It’s not your imagination: Concert ticket prices are
going through the roof.
And not just for the super wealthy who pay thousands
of dollars to see the best acts from the front row. Fans of all types are
paying more to see their favorite musicians.
The average price of a ticket to the 100 most popular
tours in North America has almost quadrupled over the past two decades, from
$25.81 in 1996 to $91.86 through the first half of this year, according to
researcher Pollstar. Along with pro sports and Broadway shows, concert prices
have far outpaced inflation.
Some of that increase was out of necessity. As piracy
eroded music sales, artists began to lean heavily on concerts. Stars like
Beyonce and Taylor Swift can make more in a couple nights onstage than they can
from a year of album sales. But something else was going on, too. Ticket
sellers like Ticketmaster and AEG’s AXS began adopting technology that showed
fans would pay almost any price for their favorite acts, especially stars who
only come around every few years.
“We all undervalued tickets for many, many years,”
said Joe Killian, who runs a media consulting firm and founded a concert series
in New York’s Central Park.
Higher prices have been good for the concert
business. The live-music industry surpassed $8 billion in revenue in 2017, and
is on pace for another record in 2019. Live Nation Entertainment Inc., which
owns Ticketmaster, touts its ability to charge higher prices.
It’s not just tickets, either. Music fans also face
skyrocketing prices for food, beverages and merchandise. The average fan spent
$20 at events in 2016 staged by Live Nation, the world’s largest promoter. This
year, that figure is expected to reach $29, an increase of almost 50%.
If artists’ growing reliance on live music has led to
any guilt about appearing greedy, the rise of ticket resale sites like StubHub
took care of that. For years, entertainers watched as scalpers vacuumed up
tickets and resold them for far more on such exchanges. Agents took this as
proof that tickets were underpriced — and their artists underpaid.
Ticketmaster and others have since developed the
ability to change pricing at any moment, enabling artists to charge more
upfront and keep more of the dollars that went to scalpers. They can also
reduce prices closer to show time if tickets aren’t selling, or create special
windows for true fans.
Not every artist has embraced the new philosophy. Ed
Sheeran booked the highest-grossing tour of all time while charging less than
$100 a ticket, making him one of the cheapest of the top tours. He is adamant
that his show be affordable to all his fans.
After a record-breaking rally in bond markets, all of
Germany’s government debt now trades at sub-zero yields. That raises an
important question: what kind of investors are happy to hoover up bonds that
guarantee a loss if they are held to maturity?
One answer is that investors — in the sense of fund
managers seeking to generate a return on their clients’ money — do not actually
own very much of the German bond market.
An analysis by Union Investment, a Frankfurt-based
asset manager, shows that the overall value of Bunds outstanding has
been falling slightly since 2014 thanks to Germany’s aversion to
running budget deficits. But the volume of freely tradable Bunds on the market
has fallen much more sharply, and is expected to drop below €70bn by 2024 down
from more than €600bn a decade earlier.
The precipitous drop has been caused by the rise of a
class of bondholders typically indifferent to the level of yields. These
include foreign reserve managers at central banks, financial institutions that
since the crisis have had to hold ever larger piles of government bonds to meet
regulatory requirements, and the German central bank itself. The Bundesbank
holds more than €350bn of Bunds as a result of the European Central
Bank’s quantitative easing program.
Given the paucity of Bunds, it is not surprising that
Berlin is under growing pressure to borrow more, particularly with the German
economy seemingly headed for recession. But the modest scale of fiscal
loosening plans — finance minister Olaf Scholz has discussed a
€50bn stimulus package — seems unlikely to alter the dynamics of the
Bund market, for now.
More than most other places in the world, this
southern African nation with a long history of monetary
dysfunction has staked its financial system on mobile money, which allows
funds to change hands through the touch of a few buttons on an old-school
cellphone or through a smartphone app.
But now, amid power cuts lasting for up to 17 hours a
day, EcoCash breaks down frequently. The outages are blocking everyday economic
activity and exacerbating a financial crisis that has left Zimbabwe’s
government bankrupt and some five million people, about a third of its
population, in need of food aid.
Eight out of 10 transactions in Zimbabwe—from buying
milk to filling up a car or settling a utility bill—are done via cellphones,
almost exclusively on EcoCash.
“We are more or less a cashless economy,” said Ashok
Chakravarti, an economist based in Harare who believes that the EcoCash outages
will hurt Zimbabwe’s gross domestic product, which the International Monetary
Fund expects to shrink by 5.2% this year.
