US Economy Surges Up With Job Additions

The American economy provides the first glimmer of hope in a recessionary economy. With reports of the first quarter labor surveys filtering in, it seems that 287000 jobs have been added by June which has gone above the cautious estimate of 180,000 that was predicted by the economy experts. It definitely is accompanied by a jump in payrolls as well, which has been the biggest in the last eight months. The unemployment rate has climbed up slightly, but that could be due to the additional number of people who joined up in the labor force of the country in the first quarter. The participation rate is up by 62.7% in the month of June.

Impact on unemployment

The unemployment rate has increased marginally, from 8.2% for African Americans to 8.6%, while for the Latino Americans the unemployment rate has gone up to 5.8% from 5.6%. Both figures show marginal increases that should not be cause for concern. Hourly earnings at an average have increased if you compare the year over year figures. The increase has been from 2.6% to 2.7%.

Job additions and resultant impact

The job additions have come primarily in the non farming sector but it is not time yet to fully rejoice. The weaknesses witnessed in the job sectors have not been covered fully as yet. The reports that came in May were dismal, but June reports showed improvement. US companies reported adding a paltry figure of 38000 additions in payrolls. The number was short of what the economists predicted. The May figure was revised lower while the April figures were revised up. However, the overall picture is positive as is being seen by most economists. The global implications also reflect the health of the world’s economy. The US job market reflects the monetary policy and the direction that it is moving toward. There are implications too for the currency and bond markets. US payrolls show that investors are waiting for confirmation that weaker currency is not leading to a weaker trend. The Feds are also watching the job scenario closely. It is a mandate of the Federal Reserve that the country should have full employment. If there are deteriorating trends seen in the job markets the Feds would respond by making the monetary policy looser.


Cautious outlook remains

The Job Report In May had been disappointing for which the Feds decided not to increase the interest rates. The pace of pickup in the labor market is not yet fast enough, but the economic activities have stepped up in general. Job gains need to raise more though unemployment rates have gone down. In general, the economists are making cautious predictions in light of the slowly improving world economy. With added jobs and a positive outlook in general, it is hoped that recovery would be more positive in the second quarter. That would certainly signal the Feds To Start Hiking Interest Rates.

Investing Focus Gets Back To US

With Brexit becoming reality investors focus on US. The Brexit news had been much awaited in the world corporate scenario and indeed, in the weeks following up to the opinion polls, the world economic scenario had been uncertain and future investment decisions were put on hold in many cases. As it has been a week since the decision was announced, the European Union has become busy with several meetings being held by policy makers and business leaders as to work on consequent policies and norms that would come into place in the European Union as a result of this decision. The overall impact is a slowdown of the economy following Brexit which has to be countered with the right measures.

Market reactions

There had been uncertainty in the global markets as this decision was pending, but Brexit has definitely nailed all hopes to the ground. The European markets were hoping to surge back to Britain chooses to remain with the European Union, but that did not turn out to be. The negative impact on the financial sector is palpable. The Bank of England has hinted that the bank rates would be lowered to counter the adverse impact on the economy that would be felt this summer. Hence, an interest cuts as much as 85% is expected to come in the month of November. All trading sectors have their eyes on currency pairs like USD/GBP and EUR/GBP in order to understand the impact of this decision that is being felt in the forex trading scenario. Check Out this article on Bremain Affects Trading Markets.


Traders change focus

In general the traders are not changing their focus of US with the current scenario yet to settle in Britain or in Europe. The jobs data that has been recently published in US shows that the US industries are looking up and it has strengthened since the Brexit referendum has been announced. Investors are now looking to move to the safety of the dollar from the turbulent and uncertain European market. There is much hope been generated from the jobs data published in the US. The non farm payrolls are not encouraging, but show slow growth. Hence, it is too early to predict that there would be a rise in the US job sector immediately, but it is definitely a more steady market to look at for investing purposes than the European market. Gold has been a beneficiary at this time as the Brexit decision was announced and realized. It has reached a high mark and will sustain the position at current times.

As for the US economy, markets are withstanding volatility as of now. The industrial average’s show slow growth and dips that is not alarming. As per the domestic economic performance, the consumer spending has been slow but steady. It signifies about two thirds of spending in the US economy and hence, caution needs to be taken if one is planning to invest aggressively in this sector.

