Argentina Seeks Funds From the IMF

The Finance Minister of Argentina is set to meet with members of the IMF to discuss financial aid to "avoid a crisis". Recently interest rates hit 40% and President Mauricio Macri says that aid from the IMF will help prevent a financial crisis in Argentina. This comes 12 years after Argentina "severed ties," with the IMF. Recently Argentina had talked to the IMF and they are working on an agreement together. Bloomberg recently reported that Argentina is asking for $30 billion but the Argentina government declined that comment. We will have to see how this turns out for both Argentina and the IMF.

155% minimum wage increase

President Nicolas Maduro of Venezuela announced a 155% hike in the minimum wage on 4/30. Now US companies McDonald's and Wal-Mart are up-ing the argument for a minimum wage of $15 here in the US. 

The problem for a lot of people is that Venezuela has a good reason for this "gift"...their inflation is at 8900%, while the US (thankfully) is only at a 2.4%.

Another argument against the raises, is that McDonald's and Wal-Mart aren't welfare agencies, they are profit enterprises. So for the sake of their employees, they should just let this fight go..

Trade war ??

If these trade disagreements between the US and China continue, global growth might pay the price.

"The trade by itself doesn't really move the needle in terms of the macro. But what we're worried about is the trade spat drags on … consumers stop spending so much, firms stop investing, confidence goes down, and we go to a less good growth path," says Paul Gruenwald the chief economist at S&P Global Ratings.

Currently in Beijing, there are talks of  levying tariffs and investments and property protection issues and all these arguments that are essentially going to cause a huge reduction in global trade growth. 

Already there has been several cancelled shipments of US soybeans to China. 

The only thing we can say for sure is that it's complicated and right now its not looking too good.  

Zimbabwe Employees Strike

May 1st might be the celebration of International Workers' Day across the globe, however in Zimbabwe government employees have come together in protest. This has resulted in a series of strikes. On Friday teachers announced they would be striking on May 8th after the doors re-opened after the holiday. The Zimbabwe Teachers' Association, 44,000-member group, cited stagnant pay restrictive annual leave as reasons for their actions. 

"No amount of threats or illegal declarations from individuals in government will stop or intimidate teachers from exercising their constitutional and legal right to participate in industrial job action," Said a statement by the Zimbabwe Teachers Association Monday, addressed to the Education Ministry.  

In mid-April, 16,000 nurses were fired by the Zimbabwean government following a walkout that began on April 16th. The strike took place due to unpaid wages, the walkout took place one day after the month-long walkout by junior doctors ended. Vice President Constantino Chiwenga decribed the nurses' strike as "politically motivated". 

Zimbabwe's bloated civil service was an attempt to create jobs in the country. This means that the government struggles to meet its wage bill every month. Unemployment figures for Zimbabwe vary widely. 

"Politicians need to be more receptive to their demands," said Charles Laurie, director and head or politics at consultancy firm Verisk Maplecroft, "But striking workers need to be careful of settling for unrealistic promises from politicians that are ultimately unsustainable," he warns 


Crabtree, Justina. “Mass Strikes in Zimbabwe Trouble the New President Ahead of Keenly Watched Election.” CNBC, CNBC, 1 May 2018,
Aljazeera. “Zimbabwe: Nurses' Strike Takes Toll on Public Health Service.” News24, 19 Apr. 2018,

T-Mobile Agrees to Merge with Sprint

Two of the largest mobile carriers have agreed to merge. T-Mobile and Sprint are Americas third and fourth largest mobile carriers. This merger could affect many people, not just the ones who use these two companies. This merger will potentially affect customer prices for all mobile companies. T-Mobile and Sprint think that this will help them compete with Verizon and AT&T, which are the two largest mobile carriers. These two companies have tried to merge before, but were shot down by the Obama Administration because of competition concerns. We do not know what the Trump Administration will do this latest news. Even with concerns about competition, T-Mobile claims that this move is necessary and will be good for the people. They claim it will create jobs and that it will help them create a large 5G network. They say it is necessary to create this network because of the "fierce competition with China." There is no way to know what will come of this, but the outcome will be interesting.

http://www.bbc.com/news/business-43943848

Big Stock Decline for TESLA

Tesla experienced another fatality to hang on its semi-autonomous driving system. The company just revealed that its Autopilot feature was turned on when a Model X SUV slammed into a concrete highway lane divider and burst into flames on the morning of Friday, March 23. The driver, Wei Huang, died shortly afterwards at the hospital. The company shares declined 22 percent in March after the concerns or the fatal car crash in California. Tesla’s 5.3 percent bond, issued last August and maturing in 2025 also fell 4 percent to 87.25 cents Wednesday with a yield of 7.6 percent, according to FactSet. The Bond’s price declined 8 percent this month.

