Trade deficit or trade surplus

The U.S trade deficit rose to its highest level since October 2008. The U.S trade deficit rose to $51,4bn in March, which is up 43,1%. The dollar have skyrocketed and made it cheaper to buy products and services and more expensive to sell.

This makes it more expensive to export which is hurting the U.S exporters. The strength of the dollar makes it more difficult to sell products because they will be too expensive and less competitive.

The U.S has been running consistent trade deficit since 1976 due to high imports of oil and consumer products. Balance of Trade reached an all time high of $19bn in June of 1975, and a record low of -$67bn in August of 2006.

 

Stack of $100 bills

Consumer goods, capital and foods` imports peaked at a record high in March and petroleum imports fell to the lowest level on record. Imports of mobile phones helped increase the U.S trade deficit. U.S imports whooped 7,71 percent and its exports rose by 0,88 percent in March

On the other side, Ben Bernanke said last month that Germany`s surplus is a problem. Five years ago, U.S Treasury secretary Tim Geithner scolded Germany for its large trade surplus.

In 2013, the U.S Treasury formally rebuked Germany`s for its export successes. In 2014, the French government also presented some strange ideas on how to reduce Germany`s competitivness.

Previous Fed Chairman Ben Bernanke has a point. Germany is benefiting from an exchange rate that is too low for its economy.

Ben Bernanke writes; «The comparatively weak euro is an underappreciated benefit to Germany of its participation in the currency union. If Germany were still using the Deutschmarks, presumably the DM would be much stronger than the euro is today, reducing the cost advantage of German exports substantially.»

Bernanke also explains why Germany`s trade surplus does not correct itself. He writes; «Systems of fixed exchange rates, like the euro union or the gold standard, have historically suffered from the fact that countries with balance of payments deficits come under severe pressure to adjust, while countries with surpluses face no corresponding pressure.»

Should Germany be part of the euro zone if their exchange rate is out of kilter, and their balance of payments surplus appears persistent just because they are part of a fixed exchange rate system?

The problem can be solved if they exit the euro zone. Their trade surplus will decline. So will its competitiveness, and their currency will appreciate. Germany is an export country like China, but the U.S is not an export country. What is the best? Surplus or deficit?

First of all; The balance of trade compares the value of a country`s exports of goods and services against its imports. When exports are greater than imports, that`s a trade surplus, which is generally considered a favorable trade balance.

When the value of imports outweighs the value of exports, is a trade deficit, and this is generally considered an unfavorable trade balance. But it all depends on where the country is in its business cycle, how long the deficit or surplus has been ongoing, and the reasons behind it.

The balance of trade is important because it`s a large component of the current account.

Countries generally try to create trade policies that encourage a trade surplus. They consider this to be a favorable trade balance because it`s like making a profit as a country. If you sell more and get higher income, then you will have more capital for your residents.

This will translate into a higher standard of living. That`s because your businesses will sustain a competitive advantage by gaining the expertise in producing everything they export. They will hire more workers, reducing unemployment and generating more income for their residents.

But U.S have a trade deficit, and Germany have a surplus. Is it good for the U.S to have deficit?

Sometimes, a trade deficit can actually be a more favorable balance of trade. It all depends on where the country is in its business cycle. If a country has a trade deficit, its imports can be raw materials which it converts to finished goods and re-exports out. A country`s trade deficit can be a result of a strong economic growth, which allows its residents to enjoy the higher standard of living.

On the other side; Romania`s dictator Nicolae Ceausescu, created a trade surplus through protectionism and forcing Romanians to save, and not spend on imports. This resulted in such a low standard of living (Source; CIA World Factbook).

But a trade surplus is not always a favorable trade balance. Japan and China are both dependent on exports to drive economic growth. To maintain this surplus, they both purchase large amount of U.S Treasuries to keep the dollar`s value high, and their value of their currencies low to make their exports competitively priced.

