In early February, President Donald Trump announced the imposition of tariffs on imports from Canada, Mexico, and China, marking a significant shift in U.S. trade policy. These measures have sparked extensive debate regarding their economic implications.

Economic Impact on Domestic Prices

Tariffs function as taxes on imported goods, leading to increased costs for businesses that rely on these imports. These elevated costs are often transferred to consumers through higher prices. For instance, a 25% tariff on Canadian and Mexican imports could raise production expenses for U.S. automakers, potentially adding up to $3,000 to the price of some vehicles. Additionally, gas prices in the Midwest might surge by as much as 50 cents per gallon, given that Canada and Mexico supply over 70% of crude oil imports to U.S. refineries.

Effects on Employment and Production

While tariffs aim to protect domestic industries by making imported goods less competitive, they can also lead to unintended consequences. In 2017, Samsung established a washing machine factory in Newberry County, South Carolina, creating over 1,500 jobs. However, the associated tariffs increased washer prices by approximately 12%, affecting American consumers. Economists argue that the additional costs borne by consumers outweighed the employment benefits.

Market Volatility and Business Uncertainty

The announcement of new tariffs has introduced uncertainty into financial markets. The S&P 500 recently experienced a 0.9% decline, culminating in a 0.2% loss for the week, as investors reacted to potential trade conflicts. Businesses are now navigating an unpredictable environment, reassessing supply chains, and considering strategies to mitigate risks associated with fluctuating trade policies.

International Trade Relations

The tariffs have prompted concerns about escalating trade tensions. While the U.S. has paused tariffs on low-value packages from China to develop efficient collection processes, the overarching trade strategy has led to retaliatory measures from affected countries. This tit-for-tat dynamic can disrupt global supply chains and strain diplomatic relations.

Conclusion

The recent U.S. tariffs represent a pivotal moment in trade policy, with far-reaching economic consequences. While intended to bolster domestic industries, these measures may lead to higher consumer prices, market instability, and strained international relationships. As the situation evolves, it is crucial to monitor these developments to fully understand their long-term economic impact.

In the world of financial trading, the concept of funded accounts and proprietary (prop) firms has gained significant attention. These models provide aspiring traders with the opportunity to trade using someone else’s capital, often offering the chance to scale their careers without the need for substantial personal funds. Understanding how funded accounts and prop firms work is essential for those looking to navigate this area of trading.

What is a Funded Account?

A funded account is a trading account that is provided with capital by a third-party firm, typically a prop firm. The trader, often referred to as the "funded trader," can use this capital to execute trades in various financial markets, such as stocks, forex, or commodities. The key difference between a funded account and a typical trading account is that the trader does not have to risk their own money. Instead, they use the firm’s funds to make trades, with the understanding that profits are shared between the trader and the firm.

How Funded Accounts Work

To receive a funded account, traders usually need to go through an evaluation process, which may involve demonstrating their trading skills, strategies, and risk management abilities. Many firms set specific parameters, such as profit targets, drawdown limits, and risk thresholds, to assess whether a trader has the necessary skills to handle larger sums of money.

One of the most popular models for funded accounts is the "evaluation account" system. Traders begin by trading a demo or a simulated account under real-market conditions, with a predefined set of rules. If they meet the firm’s targets without violating the risk parameters, they are offered a funded account. These accounts often come with various profit-sharing structures, where traders receive a portion of the profits they generate, with the firm taking the rest.

Proprietary (Prop) Firms

A proprietary trading firm, or prop firm, is a company that provides traders with access to capital in exchange for a share of the profits. Prop firms typically operate by leveraging their own capital to trade on financial markets, with their traders working on behalf of the firm. These firms often specialize in various asset classes, including equities, forex, futures, and options.

The primary advantage for traders working with prop firms is the opportunity to trade large sums of money without needing to invest their own capital. Prop firms may offer various account types and levels, from small accounts for beginners to large accounts for experienced traders. In exchange for the opportunity to trade with firm capital, traders typically share a percentage of their profits, which can range from 50% to 90%, depending on the firm and the trader’s performance.

Benefits of Funded Accounts and Prop Firms

1. No Need for Personal Capital: One of the most appealing aspects of funded accounts and prop firms is the ability to trade with someone else’s money. This allows traders to take on larger positions and diversify their portfolios without risking their own savings.

2. Access to Professional Tools and Resources: Many prop firms provide traders with access to advanced trading platforms, research tools, and risk management systems. This can be particularly valuable for traders who may not have access to such resources when trading independently.

3. Profit Potential: Traders in funded accounts and prop firms can potentially earn higher profits compared to retail traders. With larger amounts of capital, they can take on bigger trades and exploit market opportunities more effectively.

4. Learning and Mentorship: Many prop firms offer training programs, mentorship, and a collaborative environment, which can accelerate a trader’s learning curve. This is especially beneficial for those starting their careers in trading.

Challenges and Considerations

While funded accounts and prop firms offer numerous benefits, they also come with certain challenges. Traders must adhere to strict risk management rules and often face pressure to meet profit targets within specific time frames. Additionally, the profit-sharing model means that a portion of earnings goes to the firm, which may not be ideal for traders who prefer to keep all their profits.

Conclusion

Funded accounts and prop firms provide traders with significant opportunities to access capital, gain experience, and earn profits without risking their own money. However, these models come with a unique set of challenges and risks, particularly in terms of adhering to performance expectations and sharing profits. For traders looking to scale their careers, working with a prop firm or utilizing a funded account can be a powerful path to success in the competitive world of financial trading.

