December 30, 2021
Eyes4Research
It seems as though the word Covid will forever precede the number 19 as the pandemic, first affecting the world in 2019, is marked down as a watershed in global history. The Covid-19 coronavirus startled individuals, communities, and nations into taking a fresh look at lifestyles and values. Holidays in lockdown forced many to abandon get-togethers, traditional celebratory meals, gifts, and entertainment, impacting the national economy as rarely seen before.
With the easing of restrictions going into Cyber Week/Black Friday and Thanksgiving, and heading towards the 2021 Christmas/New Year festivities, the importance of holiday spending is again the focus for assessing the health of the US economy. Consumer purchasing is the single most important driving force in the economy – increasing manufacturing and production, creating and maintaining high employment levels, and thus sustaining a buoyant economy. An estimated 70% of Gross Domestic Product is made up by consumer spending with 30% of that figure occurring in the November/December holiday months.
This being so, the importance of holidays to the economy cannot be understated. This boom season generates demands for goods and services, creating many jobs in production, distribution, retailing, restaurants, entertainment, and travel. Some economists may point out that the increases in spending will be balanced by thrifts in January and February, but these are the coldest months in most states. While some retailers may have to rely on the boost of the preceding holiday period, sales in heating and fuel, gasoline, winter breaks, and warm apparel will remain high. In years when holiday sales are good, even a lean New Year will be well tolerated.
Before the unique pandemic phase, the holiday season (beginning in October and reaching a crescendo in the weeks just before Christmas) represented one-fifth of all yearly retail sales and around 30% of individual retailers’ annual revenue. Despite Covid restrictions, holiday sales in 2020 still totaled $1.2 trillion, with increases anticipated this year at around 9%. Even before Covid, the rising star was e-commerce, with over half of holiday purchases and bookings generated by online purchases. The pandemic temporarily skewed all figures but digital shopping has continued in the ascendant and shows no signs of falling off over the 2021/2022 winter season. However, the pandemic has undoubtedly made an impact and continues to surface problems.
Marketing may be affected by many factors, but the human response to national or international events surely has to be factored in. During lockdown, people learned to be creative in dealing with the situation, including working from home and ordering everything for their daily professional, personal, or family needs online. Consequently, e-commerce skyrocketed but with it came supply and distribution blockages and shortages. As the pandemic spread, even e-commerce giants like Amazon began to face problems. Already this year, shoppers have been buying early, anticipating further supply chain problems and rising prices.
The other two big issues this holiday season, along with supply chain concerns, are sticker shock and inflation. Inflation is running high and sticker shock is threatening to limit consumer spending, with some financial advisors warning that this will be a very expensive Christmas. So far, this does not seem to have deterred consumers. During the pandemic, many people were able to put away savings from home-working and limited social life. As the Delta variant of this devastating virus seems to have been abating, job vacancies and attempts by employers to lure back workers have forced higher wages and better conditions for many. Inflation is also fueling demands for higher salaries. Benefits have added to funds available for bumper spending this year and, perhaps, most significant of all is the national feeling of being free to share the festivities with friends and family again. The e-commerce boom continues but many shoppers are enjoying the ability to buy at brick-and-mortar stores too. With the vaccination campaign in full swing, restaurants and hotels are re-opening and travel is once more part of the holiday budget for communities emerging from the Covid nightmare.
With inflation escalating prices in almost all goods and services across the board, there are notes of caution underlying this holiday mood. Basic food bills are up by about 12% with the US Department of Labor indicating an overall increase in consumer prices at 6.2% over the last year. Already, consumers may be shunning expensive goods like autos and domestic appliances for cheaper items or less expensive models. Looking forward, there may be a sharp pullback after Christmas with smaller retailers benefitting against luxury goods providers. A local study in a California district finds shoppers already cutting back on regular groceries as sticker shock starts to bite into the weekly bills. One woman claimed that her food and groceries had more than doubled in price.
