Mustard Seed

What is a ‘Mustard Seed’

A mustard seed refers to an economic event that could eventually trigger economic recovery. Such events generally seem small or insignificant but could either signal or lead to broader economic growth following a recession or a bear market.

BREAKING DOWN ‘Mustard Seed’

Mustard seeds rank among the smallest seeds in agriculture but produce large trees, sometimes under adverse conditions. Historically, this has made the mustard seed ripe for metaphorical reference, including several instances in the Bible which refer to tiny seeds commonly interpreted as representing the growth of Christianity throughout the world. Larry Kudlow, formerly of CNBC and currently Director of the National Economic Council, popularized the term in the context of financial markets via opinion editorial pieces analyzing the U.S. economy’s recovery from the 2008 financial crisis.

Mustard Seeds and Green Shoots

In effect, mustard seeds describe the same phenomenon as the term green shoots, popularized by former Chancellor of the Exchequer of the United Kingdom Gordon Lamont during an economic recession in 1991. During a recession or bear market, many investors look for signs of a turnaround. When those signs can be difficult to see, investors frequently take the next logical step and look for small signs that could eventually bloom into stronger indicators of recovery. As with their agricultural counterparts, not all mustard seeds take root and not all green shoots produce full-grown produce.

For example, small changes to indices that chart consumer confidence or consumer spending, such as the Consumer Confidence Index could herald a turnaround if they represent the beginnings of a shift in spending patterns that could drive the economy toward recovery. Other signs of a distant recovery might include a rise in bank lending activity, which could indicate growth in the small business sector, in turn heralding a rise in employment activity somewhere down the road. Other business indicators, such as those included in the Purchasing Managers’ Index could provide hints that the economy has begun to stabilize or turn back toward growth.

 Difficulties of Economic Predictions

U.S. Federal Reserve Chairman Ben Bernanke famously described what he considered to be green shoots in the U.S. economy in 2009. Instead of a quick recovery to robust growth, however, the indicators Bernanke saw led to a much slower and more protracted period of recovery. For better or worse, mustard seeds and green shoots become much easier to identify in hindsight than in real time, when it can be almost impossible to determine whether a hopeful sign will actually bear fruit.


What is a ‘Transumer’

Transumers are customers whose purchasing decisions value experience over ownership. Marketers often target transumers by offering products on a rental basis or in situations uniquely conducive to a spontaneous purchase.


Transumers represent a growing cultural trend, driven in part by an expansion of business travel. The global marketing firm Fitch first coined the term to describe travelers passing through airports. Such travelers become a captive market as they wait for flights. Fitch considered such travelers to be in transition, with a mindset driven by the experiential expectations of travel. This mindset creates a marketing sweet spot for short-term expenditures that consumers perceive to enhance their experiences.

Corporations have increasingly begun to target transumers by offering to rent products that enhance an experience. Transumers typically have short attention spans and are younger than traditional consumers. Their orientation toward experience makes them more likely to rent items they see no need to own, but which they desire over the short term.

The Evolution of Transumer Culture

Travelers in particular may dislike the idea of making a purchase in an airport that they then must carry to their destination and then back home. Rental cars and lodging at destinations have long appealed to the attitude behind transumerism, as few travelers wish to deal with the hassle of purchasing real estate or transporting an automobile for a short-term business trip or vacation. In targeting transumers, marketers have simply expanded the array of items available. Within the travel sector, some airports and train stations offer short-term rentals of consumer electronic equipment, such as personal video game or movie players that travelers can rent prior to departure, use in transit and return at their destination. Airlines, travel agencies and tourist concerns have discovered that travelers often plan future trips while en route to a current destination, making them better targets for pitches that focus on new and unique experiences.

Marketers have pushed these ideas further, suggesting consumers value experience over ownership at other points in their lives as well. Some have suggested transumers represent a new economic trend entirely, as the growing market for transient products and experiences creates additional incentives for renting over owning. For example, some marketers suggest that regular consumers may shift to being transumers as they discover outright ownership can be cost prohibitive to a here and now feeling. A depressed economy, space considerations and concern over the generation of unnecessary post-consumer waste may also result in similar shifts.

Lending Freeze

What is a ‘Lending Freeze’

A lending freeze occurs when banks implement requirements around loan qualifications to reduce the number of new loans they underwrite. Banks use such methods to protect their capital and risk exposure.

BREAKING DOWN ‘Lending Freeze’

A lending freeze protects bank capital at the expense of reduced loan availability for consumers and businesses. Banks track their credit risk when making decisions about whether or not to issue loans. As credit risks rise, banks generally issue new loans at higher interest rates to cover the potential for increased default rates. When risks rise quickly or affect certain subsets of potential creditors, banks may opt to effectively freeze lending to those groups until the perceived credit risk of new lending falls back into line with bank policies. As a result, borrowers considered a high credit risk will have less access to loans during the freeze, and therefore may find themselves unable to secure a mortgage, an automobile loan or business loans. These in turn can have a negative impact on other economic factors such as hiring and business expansion.

Examples of Lending Freezes

Among consumers and business banking clients, most lending freezes actually resemble more of a credit squeeze as banks generate more stringent loan underwriting requirements rather than denying loans flat out. The effect remains the same as certain types of lenders struggle to obtain loans. For example, a downturn in the economic prospects of a specific industry might cause banks to tighten restrictions on lending to small businesses attempting to enter those markets.

In other cases, credit squeezes protect bank capital in risky economic situations. After the financial crisis of 2008, many banks took a risk-averse position on lending in general. The resulting credit squeeze made it significantly more difficult for businesses that depended heavily on loans, such as smaller, more innovative companies without alternative funding or strong recurring revenue streams.

When banks actually do halt lending entirely, the consequences can become more severe. After the fall of Lehman Brothers in 2008, for example, many banks lost confidence in other financial institutions involved in interbank lending, which plays a key role in generating the liquidity necessary for banks to function smoothly. As banks began to freeze lending to one another, central banks in Europe and the United States perceived enough risk to issue loans themselves in order to stabilize the interbank markets.

