All posts by Larry Lopez

Despite conflicts, the US-China Trade relationship is a significant one

Image source: CNN

 

The balanced trading agreements and economically productive relationships among the most powerful countries have kept the world a better and safer place. The optimism towards healthy international relations among these nations have so far, benefited the markets and the global economy – and what happens when two economic giants would come to a massive trade disagreement will not only send ripples but huge waves that have the power to wipe out everything on their way.

The exact scenario recently made headlines when two economically dominant nations, China and the United States, started waging what experts tagged as an on-going “trade war.” Many suggest this event has the potential to reshape the two countries’ economy and the global markets as a whole.

Commonly known as the US-Chinese Relations, the trade relationship between the United States and China is a powerful yet complicated one. The former holds the title as having the world’s largest economy while the latter ranks second. Although their current relationship has been riddled with conflicts, and the current threats of the present trade war, it has proven to be a strong and stable one ever since it began in 1949.

Today, the rough yet productive trade relationship between U.S. and China is actually supporting over 2.6 million jobs in American, benefiting several industries in the country. In 2015, records show that Chinese consumption and buying power brought in over $160 million to the country’s exports and their economic output.

China, on the other hand, became the third largest destination of goods and services from the U.S. (as of 2000 ranking), directly and indirectly contributing growth to the Chinese economy.

For more insights on global economies, finance, and investing as a whole, follow LOM Financial on Facebook and visit their official website.

Methods that help Central Banks influence a country’s money supply

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The role of central banks in every country’s economic prosperity is an irreplaceable one. As a core part of a nation’s financial and monetary machinery, these institutions have helped every economy in the world maintain stability and growth.

One example of a central bank’s important contributions to their home country’s overall economic operations is their influence on money supply. It is a fact that an economy may sometimes need more money, and there are other times when it needs less – and there are specific methods that only central banks have the power to implement.

However, these methods normally depend on the amount of power bestowed in a country’s central bank and of course, the current economic weather in that country.

The American Central bank, for instance, influences the country’s money supply by directly modifying its reserve requirements. In other words, the Fed deploys a method that can affect the relationship between the number of fund banks and deposits of inbank accounts – with the goal of increasing the total supply of money in the U.S. economy.

On the other hand, if there is a need to reduce the Fed’s money supply, they have the option to sell bonds. Doing so will result in a lesser amount of money reserve to lend to its borrowers. With less money to lend, it leads to an increase in the central bank’s interest rate, affecting the value of the U.S. dollar.

Printing more money is also another method to increase a central bank’s money supply, but its consequences prevent countries to print as much as they want. This is because; the presence of more printed money makes a currency less valuable against other currencies.

For more about monetary systems, currencies, capital markets, and the finance industry as a whole, visit LOM Financial’s official website or follow them on Facebook.

 

How global sporting events like the FIFA World Cup reinvigorate the economy

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International sporting events have long been a great source of entertainment and inspiration for the millions of fans around the world. While the spotlight goes to the best teams and their most valuable players, the economic impact of international sports events is not often given its place in the podium.

For many people, this is always a big question: Despite the fact that hosting international sporting competitions cost millions to billions of dollars, why are countries still willing to take in this responsibility? Most importantly, why do hundreds of member countries spend and invest in these events in the first place? The answer lies in how it directly affects the national and global economy.

The FIFA World Cup, for instance, has brought a significant impact not only on the economy of its host country but it has also made its economic presence felt on a global scale. This is because, hosting sports events like the World Cup can easily ensure inflows of foreign capital, directly generating local employment and promoting tourism.

Opportunities for employment and a boost for other industries such as banking, hospitality, and construction to name a few, are some of the many aspects that can eventually encourage and reinvigorate the confidence for investments.

While most major sporting events take place in relatively large countries like the US, Brazil, China, and Russia, there are smaller jurisdictions that host athletic spectacles that may be lower in profile but equally global in scale. The 2017 America’s Cup, for example, took place in the British Overseas Territory of Bermuda (home to major offshore investment institutions like LOM Financial). The 2022 World Cup, meanwhile, is expected to be hosted for the first time by the small GCC nation of Qatar.

