Archives for February 2017

Big Brother is watching you: Jim Rogers prophesizes death of cash total govt control of spending

According to the newspaper, the ministries are considering banning the payment of salaries in cash, limiting large cash purchases or introducing a cash tax.

Officials want to limit cash purchases of real estate, cars, and luxury items, but the cut-off price is being discussed. The economists are also looking at examples of India and Azerbaijan that limit not only cash transactions, but also cash withdrawals.

In January, the Russian media reported the government is considering setting a single cash purchase limit at 500,000 rubles (about $8,750 at the current exchange rate). Minister of Finance Anton Siluanov backed the initiative without specifying the limit.

At the moment, Russians still prefer cash transactions. In the first nine months of 2016 holders of bank cards withdrew 19 trillion rubles ($330 billion), but only spent 8.7 trillion ($150 billion) to pay for goods and services using plastic.

The share of cash in circulation is about nine percent of Russia’s Gross Domestic Product, according to the Central Bank.

Businesses are complaining about high costs and service fees of points of sale (POS) terminals in Russia, which may cost up to 10 percent of net profit a month.

Another option under discussion is a differentiated VAT (value-added tax) rate, which can be reduced for non-cash purchases. However this option partly violates the ban on restrictions on free movement of goods and funds in Russia and is unlikely to be adopted, tax adviser Sergey Kalinin told Vedomosti.

Article source: https://www.rt.com/business/378126-russia-cash-transaction-limit/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Ending ‘death by overwork’ bad for Japan’s economy – Deutsche Bank

The Royal Host restaurant chain closed its last 24-hour cafe in the Tokyo suburbs at the end of January, the FT reports. Straight after, the Skylark Group, a pioneer in the family restaurant business in Japan shut 310 outlets overnight, leaving 100 to stay open around the clock.

One of the reasons for the shut-down is Japan’s aging society with fewer students as key customers for 24-hour restaurants.

The main factor is the increasing shortage of casual staff, which makes it impossible to work profitably during late-night hours.

“The number of late-night customers is falling, but the number of staff willing to work nights is falling too, and if there’s a shift you can’t cover then it’s impossible to open,” says Minoru Kanaya, chief administrative officer for the Skylark Group, as quoted by the FT.

“People working in the middle of the night are mainly driven by money. It isn’t that they want to work then — they do it because the pay is good. And for those hours the wage rates have been increasing steadily,” he said.

READ MORE: Japanese go to work dressed as ninjas – bet you never saw that coming (VIDEO)

Growing labor shortages, as well as an unemployment rate of just 3.1 percent, still fails to push wage inflation and upward pressure on prices, according to the FT.

Inflation is stuck near zero that is far below the Bank of Japan’s two percent goal.

At the same time, the ratio of jobs to applicants in Japan is now at its highest for 25 years. There are 3.8 jobs for every applicant for a waiter position, 2.7 – for drivers.

The numbers highlight how difficult it is to hire service employees. Companies are currently raising wages, hiring more women as well as foreign guest workers.

Corporations across a range of industries are being forced to rejig operations to improve working conditions and attract staff while keeping the total wage bill under control, even if they lose sales.

Although the measures make life better for employees, they do not lead to salary increases or boost consumption.

Article source: https://www.rt.com/business/378104-japan-end-overnight-service/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

A new problem that has suddenly emerged is the record levels of gasoline sitting in storage. The market has already had to digest the fact that US crude oil stocks were rising, and investors have done their best to explain away the trend. But now gasoline inventories are climbing to unexpected heights.

It would be one thing if crude stocks were rising, perhaps because refiners were going offline for maintenance. But if that were the case, then gasoline stocks would draw down on lower refining runs. But if both crude and refined product inventories are going up at the same time, then there should be some reasons for worry.

In fact, the glut of gasoline is now the worst in 27 years. At 259 million barrels, US gasoline storage levels are now at their highest level since the EIA began tracking the data back in 1990.

