Posts by Rick Newman
- Rick Newman at Yahoo Finance5 days ago
It’s time to cut the millennials some slack.
It’s supposed to be terrible news that more people in their 20s and 30s are living at home with their parents. Pew Research, for instance, just reported that a record 57 million Americans — about 18% of the population — live in multigenerational households. The main reason for that is a sharp increase in the number of 25-to-34-year-olds crowding into the family abode with their parents and grandparents.
This “boomerang generation,” needless to say, is the target of much scorn over its slow start in life and its apparent aversion to independence. They’re also causing considerable anxiety among homebuilders, automakers, appliance manufacturers and many other companies that rely on a steady flow of U.S. consumers spending every last dollar on things prior generations considered indispensable.
- Rick Newman at Yahoo Finance5 days ago
CEOs get paid (very well) to deal with every challenge that pops up. Now there’s a new one: Proving they practice “economic patriotism.”
This new form of patriotism has become an issue now that several big U.S. companies have decided to relocate their headquarters to other countries, in order to lower their tax bill. These so-called “tax inversions” require a merger with a foreign company, a strategy big firms such as AbbVie (ABBV), Mylan (MYL), Walgreen (WAG), Medtronic ( MED), Chiquita Brands (CQB) and others have been pursuing. Since the U.S. corporate tax rate is one of the highest in the developed world, moving overseas can save a bundle of money.
- Rick Newman at Yahoo Finance6 days ago
Many Americans are down on the U.S. job market, since good jobs are still hard to find and a lot of people who do have jobs are earning less than they used to.
But America still seems like the promised land to many foreigners. A new study by job-search site Indeedfinds that the United States is the top destination, by far, for people looking for jobs outside the country where they live. That’s partly because the labor market in many other countries is weaker than it is here, and also because certain pockets of the U.S. economy — technology, especially — are remarkably strong. Says Indeed economist Tara Sinclair, “The American Dream is alive and well in terms of people looking for jobs in the U.S.”
- Rick Newman at Yahoo Finance7 days ago
There’s growing outrage over American firms that establish overseas headquarters in order to lower their tax bill. But one group seems surprisingly unperturbed: Congress.
The latest big U.S. company to attempt a “tax inversion” is drugmaker Mylan (MYL), which plans to acquire a Dutch entity and relocate its HQ to the Netherlands, where taxes are lower. Mylan’s CEO happens to be Heather Bresch, the daughter of Sen. Joe Manchin (D-W.Va.); she says she has spent plenty of time explaining to members of Congress why the U.S. tax code drives corporations overseas. “You know what they all say?” Bresch told the New York Times. “‘Yeah, uh huh, O.K. Uh huh.’”
- Rick Newman at Yahoo Finance8 days ago
President Obama has talked about the economy for so long you can be forgiven if you think he was first elected during the Panic of 1907. Many voters, no doubt, have learned to tune him out. But after six years in office, Obama finally has an upbeat story on the economy to tell, which could give Democrats at risk of losing the Senate a desperately needed edge in the upcoming midterm elections.
Despite infinitesimal odds of Congress passing any of his big economic ideas, Obama continues to barnstorm the nation calling for more infrastructure spending, a higher minimum wage and other kinds of stimulus. His economic speeches also include a lengthy list of bullet points touting his accomplishments on the economy — something that was in very short supply until recently.
Here are seven of Obama’s major claims on the economy, with a bit of fact-checking and analysis:
- Rick Newman at Yahoo Finance11 days ago
One of the momentous financial events of 2014 will be the initial public offering for Alibaba, the huge Chinese e-commerce company, expected to be one of the biggest IPOs ever. Part of Alibaba’s aggressive growth plan is a foray into the U.S. market, where it hopes to challenge Amazon (AMZN), Walmart (WMT) and other premiere merchants.
But the big retailers don’t have to worry yet, because Alibaba’s U.S. debut doesn't involve one of its signature online mega-malls. Instead, Alibaba is quietly rolling out a small startup peddling something that might seem surprising for a Chinese firm: Americana.
(Disclosure: Yahoo [YHOO] owns 23% of Alibaba and stands to profit from the forthcoming IPO.)
- Rick Newman at Yahoo Finance12 days ago
Have they suffered enough?
Following the housing meltdown and the 2008 financial crisis, hardly anybody felt the slightest sympathy for the Wall Street banks that helped cause it all. But six years on, the four biggest U.S. banks alone have paid a whopping price — approaching $100 billion, according to a Yahoo Finance tally — in fines, penalties and various legal settlements. Virtually nobody responsible for the financial crisis has gone to jail, of course, and the penalties they've paid are a fraction of the damage caused by the 2008 crash. Yet the punishments may have reached the point of diminishing returns.
“The banks have turned into a bunch of zombies,” says Roy Smith, a finance professor at the NYU Stern School of Business. “They’ve hunkered down and don’t want to take any type of risk.”
- Rick Newman at Yahoo Finance14 days ago
A century ago, roughly one-third of U.S. workers toiled in agriculture. Now just 1.5% do. Yet agricultural output has skyrocketed, and the United States, after feeding itself, has plenty of food left over to export.
That explosion in agricultural productivity is considered a crowning achievement of 20 th -century capitalism. Yet a similar trend that may now be underway in manufacturing and even the service economy isn’t viewed with the same reverential awe. Instead, the rise of robots and computers in place of workers looms as one of the great challenges in capitalism’s next century.
“The economic challenge of the future will … be providing enough good jobs,” Harvard economist Larry Summers wrote recently in the Wall Street Journal. “Technology is allowing the production of far more output with far fewer people.”
- Rick Newman at Yahoo Finance15 days ago
We’re No. 33!
That’s the bottom line in a new Gallup poll measuring the extent of freedom in 135 countries. Only 79% of Americans say they’re satisfied with their freedom to choose what to do with their lives, down from 87% in 2008. The top five nations where people feel most satisfied with their freedoms are New Zealand, Australia, Cambodia, Sweden and the United Arab Emirates. At No. 33, the United States is sandwiched between Bahrain and Cameroon.
Gallup doesn’t define “freedom” in this poll, so citizens of different countries are likely to interpret the word differently. That’s why Cambodians — enjoying peaceful elections as they recover from years of war — rank among the top five. Still, changes over time show whether people in a given nation feel their freedoms are improving or deteriorating.
- Rick Newman at Yahoo Finance20 days ago
It might be the Tesla (TSLA) of motorcycles, or it might be a flop. Last week Harley-Davidson (HOG) allowed me and a few other drivers to test ride Project LiveWire, the company’s new electric motorcycle. Project LiveWire is a prototype motorcycle that isn’t going to be road model, at least that’s what they tell us. Harley’s first ever electric powered bike definitely looks the part, although it’s range is only about 55 miles on a full charge. And the sound it makes is decidedly not very Harley-like, but more on that later.