Risk Appetite In Forex Markets Remains Steady

If you look at the Asian markets that opened this week there has not been much excitement, but the markets have picked up strength. The Hong Kong and Japan indices have gained and are up by 1.25%. The commodity that has gained the most has been gold, thanks to the refit situation adding to the uncertainty of European markets and how they will face the downturn that is going on. Crude oil is down and is likely to remain at levels around 49. Commodity movements seem to be limited to such extent. Take a glance at how the first quarter FY16 ended last week.

The last weekend there were more talks about the Brexit situation, but the markets did not get swayed by any apprehension about that. Trading has been subdued as well due to the US national holiday that has been on 4th July.  As per the Brexit situation and the impact of the same on the finances of the European Union, the ECB executive board stated that it is too early to predict any action that would be taken by the central bank. The time frame as well as terms of the Brexit needs to be cleared up so that uncertainties do not remain. British economy as well as monetary policies would have faced challenges that are contradictory in nature. The challenge of inflation is one and the effect of the same on the pound that has fallen by 11 percent since Brexit was announced.


The impact of Brexit of the European economic scene is uncertain and that is leaving a negative effect on job market predictions as well as on investments. The central bank would be looking at Q2 for signs to predict which way the inflation rate would move. With such uncertainties in the European market and the lack of a clear winner in the polls in Australia turns the focus of the world economy towards the US. The events in this country will remain in focus now. Rates have remained steady, even after the Brexit situation unfolded. Rate hikes are being predicted by the Feds as they see signs of investments coming their way past the Brexit uncertainty. Job data that has come in to US for the first quarter look solid and that would surely encourage investors to consider putting in their funds in this market.

If you look at the micro events that have happened in the last week ending the first quarter you will find that Australia has seen building approvals that has boosted confidence in the investor sector. Trade balances and retail sales have been positive in this country. UK retail sales have held as well as the USA factories see a steady inflow of orders. Japan has showcased cash earnings for the labor sector, while Germany and UK have had positive trade balances. These are some indications of the forex market holding steady. That heralds the start of a new quarter as well. Find Out More here about Why Japan Threatens To Make Forex Intervention.

Firms Remain Cautious About Investments In Canada

Take a look at the Latest Investment Scenario In Canada. With the first quarter of FY16 concluded in a turbulent market scenario, Canada has been able to hold itself steady, relatively though businesses are taking cues from the slowdown of global demand and are being cautious when it comes to considering new investments. The service sector seems to be optimistic though the energy sector is anticipating a slowdown in demand. The reason is the weak prices ion the commodity sector. This is as per the findings of a survey by the Bank of Canada. Business sentiment remains low as commodity prices are weak and this in turn is weighing on the firms and affecting their decisions to invest further. Take A Look at this article on Alternative Investment Opportunities You Need To Know.

The central bank of the country issued the business outlook survey for the quarter, which indicated that the investment plans for the firms remained on the cautious side. Many businesses which operate in the energy sector are anticipating that their demand forecasts might be amended on the lower side. The service sector, however, showcased an optimistic picture for the future and the investment plans for the same. Domestic demand is predicted at modest levels overall. Key factors as foreign demand and uncertainty in foreign markets is holding back the investors when it comes to taking the plunge to increasing work and investments in different sectors.


The central bank, however predicted that the next 12 months will see acceleration in demand and sales will grow. The businesses in areas like Saskatchewan and Alberta are seeing recovery after the oil price fall that was experienced. The regions that are not too dependent on the energy sector have reported a modest improvement in demand. The findings are on the basis of a survey conducted in the early parts of May and June. This was before the UK vote occurred on whether it would stay or leave the European Union. The central bank has found that businesses are expecting sales to accelerate at a faster pace next year, though the predictions have also gone down, from 48% to 43%.

The economists are quick to point out that the global economy being in an uncertain state, this has an effect on the Canadian economy as well. The energy prices having fallen and still on their way to recovery would have a negative impact on businesses. Hence, businesses are staying on hold, remaining steady with the growth rate that they see which not enough to predict a growth in investments is. The central bank had reduced the interest rates twice last year. This was in response to the negative effects as oil prices fell. This is a major resource for the businesses here and the business sector has been cautious since then. Hiring intentions remain the same, but there is no upbeat change predicted. The addition of jobs is expected to remain the same without a sharp rise or increase. Service sector would be adding on more than the energy sector.

How Rich People Often Lose Out On Their Wealth?

You might envy people who are rich but their lives are not peaceful either. With money there are a lot of responsibilities and distractions. With several temptations around and money that can be spent as you feel like, many people make the wrong decisions and end up with lesser wealth instead of being able to build on the same. While things might go wrong that are out of one’s control, there are times when people make the wrong decisions and reasons that are silly for which they end up losing their money. Take a look at some common mistakes made by rich people.