The past has been an exciting year for financial education efforts across the country. We’ve seen states like Indiana, West Virginia, Minnesota, Connecticut, Wisconsin, and Louisiana create standalone financial education requirements. Oregon and Montana were also able to pass new requirements that integrate key financial education topics into required coursework. 

We are constantly looking for new ways to elevate your voices and perspectives. Before the passage of SB 35 in Indiana, we activated our advocates located in the state to reach out to their representatives that were hesitant to support the legislation. One of our advocates sent a personalized letter urging their members to support the legislation due to the state's dire need for financial literacy. Advocacy like this is what helps get financial education legislation across the finish line.

FinEd50 also had the opportunity to support student and educator voices in Oklahoma. We worked closely with the Oklahoma Council for Economic Education to coordinate a panel that consisted of teachers and students to discuss the importance of financial education in their state. Their discussion was full of impactful insights and personal experiences that made a solid case for a financial education requirement in the state. We look forward to continuing our work in the state for years to come.

Building Personalized Advocacy Strategies

Another critical component to our work is ensuring our advocacy efforts are led by local partners and the political circumstances in each state. To do this, we work to support partners in every state to start and lead conversations about financial education. This year, we had the opportunity to co-host a panel with NEFE at the National Association of State Treasurer’s conference in Portland, Oregon. Our session focused on highlighting premier research and aiding treasurers on how to craft an advocacy campaign in their state. Sessions like these help leaders understand the existing research and how they can use that research along with personalized state data to make the case for financial education.

What’s in store for next year

There are still a number of states considering financial education requirements going into the new year. We will continue our work in Pennsylvania, New York and Oklahoma, while also working with partners in states like Massachusetts, Delaware, Maine and California to help their states prioritize financial literacy and expand access. As always, we are eager to contribute anywhere we can, so if there are efforts to expand financial education in your states let us know through our contact us form! One of our founding partners, the Council for Economic Education, will be releasing their latest Survey of the States report in February. This will give us a fresh look into education standards across all 50 states (and DC). We are excited to work with this new data to celebrate our successes and learn more about where our advocacy efforts are needed. Thank you all for your support this past year!

We are excited to continue our work for years to come to bring financial education to every state across the country.

With holiday ads already bombarding our screens and the festive vibes kicking in, it's time to unwrap not just presents, but also some valuable lessons about money and personal finances. Yep, you heard it right! The holiday season is more than just twinkling lights and jolly tunes – it's the perfect time to sneak in some money talk. Here are some cool ideas to navigate the holiday season while mastering the art of dollars and cents.

The 4-Gift Rule: Keeping it Real

Let's face it – we're all tempted to go all out during the holidays, especially when it comes to gifts. But what if I told you there's a way to keep things in check and still have an epic gift exchange? Enter the 4-Gift Rule: Something I Want, Something I Need, Something to Wear, and Something to Read. It's like a gift checklist that helps curb the chaos and puts the focus on thoughtful giving. This way, we not only save money but also get a crash course in distinguishing between wants and needs. Win-win!

Budgeting for Gifts: Because Money Doesn't Grow on Trees

Guess what's cooler than receiving gifts? Giving them! And what's even cooler? Learning how to budget while doing it. Grab a pen, some paper, and maybe a hot cocoa, and let's get down to business. Start with a total spending limit – whether it's money you've saved up or a budget from your folks. List down everyone you want to surprise with a gift, then hit the web for some savvy comparison shopping. It's like being a financial ninja, making smart choices and spreading the joy without breaking the bank.

‘Tis Better to Give: Spreading Holiday Cheer

While the holiday season is all about receiving, it's also the perfect time to give back. Let's shift the focus from our wish lists to making a positive impact in our communities. From faith-based efforts to adopt-a-family programs and Christmas Angel donation drives, there are countless ways to get involved. Even those Salvation Army bell-ringers – ever wondered what they're all about? It's not just spare change; it's a chance to talk about why helping others matters, especially during the holidays.

So, why not make this holiday season a little extra special by not just celebrating but also learning some money moves? Whether you're all about Christmas lights or you've got a Festivus pole waiting, let's make the most of the season – and our newfound financial wisdom. Happy holidays, money-savvy teens! 🌟💰

12/10 ’Tis the season to be jolly! Fa-la-la-la-la, la-la-la-la.  

Hey everyone! Hope you had an awesome Thanksgiving hanging out with your family and friends. So, guess what I was thinking about during the holiday? No, not just turkey and pumpkin pie, but also Black Friday! And guess what's cool? Black Friday is like a real-life game, and I'll explain it.

There's a concept in economics called Game Theory. No, it's not the popular YouTube channel, but I enjoy that too. It's all about how people's decisions are influenced by what others do. For example, if I'm deciding whether to binge-watch a show or read a book alone, that's not game theory because no one else is involved. But, if I'm picking a Disney movie over a documentary because I'm with a four-year-old, that's game theory in action, because the little one's presence is affecting my choice.

Now, let's talk about Black Friday. It's not just a crazy shopping day, it's a game, too! Stores are players in this game, and they're thinking strategically. Ever wonder why they open so early? It's not just random. They do it because they know other stores are doing the same, and they want to be ahead in the game. Remember when Macy's started opening on Thanksgiving Day in 2016? Boom! Other stores were said, "Hey, let's do that too!" It's a domino effect.