Although hosts invest billions of dollars to provide the proper infrastructure to support events like these, analysts have always been positive of a generous return of investment. Russia, the host for 2018’s World Cup, for instance, expects $31 billion economic impacts, according to its organizers.

Should investors worry about inflation?

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In definition, inflation takes place when there is a noticeable rise in the prices of both goods and services, resulting in an equal fall of a currency’s purchasing power. This event has majorly caused serious financial woes especially for fix-waged earners, but this period can also be challenging especially for investors looking at long-term goals.

How inflation affects investors will depend on their choice of investment. Basically, as the implicit value of money fails, long-term investors have to worry about how inflation can slowly take away real savings, devaluing investment returns and at the same time, decreasing their long-term purchasing power.

Unprotected investment portfolios that lack enough diversification can be the top victim of inflation. For instance, investors who look forward to a stable income stream from fixed income securities find inflation as their number one threat. Most fixed income securities carry the same rate of interest until maturity, making its purchasing power vulnerable to decline.

As a response to the risks posed by inflation, experts—such as LOM Financial—suggest investing in equities as a more flexible and safer alternative. With this type of investment vehicle, there’s a higher possibility that the value of one’s investment can have the chance to fight the effects of inflation.

However, investing in equities doesn’t protect you from other threats that could make you lose your money. This investment option carries a high risk and should be carefully studied and assessed. Such risks are understandably a major consideration in how portfolios must be designed, including offshore discretionary management accounts.

Of course, your investing strategies should ultimately depend on your financial goals and how you want to survive in the world of investing. The only way to protect yourself from these risks is to stay informed, learn from your failures, and remember the lessons of your success.

Offshore financial centers and how they thrive on near-zero taxation

Image source: LOM Financial

 

Most countries generate revenue via different sources and national taxation is one of them. Two of the biggest national income providers come from the citizen’s personal income tax and the domiciled companies’ corporate taxes, but what happens to jurisdictions who decided not to impose them?

Offshore financial centers (OFCs) are often asked the same question: how can these geographically small nations afford not to impose corporate and personal income taxes? Since it’s impossible to support the economic growth of these countries, how will they make up for the loss from the absence of these revenue-generating systems?

The truth is, OFCs enjoy several benefits than other nations but it doesn’t mean that they’re completely tax-free. The taxation system in the Cayman Islands, for instance, supplement the loss of corporate taxes by imposing several measures like increasing tax requirements for imported goods, resulting in a higher cost of living. This means that while employees enjoy a completely zero income tax environment, they have to pay higher for their daily, living expenses.

One of the most interesting facts about the Cayman Islands is the number of domiciled companies in this jurisdiction: approximately over a hundred thousand – that’s almost twice their territory’s total population. This impressive statistics also means one thing: while there is no corporate tax collected from over 100,000 companies based in this offshore investment center, the government still earns by imposing registration fees as not just a one-time payment since an annual renewal fee for continued operations is also required.

Indeed, tax revenues from a growing business environment as well as the spending power of a particular population make up a large percentage of the national income, but there is also one sector that contributes to its total earnings: the tourism industry. From this highly active sector, tropical OFC destinations earn from collecting departure taxes as soon as tourists exit the country.

The strangest ways today’s superstars were discovered

The most talented superstars on the planet were once just like you – a normal person, living and just doing what they love, until that one fateful and not to mention strange encounter changed their lives forever. Here are some of the strangest ways celebrities were discovered to become who they are now:

Justin Bieber and Youtube

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Youtube, the video sharing platform was just in its early years when the 12-year old Justin Bieber was discovered. It was in 2007 when produced Scooter Braun accidentally clicked on Bieber’s video, with the then child Youtuber singing Chris Brown’s famous hit, With You. Braun was able to track the young singer and the next awesome thing happened – Bieber got the chance to perform for the multi-awarded singer/songwriter/producer Usher. Fast forward, Justin Bieber has sold over 15 million albums and has a net worth of $200 million.