Watching the pennies, but not the dollars

This is a trend that is seen among millionaires. Many are frugal by nature and that means they are watching their money when they send their clothes to the dry cleaner or the bank fees that are being charged or how much does a new landscaper cost. However, they would invest in diamond rings and expensive watches, buying a yacht or taking a vacation, stating reasons like they are life’s experiences that are worth spending on. It is definitely hard when it comes to staying healthy, but it is foolishness when one makes large expenses based on emotions while they cut wages and daily costs to keep their savings on pennies.

Emotional attachment to investments

Usually rich people are long term investors who buy and hold their investments for long and do not panic easily. The economy might go down and they might even double up their investments and buy at the discounted price, believing that the markets will rise again and they can hold out till then. Some wealthy investors usually invest in an aggressive manner, but they panic when the market goes south. That is when they show their attachment to their wealth and not being able to hold out till the market comes up again.


Failing to realize that you need to check the details

Many individuals who are able to become rich usually do so by the following:

  • Spending less than what they earn
  • Expanding on their earnings
  • Saving and growing income
  • Inheriting money

However, it is also important to note the details when it comes to saving and retaining your wealth. For instance, you need to review the monthly transactions on your bank accounts to note whether there have been any unauthorized transactions or fees that have been charged in their credit card statements. They do not check their monthly bills or hotel bills to ensure that they are billed for the services used and not for other things. Often hidden fees and taxes are charged that need to be brought to attention so that one can decide to change their restaurant next time or opt for a dinner in with takeaway where service charges are less.

Not diversifying investments

Many rich people also tie up much of their assets in a single place which might be their business or in real estate and that could also lead to loss in liquidity in the future. For Alternative Investment Opportunities Go Here.


Can US Economy Learn From Dubai Economy?

The lack of growth in the American economy is worrisome. We always complain about the state of our economy. Even though it is doing okay at the moment, especially after the 2008 recession, we are all worried about the future of the US economy. China and India, once considered as 3rd world countries, are fast developing. In fact, China has already overtaken the US. In that case, we are looking for inspiration wherever we can find. Let’s take a look at the Middle Eastern city Dubai. The kind of growth Dubai has witnessed in the last few decades is nothing short of magic. We can learn a lot from them. We have to fight the lazy bureaucracy, rabid regulators, crony capitalists and growing dependent class. We can see that Dubai doesn’t have these challenges. Learning more about the growth of Dubai will teach us some important lessons as how to approach our economy. After all, some 25 years ago, this was a plain desert! People have already started doubting the Longevity Of The US Economy. To Learn More, Click Here.

The US economy badly needs a role model. What about the Dubai economy?

Dubai as we know today

As we all know, Dubai is one of the richest global cities in the world. It attracts millions of tourists every year. Also, the kind of infrastructure, we see in Dubai is really amazing. There are several things going in the favor of this Middle Eastern city. However, one cannot overlook the influence of oil on the economy of Dubai. Ever since they discovered oil in 1966, Dubai has witnessed the large scale urban development, which was unprecedented. They spend the profit from oil on the infrastructure projects. However, they knew that relying too much on the limited oil reserves wasn’t a very good idea. As a result, they focused their energy on diversification of the economy. They ventured into other fields as well. As a result, oil contributes only less than 3% to the overall economy of Dubai today.


The gateway of Middle East

As we can see, they had capable leaders leading their country. Their leaders have been visionary and they took charge of their economy and did the right things at the right time.

  • To make advantage of their strategic location, they built a large harbor named Jebel Ali, which was inaugurated in 1979.
  • And in 1985, they created Jebel Ali Free Zone. This has definitely helped Dubai as it started competing with Hong Kong and Singapore ports in no time. It became a very popular re-export center very soon.
  • Liberal civil laws also helped their economy. As a result, Dubai became an attractive location for many multinational companies to do their business. Many companies opened their offices and warehouses in the country. All these helped the economy to grow in a new direction.

A business magnet

Without any doubt, Dubai is known as a business magnet. Dubai soon became a trade hub for the entire Middle East. They invested their resources in creating infrastructure and facilities. Also, they modified the laws to make sure that companies find Dubai an attractive destination to do business. This resulted in many global companies to head to Dubai. Soon, the World Trade Center was opened in Dubai in 1979. And many other business oriented facilities like Dubai Internet City, Dubai World Center Dubai Investment Park etc. came to the fore.