President Biden has taken steps to address the supply chain problems with ports operating at all hours to clear backlogs but nobody can predict with accuracy how the pandemic will affect the situation next year. Overseas, supplies may fail to keep up, national shortages in trucking staff may hold up deliveries, and another wave of the virus may ground the nation again. Those encouraging figures for travel, restaurants, and entertainment may take another nose-dive. For now, consumers are spending and e-commerce is likely to continue as a buffer against any downswing.
No question though, Covid-19 is going to leave an indelible mark – lifestyles have changed. For so many people, the effects of the pandemic have meant suffering and loss, and it is not possible to be joyful over an emerging new era with these tragic facts in mind. However, the human spirit that has prevailed throughout this grim phase in history will doubtless grasp the positives and adapt to new ways. Holidays will remain enormously important to the national economy.
December 21, 2021
Eyes4Research
When Bitcoin became a reality in January 2009, it revolutionized global economics. Bitcoin, and the hundreds of cryptocurrencies that came after it, have offered individuals a completely new way of envisioning and conducting everyday financial transactions, as investors use it as an alternative currency, hold it as a store of value, and trade it as a financial instrument. And thanks to the versatility and decentralized nature of cryptocurrencies, investment in them has taken off, sending the prices to the moon, but all this growth hasn’t been without some problems.
You’re probably aware of the People’s Republic of China’s love-hate relationship with cryptocurrencies, which has influenced the market’s volatility and quick bear-bull cycles. One of the earliest bullish proponents of Bitcoin and other cryptocurrencies was Tesla CEO Elon Musk, who made the unprecedented move on March 24, 2021, of accepting Bitcoin payments for his company’s electric vehicles (EVs). The move sent Bitcoin prices and Tesla stocks soaring, but “as the lord giveth he taketh away”, and on May 21, Musk made an about-face, announcing that Tesla would no longer accept Bitcoin as a form of payment. The announcement caused the bottom to drop from Bitcoin, and most cryptos in general, from which the market has still not quite recovered.
Many crypto investors were furious with Musk, accusing the entrepreneur of manipulating the market for his own ends, but the truth is that he expressed legitimate concerns about the crypto mining process, which requires enormous reserves of energy. Many in the crypto community believe the answer to the costly and potentially environmentally hazardous process of crypto mining is to transition to proof of stake (PoS) coins, and as young, environmentally conscious investors enter the crypto market PoS coins are certainly worth considering.
One of the most interesting aspects of Bitcoin and most other cryptocurrencies (but also the most problematic in many people’s eyes) is how new coins are produced. Crypto coins are produced by way of a process known as mining, which involves either a graphics processing unit (GPU) or an application-specific integrated circuit (ASIC). The mining process can be done by anyone, anywhere, provided they have the proper computers. The computers connect to the blockchain where they attempt to solve complex equations. The first computer to do so receives a new block of crypto.
This process is known as the proof or work (PoW) distributed consensus algorithm. These same computers (and those who use them, known as “miners”) also validate crypto transactions on the blockchain to prevent the double-spending of coins. In addition to Bitcoin, some of the most popular cryptocurrencies use the PoW process, including Bitcoin Cash, Litecoin, and Ethereum. The PoW process may seem complicated, but it is highly effective and efficient to a certain degree. The issue that Musk and many other crypto investors have with it, though, is the high amounts of energy it consumes.
The high energy consumption of PoW coins is the result of the competitive nature of the mining process combined with a worldwide increase in Bitcoin’s popularity. As more and more people invest in crypto, more and more people also want to mine it. To put this into perspective, in 2017 miners were using 29,05TWh of electricity annually, or about .13% of the world’s annual energy consumption. This may not seem like much, but it’s more what than 159 countries produce combined.
And this trend will only continue, as more and more countries continue investing resources into creating massive mining pools where hundreds of ASIC computers run nonstop. The PoW system has been blamed for contributing to rising energy costs and making it difficult for independent miners to get into the game, but there’s also been a growing chorus of crypto enthusiasts who want to limit the process’ carbon footprint. Due to all of these problems, crypto developers introduced the proof of stake (PoS) system in 2012.