Lending Freeze Compared to Credit Freeze

While the terms sound similar, in common usage lending freezes and credit freezes refer to different activities. Where lending freezes deal with bank lending, a credit freeze offers consumers a mechanism for securing their credit information by halting access to new credit requested in their name.

Unitary Thrift

What is a ‘Unitary Thrift’

A unitary thrift is a chartered holding company that controls a single thrift entity. Historically unitary thrifts could engage in a broader range of activities than bank holding companies, however they have come under increasing restrictions since the 2008 financial crisis.

BREAKING DOWN ‘Unitary Thrift’

Unitary thrifts, also known as savings and loan holding companies, or SLHCs, are a type of holding company that mainly holds assets in thrift investments. Thrift institutions, also known as savings and loan associations, offer a narrower range of products than other financial institutions. Their focus on customer and community service typically means they deal in traditional basic banking products such as savings and checking accounts, home loans, personal loans, automobile loans and credit cards.

Regulatory History

Because thrifts tended to serve customer needs rather than investor desires, they initially operated under less regulatory oversight in the U.S. Prior regulatory regimes allowed unitary thrifts to open branches anywhere in the U.S. Unlike major banks, unitary thrifts could allocate up to 20 percent of their assets to commercial loans as long as they continued to hold at least 65 percent of their assets in qualified thrift investments, such as residential mortgages or mortgage-backed securities.

In the 1980s the savings and loan industry underwent a crisis after thrifts engaged in risky financial activities in an attempt to cover losses caused by depositors who moved their cash from thrifts to money market funds as interest rates boomed in the late 1970s. By 1989, much of the industry had collapsed after failed thrifts caused the insolvency of the Federal Savings and Loan Insurance Corporation, or FSLIC, which insured deposits.

The Financial Services Modernization Act of 1999, also known as the Gramm Leach Bliley Act, forbid the Office of Thrift Supervision, or OTS, from accepting any new applications for unitary thrifts. Since that time, the federal government has increased restrictions on the remaining unitary thrifts. The passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act in 2010 eliminated the OTS, which suffered from implications of wrongdoing in the collapse of IndyMac and the failure of AIG during the 2008 financial crisis. Dodd-Frank passed supervision of grandfathered unitary thrifts to the Federal Reserve Board.

Savings and Loan Ownership Structures

Unitary thrifts represent one of the two ownership models for savings and loan companies. Under a mutual ownership structure, depositors and borrowers receive part ownership of the savings and loan when they engage in business with the company. Unitary thrifts offer a smaller group of investors a way of controlling a savings and loan through purchase of stock in the holding company that owns the thrift.

Jack Ma’s Ant Raises $14 Billion

HONG KONG—Jack Ma’s financial-technology giant has solidified its position as one of the world’s most valuable private companies.

China’s Ant Small and Micro Financial Services Group Co. on Friday said it raised around $14 billion from domestic and global investors in one of the largest private-capital raises on record.

The share sale—Ant’s third in three years—was met with strong demand and drew many high-profile investors who are expecting Ant to go public in the next year or two.

The funding round valued Ant at around $150 billion, according to people familiar with the matter. It also marks the first time foreign investors could buy stakes in the Hangzhou-based company.

Foreign investors included Singapore and Malaysia’s sovereign-wealth funds, as well as global private-equity funds Warburg Pincus, Carlyle Group LP, Silver Lake, General Atlantic and Primavera Capital. Mutual fund giant T. Rowe Price and the Canada Pension Plan Investment Board also participated in what Ant said was a U.S. dollar-denominated tranche of its financing raised by an offshore subsidiary.

Existing Chinese investors in Ant provided funds for a yuan-denominated tranche the round, the company said. Ant raised $11 billion in the U.S. dollar portion of its fundraising and $3 billion from domestic investors, and both tranches were oversubscribed, according to people familiar with the matter.

Investors who bought stakes in Ant had to commit to some unusual terms—such as agreeing not to provide capital to Ant and Alibaba’s major rivals, including startups backed by Tencent Holdings Ltd. and online retailer Inc., The Wall Street Journal previously reported.

Ant, which was carved out from Alibaba Group Holding Ltd. in 2011, owns and operates Alipay, China’s largest online and mobile payments network. The company has large consumer and small-business lending operations, oversees the world’s largest money-market mutual fund and runs a fast-growing technology-services business. Ant has grown rapidly in recent years by providing financial services to people and companies that traditional banks have ignored. Mr. Ma, who founded the company, is its controlling shareholder.

Eric Jing, Ant’s executive chairman and CEO, said in a statement that Ant plans to “accelerate” its growth strategy and the company will continue to invest in technology to provide financial services to more people and small businesses in China and abroad.

In the year to March 2018, Ant said Alipay and its global partners together served around 870 million “annual active users” globally and more than 15 million small businesses in China.

Ant’s previous funding round in the summer of 2016 valued the company at $60 billion. Last year Ant reported $2 billion in pretax profits, but posted a first-quarter loss early this year because of heavy spending on marketing and customer-acquisition costs.

Write to Stella Yifan Xie at and Julie Steinberg at

Appeared in the June 8, 2018, print edition as ‘Ma’s Ant Shows Again It’s A Giant.’

After 44 years, Washington Capitals win first Stanley Cup title

Jubilant fans celebrated in the streets of Washington on Thursday night, as the Capitals won their first Stanley Cup championship in the franchise’s 44-year history.

The Capitals rallied in the final period Thursday to beat the Vegas Golden Knights, 4-3, in Game 5, to win the best-of-seven series, four games to one.

Playing in front of a loud home crowd in Las Vegas, the Golden Knights took a 3-2 lead into the third period, but a sprawling shot by Devante Smith-Pelly tied it up, and a rebound goal from Lars Eller put the Caps ahead with less than 8 minutes to go.

Long-suffering Capitals fans, clad in red, packed streets in the nations capital, and celebrated the victory well into the night.

It was the Caps’ 28th playoff appearance, but they had only made the finals once before, losing to Detroit in 1998.

The Golden Knights, an expansion team who stunned the league by winning 51 regular-season games, lost four games in a row for the first time this season.

Thirteen-year veteran Alex Ovechkin, who scored a second-period goal, won the Conn Smythe Trophy as the postseason MVP. It was his first NHL championship.

