Germany may have
clobbered Brazil in the World Cup quarterfinals last week, earning a chance to
become the first European team to win the event in Latin America, but things
back home in Europe weren’t quite so rosy.
First, a sizeable
Portuguese bank startled investors when it failed to make an interest payment
on its short-term debt. Investigators have found financial irregularities at
the bank’s parent company and don’t believe the problem is systemic, according
to Barron’s.
“…but jittery
investors didn't hang around to find out the true picture. The missed bond
payment sparked an indiscriminate selloff among financials across Europe. Banks
in countries at the periphery of the euro zone were particularly hard hit, but
the ripples washed over markets at the core, too.”
In addition, Reuters reported a Spanish bank
cancelled its bond offering and Greece was only able to place one-half of its
debt issue as a wake of uncertainty about Europe’s financial system buffeted
investors.
Worries in Europe
intensified when industrial production numbers came in below expectation. In Germany,
production fell by 1.8 percent. In France, it was off by 1.7 percent, in
Britain by 1.3 percent, and in Italy by 1.2 percent. Weak industrial production
is a sign the European economy is struggling to find solid footing. By the end
of last week, European financial companies had lost 3.7 percent of their value
and the Stoxx Europe 600 Index was down 3.2 percent.
U.S. markets moved
lower last week, too, as reminders of Europe’s banking crisis renewed investor fear.
Barron’s suggested investors’
skittishness also had something to do with the fact that Standard & Poor’s
500 Index has not experienced a 10 percent correction for more than two years.
Corrections typically occur about every 25 months helping to, “…wipe out some
of the frothy sentiment, reset expectations, and prepare the way for another
move higher.”
what is the value of higher education?
does it justify the cost? It appears the value of education is in the eye of
the beholder. Aristotle thought education was about learning to think. He said,
“It is the mark of an educated mind to entertain a thought without accepting
it.” Nelson Mandela, who helped lead South Africa out of apartheid, said, “Education
is the most powerful weapon you can use to change the world.” Ben Franklin
wrote, “An investment in knowledge pays the best interest.” On the other hand, Abe
Lincoln was self-educated and Mark Twain belittled school boards.
The
cost and value of higher education have become issues for debate in recent
years. During the 2013-14 school year, the average cost of tuition, room and
board, and fees at a four-year public, in-state university was more than
$18,000 per year or about $72,000 for four years. At a four-year private
non-profit university, the cost was almost $41,000 per year or about $164,000
over four years. That’s a hefty chunk of change even without adding the
interest owed on student loans and it has left some parents and students
wondering whether it was money well spent.
James
Altucher, a venture capitalist, Cornell graduate, and father of two young
children, wrote an article questioning the value of college. He suggested young
people choose not to attend college and instead start businesses, travel the
world, and create art, among other things. He has since become one of the
leaders of the ‘anti-college’ crusade, said New
York Magazine. When asked about his stance on higher education, he told the
publication he was trying to reduce demand for college so costs would go down.
Skipping
college may not be the best idea. As it turns out, more than 98 percent of the
world’s millionaires went to college, according to a 2013 study from Spear’s magazine and WealthInsight, a consultancy group. Just
over one percent took a pass on higher education or dropped out before
graduating. The dozen colleges and universities with the most millionaire
alumni are:
·
Harvard
University
·
Harvard
Business School
·
Stanford
University
·
University
of California
·
Columbia
University
·
University
of Oxford
·
Massachusetts
Institute of Technology
·
New
York University
·
University
of Cambridge
·
University
of Pennsylvania
·
Cornell
University
·
University
of Michigan
Millionaires
who participated in the survey typically studied
engineering, business, economics, and law, although many did not pursue careers
in their fields of study. According to a Spear’s
editor, “Entrepreneurs, who ultimately end up being the wealthiest in the
world, are innovators, and the top subjects are those which encourage new and
smart thinking, whether technical or financial.”
Weekly Focus – Think About It
--Leonardo da Vinci, Italian inventor
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