The PoS system works to validate crypto transactions, get consensus, and ensure that coins aren’t being double spent, but the key difference is the lack of mining or miners. With PoS cryptocurrencies, “validators” replace miners by validating new blocks in the chain based on how much stake is owned. For every new expected block to enter the chain, a validator will be “nominated” by participants who hold a stake by owning a certain amount of the blockchain’s coins. Once the validator solves a transaction, a verification process takes place.
So how does the PoS system relate to cost efficiency and carbon footprints? Well, the most important part is that the powerful mining computers that form the backbone of the PoW system aren’t needed. Because the digital coins are created in the network with PoS systems, they only need enough energy to power their blockchain’s core software, which means that they use less energy, create less of a carbon footprint, and are ultimately more cost-efficient.
For all of these reasons, PoS coins have become popular with younger and environmentally-conscious investors, and also with investors who have discovered some of the unique financial benefits of the nominating process.
In addition to holding PoS crypto coins, investors can stake their coins for validators to use in the process. Investors nominate validators who then complete the process of validating new blocks in the chain, which then pay dividends to the stakeholders. There are a number of PoS coins that have become more attractive as investment opportunities. This is due to both their overall value and their potential for staking.
Currently, the top PoS crypto available is Cardano (ADA). Since its debut in September 2017, Cardano has taken the crypto world by storm, selling briskly and earning a market cap of nearly $73 billion. This amount is good enough to place it just behind crypto giants Bitcoin and Ethereum. Cardano is expected to produce staking yields of nearly 3% for 2021, making it a good investment to hold or stake.
Also founded in 2017 (and just behind Cardano with a market cap of $71.5 billion) is the PoS coin Binance Coin (BNB). Binance Coin is the official PoS coin of the largest online cryptocurrency platform in the world, Binance, which – at least for the near future – should assure the currency’s relevance and value in the market.
Two other notable PoS coins to keep an eye on are the somewhat strangely named Polkadot (DOT) and Solana (SOL). Solana has performed well recently, with a market cap that hovers between $50 billion and $45 billion, while Polkadot is just behind at around $34 billion and gaining. Trading in Polkadot has become particularly popular on the Ledger Live trading app, which is the proprietary crypto app of the Ledger hardware cold wallet.
There is no doubt that cryptocurrencies are here to stay. Governments may try to ban them and many people may not understand them, but that doesn’t diminish their importance or ability to change the nature of economics and finance in the 21st century. And as the nature of economics and finance has evolved in general, so too has the nature of crypto.
As energy costs and environmental concerns grow, expect the more cost-effective and environmentally friendly PoS cryptos to grow in popularity. PoS coins currently comprise four of the top 10 cryptos in terms of market cap, and ongoing open-source development continues to transform Ethereum into a PoS coin. When these factors are considered, along with the fact that many PoS coins are a good way to earn passive income, the future of crypto does seem to be much greener.
December 16, 2021
Eyes4Research
As NASA’s physical exploration of space has diminished in recent years, other organizations have picked up the slack. The Russians, Europeans, and Chinese have all increased their presence in space, but so too have a number of corporate entities. In fact, the recent popular (and media) interest in space exploration has largely been spurred by three billionaires and their organizations – Elon Musk’s SpaceX, Jeff Bezos’s Blue Origin, and Richard Branson’s Virgin Galactic – leading many to term this new era of space exploration the Billionaire Space Race.
The Billionaire Space Race grabbed headlines in the summer of 2021 when Bezos and Branson flew in their creations to the lower limits of outer space. Their programs have been around for several years, and this has created plenty of debate about the merits, or lack thereof, of this new space race. The reality is, though, whether you think space exploration by private organizations and individuals is a good idea or not, it’s not going to stop any time soon, so it’s important to critically examine this new space race and how it will affect all of us in the future.
A few particularly important things to consider include the technology used by these new space vehicles, how they are different than the vehicles of the first space race, and how those changes are beneficial. The Billionaire Space Race’s impact on everyday consumers and investors is also considered here, in particular how private space exploration can help alleviate some of the challenges we face on Earth and how investors can benefit in the process.