It was also the first championship for Washington in any sport in 26 years.

Stitch Fix Inc Stock Up as Q3 Revenue Soars 29%, Tops Expectations

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Stitch Fix Inc (NASDAQ: SFIX ) reported its latest quarterly earnings results after the bell Thursday, which were well ahead of what analysts were calling for.

Stich Fix Inc Source: Wikipedia

For its third quarter of fiscal 2018, the online subscription and personal shopping service announced revenue of $316.7 million , which was better than the $306.4 million that analysts were calling for. The figure was also a 29% improvement compared to its year-ago sales totals.

On the earnings front, Stitch Fix also impressed with an adjusted profit of 9 cents per share. The figure was triple what the Wall Street consensus estimate was calling for at 3 cents per share.

For the period, its cost of goods sold reached $178.5 million, up from the 43% it had in the third quarter of fiscal 2017. Its advertising spending reached $25.2 million, an improvement over the $21.3 million from the third quarter of 2017.

Stitch Fix’s advertising spending was $25.2 million, up from the $21.3 million from the year-ago quarter. The company’s active client base reached 2.7 million by the end of the quarter, a 30% improvement from the year-ago total of $2.5 million.

For its fourth quarter of fiscal 2018, Stitch Fix projects revenue in the range of $310 million to $320 million (midpoint guidance of $315 million), ahead of analysts’ expectations of $314 million.

SFIX stock fell about 4.7% during regular trading hours, but soared about 6% after the bell on its earnings beat.

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Referenced Symbols: SFIX

Doubts Emerge About Whether Oculus Connect 5 Will Positively Impact Facebook, Inc.

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If any company needs a positive distraction, it’s Facebook, Inc. (NASDAQ: FB ). From the eyes of the general public, the social media giant is still reeling from the Cambridge Analytica fiasco. In particular, political pundits accuse Facebook of helping to elect a decidedly unpopular President. The recent Oculus Connect 5 announcement couldn’t have come at a better time.

Oculus, the FB-owned virtual reality company, hosts an industry conference called Connect every year. This latest entry will occur on Sep. 26-27 in San Jose, California, home to tech-savvy entrepreneurs and businesses. On the agenda is a recap about the previous five years in VR innovations, and what Oculus fans can expect over the next five years.

Facebook eagerly anticipates strong media coverage and the opportunity to set the tone for its entire organization. While the primary social media business isn’t going away anytime soon, CEO Mark Zuckerberg clearly wants to diversify and “de-leverage.” Like any visionary leader, Zuckerberg doesn’t want to limit his company to any one industry.

For instance, Facebook spent considerable time developing its  smart-speaker products . Code-named Aloha and Fiona, FB will go head-to-head against Alphabet Inc (NASDAQ: GOOG , NASDAQ: GOOGL ) and market-share leader, Inc. (NASDAQ: AMZN ).

It’s a remarkably ambitious move as Amazon and Alphabet combined for nearly 88% global market share in the fourth quarter of 2017.

That’s not all. In another show of force against Alphabet and its YouTube platform, Facebook signed a licensing deal with Sony Corp (ADR) (NYSE: SNE ). Under the agreement, FB users can post music from the Sony/ATV catalog in videos uploaded to Facebook’s platforms, which include Instagram and Oculus.

Therefore, Oculus Connect 5 demonstrates that Facebook isn’t a one-trick pony. However, the challenge remains proving relevancy.

Can Oculus Connect Spark Momentum for Facebook?

Make no doubt about it: VR technology is very much relevant. The platform represents the next step forward in video gaming and other media formats. That said, the question is whether VR will be a winner for Facebook.

It’s more than a fair inquiry. No one questions the company’s dominance in social media. Twitter Inc (NYSE: TWTR ) and Snap Inc (NYSE: SNAP ) have both made strides, but they can’t touch Facebook’s growth and user base. Yet when it comes to expanding to other businesses, FB has a mixed record.

One of the company’s biggest acquisitions is Instagram. The photo-sharing app provides Facebook an in with the younger crowd. So far, Instagram is doing its job as advertised. Still, in terms of overall dominance, Snapchat resonates with teenagers and young adults at an untouchable magnitude.

And as impressive as Oculus is, the VR company isn’t quite living up to expectations. Don’t get me wrong: VR enthusiasts love what Oculus is brewing. For example, in last year’s Connect 4 conference , the FB-owned firm unveiled the Oculus Go.

Physically a stand-alone device that doesn’t require being tethered to a separate device, the Go costs only $200. It truly is the VR platform for the masses. So, where are the masses?

Industry experts forecast that Sony’s VR device shipments will take 40% market share . Those same experts believe that Oculus will take half that figure at 20%. HTC Corp is expected to bring in 12% market share, while Microsoft Corporation (NASDAQ: MSFT ) may take 8%.

If Oculus resonated with customers, their market share would be much higher. Moreover, CNBC contributor Todd Haselton argued that no compelling reasons are readily available to justify Oculus’ VR headsets. They’re platforms seeking a reason to exist.

Right Attitude, Wrong Technology?

We also know that Oculus has been struggling because it’s constantly experimenting with price points. If the demand was there, the company wouldn’t have to entice customers to consider its innovations.

Which brings me to my final point: I love Facebook’s attitude, but it’s probably chasing the wrong technology.

For whatever reason, virtual reality doesn’t jive with the social media experience. Haselton brought up Altspace VR, a relatively popular social VR platform. However, the company shut down last August due to poor demand. Microsoft later acquired the company, but we’ll see if the acquisition is worth it.

At this point, I have much more faith in Facebook’s smart-speaker systems. With Aloha and Fiona, it can organically utilize the Facebook network, which is a data goldmine. After all, that’s the reason why Cambridge Analytica wanted access.

But with VR, I’m not sure what the endgame is. Yes, Oculus has the right stuff, but without compelling, practical applications, the products will collect dust. I’d like to be proven wrong on this as I’m generally bullish on FB stock. However, the evidence indicates that VR detracts from Facebook’s more-promising ventures.

As of this writing, Josh Enomoto is long SNE.

