Financial News Friday – September 2, 2016

Financial News Friday – September 2, 2016

The Disastrous $45 Million Fall of a High-End Wine Scammer

Premier Cru offered premium collector wines at rock bottom prices that were too good to be true….and they turned out too good to be true. John Fox, the owner of the company, started Premier Cru in 1980 and has since offered deep discounts on wines if you prepaid for them with an extended waiting period (waiting periods are typical of many stores in the wine market, but his were even longer waits). This extended waiting period allowed him to create a Ponzi scheme over the years that eventually imploded and ended up bilking customers for $45 million in undelivered wine.

68 Million Dropbox Accounts Hacked And That’s Why You Need To Change Your Password Now

Back in 2012, Dropbox was hacked and user passwords were compromised. That list has now been leaked to the broader internet. At the time, Dropbox required you to change your password, but if you used Dropbox in 2012 and the password you used was also used on any other services, change those passwords now.

Google Is About to Take On Uber in a Big Way

It’s been a foregone conclusion that Google would eventually get into the ridesharing game once their autonomous cars hit the road, but it looks like they’re getting a head start on getting their ridesharing programs out to the public. Google has launched a prototype ride-sharing program in San Francisco and has plans to expand the service throughout the city.

 

EU orders Apple to Pay €13B In Tax Plus Interest

The EU recently ordered Apple to pay 13 billion Euros ($14.5B) after Ireland reduced Apple’s taxes from 1% in 2003 to 0.005% in 2014. The EU alleges that this treatment gave it an unfair advantage over competitors.

In a letter on Apple’s website, CEO Tim Cook stated: “Every company in Ireland and across Europe is suddenly at risk of being subjected to taxes under laws that never existed.”

Bank of Japan Won’t Hesitate To Boost Stimulus

The Bank of Japan has already conducted some of the world’s most extreme cases of monetary policy with its asset-buying programs. It maintains that it will continue the large amounts of stimulus and even boost their asset-buying programs in an effort to achieve 2% inflation.

Fed has options for dealing with recession, Yellen says

Janet Yellen doesn’t rule out the Fed getting into the asset-buying extravaganza in the future should we be faced with a prolonged recession. In the event of a recession, she notes Chair Janet Yellen said. “Future policymakers might choose to consider some … tools that have been employed by other central banks, though adding them to our toolkit would require a very careful weighing of costs and benefits and, in some cases, could require legislation,” she said.

EU-U.S. Trade Deal In Doubt As France Urges End To Talks

The free trade deal between the EU and the US has received pushback from France, adding their voice to others such as Austria and Germany. This may end the talks for the trade agreement.

Explosion At SpaceX Launch Pad Destroys Rocket, Satellite

Like to sensationalize this, but rocket explosions are unfortunately par for the course. A rocket is essentially a controlled explosion, which is why rockets tend to blow up when the smallest of things go wrong.

Perks Vanish as Funding Recedes for Startups

Startups capital is being a bit more careful these days. When startups perks and the tech job market stabilizes to a more “normal” regime some tech employees will have to come to terms with how a more normal job market works.

Wall Street’s Next Frontier Is Hacking Into Emotions of Traders

Emotional surveillance is a new buzzword on Wall Street. Traders at Wall Street banks may soon have sensors in their badges and AI monitoring their voice levels on phone calls.  The aim is to avoid the bad trading activities that can occur when traders get in a hole from a trade and try to get back to even, piling on risk until they get even or, more likely, lose big. When a trader can lose $100 million on a single bad trade, I can see why the banks would want to monitor their emotional states

Market shrinkage: Fewest US Stocks Since 1984

There are the fewest stock shares outstanding since 1984. This may be due to more companies staying private for longer thanks to more robust private equity markets.

Anyone Can Invest Like a VC Now—So Why Aren’t They?

Equity crowdfunding has been available to companies for the last few years, but it really hasn’t taken off, with only 16 companies actually raising capital in this manner. This may be due to the complexity of the process and the limit to the capital raises possible ($1M cap). A new bill coming down the pipeline may simplify the process.

Why I Invest in Stocks….Why Do You?

Big returns in stocks can mean huge drawdowns on the way there. Many people can pick good stocks, few can soldier through a position having a 90% drawdown (e.g. Amazon).­

A Hidden Habit of Successful People

Doing less busywork and extraneous activities and spending more time thinking.

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