Bremain Affects Trading Markets

The relation between Sterling and Forex has taken a pause after it grew for some time, banking on hopes created by the Bremain situation. The British pound has eased back against the US dollar today. This is after it posted a large gain as compared to last 7 years when Britain decided to stay back and be part of the European Union. If you are wondering how much sentiment play a role in forex markets, this should give you a fair idea on how sentiments rule the highs and lows besides pure statistics and economic decisions.

The effect on the UK’s decision to stay or opt out of EU affects trading decisions.

Bremain sentiments affect the markets

There were opinion polls run on Monday where it showed that the camp in favor of Britain staying with the Union had covered some grounds in the debate that has been ensuing about the European Union and Britain referendum. The probability for Britain to stay with the Union rose to 78 percent as per the vote that came in on Thursday. This was in contrast to the same vote falling to a low figure of 60 percent last Thursday. These were the odds that were gathered by the gaming website called Betfair. The movement of the foreign currencies has been accordingly. For instance, the British pound eased up about 0.1 percent in the Asian markets, which pulled back from a high figure that was set on Monday. It has risen again on Monday by 2.1 percent, which has been a big gain in a single day, a feat that has occurred in the forex markets last in 2008. The Influence On World Events In Forex Trading are Discussed Here.


Band patterns

As per these movements, it is apparent that the market is reacting to every change in opinion polls. The market in general has been witnessing a choppy trading scenario as there are big decisions that are yet to be taken. Hence, trading in options is yet to see considerable changes in pattern. This is as per the currency pair and the band that it has been tested for since May. If there is a break of the levels of $1.47-48 band it would lead to short covering trends in the British pound. Traders are of the opinion that any break in the band or pattern would come only when the results are released of the referendum discussions. Hence, one could see more ups and downs in the trading patterns till concrete results are known. These are of the opinions of currency strategists in Tokyo. However, the latest swings have been in favor of UK remaining in the European Union. The actual results of the vote will reach Asian markets by Friday morning and hence, sharp changes in trading patterns will come by after that.

Volatility and predictions

It is implied that pound options remain volatile. Many investors feel that this indicates that the Leave camp is having diminishing probability. The volatility that lasted for three months has stood at an average of 13.3 percent. Last week it was especially high at 18.5 percent. The Euro has been down, but it rose about 0.5 percent against the sterling. It also rose against the dollar by 0.1 percent.

The Significance Of Budgeting Your Money

When it comes to how we prepare our kids for the future challenges, we can see that we give them all sorts of training except may be handling the finance. That is exactly why many end up in debt and struggle to build wealth. Well, kids need to be taught as how to budget their money. They need to acquire this skill so early on so that they will not make many mistakes with their money. Budgeting the money and keeping track of the money are really important when it comes to securing your future. It is important to budget your money to preserve your financial health. Let’s learn more.

Money is powerful

As we all know, money can be a very powerful tool in your life. The success of your life depends on how you use that tool effectively to your advantage.

  • People are good at earning money. But when it comes to keeping that money most of us struggle.
  • Many of us assume that writing down the expenses is the right way to keep track of the money. This is a wrong notion.
  • Even if you write down the expenses, you often tend to not look at it again.

Learn to budget money

Yes, learning to budget your money is a very important aspect of your maintaining your financial health. Writing down your income and expenses is a good practice as it helps you see where the money you earn disappears. And some of those findings might be surprising for you as well. You will realize that the small expenses are what the troublemaker on the expenditure column. You realize that the small expenditures add up. You realize that you could have done something with that amount.


Significance of writing down expenses

Yes, it is extremely important to write down all your expenses. This is the first step when it comes to learning to budget your money. You need to write down all your monthly expenses on a paper. If you are good at computers, you can record it on an excel sheet. By doing so, you will get an idea about the common expenses. Now it’s time to figure out all your monthly expenses. This includes everything, be it rent, credit card payment, car payments, utility payments, mortgage etc. You have to consider even the smallest of expenditures. And keep them in specific categories as it will be useful for later easy access. Now subtract your expenses from your income. How much money is left? Speaking of money, Check Out the origin of China’s Currency Devaluation.

Your first budget is ready

You have just made your first budget. You have just learned where your money has been going every month. Now that you where you spend money every month, you will be able to exert better control on the flow of money. You will be able to take back control of your finance this way. You will be able to turn your back on the expenses that are unnecessary. Also, you will be able to set your goals, both short term as well as long term. This will be very helpful in controlling your expenses.

Basic Investment Principles To Keep In Mind

As a novice investor, you may not be familiar with the basic investment principles. Let’s Find Out.

