With Fifth Third Out, Banks Have Repaid 99% of TARP

http://online.wsj.com/article/SB10001424052748704261504576205142438418336.html?mod=googlenews_wsj

I found this article to be interesting. This talks about how banks have repaid 99% of TARP funds that were given to them during the recession. What this means for businesses is that banks no longer have the burden on their shoulders to repay the government and instead will be able to borrow more money to individuals or re-invest their money within their organization. For the banking industry this is great news. For the private sector this is also great news. With interest rates at an all time low, business should be able to easily secure a loan and reinvest with their organization. There is no reason that a business should not take advantage of this opportunity to help their-selves grow and succeed.

Japan Quake Tests Supply Chain From Chips to Ships

I read an article about worldwide supply chain problems caused by the Japanese earthquake and ensuing tsunami. This natural disaster destroyed ports that handle approximately 7% of Japan’s industrial output and damaged the electrical infrastructure. This disaster will have a global impact on the supply of high-tech components, especially semi-conductors, as well as, steel, polysilicon, and wafer material. South Korea seems to have the most to loss, as they depend on Japan for steel to support their shipbuilding industry, LCD glass, silicon wafers, and other materials for making semi-conductors. The impact of this disaster will also affect the U.S. solar energy business, the European car industry, and Japan’s auto industry.

This article illustrates how interdependent the countries of the world are in the manufacturing of products. One seldom considers the complexity of manufacturing an automobile, but the bill of materials for an automobile consists of thousands of items. The supply chain for these components spans the globe. Typically, automobile manufacturers only hold a few days inventory of components, so they are quickly dead in the water if the supplier cannot perform. It only takes one missing component to prevent the car from moving to the end of the assembly line. If a supplier’s business is severely damaged and no contingent suppliers are available, the automaker could experience long-term part shortages. This will eventually generate shortages for the consumer, which can cause the consumer to purchase a competitor’s product. It is ideal to have a contingency plan in place just in case the unthinkable happens.

http://www.reuters.com/article/2011/03/14/us-japan-quake-supplychain-idUSTRE72D1FQ20110314

senior debt

I found the following article to be very interesting and a bit scary - I wonder where the money will come from.

http://www.usatoday.com/money/perfi/credit/2010-11-21-senior-debt_N.htm?csp=obinsite

About one third of the seniors surveyed for this article carry their mortgage debt into retirement.

Many are not worried about their debt and continue to rack up debt, they feel it is too late to do anything. The feel privileged, continue to vacation and entertain -- do these people have a conscience? Where is there moral goodness? Some don't talk about debt because of pride and some are scared; 75% went into debt because of medical expenses and funeral expenses.

With over 38.5 million Americans over the age of 65, this is becoming a huge problem. Should lending agencies continue to allow mortgages after a certain age; or would this be discrimination? Should credit card agencies tighten the limits? Maybe the new Health Care Reform will reduce the medical expenses on individuals....but this money too must come from somewhere.

Japan's Crisis and the Auto Industry

I know this is a very new and uncertain topic, but the thought of how the disaster in Japan effects the rest of the world and the business world is very interesting.  I know questions have already been raised about how the nuclear crisis will influence the nuclear power situation in the rest of the world. In this article, however, I found it intriguing the way in which Japan's crisis could effect the auto industry. The loss of thousands of vehicles, parts, raw materials and factories will greatly influence the world's new supply. It also stated that Japan manufactures the batteries central to US car producers hybrid cars. It's just amazing how one country's struggles influence the rest of the world.

Fear of Escalating Drug Violence Delays Fresh Fruit & Vegetables from Mexico

This is an article that caught my attention this week regarding the problems Mexican farmers are having getting fresh fruit and vegetables shipped into the US. The problem is with the drug wars going on in all of the border towns between Mexico and the US. This is not only a concern for any of us who enjoy fresh fruit and vegetables here, but it is a major concern for Mexican farmers. Mexico's #1 farm export to the US is fresh tomatoes.

China's Facebook Syndrome

hi everyone,
I posted an interesting article about Facebook and how censorship hinders access to China's online markets. Chinese social network can tap U.S. capital markets, but American social networks can't tap Chinese consumer markets. Does that sound fair?

Week 2

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