But wait, the game isn't just for stores. Us shoppers are players too! Think about it – waking up at the crack of dawn to snag those crazy deals. Would anyone voluntarily get up at 5:00 AM to shop? Probably not! We're doing it because we know everyone else is doing the same, and there are only a few super discounted items. It's like a race, and we want to be the ones with the cool, cheap stuff in our carts.

So, Black Friday isn't just about scoring awesome deals and kicking off the holiday shopping season. It's a real-life game of strategy and tactics, and that's what makes it so interesting for us economics nerds. Who knew shopping could be so strategic, right? Game on, Black Friday! 🛒🎮

11/24 Black Friday

Hey there, friends! October is almost here, and it's Financial Planning Month. This is the perfect time to get a grip on your money, set some goals, and create a plan for your financial future!

USJIC has proudly requested requested that the Colorado Governor officially declare October as Financial Planning Month. You can view the proclamation here, and you're encouraged to reach out to your state governor to request a similar proclamation. If you require assistance in obtaining one, please don't hesitate to contact us!

Financial planning is like your personal money GPS. It helps you figure out where you are financially, where you want to go, and how to get there. Let's check out why it's awesome:

• Get Inspired: Knowing where you stand financially can motivate you to take action. Maybe you'll start saving money or dip your toes into investing.

• Set Goals: Financial planning makes you think about what you want in life and helps you set money goals that match your dreams.

• Make a Plan: With a clear picture of your finances, you can create a step-by-step plan to reach your goals.

• Clear Your Mind: Understanding your money reduces stress, so you can make smart choices even if you're not rolling in cash.

• Track Progress: You can measure how well you're doing by setting milestones, making sure you're moving closer to your goals.

• Be Prepared: A financial plan helps you handle emergencies, big expenses, and even retirement down the road.

For teens like you, here's how to dive into financial planning:

• Talk to your friends and family about money. It's okay to ask questions and share ideas.

• Create a simple budget to manage your money and avoid debt.

• Keep an eye on your spending habits by tracking where your money goes.

• Think about how you'll handle things like student loans and debts in the long run.

• Ever thought about a career in finance? It's an option worth exploring.

To make the most of Financial Planning Month, try these tips:

• Look into different ways to invest your money based on what you can afford and your goals.

• Start thinking about retirement, even if it seems far off. Use online tools to see where you stand and make a plan.

• Keep tabs on your savings and spending. You can use apps, spreadsheets, or even a simple notebook.

Some cool financial facts:

• Financial planning doesn't just help in the future; it can improve your finances right now.

• Simple financial plans are usually better than complicated ones.

• On average, people in the U.S. spend about $63,000 each year.

• Interestingly, millennials might have less spending power than their parents did at their age.

• And remember, scrolling through social media doesn't save you money!

Financial Planning Month is all about taking care of yourself, learning about money, and being responsible with your finances. It's a reminder to take charge of your financial future and make sure you're on track to achieve your goals.

So, this October, use Financial Planning Month as your chance to get ahead with your money. It's never too early to start, and even small changes can make a big difference in your financial future. Happy Financial Planning Month!

9/15

Once more, the start of a brand-new school year is upon us!  You might not realize it, but reusing your school supplies isn't just about being eco-friendly – it's a lesson in economics that is beyond boosting your wallet. Today, we'll try to make sense of reusing school supplies using economics way of thinking.

Understanding Opportunity Cost

Imagine you have some money saved up, and you're faced with a choice: buy a bunch of new school supplies or keep your old ones and save that cash for something else, like the latest video game or a fun outing with friends. This is where the concept of opportunity cost comes into play.

Opportunity cost is what you give up when you make a choice. In this case, if you choose to buy new supplies, you're giving up the chance to spend that money on something else you might enjoy. By reusing your old supplies, you're making a smart economic decision because you're considering what you could have done with the money you saved.

Resource Scarcity and Conservation

Ever heard of the saying, "Waste not, want not"? Well, it's linked to the idea of resource scarcity. This means that resources like wood for pencils, metals for binders, or oil for plastic folders are limited. When we reuse, we help conserve these resources.

If more people start reusing school supplies, it means there's less demand for new supplies. When demand goes down, prices often follow. So, reusing not only saves you money but can also help keep prices stable for school supplies.

Supply and Demand

In the world of economics, there's this fundamental principle called supply and demand. It's all about how much of something (supply) is available and how many people want it (demand). When demand decreases, prices can go down. When demand increases, prices can go up.

By reusing your school supplies, you're reducing the demand for new ones. If more students did the same, it could potentially make school supplies more affordable for everyone. So, not only are you saving money, but you're also part of a bigger economic picture.

Sustainability and Future Planning

Lastly, let's talk about sustainability. This is a big word, but it basically means using resources wisely so they'll be available for future generations. When you reuse your school supplies, you're helping ensure that there will be enough resources for you and your peers in the future.

Think of it this way: by reusing your supplies today, you're contributing to a more stable and sustainable economy tomorrow. It's like investing in a brighter financial and environmental future for yourself and the world.

In conclusion, reusing your school supplies isn't just about being eco-conscious; it's a lesson in economics that can make your wallet happier and the planet healthier. So, next time you're tempted to buy new supplies, consider the economic impact of reusing the ones you already have. It's a smart choice for both your present and your future.

8/23

Shorting is a widely recognized concept in the investment world, although it often takes a backseat to going long, which is considered the more popular investing option. However, shorting offers unique opportunities and advantages that differentiate it from going long.