A government austerity program and limits on issuing
T-bills haven’t stopped the new Zimbabwean dollar from losing value. Inflation
spiked to 176% in June. Last month, the finance minister announced Zimbabwe’s
statistics agency would stop publishing annual inflation data until February,
saying it was distorted by the reintroduction of a local currency.
New York leads all U.S. metro areas as the largest
net loser with 277 people moving every day — more than double the exodus of
132 just one year ago. Los Angeles and Chicago were next with triple digit
daily losses of 201 and 161 residents, respectively.
This is according to 2018 Census data on migration
flows to the 100 largest U.S. metropolitan areas compiled by Bloomberg News.
At the other end of the spectrum, seven cities had on
average more than 100 new arrivals every day. Dallas, Phoenix, Tampa, Orlando,
Atlanta, Las Vegas and Austin saw substantial inflows from both domestic and
international migration. Sun Belt cities Houston and Miami claimed the 8th and
9th spots in the ranking. Seattle was the only cold-weather destination among
the top 10.
The migration figures exclude the natural increase in
population, which is the difference between the number of live births and the
number of deaths.
In 10 of the top 100 metros, deaths exceed births.
Thus, without migration these cities would be shrinking. Half of the 10 are
located in Florida. In 11 more cities, mostly in Utah and Texas, there are more
than twice as many births as deaths. Provo, which ranks first in births and
last in deaths, had a 5-1 ratio.
While New York is experiencing the biggest net
exodus, the blow is being softened by international migrant inflows. From July
2017 to July 2018, a net of close to 200,000 New Yorkers sought a new life
outside the Big Apple while the area welcomed almost 100,000 net international
migrants.
The second most attractive locale for international
migrants was Miami with an addition of 93,000, followed by Los Angeles,
Houston, Boston and the nation’s capital, Washington D.C.
Phoenix passed Dallas as the greatest beneficiary of
domestic migration, adding more than 62,000 residents between July 1, 2017 to
July 1, 2018. Dallas got an influx of 46,000, while Las Vegas, Tampa and Austin
rounded out the top five metro areas.
Some areas are affected by high home prices and local
taxes, which are pushing residents out and deterring potential movers from
other parts of the country. About 200,000 residents left New York last year.
Los Angeles had a decline of nearly 120,000 and Chicago fell by 84,000. Miami,
Washington D.C., San Francisco and San Jose experienced similar trends.
WSJ – Daily Shot: US Crude Oil Production (Select States) 8/30/19
Note
that BP just sold out of all its Alaska operations this last week after having
been in business in the State for 60 years
Few places on Earth feel the impact of the automobile
quite so keenly as Singapore. Car ownership rates are low — around 11%,
compared to 80% in the United States — but that still amounts to nearly 1
million vehicles (600,000 of which are private and rental cars) packed into an
island city-state half the size of Los Angeles. Roads account for at
least 12% of the total land mass.
To manage the traffic and other impacts on urban
livability, Singapore imposed the world’s first congestion pricing
scheme in 1975. Initially, it applied only to morning rush hour in the
central business district. But as the numbers of humans and cars expanded, so
too did efforts to control the impacts via such schemes. They were
effective in controlling traffic, but did little to crimp the appetite of
upwardly mobile Singaporeans for new cars that would contribute to traffic.
Indeed, between 1975 and 1989, the annual rate of automotive growth
averaged 4.4% (it peaked at 9.6% in 1980).
So in 1990, Singapore established
a quota for the number of new vehicles annually allowed on its roads.
Aspiring car owners bid for 10-year ownership permits. The cost of
these permits, combined with other taxes, have made Singapore the most
expensive place in the world to own a car, forcing buyers to regularly pay
three or four times more for a model than they would elsewhere. And ownership
is only going to become more expensive: in 2018, Singapore cut the
annual growth rate of new vehicles to 0% (commercial vehicles are excluded from
the policy until 2021). The government justified the cut “in view of
Singapore’s land constraints and our commitment to continually improve our
public transport system.”
They aren’t joking. In 2014, Prime Minister Lee Hsien
Loong unveiled his commitment to a “car-lite Singapore” and a
15-year, $1.5 billion program to boost public transportation. Among other
initiatives, the subway system will double by 2030, to 224 miles (at
a cost of more than $21 billion). The goal is to boost the number of commuters
using public transit at rush hour to 75% and to ensure that
90% of journeys to the city center can reach there within 45 minutes.
