Monthly Archives: January 2016

China: Separating the Signal from the Noise

ChinaTo say the least, global financial markets are off to a bad start in the New Year. Given all of the headlines surrounding China, we thought we would give a market recap and try to untangle recent events, sorting out the clamor from the meaningful developments.

What’s Up With China?

The facts are easy to see. The Shanghai composite is now down almost 16%, only a few trading days into the New Year. Even the large-cap CSI 300 index is down 15%, signaling big outflows from China’s equity markets.

Chinese regulators tried to arrest the fall by implementing ‘circuit breakers’, similar to what is built in to American markets, where trading is halted for a time if stocks fall more than a certain percentage, and then closed for the rest of the day if they fall even more after reopening. The idea is to make everyone take a break and cool off in times of extreme volatility.

Chinese markets have been blowing up these circuit breakers. On January 4, markets lost 7%, triggering the circuit breaker and closing the market for the day. Then on Thursday, January 7, Chinese markets opened sharply lower in the first few minutes. The 5% drop triggered a 15-minute halt, but when trading resumed, the slide resumed as well, again triggering the 7% loss and market close for the day. Thursday’s trading day lasted only 29 minutes. 

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Check Your Spending With These Two Questions

question road signWe have all been there. We vow to cut back on spending and save a certain amount of money, only to buy a few big ticket items that we vainly try to rationalize. The purchase might even have made sense at the time, but when we review our finances, our savings goals are far out of sight! Here are two simple questions to ask yourself – before you make a big ticket purchase.

1: Do I Need It?

It seems obvious: don’t buy things you don’t need! Of course, this is also the hardest question to ask and to answer honestly. A new car? If your current one is doing fine, and you just wanted that new car smell and extra features, then no. A new TV? Already have one, I just wanted the latest high-resolution screen.

If you answer ‘No’ to the first question, then the process is already over. Move on and try to forget about it. But you might be asking, “So I can never buy anything I don’t need because it isn’t financially the most prudent thing to do? Haven’t you ever heard of something called enjoying life?

A Slight Edge Makes a Huge Impact

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A few years ago on a flight home from Portland to Denver, I interrupted a woman seated next to me who was deeply engaged in a book. “What are you reading?” I inquired. “Oh, it’s an amazing book called The Slight Edge. You ought to check it out.” And with that, she returned to the book without uttering another word for the remainder of the trip.

I jotted the title down, only to be reminded of it a month or so ago when I randomly found it in my Evernote cache.

So what’s the principle message of The Slight Edge: Turning Simple Disciplines Into Massive Success and Happiness? Quite simply, it is that success and failure are largely predicated on the small choices that we either make or don’t make each day. The truth is that these choices will do little to change the trajectory of our lives in the short-term. However, compounded over time, they have a massive positive or negative impact on our lives.

Oculus Rift: Experiencing Reality

heroVideo games have come a long way since the release of the Magnavox Odyssey and the Atari 2600. In the last 40 years, we’ve seen gaming go from Duck Hunter to Skyrim, from Sega Genesis to Xbox One. Like all visual media arts, video gaming aims to create an experience which is both immersive and life-like. Whether you’re throwing touchdowns in the latest edition of Madden or fighting with the Minutemen in the wasteland of Fallout 4, the game becomes a means by which you’re transported into a life unlike your own. On January 6, 2016, Oculus made the announcement that their virtual reality gaming headset Rift was available for pre-order and would begin shipping March 28.

Rift originally began as a Kickstarter project in 2011, shortly after

Chipotle Cools after E. Coli

chipotleIt grieves me to say that Mexican fast-food chain, Chipotle, has recently been linked to outbreaks of E. Coli across the country and a norovirus outbreak in California that happened last August. Since the very first time my taste buds encountered Chipotle, it has been one of my favorite restaurants. Previous to the incidents, the Mexican restaurant chain maintained a pristine public perception, but it is now undergoing investigation by a grand jury for the norovirus outbreak and was served a subpoena in December. Not at all surprisingly, this has severely damaged Chipotle’s sales and the downward trend is expected to continue.

Sadly, these things do happen from time to time. Taco Bell spawned a similar outbreak of E. Coli back in 2006. If history serves as a guide, Chipotle might expect their plunge to continue for at least a year or more, like Taco Bell’s which lasted for five quarters. Fortunately for the chain formerly beloved by so many, Taco Bell and other restaurants that suffered similar dives in the past have all typically made full recoveries, though it often took a couple of years.

For Chipotle, these outbreaks could potentially prove to be damning in ways that Taco Bell’s E. Coli outbreak was not. The company has poured all of its marketing efforts into building a reputation as a fast-food restaurant committed to using better ingredients and making its food fresh.

Stay Tech Safe

Information concept: Opened Padlock on digital background

Text from a friend on July 14, 2015…..

Disastrous hacker situation. The virus got through over the weekend. Killed every single file and photo on my hard drive. All tax files, PowerPoint presentations, everything. Unfortunately, I was not backed up in the cloud.”

 With the continued acceleration of technology, scenarios like this are occurring at an alarming rate. Keeping our computers and mobile devices secure against unwanted intrusions can be a daunting task. It requires vigilance and a bit of savvy to steer clear of attacks that threaten your digital landscape.

If you find yourself ignorant of the threats we face on a daily basis, then the book Future Crimes: Everything Is Connected, Everyone Is Vulnerable And What We Can Do About It will get you up to speed in a hurry. Written by global security expert Marc Goodman, the accounts he shares on the proliferation of nefarious digital acts will frighten you into wanting to take proactive security measures to protect your wares. It offers a sobering look at the world of cybercrime and how it is affecting our lives.

By way of example, credit card fraud is one of the most widely feared risks that consumers face. Yet it’s been comical watching the FinTech community  respond to these concerns. I talk about this at length in a blog post that I wrote a few months ago. Sadly, despite advancements in new chip technologies for credit cards, we are all still vulnerable to hacks. And contrary to popular belief, most of these intrusions occur through in-person point-of-sale transactions for one blindingly obvious reason; the damn credit card number is still on the front of a card. Why not embed it into the strip so that when you hand it to a restaurant server, they can’t pull out a pen and write your number down? Kind of defeats the purpose of that new security chip, huh?