When engaging in shorting, investors have the ability to profit from the decline in the value of a particular security or asset. Unlike going long, where investors aim to benefit from the price appreciation of an asset, shorting allows them to capitalize on falling prices. This approach can be particularly valuable in situations where companies or individuals engage in fraudulent activities or misrepresent their financial information.

One notable example of short-selling activism occurred on June 6, approximately a month before this blog post, when Hindenburg Research, a prominent short-selling activist group, exposed deceitful practices surrounding an African company named Tingo and its founder, Dozy Mmobuosi. Hindenburg Research specializes in investigating companies that manipulate their financial records or falsely represent their assets and returns. After conducting their research, Hindenburg releases a comprehensive report detailing their findings, concurrently initiating a short position in the targeted company.

The release of Hindenburg's report often prompts other investors to follow suit and initiate their own short positions. This collective effort serves a dual purpose: first, it aids Hindenburg in exposing fraudulent practices and combating corporate fraud, and second, it presents an opportunity for the participating investors to generate profits.

As more investors short the fraudulent company, its market value gradually declines. Eventually, the impact of the short-selling activity causes the company to experience a significant decline or even a market crash. Meanwhile, Hindenburg and its supporters, who had taken a short position before exposing the deceit, reap the benefits of their astute analysis and are left with substantial profits.

Indeed, Hindenburg's report on Tingo is not only informative but also captivates readers with its clever and witty portrayal of the company's fraudulent activities, it makes you wonder how Tingo could get away with what they have been doing for so long. Read Hindenburg's full report here: https://hindenburgresearch.com/tingo/

This example illustrates how shorting can serve as an effective tool in combating dishonest practices in the investment world. By targeting companies that engage in fraudulent activities, short-selling activist groups like Hindenburg Research play a critical role in maintaining market integrity and protecting investors' interests.

7/12

It is thy Finals week around the corner! When it comes to acing your finals from an economic perspective, applying some economic principles can help you optimize your study efforts and maximize your chances of success. Take a look, try a few or (even better) all strategies and see for yourself!

1. Time management: Time is a valuable resource, and managing it effectively is crucial. Apply the principle of opportunity cost by prioritizing your study time and allocating it to subjects or topics that have a higher weightage or pose a greater challenge for you. Focus on areas where you can make the most improvement and allocate time accordingly.

2. Marginal analysis: Use the concept of marginal analysis to determine the optimal allocation of study time across different subjects or topics. Allocate more time to areas where you have the greatest potential for improvement or where you struggle the most, rather than spending equal time on all subjects.

3. Study efficiency: Apply the principle of diminishing returns by recognizing that there is a point where additional studying may not yield significant benefits. Identify when your returns start diminishing and avoid overstudying to the point of diminishing marginal returns. Take breaks, get enough rest, and maintain a balance to enhance overall study efficiency.

4. Cost-benefit analysis: Evaluate the costs and benefits of different study methods and strategies. Consider the effectiveness and efficiency of various approaches, such as group study sessions, flashcards, practice exams, or reviewing lecture notes. Choose study methods that yield the highest benefits and optimize your learning process.

5. Comparative advantage: Leverage your strengths and areas of expertise by applying the principle of comparative advantage. Identify the subjects or topics where you have a comparative advantage or find easier to grasp, and allocate more study time to those areas. This can help you excel in subjects where you have a natural aptitude.

6. Incentives: Create incentives and rewards for achieving study goals. Break your study sessions into smaller, manageable tasks, and reward yourself upon completion. These incentives can help motivate and reinforce positive study habits.

7. Opportunity cost of distractions: Recognize the opportunity cost of distractions such as social media, excessive entertainment, or unrelated activities. Be mindful of how you spend your time outside of studying and make conscious choices to minimize distractions that may negatively impact your focus and productivity.

8. Diversification: Apply the principle of diversification to your study approach. Instead of focusing all your efforts on a single study method, diversify your strategies. Use a combination of techniques such as reading textbooks, watching video tutorials, practicing with sample questions, and explaining concepts to others. This diversification can help reinforce learning and improve retention.

9. Trade-offs: Understand that achieving high grades may require trade-offs in other areas of your life. During the intense period of final exams, you may need to temporarily prioritize your studies over social activities or leisure time. Recognize the trade-offs you need to make and find a balance that aligns with your academic goals.

10. Review and feedback: Continuously review your study progress and seek feedback from teachers, peers, or tutors. Apply the principle of feedback to identify areas of improvement, correct mistakes, and adjust your study strategies accordingly. This iterative process can help you refine your knowledge and better prepare for your finals.

11. Last but not the least, mental and physical well-being: Remember to prioritize self-care, including sufficient sleep, exercise, and relaxation. A healthy mind and body contribute to better cognitive function and overall performance during exams.

I wish everyone the best of luck in the final exams. May all of you study diligently, stay focused, and perform to the best of your abilities. Practice effective study techniques, seek help when needed, remember to take breaks, and believe in your capabilities. You've got this! 

5/18

April is National Financial Literacy month! It evolved from Youth Financial Literacy Day, introduced by the National Endowment for Financial Education to raise public awareness of the importance of financial literacy and maintaining smart money management habits.

The United States Senate passed a resolution in 2003 officially designating April as Financial Literacy Month. President Obama made a proclamation in March 2017 highlighting the importance of being financially capable and declaring the month of April as National Financial Capability Month.

As a coalition, we aim to uplift the voices of communities in their fight for access to financial education for all. We want to be a resource for individuals and provide them with the tools they need to craft a successful advocacy campaign.