Investing is not that simple; it can be really tricky. This holds true especially in the case of first-time investors. The biggest problem lies with novice investors is that they are unsure about everything. They always keep worried about making a mistake. Even when they have made the right choices, they doubt their choices because they have no clue. And on top of it, you are always worried about the return of your investment. The fear of losing everything can be troublesome for the first time investors. Well, irrespective of your confidence or lack thereof, there are certain investing principles that you need to follow if you want to stay long in the business. There are a few tried and tested principles which will allow you to move in the right track. Also, these principles are going to ensure long term success for you. You will finally be able to enjoy the process of investing.

Diversity is a must

Yes, when it comes to investment, risk factor is always there. But to reduce the risk factor, you need to diversify your investments.

  • You have to invest in a wide range of investment choices to reduce the risk.
  • Hold a mixture of different types of investments which can improve your investment portfolio.
  • There are plenty of choices before you including property, cash, bonds, shares etc.
  • When you opt for more than one asset class, you will ensure that all of them won’t rise or fall in value at once.
  • I would also suggest you to reduce the risk via geographical exposure as well.
  • Opting for long term investment is another way to reduce the risk factor.
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Be knowledgeable

When it comes to investment, having an in-depth knowledge about the type of investments you have is always going to be beneficial. You might be getting help from an investment solutions provider or financial adviser. But being knowledgeable about your investments is always going to come in handy at one point or the other. It is important to have a good understanding of your portfolio. You should be aware of the fact that there are people who are looking for an opportunity to cheat you. Therefore, it is really important to have a more realistic expectation about the returns and profits. There are Alternative Investment Opportunities You Need To Know. Let’s Take A Look Here.

Long term investment is crucial

Long term investment can always be more profitable. You might get huge profit. But the only problem attached with this is the long wait, which most of us are not ready for. When you go for long term investments, you might be doing the right thing to secure your future. Long term investments can hardly go wrong. But people are not interested in long term investments. This is true especially in the case of new investors. They are always looking for, making a quick profit. Of course, you should opt for options that provide quick profit. But more than that, you need to make sure that you have considered long term investment options as well. Putting all your eggs in a single basket is never a good idea. So, remember the significance of long term investment for the overall health of your investment.

Accounting Rules To Change For US Banks

Accounting rules have been shaken up and many members of the banking lobby in US are concerned about what it would imply. It might force banks to be able to accommodate losses on loans. That might be difficult to accept by banks, as the rules would also include recognizing the losses from the day the loans originated. Take A Look at a new rule that is to be implemented for US banks.

Current scenario and changes proposed

The regime that exists now allows banks to hold off on adding to the reserves till a point is reached when a loan is a probability. However, with the new rule that has been finalized, banks need to log all expected losses which originate from day one of a loan. The losses need to be logged based on the following factors:

  • Experience
  • Forecasts of the banks
  • Current economic state

The overhaul is set by the Financial Accounting Standards Board that states that the overhaul was necessary and will bring about changes in banking decisions that will see significant differences as compared to the last 40 years of their operations. The new standard will be adopted since 2019 and it would become mandatory from 2020. It would help to rein in the kind of behaviors that banks have exhibited which has led to financial crises coming up. Banks have offered loans even when their allowances have run down and been in losses. This had looked pretty in the books of the banks, which only increased the troubles for the banks when their loans turned into non performing assets.


What bank lobby says?

The rule change is being chafed at by bank lobbyists. They warn that the assessment of the losses that are likely will become a deterrent and reduce lending to a large extent. As banks weigh in the potential risks more it would lead to less loans being meted out. As the vice president of the American Bankers Association pointed out, if the forecasts were to be of longer terms it would make profits more volatile and so would capital levels become. Banks are known to change their estimates by the year. To know Why Is It Important To Embrace Online Banking – Visit This Link.

If estimates and assumptions are changed every year it would mean whether a dividend is being paid or not. There would have to be a good support system and expert predictions in place. The new standard is finalized, but ABA feels that they can shape the way the rule would be implemented between the current period and by 2019. The banking industry is voiced by the American Bankers Association, which is based out of Washington, DC and their voice is considered to have a lot of weightage in the banking industry. The lenders who are part of this association account for $12tn of assets in deposits who forward about $8tn in terms of loans. If there would be changes in assumptions it would mean that there would be a difference in whether a dividend is paid or not. However the new rule is supported by many as they feel that the new rule would be cleaner and simpler and helps to align the underwriting economics and informational needs of investors.