 


Click the link below and check out the Fan Fund

https://www.eventbrite.com/e/fan-fund-tickets-15580655159


 

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

Leave a comment

Filed under Politics

Hitachi expands globally

Internet of Things (IoT) will become the biggest business ever! You can read more about it in my article; The Internet of Things (IoT) dated September 3, 2014. Many companies will try to position them self in the new market. Hitachi is one of them.

Hitachi, Ltd is a diversified company. Information and Telecommunication System segment offers system integration services and automated teller machines. Electricity System segment offers power generation systems. Social and Industrial System segment offers industrial machinery.

Electronic Device and System segment offers liquid crystal displays. Construction segment offers hydraulic shovels and wheel loaders. High Functional Material segment offers electric wires and cables. Automotive System segment offers engine management and in-car information systems.

Digital Media and Consumer Product segment offers optical disk drives and refrigerators. The Others (Logistics and Service) segment provides logistics, real estate related services. Financial Service segment offers leasing and loan services.

 

Hitachi

 

Japan`s $100 billion conglomerate see big opportunity in IoT and expect to earn billions in this business by 2020. Their goal is to enter this business by combining the technology capabilities of their subsidiary Hitachi Data Systems and data from millions of sensors that they already have installed in industrial equipment over the years.

Hitachi is not only trying to focus on industrial solutions but do what others are doing right now; focusing on smart cities and driverless cars. Connected healthcare systems is also a market they want to penetrate.

CEO Hiroaki Nakanishi said Hitachi need to change their business model rapidly.

Hitachi will move from a storage hardware company to a social innovation company. They will offer more IoT solutions and Nakanishi said; «We now need to commercialize these solutions to increase our revenue.»

Hitachi have what it takes to take a big stake in this market, but they need to change to a pure IoT company and try to use the sensor data they have today in their new components that they want to sell in the new market.

CEO Hiroaki Nakanishi is best known as a turnaround business leader, and Hitachi is now looking to pursue global expansion aggressively. Focusing only on becoming Japan`s No. 1 is not enough. Through acquisitions, they want to grow and be bigger in Europe, China and the Middle East.

Hitachi see big opportunities in Europe`s railway sector, and have a track record in the U.K. This is why the company is looking for more businesses to acquire and also enter into strategic partnerships to better penetrate the European market.

They recently inked an 809 million euro deal to acquire rail assets of Finmeccanica, and moved closer to its competitors like Siemens, Alstom and Bombardier in the rail signaling segment. Hitachi hopes the acquisition will help their expansion in Australia, New Zealand, India and the Middle East.

Hitachi is down -8% YTD. Market Cap is 33,33B, and P/E is 15,12. The stock Hitachi, Ltd (OTCMKTS: HTHIY) is trading at $69,00.

 


Click the link below and check out the Fan Fund

https://www.eventbrite.com/e/fan-fund-tickets-15580655159


 

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

Leave a comment

Filed under Uncategorized

Fan Fund


Click the link below and check out the Fan Fund

https://www.eventbrite.com/e/fan-fund-tickets-15580655159


shinybull countdown

Leave a comment

Filed under Uncategorized

The Apple is getting bigger

Apple is for me the best marketing company on this planet right now. How is it possible to make so many people around the globe to sleep day and night outside to wait for an Apple store to sell their new product?

Apple is a great success in the West but China will become a more important player in the future. Revenue in China grew 71 percent, to $16,8 billion, Apple said in its financial earnings report earlier today.

Revenue in total jumped 27 percent to $58 billion ($45,6 billion in 2014), and their profit for its Q2 jumped from $10,2 billion last year to $13,6 billion in 2015. That`s above Wall Streets estimates, which is awesome.

Apple-Watch-logo-main1

CEO Tim Cook said that their March quarter is the best ever, and reported a higher rate of people switching from Android smartphones to iPhones wich is profitable for Apple. Last year they sold 43,7 million iPhones, but this year they sold 61,2 million.