Singapore’s government hasn’t been nearly as
aggressive when it comes to aiding the deployment of personalized electrified
automobiles. Just ask Elon Musk: in 2018, he tweeted that
“Singapore govt is not supportive of electric vehicles.”
His grudge, it appears, dates back to 2016, when
Singapore imposed a $10,850 carbon emissions surcharge on a Tesla
Model S to account for carbon emitted during the electricity generation process
(Singapore is heavily reliant on fossil fuels). There is also
Singapore’s slow deployment of battery-charging infrastructure
compared to other countries.
Masagos Zulkifli’s repudiation of Tesla as a lifestyle is
easier to understand. Thanks to Tesla’s premium pricing (and Singapore’s
taxes), a used model S can
exceed $250,000 in the city-state (a new one can be double). In
fairness, other electric vehicles also have eye-popping prices in Singapore —
the Kia Niro is one of the cheapest at $132,600. But from the
perspective of policymakers seeking to electrify transport for as many people
as possible, a car that exceeds the price of some homes isn’t a climate change
solution — it’s a bauble.
When Mauricio Macri was elected president of
Argentina in 2015, one of his first acts was to abolish capital controls that
restricted buying and selling of the peso. The move symbolized Argentina’s
pivot back to open markets and liberal economic reforms under his rule. On
September 1st, after weeks of market turmoil, Mr Macri was forced to issue a
decree re-imposing controls in an attempt to shore up the currency. From now on
ordinary Argentines’ purchases of dollars will be capped at $10,000 a month. Companies
will face restrictions on their ability to purchase dollars in the
foreign-exchange market and to pay dividends to investors abroad.
Following days of market chaos in the wake of the
vote (the August 11 primary vote that went to Peronist rival Alberto Fernandez
(no relation to former president Cristina Fernandez de Kirchner)), Mr Macri’s
government bowed to the inevitable last week and asked creditors for more time
to pay back Argentina’s $101bn of foreign debt, including the IMF money,
as Buenos Aires struggled to avoid the country’s ninth sovereign
default — and the third this century. Currency controls were imposed
on businesses on Sunday after it lost an estimated $3bn in reserves in
just two days last week.
Thirty percent of all investment-grade securities now
bear sub-zero yields, meaning that investors who acquire the debt and hold it
to maturity are guaranteed to make a loss. Yet buyers are still piling in,
seeking to benefit from further increases in bond prices and favorable
cross-currency hedging rates—or at least to avoid greater losses elsewhere.
South Korea’s birth rate, already the lowest in the
developed world, has fallen to a new low on factors such as the high cost of
private education despite various government initiatives to prop it up, raising
concerns about the country’s bleak demographic outlook.
The country’s fertility rate — the number of expected
babies per woman — fell to 0.98 in 2018, according to the latest government
data released on Wednesday. It was already the lowest at 1.05 in 2017 among
members of the OECD, far lower than Israel, which was the highest in the
organization with 3.11 expected babies in 2017, the US at 1.77 and Japan’s
1.43.
The replacement level — the total fertility rate for
developed countries needed to keep the population constant — is 2.1.
Policymakers are also concerned about the country’s
falling potential growth rate due to ageing, with South Korea now having more
economically active people aged over 60 than in their twenties.
Despite growing concerns about the looming labor
shortages, South Korea maintains a strict immigration policy, not allowing
foreign workers to migrate with their families or apply for South Korean
citizenship in most cases.
…An estimated 270m migrants around the world who will
send a combined $689bn back home this year, the World Bank estimates. That
figure marks a landmark moment: this year remittances will overtake foreign
direct investment as the biggest inflow of foreign capital to
developing countries.
Remittances were once viewed by many economists
as a secondary issue for developing economies behind FDI and equity
investments. Yet because of their sheer volume and consistent and
resilient nature, these flows are now “the most important game in town when it
comes to financing development”, says Dilip Ratha, head of the World
Bank’s global knowledge partnership on migration and development.
The number of people in the world who live outside
the country of their birth has risen from 153m in 1990 to 270m last year
according to the World Bank, swelling global remittance payments from a trickle
to a flood. As migration has increased, these financial snail-trails have
become one of the defining trends of the past quarter-century of globalization
– the private, informal, personal face of global capital flows.
For many developing economies, it is a lifeline.
“In times of economic downturn, natural disaster or
political crisis, private capital tends to leave and even official aid is hard
to administer,” says Mr Ratha. “Remittances are the first form of help to
arrive, and they keep rising.”