Here are some active legislation updates as of March, 2023

Nevada

We are glad to see Freshman Assemblyman Duy Nguyen's first bill deals with  financial literacy: Assembly Bill 274 requires students at public high schools to enroll for a certain number of credits involving financial literacy.  The bill has not had a committee hearing yet. But when it does, it will be before the Assembly Committee on Education.  We urge fellow Nevadans to show your support！

Pennsylvania

Following the passage of SB 1243 through the Pennsylvania senate in 2022, we've contacted Senator Chris Gebhard on slightly modified language that would further support the needs of educators. We are hopeful that PSEA support will clear the path for passage of this legislation and ensure access to financial education for young people in the state. 

if you are from PA, please contact your representative and the PSEA and urge them to support a personal finance graduation requirement!

New York

Following a New York State Education Department report that indicate a greater need for k-12 financial literacy education, a Blue Ribbon Commission was created to recommend changes to the New York State graduation requirements. If you know anyone on the Blue Ribbon Commission, please urge them to ensure students in New York receive the best quality financial education!

Resources are available on our website to help you to make the case for financial education in your state!

Other Legislation to Track

As of March, 2023, Montana, Indiana, California, Idaho, Minnesota and Oklahoma are all starting to consider whether they should improve access to financial education in their state. if you are from any of these states, you can show your support for personal finance education initiatives - it is critical for as many of us as possible to be

involved. You can craft a letter to send, tweet. or make a phone call to your state representatives to tell them why you think your state needs financial education.

Stay Engaged!

3/27

One of the exciting things around this time of year in high school would definitely be the college offers the seniors get and/or expect, and the decisions they make about their college.

A friend told me that his sister chose School of Mines over Yale because the former offered significantly more money for her college years and she doesn't want to pay for Yale. Though this kind of choice was utterly personal, it makes me wonder: should we make education decisions based on how much we would like to spend? Isn’t investing in education the best investment?

From the 1st day of kindergarten to college graduation, it is almost 20 years a student spends before getting his or her first job.  In addition to school, some may have also learned how to play a couple of instruments, some sports, and many other things. No matter what activities you do, every one of them costs time and money— you are busy, and your parents pay the dues. When it comes to children's education, parents find creative ways to make the schedule work, some even borrow money to meet their children's learning needs.  LendingTree researchers estimate that basic costs for raising a child in the U.S. equal $20,152 annually, and they’re trending upward. 20 years of that cost? You do the math.

Speaking of investment in education, we must first understand human capital. Many economists believe that there is only one kind of capital in the world, called physical capital. For example, we almost always recognize raw material’s capital nature. Because as long as this batch of raw materials is sold on the market, we regain the cost of purchase again.

But the costs for children's education are different. And, this particular human investment has a very long payback period but with a lot more uncertainties. 

Let’s face it, a fresh graduate from college would most likely get an entry level job with a lower salary. It will be a while before he or she earns a higher income. Moreover, the growth process of a person is very complicated; it takes lots more than education for a person to be self-sufficient, let alone happy and be able to contribute to the world around them. How can you assert that one’s adult life is directly related to the investment in education when he was a child? 

The annual rate of return on investment in education in the United States in the 1990s (annual profit before tax/total investment x 100%) reached 18%, which is a quite impressive. After 2010, this rate  dropped to 15%. However, in comparison, the rate of return on investment in stocks is below 7%, the return of investing gold is merely 2-3%, the return of education investment is still pretty decent. Even Warren Buffett’s return on his investment after 2000 is less than 15%. Investing in education has been a very cost-effective investment.

Moreover, studies of the results of American higher education have found that the rate of return is very high. And over time, the return on investment has become more and more consistent. In 1963, the average salary of a typical American college graduate was about 50% more than the salary of a typical high school graduate. Later, the gap between the two became bigger, after 1980, and around 2012, the gap between the two grew even more. On average, college graduates earn nearly twice as much as someone with only a high school diploma. 

At the same time, we also can notice that the return on investment in education is more complicated than education itself, but also related to many other factors like where you study, what you study, and social network availability etc. 

For geography elements affecting the return of one’s education, big and important cities can have huge impacts on certain industries while having minimal effects on others. For example, if you are in show business, you would want to be in a city like New York or LA, in order to have plenty of opportunities for personal growth, a massive audience body, and a mature market.

Another factor that seriously affects one’s education investment return is student loan debt. This boils down to a cost-gain decision involving risk control management. It is a case by case decision and there will be another blog to elaborate.

Good luck to you seniors out there!

3/23

Financial reports are not only to help you trade stocks. They can also help us decode various pricing strategies and tricks that businesses use to maximize their profits. Financial reports tell the true story of a company.

Every year, from January to April, major listed companies will announce their financial reports for the previous year. The financial reports include the company's operating condition, details of assets and liabilities, and various financial information such as income and profit. Usually this information serves as an important reference for investors.

However, financial reports are actually more relevant  to our lives than you would imagine. They provide such insider information that can guide so many of your everyday decisions.

Let's take a look at the secrets contained in the financial reports!

A clothing brand called La Chapelle was once pursued by thousands of trend sensitive young customers for the “newest look”. But if you take a look at La Chapelle's financial report, we can find that starting from 2019, the sales volume of the company's tops, bottoms, skirts, accessories and other products are far greater than its production volume, and the number of clothes that cannot be sold in previous years was 31% less in 2019. 58.79% less in 2020,and 58.1% less in 2021. This means that a large part of the clothes bought in La Chapelle in the past three years were clothes that could not be sold in previous years. Knowing this fact, do you still think those “newest looks” are the newest?