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The Top 6 Reasons Americans Tap Their Emergency Funds

Have you ever pulled out of your driveway only to see your “check engine” light start flashing? Or woken up to the sound of a water leak that’s been wreaking havoc on your home for the past 30 minutes? Scenarios like these arise all the time, and they’re not only inconvenient, but expensive.

In fact, there are a host of unplanned expenses that can pop up out of nowhere and cause us undue stress if we don’t have the money to pay for them. And that’s why every single one of us needs an emergency fund , whether it’s to cover an unexpected bill or a period of joblessness. Ideally, our emergency funds should contain enough money to cover six months of living expenses, with three months of expenses being the minimum threshold to aim for.

Woman holding a bucket while water pours from the ceiling


Of course, once you have that safety net in place, the question becomes: When do you use it? What constitutes a true financial emergency? GOBankingRates did some digging to see why Americans wound up tapping their emergency reserves, and here’s what they found:

Reason for Accessing Emergency Fund Cash

Percentage of Americans Who Tapped Emergency Funds for That Reason

Major household repairs


Auto expenses


Medical bills


Job loss


Cost-of-living increases


Having to move



These are things that can happen to any of us. We can all do our best to maintain our homes and vehicles only to have them age or break down. We can work to keep ourselves healthy, but get hurt and wind up with an extended hospital stay and a string of bills to boot. (In fact, medical debt is actually the No. 1 source of personal bankruptcy filings in the country.) And no matter how many hours a week we work, or what we accomplish on the job, we can’t discount the possibility of falling victim to layoffs at some point in time or another.

The point is that most of the above reasons are pretty valid ones for raiding an emergency fund, and they’re also not that uncommon, which underscores the importance of having those cash reserves handy. So, if you’re behind on emergency savings, you’d be wise to make boosting your bank account your top priority in the near term.

Building your emergency fund

It’s a frightening statistic that 55% of Americans don’t have enough money on hand to cover six months’ worth of living costs. The problem, though, is that those same folks risk racking up costly debt the moment a catastrophic expense creeps up. If you’d rather not subject yourself to that sort of financial upheaval, you’ll need to focus on building some cash reserves.

You can start by examining your budget , identifying ways to cut corners, and using the cash you free up to find your emergency savings. (And if you don’t have a budget, create one immediately.) Maybe that means downsizing your living space to lower your rent, or curbing your leisure spending until you’ve made progress savings-wise. It doesn’t really matter what expense, or expenses, you slash as long as you do something to ensure that you’re able to put money away from each paycheck.

Another move you might consider is working a side hustle and using the cash you earn from it to build savings more quickly. The beauty of getting a second gig is that your earnings aren’t earmarked for existing expenses. Rather, you’re getting bonus cash in hand that you should have no problem sticking directly into the bank.

Finally, be smart when unexpected money lands in your lap. If you get a generous cash gift from a relative or a bonus at work, resist the urge to blow through it and instead apply it to your emergency fund. All of these steps will help you build that safety net more quickly, thereby reducing your chances of getting caught in a tough financial spot.

Remember, you don’t need to establish your emergency fund overnight, or even within a couple of months. Just work on slowly but surely building your savings so that when an emergency does strike, you’re better prepared for it.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

ACCRA Cost Of Living Index – COLI

What is the ‘ACCRA Cost Of Living Index – COLI’

The ACCRA Cost of Living Index is a dataset containing key living costs compiled by the Council for Community and Economic Research. Economists can use the index to make an apples-to-apples comparison of the cost of living between two different urban areas in the United States.


The ACCRA Cost of Living Index is a quarterly publication put out by the American Chamber of Commerce Researchers Association and the Council for Community and Economic Research. The index uses a set of broad categories calculated based upon consumer spending on groceries, housing, utilities, transportation, health care and a miscellaneous collection of goods and services that do not fit under other categories. The composite index weights costs based upon spending patterns identified in households with mid-management income, as measured by government surveys.

Price comparison data exist within the index for over 300 U.S. cities, aggregated by county and by metropolitan statistical area.

Using the COLI

The index publishes a national average for the cost of each item in a category and extrapolates an expected expenditure by various family types in a specific area based on the variance from the national baseline across categories. For example, the index looks at a variety of staple grocery items to generate its overall category expenditure, including items such as ground beef, eggs, bananas, coffee and facial tissues. Average rental costs for apartments and average home sale prices yield a cost for housing. A similar approach across categories led to a national average of $5,976 per month in 2017 for a husband and wife with children under six years of age.

Job seekers and human resources departments can use the ACCRA Cost of Living Index to compare salaries and salary requirements in different parts of the country by looking at the deviation from average in a given area. Apartment rent averaged $1,037 per month on a national level in 2017 according to the index, significantly lower than the rent one might pay in Manhattan or other major coastal urban areas. Employers might use COLI data to ensure their pay remains competitive with salaries in other areas or to ensure that job seekers considering a move understand how much farther their take-home pay would go.


The ACCRA Cost of Living Index provides points of comparison between two geographic areas at a single point in time. It has little statistical value in terms of tracking prices over time, or charting inflation, however. For those interested in measuring inflation, the U.S. Bureau of Labor Statistics publishes the Consumer Price Index, which uses a somewhat similar approach to capture changes in cost of living over time.

Economic Tsunami

What is ‘Economic Tsunami’

An economic tsunami is a widespread set of economic troubles caused by a single significant event. The downstream effects of economic tsunamis generally spread to broad geographic areas, multiple industry sectors or both.

BREAKING DOWN ‘Economic Tsunami’

Economic tsunamis take their name from natural tsunamis, which are abnormally large waves triggered by a disturbance to the ocean floor, such as an earthquake. The resulting wave causes widespread destruction as it reaches shore and floods low-lying coastal areas. Likewise, economic tsunamis generate destructive effects beyond the geographic area or industry sector in which the triggering event takes place. These consequences can illustrate previously undetected connections between parts of the global economy that create a ripple effect only under extreme stress. Depending on the severity of the consequences and the mechanism by which they spread, economic tsunamis can lead to new regulations as markets attempt to adapt to mitigate or prevent a future recurrence under similar conditions.