Remittance inflows help boost countries’ balance of
payments and therefore their credit ratings, lowering the borrowing costs
of governments, companies and households. In the Philippines, for example, this
year’s remittances inflows of $34bn will help reduce what would otherwise be a
current account deficit of more than 10% of gross domestic product to a deficit
of just 1.5% of GDP.
But remittances have economic downsides too. By
helping to subsidize low incomes at home they provide a cushion against the
impact of slow growth, which eases pressure on governments to reform their
policies.
And, by channeling capital into consumer spending,
remittances boost imports – which, some economists say, holds back the
development of domestic manufacturing.
Remittances are also one of the key transmission
mechanisms of global economic stress. People move in search of opportunities,
so emigration rises when an economy is doing badly. When their host country is
doing well and migrants prosper, they send more money home – a counter-cyclical
boost to the struggling economy at home.
But when host countries hit hard times, the shock is
transmitted back to migrants’ families in the form of lower remittances. This
can export the slowdown to the recipient country, fueling economic instability
on a global scale.
One example is the recent fall in oil prices. It was
a blow not only to oil producing countries but also to families across
south-east Asia and elsewhere who have breadwinners working in the Gulf.
It proved to be a structural shock for Lebanon, a
small economy in which families and the banking system are heavily dependent on
inflows from the diaspora.
“We’ve been watching Lebanon closely because
remittances have really declined in the past decade, by almost 12% of GDP,”
says Frank Gill of S&P Global, one of the big three rating agencies. “This
is a key source of funding for the public sector and it’s a major worry for a
rating agency, for obvious reasons.”
In May S&P lowered its outlook for Lebanon’s
sovereign rating to negative, citing slowing inflows from non-residents as a
threat to the country’s fiscal stability.
Although remittances have become one of the chief
characteristics of the current era of globalization, political shifts including
the rise of populism raise the question of whether their economic importance
will prove short-lived.
The backlash against globalization is growing
and anti-immigration sentiment is rising in many developed countries.
So it is possible that both migration and the capital flows that it drives
could begin to ebb.
But the World Bank expects 550m people to join the
work forces of low and middle-income countries between now and 2030. And the
gaping income disparity between developed and low-income countries – $43,000 a
year per capita in the former, and $800 a year in the latter – is set to
persist.
That means job opportunities abroad will continue to
look attractive.
And the push from poor countries will be met by a
pull from rich ones.
“The western world is ageing, and it’s going to be
increasingly reliant on imported labor,” says S&P’s Mr Gill. “I don’t see
why that isn’t going to continue.”
Student debt is soaring—it is now nearly $1.5
trillion—and defaults are at a record. That has been fertile ground for
companies that promise to help stretched borrowers by navigating the maze of
federal programs that can reduce or forgive debts for those who
qualify, such as public-service workers or people on low incomes.
Some companies operate legally, although there is nothing they offer
that borrowers can’t get free,
regulators say. Other firms are outright scams, or make promises to
borrowers that are illegal, regulators and consumer advocates warn.
A record $89.2 billion of student loans was in
default at the end of June, New York Federal Reserve data show. Of the $1.48
trillion outstanding, 11%, or $160 billion, was at least 90 days behind on
repayments—and the true rate is likely double that, because only half the loans
are currently in repayment.
“We’ll do the work for you,” Financial Preparation
Services says on its website. “No more drowning in a sea of confusing paperwork
and processing!” Its fee: $1,195 for document preparation, then $40 a month for
almost 20 years—a total of $10,555—according to a 2018 client agreement
reviewed by the Journal.
Many of the FTC cases allege that the companies
charged upfront fees for debt relief, which is illegal, or engaged in other
prohibited practices such as masquerading as being government-approved, or
faking information on applications for federal relief.
Red Flags for a Student Loan Debt-Relief Scam
The Federal Trade Commission says borrowers should
beware of companies that:
Charge
upfront fees. It is illegal for companies to make you pay before they help
you.
Promise
fast loan forgiveness. Scammers may pretend to offer an easy way to wipe
out loans—it doesn’t exist.
Pretend to
have official endorsements, such as using Department of Education logos.
The government doesn’t approve any debt relief companies: it advises if
you have federal loans to go direct to https://studentaid.ed.gov/sa/
Try to rush
you into signing up. Companies may say you have to act fast to qualify for
programs: Check them out before you commit to anything.
Demands
your student loan ID, or asks you to sign a power of attorney, to deal
with the government on your behalf. You can lose control of your finances,
and be cut off from information on what’s happening to your loans.