Many people love snacks. But the prices of some famous brands have gotten quite pricey over the years. Are there any snacks with the same quality as less expensive? Well, you may discover the answer in your favorite snack company’s financial report!

In a financial report, you can easily find out who the company’s suppliers are. Check out those suppliers’ product information, and you can find the same quality of snacks with different less known trademarks, often for a lower price.  

Another example is if you are eyeing on a luxury brand of mattress, which can cost hundreds or even thousands of dollars. Before you make a purchase, take a look at the mattress company’s financial report. It might surprise you that this acclaimed European luxury brand is actually designed and made locally, the company just using a French designer’s name in their commercials by paying the designer some fees. And, the actual cost of a mattress is merely a fraction of the price tag!

Financial reports are the storybooks of a company. They tell the past, present and future of a company. Once you understand and are able to explore different ways to interpret them, they give you an honest and direct decision-making basis, not only for stock trading, but also for more sensible consumption choices.

3/6

While the NFL is no longer a tax-exempt organization, it does conduct a competitive bidding process for the cities that want to host the Super Bowl. This tends to draw enormous interest from local governments eager to draw in tens of thousands of high-spending tourists, but to do, so they need to make very expensive contributions to the NFL.

In 2019, an investigation by the Atlanta Journal-Constitution found that Atlanta's successful bid for the Super Bowl cost around $46 million dollars. This came in the form of sales tax concessions, a hotel-motel tax designated for major events, reimbursement for any state or local taxes connected with the event, and $20 million pledged by local businesses. 

This money comes on top of the additional expenses that a city takes on during a major event like the Super Bowl. Although the NFL did not directly pay for Atlanta’s municipal services, local fire, police and medical personnel still had to keep the city running while serving a significantly larger, more centralized population than usual. A major influx of tourists costs the city additional money in maintenance, public transportation, and countless other local expenses that a tax-free event does not pay for.

This is not to say that the Super Bowl isn’t worth it. Historically, every Super Bowl had brought great profit of many times as much revenue as the city spent, making it a worthwhile expense. It is, however, important to remember that all this revenue comes at a cost. 

2/15

Super Bowl 2023 is in less than one week! Many people see the Super Bowl as a pure sports event, however, if we take a deeper look, we will find that it is an extremely efficient way to earn money in the entertainment industry! In fact, sports affect the economy much more than you think. 

Why are we so drawn to a sports event like this? The day of this championship game of the National Football League, known as Super Bowl Sunday, has evolved into an unofficial American holiday, with viewing parties held in homes, bars, and restaurants throughout the country. The week prior to the game is highlighted by extensive media buildup and a festival atmosphere in the host city. The game itself is accompanied by elaborate pregame and halftime ceremonies and entertainment. The Super Bowl’s commercials have garnered nearly as much interest as the game itself. But again, why do games gain so much attention?

Sports games are like the raw ingredients of a big meal, as they are the core product of the sports industry, and their source of income. 

In 2021, the NFL expanded its playoff field to 14 teams, and each team had to go through Wild card round, divisional playoff round, conference championship round, and then the two conference champions advance to the Super Bowl. That’s a lot of ticket sales and commercials. 

In fact, many large-scale sports events other than the Super Bowl have business operation models behind them, and the core of this industrial chain is sports assets and fans. The game (product) is exciting to watch, and fans buy tickets and all other revenue generated by TV rights and ad sales are all the ways the sports industry, and the entertainment industry, make money. 

Let’s take a closer look at the breakdown of the Super Bowl. 

In addition to tens of millions of dollars in merchandise sales, the NFL gives a central position during the Super Bowl and to the league’s branded partnerships every year, which typically worth $1.8 billion, according to SportsPro. But this amount begins to pale in comparison in the face of broadcasting the games. In 2023, Fox will be the host among the three networks (Fox, CBS and NBC) that pay the NFL $3 billion for the rights to broadcast the games. This big money buys them the rotating right for one of them to broadcast the game. 

Also, starting from this year (2023), The league’s landmark 11-year broadcast and media distribution agreement, which expands its digital and streaming presences, cashed in about $110 billion, according to a New York Times report. 

Networks pay so much money because broadcasting NFL games is worth so much money. Last year, the half time commercials alone cost the game’s sponsors $6.5 million for each 30-second slot during the telecast. 

The Super Bowl also has a huge impact on a local economy. Events like a Super Bowl don’t come cheap, and moving the sheer volume of people and material needed for a game like this comes at a particularly high cost. In the short term, local businesses will boom. Hotels raise their rates by anywhere from 50% to 300% during the weekend of the game, the cost of getting to the big game has surged before the game as well with one of the most expensive round-trip flights notching over $6,000 from a recent search on Hopper. 

While most fans aren’t willing to spend so much money just to see the game, that doesn’t mean they’re not going to spend for the game. According to the National Retail Federation, last year’s Super Bowl generated roughly $14.6 billion in spending nationwide. The average fan will spend about $79 on food, drinks, decorats and other merchandise to celebrate the game.

2/8

Q: Are the busier people earning more than the less busy ones? 

Every day we meet all kinds of people, most of them are busy with work, but the results of work seem to be very different. Have you noticed that, for one meal, some can afford expensive high-end restaurants and eat out often, while others can only spend less than twenty bucks once in a while at a street vendor? Different income levels lead to very different consumption abilities. Are you curious about this disparity between people? What are the reasons for this disparity? These questions are difficult to answer, but economists are always looking for answers.