Natalie Portman and a pizza place

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After a dance class, 10-year old Natalie Portman and her mom decided to drop by a pizza place and just talk about how the day went – but fate decided that it was where her life will change for good. While casually enjoying her slice of pizza, a representative from a modeling agency approached her and offered her a job. However, Portman didn’t like the idea of people judging her by her physical looks so she instead, asked for the team’s acting agency contacts. Today, Natalie Portman is one of the top celebrities in the world, with an estimated net worth of $54 million.

Charlize Theron and the bank “drama”

Image source: variety.com

Imagine being discovered as a dramatic actress for just being a literal drama queen? Well, that’s exactly what happened to Charlize Theron. While at a bank, an agent at the end of the queue noticed this South African beauty in the middle of her outrage towards a bank representative. Coupled with Theron’s animated movements and vocal prowess, in the eyes of the agent, she was a superstar – and she indeed became one. Today, she has a staggering net worth of $110 million, starring in billion-dollar box office worldwide.

REPOST: 5 Myths Of “Making It” In The Music Industry

Some of the world’s wealthiest and most successful people are musicians. However, having a knack for melodies and singing in the right tune aren’t the only considerations to make it big in the business. Hypebot.com explains it further here:

With so much advice about finding success in the music industry, there are a number of romanticized myths floating around that have gained more traction than they deserve. Here we debunk five such misconceptions.

In this industry it can be easy to get overwhelmed with all the information being blasted at us 24/7. Do this, don’t do that. This works, that doesn’t. It can be tough to know which advice to follow, and which to stay far away from.

As someone who has been in the industry for the last 10 years as a writer for my own and several other publications, a music publicist, an occasional booker of local shows, and an all around observer, there are a few myths that I see bands still living by, despite any proof they actually work—most of them end up actually being detrimental. Here they are:

If your music is good enough, the labels/managers/festivals will find you
This is the number one belief that I see most artists still hanging on to, despite any proof that it’s actually been the case over the last say, 20 years or so (at least). Long gone are the days where you can have nothing going for you except talent and a catchy hook and have a label come by, scoop you up, take care of all the marketing/booking/fan experiences, and just sit back and play your music. It’s just not going to happen.

Labels want to see strong proof that you’re actually marketable (IE: you’ll make them money) before “taking a chance” on you, which means before they’re even remotely interested you need to have proven yourself through engaging social media pages, successful tours, fans that are willing to support you, etc. Once you’ve done all of that, then people start paying attention.

Continue reading HERE.

REPOST: Sport tourism: $5.47M economic impact

Apparently, sports is no longer just a cultural or recreational aspect of life. It is a booming industry that has helped stimulate local economies and put several athletes into lists of the world’s richest people. And for tourism, it is an important revenue earner. Take a look at this report from Times Daily:

The Ole Miss team of John Thigpen, left, and Parker Davidson, right, display the fish they caught Friday. The team finished in ninth place. [ALLISON CARTER/TIMESDAILY]
FLORENCE — Sporting events are a vital aspect of the area’s tourism economy, and the impact just keeps growing each year.

If there was any doubt of the role sports tourism plays, consider this: The National Association of Sports Commission reports visitor spending associated with sports events in North America was $10.47 billion in 2016.

The local numbers are impressive as well with a $5.47 million economic impact to the Shoals via sport tourism in 2017.

That figure represents a $400,000 increase over 2016, according to Suzie Shoemaker, manager of sport/event sales for Florence Tourism.

“The bulk of this impact is from fishing with longer tournaments meaning longer stays in the area,” Shoemaker said. “We had some back-to-back tournaments which helped as well.”

She said the goal for next year is a 20 percent increase. Plans are in place to see that come to fruition.

The addition of another college bass tournament in April, the Bass Master College Series Southern Tour Event, should help. It’s a three-day tournament.

Florence Tourism Board Chairman David Muhlendorf said there’s no question fishing is a major component to the success of sport tourism locally. Holding tournaments in the cooler months is the goal.

“Our focus is to try to create events that will allow our hoteliers to fill rooms at times when travel is down,” he said, adding that next weekend’s Winter Blues catfishing tournament on Wheeler Lake is one such event.

Shoemaker said the challenge to bring in a wider variety of sporting venues is a priority.