Example of an wconomic tsunami

The 2008 global financial crisis sits among the most prevalent recent examples of an economic tsunami. The subprime mortgage market in the U.S. acted as a trigger in this case, as large investment banks miscalculated the amount of risk in certain collateralized debt instruments. Unexpectedly high default rates led to large financial losses in portfolios with high credit ratings, which triggered massive losses for highly leveraged investments made by financial institutions and hedge funds. The resulting liquidity crunch spread rapidly beyond the subprime mortgage market. In response, the U.S. government took over secondary mortgage market giants Fannie Mae and Freddie Mac, while Lehman Brothers filed for bankruptcy. Losses at Bear Stearns and Merrill Lynch led to acquisitions of those firms by JP Morgan Chase and Bank of America, respectively.

Foreign banks also suffered losses through investments affected by the economic crisis. Iceland’s banking sector suffered a nearly complete collapse following the subprime crisis, tanking the nation’s economy. In the United Kingdom, the British government stepped in to bail out its banking sector. The U.S., U.K. and Iceland all undertook varying degrees of regulatory reform following the crisis. Iceland’s economy essentially reinvented itself to rely more heavily upon tourism than on international banking. The U.S. introduced a range of regulatory controls via the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, as well as the Housing and Economic Recovery Act of 2008. Many of these regulations strengthened oversight of mortgage lending. The U.K. response included introduction of the Financial Services Act in 2012.

Asia Markets: Asian markets slide lower, dragged by tech stocks

Asian markets were drifting lower in early Friday trading, with China and Hong Kong leading the way with declines around 1%. Korea and Taiwan were down about half that level, following the pullback in the fellow tech-heavy Nasdaq in the U.S. overnight.

Chinese stocks added to Thursday’s weakness, extending recent underperformance in the region. The Shanghai Composite
SHCOMP, -1.25%
  was off 0.9% in early trading, dragged down by real estate, financials and utilities. Small caps were down similarly despite news that the U.S. has reached a deal with China to allow ZTE to get back to business.

In Hong Kong, the Hang Seng
HSI, -1.28%
  was off 1.1% after logging a sixth-straight day of gains Thursday. Tech giant Tencent
0700, -2.89%
  fell more than 2%.

The yen pulled back some following overnight gains as risk aversion cooled again. The dollar
USDJPY, +0.00%
 reached session highs of ¥109.85 versus ¥109.75 at Tokyo’s stock-market open. Still, the Nikkei
NIK, -0.32%
 was trading down slightly.

South Korean stocks
SEU, -0.52%
 dropped, with Samsung Electronics
005930, -1.48%
  down more than 1%. Singapore
STI, -0.52%
 , Taiwan
Y9999, -0.76%
  and Australia
XJO, -0.08%
  also fell.

The Wall Street Journal: Amazon buys rights to some Premier League soccer games in U.K.

LONDON — Inc. raised its bet on live sports programming, buying the rights to broadcast a package of soccer games from the most popular sports league in the world, the English Premier League.

The broadcasting rights are limited to Britain, where viewers will be able to watch a small selection of 20 games a season on the company’s Amazon Prime video service. But the move represents a significant boost to Amazon’s so-far modest foray into live sporting events.

The company has disrupted handfuls of industries — from health care to the grocery business. Now, it could start chipping away at the power of traditional broadcasters that have long dominated sports broadcasting.

AMZN, -0.38%
  package of games won’t necessarily include any of the league’s marquee offerings, and it only covers two rounds of play. One is in the middle of the week and one on the Dec. 26 Boxing Day holiday. The Premier League is the only major league in Europe to schedule games that day.

An expanded version of this report appears on WSJcom.

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New tax laws have home buyers checking new places.

How Kevin Durant’s shot explains the NBA finals., Inc. Looks to Take Over France With Alexa

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If you’ve followed my work over the past few years, you know that I’ve been consistently bullish on, Inc. (NASDAQ: AMZN ). Honestly, how could you not be?

Rarely have we seen companies so dominant, yet maintain the same hunger as if they’ve just entered the game, looking to make a name for themselves. And with their smart-speaker artificial intelligence platform Alexa, Amazon again changed the calculus.

It’s hard to believe that the company started life as an online book retailer. Back then, their biggest concern was to provide the means to access information. Actually obtaining the actual information (i.e., reading) was left up to the customer.

With Alexa, which is featured in the Amazon Echo series of digital personal assistants, AMZN provides the information: live, on-demand, and about anything, so long as what’s asked falls under Alexa’s parameters.

Hence, I believe Amazon bringing Alexa to France is a game changer. On Tuesday, French customers can preorder the Echo, Echo Dot and Echo Spot. The first two models will start shipping the week beginning June 10. The Echo Spot, which prominently features a digital screen interface, has a ship-out date sometime in July.

With a population of 65.2 million, France is big – for a European country. On paper, it doesn’t appear that this Alexa preorder event is particularly newsworthy, or even interesting. After all, France merely joins a growing list of countries which Alexa has integrated, including the U.K., Australia, India, New Zealand, Germany, Japan and Ireland.

More to the point, AI rival Alphabet Inc (NASDAQ: GOOG , NASDAQ: GOOGL ) has already penetrated the French market last year. If anything, Amazon is technically late to the game integrating Alexa. Plus, you’ll soon have Facebook, Inc. (NASDAQ: FB ) and Apple Inc. (NASDAQ: AAPL ) barreling in.

That, however, suits AMZN’s management just fine.

What’s So Special About Alexa Taking Over France?

I’ve visited France a few times, and I have a nuanced perspective on the people and culture. Stereotypically, Americans view the French as snobby and arrogant, and perhaps that’s somewhat true. But we also have to be fair: many American tourists act in such a way to deserve that response.

What’s my point? French customers aren’t going to accept a dumbed-down version of Alexa. They want a platform that not only speaks the language in a technically grammatical sense, but also colloquially.

Admittedly, that attitude isn’t different from other nations’ customers. However, as The Guardian notes, the French are exceptionally proud of their language as it’s rooted in national identity .

And why not? As my friend and former InvestorPlace colleague Kyle Woodley might say, it’s the most beautiful language in the world.