Cost of labor: factory worker vs engineer vs boss

Profit: distribution of the profit

Capitalism

Example:

Today, many big cities have Apple mobile phone stores. Although these specialty stores are far less popular than they were a few years ago, there are still many customers. The strange thing is that the employees of the Apple mobile phone store are not well paid, and they are not necessarily willing to buy the latest iPhone, or even use one. Why is this?

Let's first take a look at the production process of Apple's mobile phones. The assembly of iPhones is basically entrusted to Foxconn in China. Foxconn has dozens of factories in China, from Shenzhen to Jiangsu to Henan, employing hundreds of thousands of workers, many of whom contribute to iPhones. The survey data also showed that Chinese workers received extremely low returns from each iPhone. For a few bucks on an iPhone, most of the value has been taken away by Apple in the United States.

So, can we draw a conclusion - unfair value points

This is one of the reasons for the gap between the rich and the poor. In real life, we may also hear that some people have high income and some people have low income; some industries have high income and some industries have low income. What determines this phenomenon? How do adults with high incomes "make it"?

Discussion: Ways to raise your net worth

1. Education

The 2021 Nobel Prize research in Economics found that in the United States, people with 16 years of education earn 65% more than those with 11 years of education. 

2. Expertise, do what others can’t do

The second great way to make money is to have skills that no one else has. I don’t know if you’ve heard that some singers can earn hundreds of millions of dollars by opening a concert or releasing a single. This is a clear example of making money with rare characteristics. This is because these singers are so irreplaceable that the audience only recognizes their unique voice and talent. In other words, as long as there is no one to replace a job, then the person in this position can earn a huge income. The more irreplaceable this personal ability, the higher the income.

Discussion: give examples on earning differences caused by expertise

3. Cost vs Earnings

Of course, the income level is also closely related to the nature of work, which can specifically involve the work environment, work location, and work intensity. Many people only see that some people can earn high incomes, but ignore the hardships of their work. For example, work in high-altitude areas such as the Qinghai-Tibet Plateau, and engage in ocean transportation. These jobs are extremely strenuous, interfere with family reunification, and may even damage personal health. So high income often means high cost.

Discussion: What kind of life would you like to have?

4. Work more

Many of the glamorous jobs in the adult world, such as the CEO, Chairman of the Board, or Head Accountant, are the dream jobs of many college graduates. But these jobs are very demanding and stressful, and getting off work in the middle of the night or even in the early morning of the next day is the norm. Seven days a week, almost every day. Many high-income people have no family, no life of their own, no time to educate their children, or no children at all. High income does not necessarily bring happiness. The joy of going to the amusement park with your parents and playing with your friends in the community may be very difficult for them to get. 

5. Income vs expenditure

We can't generally say that a person's income is high or low, but it also depends on his expenses. If the expenditure is always greater than the income, then the income is not really high. And many people may have to maintain high consumption in order to ensure their high income.

For example, in some small towns with low wages but a leisurely life, people can choose to buy food and cook by themselves, and reduce their food costs. But in a big city like New York City, where the pace of life is hectic, people are very tired, and the cost of each person’s time is high, it is an extremely luxurious thing to be able to cook by yourself every day. People living there can only order food or go to restaurants.

Furthermore, in terms of education, the performance of groups with higher and lower time costs is also very different. For example, people who work overtime until midnight every day do not have time to take care of their children. If there is no one who is willing to help, it would be necessary to pay someone to take care of it. Looking at it this way, spending money can solve many problems, but it also brings many problems. 

6. Working for money vs Money working for you. Passive income

The income we discussed above, no matter how much it is, is salary, which people use their own time, energy, and labor to exchange for it. But there are only 24 hours a day, and so much energy one can have. Is the gap between the rich and poor mainly caused by the difference of the time and energy levels?

The answer is no.

A few years ago, the French economist Thomas Piketty wrote a very popular book "Das Kapital in the 21st Century". After studying the gap between the rich and the poor in most countries in the world, he comes to a conclusion: the gap between the rich and the poor in the vast majority of countries in the world is caused by the return on capital being greater than the return on labor. In plain words, the rich are better at investing in financial assets, so they get more capital return, which can be significantly more than wage incomes.

What are financial assets? They are stocks, bonds, futures, mutual funds, investment products, luxury goods, and real estate. When you use your money to invest in these things, they may generate more money without requiring extra labor on your part.

Today, financial assets are developing faster than anyone could have imagined. Today's gap between the rich and the poor is mainly caused by financial assets. However, one thing that cannot be ignored is that financial assets all carry risks, and the more high-yield and high-return assets, the higher the risk will be.

Therefore, we should think more deeply about income disparity. Income is not just a series of numbers, but also contains the price individuals pay for this income and the lifestyle they choose. While we pay attention to the difference in labor income, we should not ignore the difference in capital income. This is the most fundamental source of the difference between the rich and the poor in the world today.

2/3

Hi everybody! I can't believe there are only two weeks left this year! No matter if you are busy finishing finals, or trying to get some presents for family and friends, I hope that you finish the year strong and head to a bright new year!

Here are some tips you may find useful when looking back on the past, as well as planning for the future.

First and foremost, time is on our side! If you haven't tried to calculate the compound value of $1000 at a 5% yearly return in 50 years, do it now! If you invest your $1,000 at a rate of return of 5% at age of 15 and don’t do anything else for 50 years, you will have $11,467.49 when you are 65. That's the advantage of starting, saving, and investing early! If you haven't done so, plan to put saving and learn how to invest on your new year's list!