Currently, the area predominantly relies on fishing, baseball, basketball, softball and disc golf. In recent years the Renaissance Man Triathlon has been a growing attraction as well. It brings people to the area for at least two days.

“We’re working on getting other sporting events for the future,” Shoemaker said, adding there’s special emphasis on girls’ sports.

As for how the economic impact is determined, Shoemaker said surveying participants reveals a true picture of time and money spent in Lauderdale County.

“We ask very particular questions of tournament participants, detailing how much money they spend in the various areas of tourism while they’re here,” she said.

Muhlendorf said widening the diversity of activities in the area will be key to making northwest Alabama attractive to visitors.

World’s most profitable sports events in history

Image source: mirror.co.uk

 

Not all sports are created equal and some of the most popular tournaments in the world offer more than just entertainment and cultural pride, but also massive economic benefits to both their participants and organizers. This is true especially when it comes to the biggest and highly phenomenal sporting events today.

Here are some of the most expensive and extremely profitable sporting events in history and what made them stand out from the rest.

  1. World Series

The World Series is Major League Baseball’s (MLB) 100-year old showpiece series, featuring the biggest baseball teams across the United States. It was in 2016 when they recorded their most memorable, and not to mention profitable game yet: Chicago Cubs defeated Cleveland Indians and won the series championship – an epic comeback after their century-long drought without a World Series title.

  1. UEFA European Championships

The event was founded in the 1960s with just four teams and it has expanded in terms of scale and profit in the last 50 years. The Euro 2016 was held in France and it was the biggest tournament to date, with 24 nations participating. Portugal holds the current championship title.

  1. FIFA World Cup

The international football (soccer) scene is one of the most globally renowned, with the last tournament boasting 700 million in audience population. FIFA’s highly commercial operations make it one of the most expensive sports events in the world both in terms of rewards and revenues.

  1. UEFA Champions League

Most sports analysts and investors know that UEFA Champions League—another major football event—is where the money is made, boasting millions to billions worth of prizes. Many superstars are present in every UEFA Champions League tournament and we’re talking about the most expensive players in the world of football: Manuel Neuer, Daniel Carvajal, Diego Godín, Lionel Messi, Cristiano Ronaldo, and a lot more.

REPOST: Eight Decks, a Helipad and an Underwater Observatory: World’s Largest Sailing Yacht Docks in Israel

Yachts have long been a symbol of luxury and opulence, with many tycoons and the biggest celebrities seeing them as staple asset. But where exactly on the planet is the biggest and most expensive one sailing? HAARETZ has the answer:

Russian oligarch’s 144-meter mega-yacht, designed by Phillippe Starck, cost 360 million pounds

Residents of the Haifa Bay area thought they were used to luxury cruise ships and yachts docking in their city’s port. But last weekend such sightings reached a new level with the arrival of the world’s largest and most expensive sailing yacht on Friday. On Monday the ship made its way to Tel Aviv.

The exterior of the stunning ship was designed by the world-famous designer Phillippe Starck. The yacht has eight decks, a helicopter pad and its own underwater observatory in the keel.

The world’s largest sailing yacht in the Mediterranean Sea off Tel Aviv’s coast on Nov. 28, 2017. | Credit: Tomer Appelbaum
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The world’s largest sailing yacht in the Mediterranean Sea off Tel Aviv’s coast on Nov. 28, 2017. | Credit: Tomer Appelbaum
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The world’s largest sailing yacht in the Mediterranean Sea off Tel Aviv’s coast on Nov. 28, 2017. | Credit: Tomer Appelbaum
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“Sailing Yacht A,” as the yacht is known – is owned by billionaire Russian oligarch Andrey Igorevich Melnichenko, who Forbes called the 89th wealthiest person in the world in 2017 with a personal fortune of $13.2 billion. He also owns another of the world’s largest and most expensive yachts: “Motor Yacht A.” The name “A” for both the ships is reportedly for the purpose of having them appear first on the shipping register lists.

The sailing yacht is 144 meters long (35 meters longer than the second largest). It was built in the Kiel, Germany at an estimated price of 360 million pounds sterling. It was reportedly delivered to Melnichenko in May this year, after being launched two years earlier.