That Amazon believes so much in its Alexa platform to decisively take over the French market speaks volumes. Even being one year late compared to Alphabet doesn’t bother it much. In the fourth quarter of last year, Amazon’s smart speakers held almost 52% of global market share . Alphabet is still considerably behind at nearly 36%.

More importantly, French President Emmanuel Macron outlined his administration’s AI initiative earlier this year. His goal is to have his nation become a leading AI hub. further notes :

“Some of the best mathematics and engineering schools are in France, and some of the best data scientists and AI researchers come from France. Many of them now work in California or London for Facebook, Deepmind, etc. And the French government wants to capitalize on that soft power to make an AI push.”

It’s only natural that AMZN wants a piece of the French pie. And you know what? It’ll get it.

Amazon Bamboozles the Competition

Here’s the perplexing thing for Amazon haters, if such people exist. Major tech companies throughout the world are eyeing opening offices in France.

We’re talking IBM (NYSE: IBM ), Microsoft Corporation (NASDAQ: MSFT ), Samsung Electronics Co Ltd (OTCMKTS: SSNLF ) and Fujitsu Ltd (ADR) (OTCMKTS: FJTSY ). Facebook and Google are already there. Yet it’s an online bookstore that’s beating them all to the punch.

It’s not just about who has the best AI technology. If that was the sole criteria, I’d rather go with IBM. All it does is technology. In contrast, Amazon has to sell books, groceries and anything else that this planet wants.

But Amazon understands the difference between AI for technology’s sake, and AI that serves practical needs. In this regard, AMZN stands alone. Moreover, Alexa has a logical path to monetize their platform. For example, if an Alexa user is looking to purchase something, of course it will direct that person to

All this to say that Amazon is taking their time to get things right from the first try. Books were invented long before the e-commerce giant arrived. So too were groceries. That didn’t stop Amazon from radically transforming them. Why wouldn’t we expect them to do the same for AI?

As of this writing, Josh Enomoto did not hold a position in any of the aforementioned securities.

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Should You Buy the ‘Twitch of China’ Huya Inc as It Surges on Earnings?

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On Tuesday, Huya Inc – ADR (NYSE: HUYA ) reported its first earnings result as a public company. Quite frankly, the results were very impressive in my mind. Huya stock first spiked in after-hours trading but found itself slightly lower in Wednesday’s trading session.

Is the market missing something or simply digesting the large rally over the past few weeks?

Sometimes it’s better to be lucky than good. With these mid-cap Chinese stocks, that’s precisely how I stumbled into them.

About a month ago, Berkshire Hathaway Inc. (NYSE: BRK.A , NYSE: BRK.B ) hosted its annual shareholder meeting in Omaha, Nebraska. Warren Buffett’s right-hand man Charlie Munger said he believes that many American investors are overlooking the huge potential in China.

Why? That reasoning isn’t clear, but probably because China has a completely different culture in a completely different part of the world. Investors simply aren’t familiar with it, so they look to what they know.

But after watching the annual meeting, I started taking a deeper look at Chinese stocks. First I combed over names I knew well like Baidu Inc (ADR) (NASDAQ: BIDU ), Alibaba Group Holding Ltd (NYSE: BABA ) and JD.Com Inc (ADR) (NASDAQ: JD ).

Then I stumbled into the mid-cap range and began investigating stocks new to me, like iQIYI, Inc (NASDAQ: IQ ), Sogou Inc (NYSE: SOGO ) and finally, Huya stock.

What Is Huya?

Huya is being referred to as the “Twitch of China.” For those that don’t know what Twitch is, it’s a live-streaming gaming platform now owned by, Inc. (NASDAQ: AMZN ). And yes, people really do  tune in to watch people play video games live, and yes, it really can  generate sales and profits.

Huya stock has already more than doubled from its $12 IPO price from less than a month ago. With its – at the time – market cap of less than $4 billion, investors frantically bid the stock higher as names like IQ – “the Netflix, Inc. (NASDAQ: NFLX ) of China ” – BABA and SOGO were in demand as well.

Now investors are trying to sort out where these smaller Chinese stocks should trade. Even though they have bright futures, many are up 50%, 60%, 100% or even more over the past few weeks and months.

In Huya’s case, the company turned in a pretty solid quarterly report on Tuesday evening. Revenue of $134.5 million soared 111% year-over-year, while the company turned a slight profit of $5 million. This is vs. a loss in the same period last year, and by the way, this profit is on a GAAP basis. It’s good to see both sales and earnings moving higher.

Daily active user growth grew 25% YOY, outpacing monthly active user growth of 19.2% in the quarter. This shows engagement on the platform is strong, as more users are logging in daily to see what’s going on. Huya now sports more than 92 million total users on streaming platform.

Pretty impressive for a now-$6-billion, profitable company with triple-digit revenue growth. Can you see why investors are bidding up Huya stock now?

Trading Huya Stock

Huya stock has been on fire, but there’s just one problem: there’s not much chart to use!

chart of Huya stock price
Click to Enlarge

After pricing its IPO at $12, Huya stock began trading on May 11. We don’t have any major moving averages to go off of, and there are no reliable trend lines to base our levels on.

A few areas of support and resistance did stand out, though, particularly when Huya stock was trading around $19 and $23. When applying the Fibonacci levels, these areas became clear retracement levels.

So what does it mean for investors looking to buy Huya stock? A pullback down to the $23 area would be great and would give investors a solid risk/reward opportunity to grab some of this red-hot stock.

Conversely, more aggressive bulls may want to consider buying on a pullback into the mid-$27 range, which has been holding up lately. SOGO, IQ and HUYA are consolidating lately, and it’s not clear which will come first: a pullback or another rally.

Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell . As of this writing, Bret Kenwell was long IQ and SOGO.

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Why Nektar Therapeutics Stock Stumbled 11.8% Today

What happened

After getting hammered following a disappointing update on the efficacy of NKTR-214 in cancer patients, shares in Nektar Therapeutics (NASDAQ: NKTR) rebounded following a bullish presentation by management at an investor conference on Wednesday. Today, investors used yesterday’s bounce as an opportunity to sell, and as a result, shares lost 11.7% of their value.

