There was a spate of bad news last week, and
it drove U.S. markets lower.
China’s wild ride isn’t over yet. The
Purchasing Managers’ Index, a private measure of Chinese manufacturing, came in
below expectations at 48.2, according to BloombergBusiness.
Results below 50 indicate the sector is contracting. That doesn’t bode well for
growth in China, which is the biggest global consumer of metals, grains, and
energy, or the rest of the world.
Things weren’t rosy in the United States
either. Sales of new homes in June came in below expectations, and the median
new home price fell from a year ago. That news was a U-turn from recent data
indicating strength in the housing market.
Earnings news was also less than stellar. The
Standard & Poor’s 500 Index is kind of pricey, according to Reuters, and second quarter earnings for
companies in the index were mixed. Seventy-four percent of companies beat
earnings expectations but not nearly as many delivered on expected revenues.
Earnings weren’t the only issue on investors’
minds. Last week, the Federal Reserve has signaled a September rate hike was a
possibility. This week it inadvertently released a confidential staff forecast that
included estimates for inflation, unemployment, economic growth, and the fed
funds rate. The Washington Post reported:
“Currently,
the fed funds rate is between 0 and 0.25 percent, the same level it has been
since the financial crisis hit in 2008… The staff prediction is that the
prevailing fed funds rate during the fourth quarter will be 0.35 percent.
Though there is no reference to exactly when or how that could happen, analysts
say the most likely way is for the central bank to raise its target rate in
September.”
Experts cited by Barron’s cautioned, “…it’s not the first rate hike that’s
important. It is what comes after that.” Stay tuned.
a high school degree. Companies often take an interest in
education. Some involve themselves in community outreach efforts, sending
employees to teach financial literacy or educate students about careers that
demand knowledge of a particular field of study. Others have foundations that
provide financial support to school districts.
Recently, a new model of assistance was introduced. Pathways in
Technology Early College High Schools (P-Tech) were the brainchild of New York
City, City University of New York, and a large technology company. The schools
offer a six-year educational program that combines public high school,
community college courses, and paid work experience. Students graduate with an
associate degree and it doesn’t cost them a penny of tuition.
The first six students graduated from P-Tech – two years early – in
June 2015. All received job offers from the technology company. Three accepted
and three decided to go on to college. The
Economist described one graduate, who opted for employment:
“He applies his programming and technical
skills to a digital platform that provides market research to his colleagues.
It is a good job: he makes $50,000 a year, has a health-care package, and a
pension plan. Mr. Saddler is 18 years old. He earned his high-school diploma
last month. A few weeks before finishing school, he also received an associate
degree in computer systems technology.”
Experts cited by U.S. News
& World Report explained early college high schools help bridge the gap
for students from low-income families who sometimes struggle with the
transition from high school to college or university.
Since about 30 percent of the companies in the United States
cannot fill open positions, P-Tech is an idea that’s gaining traction. More
than 70 small and large companies are collaborating with high schools and colleges
to promote the concept. Twenty-seven schools have been introduced in New York,
Connecticut, and Illinois, to date. Colorado is expected to be the next state
to follow suit.
Weekly Focus – Think About It
“Rightful liberty is unobstructed action
according to our will within limits drawn around us by the equal rights of
others.”
--Thomas Jefferson,
Third President of the United States
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