This is thanks to sales in greater China, which is mainland China, Taiwan and Hong Kong. While iPhones sales goes up, the iPad sales goes down. They sold 16,4 million iPads last year, but now the sale declined to 12,6 million, but what is the difference between an iPad and a big screen iPhone?

Apple`s capital return program increased by 50 percent, using a total of $200 billion in cash by the end of March 2017. The money will be used to increase share repurchases and lift Apple`s dividend.

Apple started to sell Apple Watch on friday and they said the demand is exceeding initial supply. They will reveal sales figures for the new Watch later together with other products. How many units do you think Apple have sold so far? 2 million? 2,5 million? 3 million?

Pebble sold 1 million in one year. Samsung sold 1,2 million last year. This is what Apple have sold in one single day! But how fancy is the Watch market actually? Not as fancy as the mobile phone. 1,2 billion smartphones were sold last year. About 5 – 6 million sold in the smartwatch market I guess.

But the smartwatch market can grow. Yes, of course it can, but I`m in doubt (Sorry Tim Cook). Yes, I know that Apple didn`t sell many iPod`s at the early stage, but it took off and killed the MP3 players from Sony. Now, both are dead.

People was skeptical about the new iPhone too, and said «no BlackBerry-killer.» But we all know the rest of the story. Iphone is a big success. So can the new Apple Watch be. Not only a success in sales volume, but the most profitable too. It depends on how you measure success?

Apple Watch prices start as low as $349 and goes as high as $20,000. You can imagine the margins? I know that Pre-order inventories of the most expensive watch, which is the gold Apple Watch Edition, was sold out in less than one hour in China.

 


Click the link below and check out the Fan Fund

https://www.eventbrite.com/e/fan-fund-tickets-15580655159


 

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

Leave a comment

Filed under Uncategorized

Armenian Genocide 1915

Today, it is 100 years since the Armenian Genocide in April 1915.

The Ottoman Empire forced Armenian civilians out of their country, marching them to prison camps and murdered as much as 1,5 million people. Christian Armenian men, woman and kids were killed, but Turkey and the United States still does not officially recognize the tragedy as a genocide.

What in the world is going on here?

 

Armenian_AmbassadorMorgenthautelegram

(A telegram sent by Ambassador Henry Morgenthau, Sr, to the State Department on 16 July 1915 describes the massacres as a “campaign of race extermination”.)

 

The Armenian Genocide is also known as Armenian Holocaust, the Armenian massacres and, traditionally by Armenians, as Medz Yeghern («Great Crime»). The Ottoman Empire started the Genocide on 24 April 1915, arrested and executed some 250 Armenian intellectuals and community leaders in Constantinople.

The genocide was carried out during and after World War I and implemented in two phrases; the wholesale killing of the able-bodied male population through massacre and subjection of army conscripts to forced, followed by the deportation of woman, children, the elderly and infirm on death marches leading to the Syrian desert.

Driven forward by military escorts, the deportees were deprived of food and water and subjected to periodic robbery, rape, and massacre.

Raphael Lemkin was explicitly moved by the Armenian annihilation to coin the word genocide in 1943 and 1944 and define systematic and premeditated exterminations within legal parameters.

The Armenian Genocide is acknowledged to have been one of the first modern genocides.

It is because scholars point to the organized manner in which the killings were carried out in order to eliminate the Armenians, and it is the seconds most-studied case of genocide after the Holocaust. To date, 23 countries have officially recognized the mass killings as genocide.

Armenian_Morgenthau336

(Of this photo, the United States ambassador wrote, “Scenes like this were common all over the Armenian provinces, in the spring and summer months of 1915. Death in its several forms—massacre, starvation, exhaustion—destroyed the larger part of the refugees. The Turkish policy was that of extermination under the guise of deportation)”

 

Pope Francis spoke at the Vatican a few days ago to mark the centenary of the slaughter, and said it is «widely considered the first genocide of the 20th century». A quote from Pope John Paul II, who said some of the same words in 2001, but Pope Francis said more;

Equating the destruction of the Armenians to the Nazi Holocaust and the Soviet bloodbath under Stalin. But that`s not all. He also linked the genocidal Ottoman assault on Armenia, the World`s oldest Christian nation, with the epidemic of violence against Christians today, especially by such radical Islamist terror groups as ISIS, Boko Haram, and Al Shabab.