So what

After reporting impressive results for NKTR-214 in solid tumor cancers last year, Bristol-Myers Squibb (NYSE: BMY) inked a blockbuster deal to license rights to NKTR-214.

A man in a suit sits with his head in his hands in front of wall showing a declining share price.


In that deal, Bristol-Myers received 35% of NKTR-214’s potential profit in exchange for $1 billion upfront. Bristol-Myers also agreed to pay Nektar Therapeutics up to $1.78 billion in milestones and bought $850 million in Nektar Therapeutics shares.

Optimism shifted to pessimism when Nektar Therapeutics updated NKTR-214’s efficacy at the annual American Society of Clinical Oncology (ASCO) last week. The data reported last year showed a 64% overall response rate (ORR) in melanoma patients who were given NKTR-214 and Opdivo, but the data at ASCO showed that the ORR fell to 50% after more patients were enrolled in the trial.

Some concerns were alleviated Wednesday when management told investors at Jefferies Healthcare Conference that Bristol-Myers was advancing NKTR-214 into phase 3 studies in melanoma, kidney cancer, and bladder cancer. Furthermore, it said it hasn’t given up yet on pursuing partners for NKTR-181, a novel pain drug that it filed for Food and Drug Administration (FDA) approval of last month.

Now what

NKTR-181 could be an important new alternative to traditional opioid pain medications because, unlike drugs like Oxycontin, it passes through the blood brain barrier slowly to avoid the euphoric highs that can lead to addiction and opioid abuse. Investors had given up on the likelihood of a licensing deal on NKTR-181 after Nektar said earlier this year it was filing for approval on its own. Therefore, the resurfacing of the potential for a deal is bullish.

Nevertheless, investors are taking a more measured view of the company’s opportunity today. Yes, someone could license NKTR-181, but there’s considerable uncertainty surrounding the opioid class of drugs, and that may keep bidders at bay. More importantly, until there’s data showing ORR has stabilized for NKTR-214, investors are likely to worry that it will end up falling shy of previous sky-high expectations.

Overall, while Nektar Therapeutics’ share price has been more than cut in half since its peak in March, its market cap still is above $9 billion. That’s arguably a bit rich given the question marks associated with NKTR-181 and NKTR-214.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Cross-Currency Swap

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What is a ‘Cross-Currency Swap’

Cross-currency swaps are an over-the-counter derivative in a form of an agreement between two parties to exchange interest payments and principal denominated in two different currencies. In a cross-currency swap, interest payments and principal in one currency are exchanged for equally valued principal and interest payments in a different currency. Interest payments are exchanged at fixed intervals during the life of the agreement.

Since the two parties are swapping amounts of money, the cross-currency swap is not required to be shown on a company’s balance sheet.

Breaking Down the ‘Cross-Currency Swap’

A cross-currency swaps is used to take advantage of comparative advantages. For example, if a U.S. company is looking to acquire some yen and a Japanese company is looking to acquire U.S. dollars, these two companies could perform a swap. The Japanese company likely has better access to Japanese debt markets and could get more favorable terms on a yen loan than if the U.S. company went in directly to the Japanese debt market itself, and vice versa in the United States for the Japanese company.

Unlike interest rate swaps, currency swaps involve both the principal and interest of the loan. Both of these are exchanged from one currency to another. The interest rates on a swap can be fixed, floating, or both. 

Exchange of Principal

If the two parties exchange principal for the life of the agreement, there is exchange rate risk involved. For example, if a swap sees company A give company B £10 million in exchange for $13.4 million, this implies a GBP/USD exchange rate of 1.34. If the agreement is for 10 years, at the end of the 10 years these companies will exchange the same amounts back to each other. The exchange rate in the market could be drastically different in 10 years. The company that ends up with the currency that has appreciated is better off. That said, companies typically use these products to hedge or lock in rates or amounts of money, not speculate.

Exchange of Interest

A cross-currency swap can involve both parties paying a fixed rate, both parties paying a floating rate, one party paying a floating rate while the other pays a fixed rate. Since these products are over-the-counter, they can be structured in any way the two parties want. Interest payments are typically calculated quarterly. 

The interest payments are usually settled in cash, and not netted out, since each payment will be in a different currency. Therefore, on payment dates each company pays the amount it owes in the currency they owe it in.

The Uses of Currency Swaps

Currency swaps can be used in three ways.

First, currency swaps can be used to purchase less expensive debt. This is done by getting the best rate available of any currency and then exchanging it back to the desired currency with back-to-back loans.

Second, currency swaps can be used to hedge against foreign exchange rate fluctuations. Doing so helps institutions reduce the risk of being exposed to large moves in currency prices which could dramatically affect profits/costs on the parts of their business exposed to foreign markets.

Last, currency swaps can be used by countries as a defense against financial crises. Currency swaps allow countries to have liquid access to income by allowing other countries to borrow their own currency.

Currency Swaps Used to Exchange Loans

Some of the most common structures for exchanging loans with currency swaps include exchanging only the capital, mixing the loan principal with an interest rate swap and swapping the interest payment cash flows alone. Some structures act like a futures contract in which the principal is exchanged with a counter party at a particular point in the future. Much like a futures contract, this structure also provides an agreed rate for the swap. This kind of currency swap is widely known as an FX-swap. Other structures add in an interest rate swap. These structures are also called the back-to-back loans as both of the parties involved are borrowing the other’s designated currency.

The New York Post: ‘Fixer Upper’ stars fined $40,000 by EPA for lead-paint violations

The stars of the popular home-renovation show “Fixer Upper” have been fined $40,000 by the Environmental Protection Agency for improper handling of harmful lead-based paint during house upgrades, the agency announced Tuesday.

Handy husband-wife team Chip and Joanna Gaines — co-stars of the hit HGTV show and owners of Magnolia Homes — agreed to pay the fine and complete $160,000 in lead abatement work in and around their hometown of Waco, Texas, as part of the settlement.

The duo and their contractors didn’t take proper safety precautions when remodeling 33 homes built before 1978, the year that lead-based paint was banned from use in housing, the EPA charged.

