Financial News Friday – June 13, 2014

Financial News Friday – June 13, 2014

We’ve had an interesting week in the financial world as well as some rocky markets. Here are some of the highlights from this week:

Elon Musk Just Opened Tesla’s Patents To His Biggest Rivals (Businessweek)

Tesla Motors and CEO Elon Musk open up their patents to competitors. They hope to usher in more electric vehicles to help stem tide against climate change. They believe that their real competition isn’t other electric cars, but gas cars.

Bitcoins Seized From The Silk Road To Be Auctioned (Bloomberg)

The underground Bitcoin market was shocked late last year when the notorious Silk Road was taken down by the FBI. The FBI seized millions of dollars’ worth of Bitcoins and now seeks to unload its treasure trove of Bitcoin on to the market for cold hard cash.

Europe Stocks Slide As Oil Climbs On Iraq; Pound Advances (Bloomberg)

An article by Bloomberg covering the effects the militant threat in Iraq has had on crude oil and European markets.

Inherited IRAs In Play For Bankruptcy Creditors: U.S. High Court (Yahoo Finance)

Recently the US Supreme Court struck down bankruptcy protections for non-spouse inherited IRAs. The court considers that inherited IRAs differ from an individual’s own retirement account. This is primarily due to the fact that an individual has penalty-free access to inherited IRA money, whereas they must typicall wait until 59.5 for penalty-free access to their awn accounts. Now, creditors have the ability to seek compensation using inherited IRAs. While the federal government’s protections for inherited IRAs have been struck down, several state governments seek to enact their own laws to protect inherited IRAs.

Peter Schiff Says to Leave the U.S. to ‘Make a Fortune’ (MarketWatch)

Peter Schiff sends a message to MarketWatch readers, that the markets are overvalued and he believes that markets abroad offer more value. It’s a sentiment that been echoed by many, such as Jeremy Grantham of GMO. I share the sentiment that US markets are overvalued, however, markets were overvalued based on Shiller PE ratios for several years in the late 90’s before the inevitable crash took hold. Being too early can be just as bad as being too late.

The Good News About Crushing Costs of Retiree Health Care (Bloomberg)

Healthcare costs have risen sharply in the past decade, however, that trend, at least for now, seems to be slowing down.

Two More Confirmed To The Federal Reserve, Fischer Vice Chair (Yahoo Finance)

The Senate approved President Obama’s nominees for the Board of Governors of the Federal Reserve. The new Governors include Lael Brainard, the former Treasury Department Undersecretary for International Affairs, and Jerome Powell, a current member of the board. Stanley Fischer, former Governor of the Bank of Israel, has been approved to succeed Janet Yellen, who is now Chairman, as Vice Chairman of the Federal Reserve.

Here’s Why The Student Loan Market Is Completely Insane (Businessweek)

Over the past couple of decades, the cost of tuition has consistently increased at a breakneck pace. With many parents and students turning to student loans to pay the bills and well paid employment opportunities more difficult to find, it’s no wonder that default rates for student loans are increasing. According to the article, student loans from both private and public institutions are packaged together, even though they have very different default rates. By unbundling these loans, one program at Stanford offers an interesting solution to stem the possible flood of defaults.

Early next week, I’ll post about some exciting new updates and resources that will be rolling out to the site in the near future.

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