The technology that these new private space exploration companies use to power their vehicles is important because they yield both immediate and long-term implications. Blue Origin and SpaceX use similar vehicles to launch into space, so let’s start with them. Both companies power their vehicles with rocket propulsion technology utilizing different types of engines and fuel depending on the payload and particular mission. Blue Origin uses six different types of engines for its rockets: BE-1, BE-2, BE-3PM, BE-3U, BE-4, and BE-7. Blue Origin designs its rockets for reuse and, depending on engine type, the company uses the following propellants as fuel: Peroxide, kerosene and peroxide, liquid hydrogen and liquid oxygen, liquefied natural gas, and liquid oxygen.
Founded in 2002 (two years after Blue Origin), SpaceX uses similar technology in its rockets. The Falcon 9 rocket, which is partially reusable, is the core workhorse of the SpaceX fleet, and is fueled by liquid oxygen and rocket-grade kerosene. SpaceX also utilizes the Falcon Heavy rocket for larger payloads, and the Dragon, which ferries humans and cargo into space. The Dragon was the first private spacecraft to transport people to the International Space Station and is currently the only spacecraft capable of returning significant amounts of cargo from the Station to Earth. The third entry in the Billionaire Space Race, Virgin Galactic, oversees a fleet of very different vehicles – and reasons – for exploring space.
Virgin Galactic bills itself as the “world’s first commercial spaceline”, and its primary vehicle clearly resembles a plane much more than a classical rocket. The “spaceplane” currently used by Virgin Galactic, known as SpaceShipTwo, is sent into the lower levels of space by the WhiteKnightTwo carrier. SpaceShipTwo uses a hydroxyl-terminated polybutadiene (HTPB) fuel and liquid nitrous oxide oxidizer that propels the motor after it is released from the carrier aircraft. Upon reentry and landing, it uses no propulsion. SpaceShipTwo made it officially into space, more than 50 miles above Earth, in 2018.
All the players in the Billionaire Space Race have used existing technology to model their new vehicles, although they’ve also added a few important innovations. Blue Origin and SpaceX have utilized the technology of expendable launch systems or vehicles (ELSs/ELVs) as the bases for their vehicles, with the notable exception that their vehicles are partially or completely reusable. This may not seem like an important difference, but ELVs are much more costly and environmentally harmful. Both of these concerns may play a role to entice consumers, companies, and investors in the future when commercial space travel and exploration become more common and lucrative.
Although very different than SpaceX and Deep Blue’s vehicles, Virgin Galactic also more or less primarily draws from pre-existing NASA technology. In 1986, NASA began the Rockwell X-30, also known as the National Aero-Space Plane (NASP), which was meant to be a passenger, suborbital space liner. Like SpaceShipTwo, NASP was envisaged to take off from the ground, avoiding the need for a large rocket booster system, but the project was ultimately canceled in 1996 before a prototype was built. The vehicles of the Billionaire Space Race are definitely bringing new innovations to the field of space exploration, and as the race evolves, many long-term implications for general consumers and society have developed.
The tycoons who own these space programs and the army of scientists they employ are constantly thinking of new ways to use the technologies they’ve developed to turn a profit and offer some benefits for greater society. Some of these benefits take place in space, such as the development of more and increasingly sophisticated satellites.
SpaceX is in the process of creating a satellite network known as Starlink. Starlink was first launched on May 23, 2019 with the goal of putting up 12,000 satellites to provide broadband internet for underserved parts of the world. The other companies have shown interest in following this trend as well as developing other satellite programs for business ventures that include tracking shipping movements or locating valuable natural resources.
But the Billionaire Space Race also has the potential to help alleviate terrestrial problems such as hunger. According to the World Economic Forum, the technology described above can also be used to image large areas of agricultural land and help bring clean water to people by monitoring reservoirs. The success of such endeavors will ultimately rely on the willingness of the CEOs and boards of these companies and how much capital they have to spend, which is itself dependent upon investors.
The numbers show that there’s plenty of investment opportunities, and interest, in private space programs. In 2009, total funding in private space exploration exceeded $20 billion, which continued to grow in the following years. More than $1.7 billion in equity was invested into corporate space companies in 2019, or nearly double from the previous quarter. The profits are also expected to grow. The current $350 billion in revenue captured from private space exploration is expected to grow to more than $1 trillion in 2040, giving any ambitious investor a unique opportunity.