And, then we are going to talk about saving habits. Well, this is a tricky one. Why shouldn't I spend however much of my own money?! The previous paragraph gives us a very good reason to save now than later! Plus, the teenage years are ideally the time when there’s hardly any responsibility or liability, hence saving money at this stage is much easier than when you are older. Saving in a high-yield savings account, or investing the amount somewhere else. No matter how much the amount is, remember that what we save now can be much more down the road, the time is on our side!

Saving habits will not work at all if you are not conscious of your expenses. This one is pretty self-explanatory. If your expenses are high there will be nothing left for your to save!

Establish a credit history. A lot of people never thought about credit history until they need it. And it is often too late to amend the overlook. Good credit needs time to establish and plays an important role in your financial life. Not only is it essential for obvious things like qualifying for a loan or getting a credit card, but also for less obvious things like getting cellular telephone service, renting a car, and perhaps even getting a job. You may ask your parents to add you on their credit card as an authorized user, so you can open a credit file in your name. Once you have your own credit file, you will want to learn more about how the credit system work and what makes up a credit score, so you know how to be responsible and maintain a good credit score.

Be an entrepreneur.  In addition to a summer job, you may want to start an online business, or bake cupcakes and other sweet treats and open a local homemade bakery business. Or maybe you could be a camp counselor or a tutor for students in the summer. Be creative and embrace your entrepreneurship!

It’s never too early to start/it's never too late to start either. Now is the perfect time for you to take action! Look back in the year: kudos to yourself for what you have done, and take another look at what you have been planning. When the brand new year hits, you are going to be well prepared. 

Happy Holidays from USJIC!

12/18

Subject: Halloween Strategy

Hi USJIC,

I'm writing to you because I need your help. I'm trying to figure out what the Halloween strategy is. You see, I want to make some money and I think that some people are making a lot of money using this Halloween strategy. So if you know what it is, please tell me!

Thanks,

Wanna Know

Hey, Wanna Know! 

Halloween time is not only about getting candies, and the Halloween Strategy is something you can explore to make money on the stock market. It is based on the idea that stocks are more likely to rise during October than any other month. It is also known as the "Halloween effect" or "Halloween indicator."

Unlike the buy-and-hold strategy, the Halloween strategy tries to time the market.

The Halloween strategy suggests that investors should be fully invested in stocks from November through April, and out of stocks from May through October. Variations of this strategy and its accompanying axioms have been around for more than a century.

Why is it so? No one really knows! Some people say that it's because Halloween is the end of October and the beginning of November, and stocks go up at that time to prepare for Christmas. Others say it's because stocks are generally out of favor during May-October due to the lack of earnings reports, and investors have more cash during those months to buy into them at lower prices.

Does the Halloween investing strategy outperform buy and hold? Well, historical stock returns suggest that the premise of the Halloween strategy has been mostly true throughout the last half-century. 

If you want to know more, please come to our webinars for more in-depth discussion and, of course, more fun and cool things to learn!

Be curious and invest!

USJIC

11/22

Just a couple days ago, Russia invaded Ukraine from the east, the day after the Winter Olympics ended in Beijing, China on February 23th.

This has sparked panic all around the world, in fear of the beginning of the Third World War. This fear is justified, as Russia’s current diplomatic leader, Vladimir Putin, is facing almost no resistance from any countries from NATO (North Atlantic Treaty Organization), bullied NATO into not allowing Ukraine to join their treaty, and effectively prevented any major support or intervention from other countries willing to lend their support to Ukraine.

Even under the force of Russia’s army, Ukraine has held up surprisingly well -- my friend’s estimate of Ukraine’s resistance has been changed from a week to three weeks -- aided by the indirect support coming from countries such as Germany, the United States, France, the UK, and many more NATO countries have sent supplies to Ukraine such as anti-tank weapons, missile launchers, weaponry, and many more supplies. 

Fears of a third World War arising from Ukraine and Russia’s conflict with each other is understandable. Putin has stated that he will not be afraid to employ his arsenal of 6,200 nuclear weapons against any country that retaliates openly against Russia, and that number is ever growing.

In order to avoid this conflict, countries that support Ukraine have resorted to strictly non-military efforts such as sending supplies to Ukraine, and removing Russia from SWIFT, the international banking association that Russia uses to obtain money from their exports of crude oil, wheat, and rare metals.

Ukraine is currently the only open adversary Russia is facing in this war, but if other countries join the war, Russia might not be afraid to fight them as well.

The reason why one of the most effective methods of indirect opposition against Russia is removing them from SWIFT is that Russia has relied on its military to obtain their government funding. Their method is that they would take over a country, exploit it for its resources in order to make money to fund their military, and use their newly upgraded military to take over another country, restarting their cycle.

If Russia is removed from SWIFT, then they would have almost no options to sell their goods to other countries, therefore cutting off their military funding and preventing their cycle of military expansion from repeating.

As of the time this is written, US, EU, Britain just expelled Russia from SWIFT Banking System.

The only possibilities that the Ukrainian-Russian conflict could lead to a third World War include if other countries get involved and Russia retaliates against them, or if Russia begins to fight against other countries either during its attack on Ukraine or afterwards.

Either of those scenarios are possible so far, but neither NATO nor the US intend to be directly involved with Ukraine and Russia’s conflict in fear of World War Three starting, but it is possible that Russia has set its eyes on not just Ukraine, but possibly other countries in Europe, including Estonia, Latvia, and other East European countries that used to be part of or within the sphere of influence of the USSR.