’re reading this, you’re probably already gearing up for the holiday season and getting ready to make some purchases. And you just might have them delivered by … drone.  But only if you’re a member of the “tight-knit” 22,000-strong community of Christiansburg, Virginia.

Commercial drone delivery is here, but only for the select few. In fact, it’s probably the first time in history that the newest tech advancement hits the small-town before it can go urban.

Wing, an offshoot of Google’s parent company Alphabet, is launching a pilot program this fall with Walgreens and FedEx to eligible customers in this small town, whose claim to drone fame is that it doesn’t have any high-rise buildings or other architectural obstructions….CLICK for complete article

Tesla’s Tipping Point: Breaking Into China

Tesla chief Elon Musk believes China be the tipping point that will lead to his company’s global domination of the electric vehicle stage, but it’s become a very tough sell.

China has had close to two-thirds of the booming global EV sales market so far this year — 61.8 percent with 872,000 units sold through September 30. Tesla’s US home market only made for 236,067 EVs sold this year — 16.7 percent of the total.

But the stakes are quite high for this to become a win-win for Musk. Tesla’s new Shanghai plant started selling its first Model 3s on Friday, but the small electric sedans were given a starting price of Rmb 355,800 ($50,320). That’s roughly 3 percent less than the cost of the same model imported from the US with import tariffs sitting at 15 percent…CLICK for complete article

Social Media Influencers, Dream Job Or Billion-Dollar Fraud?

One of the biggest money-makers in today’s job market requires no real skills, no degree, and no experience.  Baby Boomers are necessarily appalled, and even some of the older Millennials.

The ‘job’ is social media influencer, and it’s raking in tons of money for those lucky enough to jump on the bandwagon at the right time and with the right angle.

Earlier this year, one Florida-based social media influencer, Jessy Taylor, posted a tearful video lamenting the prospect of working a 9-to-5 job after her 100,000-follower Instagram account was deleted.

Having previously worked at McDonald’s, Taylor said she wasn’t cut out for a 9-to-5 job because she had no job qualifications and brought nothing of note to the table–other than fast food….CLICK for complete article

Asset Class of Vintage Cars Drops into Bear Market, Down by More than in 2008/2009

The asset class of beautiful machines, which had already been struggling mightily, got whacked by the events in Monterey, California, last month. “Whether it’s threat of recession, broad economic volatility or too many cars crammed into too few hours, there’s no denying this year’s Monterey Auction Week results were depressed when you compare the results to recent years,” vintage-auto insurer Hagerty explained after the auction. The blow has now filtered into the monthly price index for vintage automobiles, the  Hagerty Market Index for September.

The index dropped 1.3% in September to a value of 148.24, down 5.0% for the 12-month period, and now in a bear market, down 20.5% from the all-time high in August 2015, a deeper drop than the peak-to-trough decline of 16% during the Financial Crisis. The index, after three years of declining, is now back where it had first been in September 2013….CLICK for complete article

Flight to Cash and Utilities Following Fed Announcement

If the Fed cuts interest rates, it means more money would flow into the economy and find its way to banks, individuals, and corporations (in that order), or so goes the traditional macroeconomic thinking. So why did investors not instantly embrace the news of the Fed cut by immediately plowing into growth assets, and instead flee all asset classes in favor of cash during the first hour after the announcement today?

Perhaps because not everyone in the professional financial community was prepared to take in the 0.25% rate cut the Fed announced – at least not immediately after the news. How these professional investors eventually responded may speak volumes about their upcoming investment strategy.

The major U.S. stock indexes ended the day essentially unchanged, but only after selling off significantly in the first hour after the Fed explained its reason for the cut. Curiously, it wasn’t just stocks, but all asset classes sold off during that hour, with the exception of the U.S. dollar (see chart below). U.S. dollar futures rallied notably during the hour, suggesting that in the immediate wake of the announcement Wall Street pros had to regroup and take the measure of the environment they were now in….CLICK for complete article