Turkey reacted angrily.

The Turkish foreign minister denounced the pope for fueling «hatred and animosity» with his «unfounded allegations.» The Turkish government denied, and to this day, the use of the word «genocide» to describe the killing of the Armenian is a criminal offence in Turkey.

Some Turkish authorities claim it is an international conspiracy against them. Someone who look like friends, but want to kill them. The Turkish Prime Minister claim that the Pope are joining a conspiracy of an evil front against Turkey.

Tayyip Erdogan blocked Twitter and Facebook last year. Turkey is one of the strictest internet censors in the world. Erdogan said the social media is the worst menace to society.

Hundreds of eyewitnesses, including the neutral United States and the Ottoman Empire’s own allies, Germany and Austria-Hungary, recorded and documented numerous acts of state-sponsored massacres.

Photographs exist that may suggest the Germans participated in the mass killing. One photograph shows two unidentified German army officers standing amidst human remains. The discovery of this photograph prompted English journalist Robert Fisk to draw a direct line from the Armenian Genocide to the Holocaust.

The powerful Ottoman interior minister during World War I, certainly didn`t disguise his objective. «The Government… has decided to destroy completely all the indicated (Armenians) persons living in Turkey,» he brusquely reminded officials in Aleppo in a September 1915 dispatch. «An end must be put to their existence… and no regard must be paid to either age or sex, or to conscientious scruples.»

Armenians_Turkish_statesman_denounces_atrocities

(Mehmed Serif Pasha was a prominent member of the Young Turk government who, in a New York Times article dated 10 October 1915, condemned the massacres and declared that the Armenians were being “annihilated” due to CUP’s policies).

 

Eitan Belkind was a Nili member who infiltrated the Ottoman army as an official. He was assigned to the headquarters of kamal Pasha. He claims to have witnessed the burning of 5,000 Armenians. Lt. Hasan Maruf of the Ottoman army describes how a population of a village were taken all together and then burned. Vahakn Dadrian wrote that 80,000 Armenians in 90 villages across the Mus plain were burned in «stables and haylofts».

Trabzon was the main city in Trabzon province; Oscar S. Heizer, the American consul at Trabzon, reported: “This plan did not suit Nail Bey… Many of the children were loaded into boats and taken out to sea and thrown overboard”. (This exactly whats going on in Libya today).

Dr. Ziya Fuad and Dr. Adnan, public health services director of Trabzon, submitted affidavits reporting cases in which two school buildings were used to organize children and send them to the mezzanine to kill them with toxic gas equipment.

Jeremy Hugh Baron writes: “Individual doctors were directly involved in the massacres, having poisoned infants, killed children and issued false certificates of death from natural causes.

About 2 million Armenian lived in the country in 1914 (before the genocide started). By 1918, 10 percent was left. Many was killed while others fled for their lives. The percentage of non-Muslims in Turkey fell from 19 percent in 1914 to 2,5 percent in 1927. Less than 0,2 percent is non-Muslims in Turkey at the moment.

Turkey is now a secular state with no official state religion. Islam is the dominant religion of Turkey with 99,8 percent of the population being registered as Muslim. That`s more than Iran at 99,4 percent.

The Armenians were not only victims of genocide, but also of jihad. The jihadists of 1915 murdered «bishops, priests, religious men and woman, the elderly and defenseless children and the infirm.

Eyewitnesses want to remind us that the jihadist savagery of ISIS and Al Qaeda is not an innovation.

 

 


Click the link below and check out the Fan Fund

https://www.eventbrite.com/e/fan-fund-tickets-15580655159


 

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

Leave a comment

Filed under Politics