And future investment in private space exploration will likely be driven by lowered costs in the industry. Morgan Stanley recently reported that thanks to the reusable rockets used by SpaceX and Blue Origin, the cost of launching a satellite has declined from about $200 million to $60 million. Satellite mass production could further decrease these costs to about $500,000 per launch. As decreasing costs will likely entice more investors (including non-industrial, “main street” investors), increased competition among the private space programs will drive innovation.
Just as the competition between the United States and the Soviet Union led to amazing scientific innovations in the original space race, the urge to be first will likely create new discoveries and bring down costs in the Billionaire Space Race. Where the race ends and how many new discoveries are made are only dependent upon the deep pocketbooks and egos of the tycoons involved, not public opinion or government bureaucracy.
In many ways, the Billionaire Space Race of today resembles the original space race between the US and the USSR. Similar to the original space race, the parties involved in current space exploration strive to be the first among their peers to grab the glory and associated profits. Yet there are also some notable differences – namely the cleaner, more efficient technologies that are propelling these space vehicles.
When the Billionaire Space Race is put into a wider perspective, it’s clear that it offers a number of benefits for consumers, investors, and society in general. The expansion of technologies to alleviate problems on Earth is perhaps the primary selling point of these private space programs, but these programs also offer investment opportunities today and in the future. Finally, the competition between these private space companies will eventually lead to better technology and lower costs, which in the end will bring more benefits to consumers and greater society.
December 9, 2021
Eyes4Research
If there is one positive effect that has resulted from the pandemic lockdowns it has to be TIME. All those things that needed sorting. That feeling that hard-earned cash could be better spent, better distributed. So many domestic chores left for a never-to-come day when there would be time to do them. Then there is quality time with loved ones and valued activities. For those fortunate enough to have an overstocked clothes closet it’s time for re-evaluation. The major fashion trend for 2021-2022 starts here. Less is more or put another way, quality over quantity are the current watchwords. New lifestyles have emerged from Covid-19 restrictions that are likely to influence sales for some time ahead. Intelligent brands will be looking at those changes.
Home Style.
Working from home, learning at home, staycationing – all these enforced ways have for many become long-term choices. Comfortable cozy loungewear is a must but sharp enough to make a quick trip to the office or the store. Nobody wants to go out in their pj’s. Quality fabrics like silk or cashmere are desirable but blends may be more practical and still attractive. Lightweight, washable but stylish to take on that ever-growing choice of spa days or weekend breaks offered at the nearest deluxe resort hotel.
Eco-friendly.
Customers have become more aware of the ethics and reputation of brands. Political correctness, social values and environmental concerns all impact fashion choices today. There has been a noticeable shift towards sustainable materials in fashion items and furnishings. Organic fabrics like natural cotton and linen or various wools have had a revival in interest although balanced by the easy-wash, no-crease quality of polyesters. Brands that offer acceptable blends may see an uptick in trade.
Many customers have lost employment or experienced reduced income levels during the pandemic and will be looking for durability and value for money items. This is where home brands can cut in on the inexpensive ‘wear once and discard’ items from cheap labor countries. Many Asian textile producers are facing crisis situations and they too are looking for increased home sales to survive and thrive again. The market for quality second-hand and resales is also likely to increase with advertisers using beguiling terms like ‘seasonless’ garments.
This is also a time when smaller home brand names can become more significant, connecting directly with their customers, their styles, budget and specific needs. Fashion analysts feel that women (rather than men) prefer to build a trusting relationship with smaller local brands.
Wellness.
The sportswear market is likely to become more buoyant after the general slump in retail sales as Covid conditions took effect, mitigated only to a degree by internet shopping. Outdoor sports and the reopening of fitness centers will naturally fuel sales but the quality of fabrics is also an important trend that crosses over into daywear. The demand for clothes using breathable natural fabrics that are also durable and stylish is currently impacting brand design.
Most of these trends were already emerging before Covid hit and are likely to continue with renewed impetus into 2020.