Part of the reason for the glut, of course, are high levels of production. Although gasoline production ebbs and flows seasonally, US production has been on an upward trend in recent years. Instead of bouncing around in a range of 8.5 to 9.5 million barrels per day before 2014, US production since the collapse of oil prices has steadily climbed to a range of 9 to 10 mb/d.

But that increase came in order to satisfy rising demand (which, of course, was stoked by lower prices). More demand should have soaked up that excess supply. However, that is where the problem gets worse. Lately, US demand has faltered.

US gasoline demand plunged to just 8.2 million barrels per day in January, and sales were down 4 percent from a year earlier. It was also the lowest level in four years. Weak demand is raising some red flags for the market.

Demand is seasonal, with softer demand in winter months, but this winter’s ‘valley’ is lower than any other since 2012.

Oil prices running out of reasons to rally

The problem becomes particularly acute when you take into account the fact that refiners have actually cut back on gasoline production in recent weeks. Even with lower refining runs, gasoline storage levels continued to rise.

The data is worrying, especially since broader economic data does not point to deep problems with the US economy. Some, including the EIA, speculate that higher prices are cutting into demand. That would be surprising given that prices at the pump are still a fraction of what they were a few years ago.

The drop off in demand could be temporary, with consumption rebounding in a few months. Warmer temperatures tend to lead to more driving, and if demand rises it will halt the climb in gasoline inventories. But even a small hiatus in demand has led to a buildup in storage levels to such a degree that it will take time to bring down. “It kind of ruins your whole year potentially,” Sam Margolin, an analyst at Cowen, told the WSJ. “Demand growth appears to be the riskiest element of the oil equation in 2017, and the rally could pause until driving season.”

The glut of gasoline has led to tankers being turned away at New York Harbor in recent weeks, diverted to ports in the Caribbean. However, even that did not resolve the glut on the US east coast. “Record-high inventories in the region are now pushing prices low enough to turn the typical trade flow on its head,” Bloomberg reports. The east coast typically imports a lot of crude oil and refined products. But refined products are instead heading in the other direction because of the buildup in supply.

If demand does not rebound, then gasoline inventories will rise further. At that point, refiners will be forced to cut back on production, which means a reduction of their purchases of crude oil. Less oil sales means higher crude oil inventories, pushing down prices. Ultimately, that could force drillers to reduce supply. In short, if US demand – and by extension, global demand – does not come through for the oil market, then oil prices could decline this year.

This article was originally published on Oilprice.com

Article source: https://www.rt.com/business/378099-gasoline-glut-oil-prices/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Macy’s squeezed to drop Ivanka Trump’s clothing line

According to the national trademark office, the firms range from alcohol retailers to wallpaper companies.

One of them, a Beijing-based company that provides weight loss services filed ten applications to use ‘Ivanka,’ on products including cosmetics and nutritional supplements.

Recently an application was applied by Fujian Yingjie Commodity Company to use Ivanka for its brand of sanitary napkins.

Most of the applications are still being processed, and it’s not clear whether any of them will be granted trademark rights.

The rush to trademark Ivanka’s name is linked to her rising popularity in China, particularly after her visit to the Chinese embassy in Washington over the Lunar New Year period.

About 40 Chinese companies have reportedly used the Chinese characters of her name in their business registrations. Most of these enterprises are involved in cosmetics, clothing, and underwear.

The growing Chinese demand for Ivanka Trump’s trademark comes as leading US retailers such as Nordstrom and Neiman Marcus dropped her fashion line from their stores. The retailers claimed the decision was not political but due to poor sales of the brand.

Under Chinese law, businesses are permitted to use foreign names or the Chinese translations of such names as trademarks. That leads to many disputes with Western companies that want to protect their brands.

Last week, after a decade of legal disputes, Ivanka’s father Donald Trump won the rights to his brand in China. The Trump trademark was officially awarded to the Trump Organization.

In a similar case, a Chinese court ruled for US basketball legend Michael Jordan in December. A sportswear company Qiaodan had been ordered to stop using the Chinese characters that make up the name Jordan.

Article source: https://www.rt.com/business/378086-chinese-firms-ivanka-trademark/?utm_source=rss&utm_medium=rss&utm_campaign=RSS