Telsa had $3.4 billion in cash or cash equivalents at year end 2017. The company lost nearly $2 billion last year and burned about $3.4 billion in cash after capital investments. Given the company’s cash rate and how it has $230 million of debt due in Nov. 2018 and another $920 million in March 2019 the company believes they will raise new capital soon.

"The losses and heavy capital spending are expected to continue this year. Over the next twelve months Tesla also has $1.2 billion in convertible bonds coming due," Fred Hickey, editor of High Tech Strategist, wrote in an email Wednesday. "In other words, Tesla has an enormous need for more cash and yet some are beginning to lose confidence in the company.”

Digital Tax Could Impact Tech Giants

The European Commission has announced it's plan to implement a digital tax. The plan is, that companies that make a lot of online revenue should pay a 3% tax on turnover. The people behind this move think that the large tech giants pay too little taxes on their revenue. This would affect companies like Google and Facebook. This is a move that would affect these companies a lot. On average these digital firms pay a tax rate of 9.5% compared to the other European companies that pay around 23.3%. These people believe that the U.S. companies are being under taxed and shouldn't get away with it anymore. Many of the digital companies have stated that they are complying with international tax laws. The rate is at 9.5% because these companies are headquartered outside the EU. The EU is arguing that there is a lot of online revenue being made in the EU that should be taxed more than 9.5%. The EU countries are divided on this issue which indicates that this new law many not come to fruition. 

FIRST POST

Hi friends! it looks like my first post isn't on this page??????? For the life of me I don't know why! But attached is a snippet of what I said, just for the record!! :) 

3,700 people is a lot of people!

So here is the deal, the company Airbus makes Europe's largest "civil and military aerospace" projects, the A380 and A400M planes. And recently they have said that there are around 3,700 jobs that could possibly be lost. This is the result of the falling demand of their A380, and in part to the cost and damages from the "troubled" A400M's. (Total losses costing them around 14 billion!!!!!!!!!!!!) 

The company came out and said that jobs will be affected in all four of its home countries - UK, France, Germany, and Spain. They estimated around 3,700 people are at risk of losing their jobs or at the least being reassigned to different projects. 

Airbus is trying to be optimistic and thankfully did get some orders for planes in, so we hope that helps hold them over for awhile, for the sake of 3,700 hard working people!! Best of luck to them!

U.S. Declares Steel and Aluminum Tariff

In chapter 6 our class covered U.S. tariffs, and read a summary of the sugar subsidies in our text book. I came across a headline ‘U.S.  eyes global Tariff of “at least” 24% on steel imports’ which I thought would be a great foundation to discuss in my groups blog. Just recently on Thursday Trump formally announced his plan to impose 25% tariff on imported steel and 10% tariff on imported aluminum. Looking further into the tariff on aluminum and steel there were mixed reactions from other countries. President Trump is convinced that the tariff will be beneficial to our country, expecting business expansion and job opportunities for the United States. Following Thursdays announcement China reacted with cautious criticism, while Europe reacted with sharp backlash and retaliation. “We will put tariffs on Harley-Davidson, on bourbon and on blue jeans- levi’s,” European Commission President Jean-Claude Juncker said, “we cannot simply put out heads in the sand.” China is not worried about the U.S. tariff and does not intend to start a trade war since China accounts for only 2% of U.S. imports, however China does expect the tariff to be self-defeating and is not afraid to start a trade war if needed. “what an extremely stupid move,” vice secretary general of the China Iron and Steel association said, “A desperate attempt by Trump to pander to his voters.” China has proclaimed that their country is in its prime but feels the world trade will be harmed if other countries follows the United States example. The European Union is considering imposing duties on U.S. imports that are worth about $3.5 billion if the tariff is enforced. Canada, South Korea and Mexico have also raised their concerns on the tariff. As far as the other countries are concerned Donald Trump is promising his “America First” agenda by declaring a trade war.   

Denyer, Simon, and Rick Noack. “China Grumbles at Trump's Tariff Move, but Europe Takes Aim at Harleys and Bourbon.” The Washington Post, WP Company, 2 Mar. 2018, 

https://www.youtube.com/watch?v=b5AmKCUhVIw (this link is the video announcement that President Trump made on March 1^st)

Venezuela

As I scoured the international business news that has been getting the most attention lately, I came across an article about Venezuela. This country has had a tough economy lately and has been heavily impacted by it. It has over $150 billion in foreign debts and has been struggling through inflation for many years. Venezuela has caught the attention of our various news sources because they have decided to "launch a cryptocurrency" to combat all of these hardships. It's purpose is also to offset the U.S. sanctions that have been put on Venezuela. The government of Venezuela hopes this will solve it's issues, but most are doubtful.

http://www.bbc.com/news/business-43133853