“It’s important that consumers and contractors understand that improper home renovation can expose residents and workers to hazardous lead dust,” said EPA head of enforcement Susan Bodine.

“Through this settlement, Magnolia is putting in place safeguards to ensure the safety of its renovation work and making meaningful contributions toward the protection of children and vulnerable communities from exposure to lead-based paint.”

Chip Gaines will also have to release a short video about the dangers of lead-based paint within 90 days.

This report originally appeared on

Benchmark Receives Acceptance of Property Option, and Proposes Closing Date for $3.21 Million Non-Brokered Unit Offering

VANCOUVER, British Columbia, June 07, 2018 (GLOBE NEWSWIRE) — Benchmark Metals Inc. (formerly, Crystal Exploration Inc., the “Company” or “Benchmark”) (TSX-V:BNCH) (OTCQB:CYRTF) (WKN:A2JM2X) – Further to the Company’s prior announcements on March 22 and May 9, 2018, Benchmark is pleased to report that on June 6, 2018, it received final acceptance from the TSX Venture Exchange of its option and joint venture letter agreement (the “OJVA”) with PPM Phoenix Precious Metals Corp. (“PPM”) for the Company’s option to acquire from PPM up to a 75% interest in the Lawyers Property, B.C. (the “Lawyers Property”) over three years. The Company also proposes to close on June 14, 2018 its non-brokered unit offering for gross proceeds of $3.21 million (the “Unit Offering”) to fund the initial phase of exploration work on the Lawyers Property and general working capital purposes. Upon closing of the offering, it is anticipated that the TSX Venture Exchange (the “TSX-V”) will issue an Exchange Bulletin providing final acceptance of these transactions and notice that the Company will resume trading at the opening of the TSX-V market on the second trading day subsequent to issuance of the Exchange Bulletin. Accordingly, the Company expects trading will resume on Monday, June 18, 2018.

Property Option
Pursuant to the OJVA, the Company will pay to PPM a sum of $200,000 (which is credited towards the Company’s earn-in requirements below), and issue to PPM the first instalment of 1.0 million common shares.  The Company will have a period of one year to incur $2.0 million in exploration expenditures on the Lawyers Property (including the $200,000 advanced to PPM above), and must incur a total of $5.0 million by June 6, 2021 to acquire its first 51% interest in the project. The Company may acquire an additional 9% interest (for a total interest of 60%) by issuing to PPM an additional 2.0 million common shares, and incurring a further $2.5 million in exploration or development expenditures by June 6, 2021, and the Company may further acquire an additional 15% (for a total interest of 75%) in the Lawyers Property by issuing to PPM an additional 1.0 million common shares, and incurring a further $1.5 million in exploration or development expenditures by June 6, 2021. 

Upon the Company earning its largest interest in the Property, the parties will either enter into a joint venture agreement for the further exploration and development of the Property, or, if the Company has acquired a 75% interest, then PPM may elect to sell its 25% interest in the Property to the Company, based on either an independent valuation, or a formula set out in the OJVA based on the Company’s market capitalization. The Company will be the operator of the Lawyers Property. The terms of the joint venture agreement will include provisions for the dilution of a party’s interest, in the event the party does not contribute its proportionate cost share to the further exploration and development of the Lawyers Property. The interest of any party diluted to 5% or less will be automatically converted into a 2.5% net smelter returns royalty (the “NSR”), with the other party having the right to buy-down one-half of the NSR for $1 million. 

The Company will also issue 94,444 common shares to an arm’s length finder in connection with the acquisition of the Lawyers Property option, and may pay a further $90,000 to the finder, in cash or shares, upon completion of the first year’s minimum required exploration work of $2.0 million. The finder may elect to be paid the finder’s fee in cash or common shares of the Company. If payable in shares, then the common shares will be issued as a deemed price per share equal to the five (5) trading day volume weighted average closing price immediately preceding the date of such election, provided that in any event the issue price for the common shares cannot be less than $0.16875 per share.

Pursuant to the Unit Offering, the Company will issue 17,833,318 units (the “Units”) at an offering price of $0.18 per Unit, to raise gross proceeds of $3.21 million (the “Offering”). Each Unit will consist of one (1) common share of the Company, and one (1) share purchase warrant (the “Warrants”) to acquire one additional common share at an exercise price of $0.36 per share until June 14, 2020. In the event that the common shares of the Company trade at a closing price greater than $0.42 per share for a period of 10 consecutive days, then the Company may deliver a notice to the Warrant holders that they must exercise their Warrants within the next 30 days, or the Warrants will expire. The net proceeds from the Offering will be used to fund exploration expenditures on the Property over the next 12 months, as well as to provide the Company with working capital for general and administrative expenses. Certain arm’s length finders will receive $182,267 in fees and will also be issued a total of 552,595 Warrants in connection with the Offering. All securities issued for the Offering will be subject to resale restrictions until October 15, 2018.

About Benchmark Metals Inc.
Benchmark is a Canadian gold, silver and diamond exploration company with its common shares listed for trading on the TSX Venture Exchange in Canada, the OTCQB Venture Market in the United States and the Frankfurt Stock Exchange in Germany. Benchmark is managed by proven resource sector professionals, who have a track record of advancing exploration projects from grassroots scenarios through to production.


s/ “John Williamson”
John Williamson,
Chief Executive Officer
Tel: (780) 966-7014

For further information, please contact:
Jim Greig, President
Tel: (778) 788-2745





The Wall Street Journal: Justice Department won’t defend ACA, asks to strike key elements

The Justice Department won’t defend the Affordable Care Act and is asking a federal court to strike down key elements of the law, a new blow to the health law and the stability of the individual insurance market.

The department, in a brief it filed Thursday in a lawsuit brought by 20 state attorneys general, asks the court to halt ACA protections that Republicans in Congress sought to preserve when they attempted to repeal the health law.

The provisions targeted by the Justice Department include the bans on insurers denying coverage to people and on charging higher rates to people with pre-existing health conditions.

Attorney General Jeff Sessions, in a letter to congressional leaders, said the department won’t defend the constitutionality of the ACA and the decision was made with the approval of President Donald Trump. It is unusual for the Justice Department not to back a federal law.

An expanded version of this report appears on

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