Archive for the ‘Finance’ Category

Investors Put Their Money on Tesla   Leave a comment

Link: https://www.ft.com/content/25e51b54-b9eb-4515-807e-730302345fad

Shares in Tesla stock doubled in price from May to December of 2019. Currently, there is not much competition in the electric automobile industry. There is concern, however, that competition from well known brands such as Audi, BMW, or Mercedes will hinder sales for Tesla due to consumer loyalty.

Original Air Date: February 10, 2020

Length: 17 minutes 14 seconds

Posted May 5, 2020 by meaghanprice3 in Finance, Market structure

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Triple-A Ratings are so Yesterday   Leave a comment

Link:https://www.npr.org/2020/02/05/803201941/triple-a-ratings-are-so-yesterday

In the United States bond market, only two companies currently hold a triple-A rating: Microsoft and Johnson & Johnson. Most companies are falling into triple-B and double-B bond ratings. Once companies fall below a triple-B rating, their bonds are considered to be “junk bonds”. Due to the current low interest rates, even if a company has a low rating, they still can receive a loan at a low price which means there is little incentive to achieve a high bond rating. With the record high level of corporate debt in the U.S., there will be little financial flexibility for these companies if a recession hits.

Original Air Date: February 5, 2020

Length: 9 minutes

Discussion prompt 1: Should the government incentivize companies to cut back on their debt and improve their bond ratings? If so, how should the government do this?

Discussion prompt 2: What are the long term economic implications of the extensive amount of corporate debt in the United States?

 

Posted March 24, 2020 by meaghanprice3 in Finance, Planet Money

Two Yield Curve Indicators   Leave a comment

Link:https://www.npr.org/2019/08/21/753185863/episode-934-two-yield-curve-indicators

In March, the yield curve for United States treasury bonds inverted. For the past six decades, the yield curve has been an extremely accurate indicator of a coming recession. Will this indicator hold true in the coming months?

Original Air Date: August 21, 2019

Length: 18 minutes 54 seconds

Discussion Prompt: What could cause long term treasury bond rates to drop below short term rates?

Discussion Prompt: What steps should the Federal Reserve take in the coming months to prevent a crash similar to the 2008 recession?

Why Netflix Turned to Junk   Leave a comment

Link: https://www.npr.org/2020/02/25/809386076/why-netflix-turned-to-junk

When it originally started, Netflix was a unique and popular streaming service, however, when more competition entered the market, the company struggled to compete. Eventually, Netflix began producing their own content. They created their own production company and by doing so, incurred debt. in order to fund their new content, Netflix has issued more than $2 million worth of junk bonds.

Original Air Date: February 25, 2020

Length: 9 minutes 40 seconds

Posted March 17, 2020 by meaghanprice3 in Finance, Planet Money

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Janet Yellen’s Mystery Story   Leave a comment

Janet YellenLink: https://www.npr.org/sections/money/2018/01/31/582224091/janet-yellen-s-mystery-story

Summary: Former head of the Federal Reserve of America, Janet Yellen, communicated about inflation, uncertainty, and monetary policy in one of her speeches last fall. With the current low inflation, the Fed hopes more consumers go out and purchase more goods to help reach the ideal inflation in the country. But as inflation remains low,  the Fed is left puzzling over this mystery.

Original Air Date: January 31, 2018

Length: 6 minutes 48 seconds

The Recession Predictor   Leave a comment

The Recession PredictorLink: https://www.npr.org/sections/money/2018/01/12/577710151/the-recession-predictor

Summary: There appears to be fear that another recession is approaching the United States, but what are the warning signs for the country’s economy? From talks about inflation, interest rates, and borrowing, the yield curve is known to be a powerful and the most accurate predictor of recessions.

Original Air Date: January 12, 2018

Length: 9 minutes 5 seconds

Stimulus Response   Leave a comment

Stimulus ResponseLink: https://www.npr.org/sections/money/2018/02/14/585844313/stimulus-response

Summary: What would a liberal economist say about the state of America’s economy today? THE INDICATOR discusses how the country’s economy may need some form of stimulus to boost further economic growth.  However, would the benefits of the short run stimulus for the economy that we say we need, outweigh the cost of the long-term tax cuts?

Original Air Date: February 14, 2018

Length: 6 minutes 30 seconds