3 Point Analysis | Will the current credit growth sustain?

Image result for 3 Point Analysis | Will the current credit growth sustain?Credit growth has improved to the highest in five years. While the Industry credit is sluggish but is expanding.

The latest credit growth is broad-based with credit to services continuing to lead the growth, increasing by 27 percent YoY.

Credit to NBFCs has also grown by a whopping 56 percent.

Sakshi Batra does a 3 point analysis of the current credit growth vis-à-vis nominal GDP growth and what’s the outlook going forward.


This Is Why Your Marketing Isn’t Working (And What You Should Do Instead)

Should Your Company Offer an Employee Discount?

There’s some good reasons to offer an employee discount when you’re a small business. They work wonders for keeping good employees and here’s a list of some big names  who know and use them to their benefi

Reasons to Offer an Employee Discount

Small Business Trends spoke with a few experts on the subject to find out what the best practices are.

Compete with Larger Firms

First and foremost, employee discounts are an excellent way for smaller businesses to compete with larger companies who have bigger budgets. Offering a discount on merchandise or food levels the playing field when you can’t match wages.

If you’re in the food business specifically, an employee discount is an incentive for servers and chefs who need to work long hours.

Long Shifts

“A restaurant should offer an employee discount to make it easier for employees to work longer shifts without having to spend their entire paycheck on meals,” says Stacy Caprio from Fiscal Nerd, a company that supplies real time stock quotes to small businesses.

“Think about your specific business type and what makes senses for your situation.”

Simpler than a Raise

Of course, one of the other reasons employee discounts are popular with small businesses is the fact there’s no actual money involved. Offering a percentage off your merchandise to workers doesn’t require the same financial juggling as a raise.

Then there’s employee engagement. Millennials and the up and coming Gen Z’ers are looking for more than just a punch clock and paycheck. Recent stats say that companies that invest in the employee experience are four times more profitable than those that don’t.

Allison VanNest is Head Of Communications at littleBits , a NYC-based technology company. She told Small Business Trends how a 40 percent employee discount benefited both workers and the business.

Best of Both Worlds

“We think it is important for employees in all departments to play with our product,” she says.  “Not only does it help them understand how to build and market it better, but it also allows them to create their own inventions in STEAM (science, technology, engineering, art, and math). Best of both worlds!”

Giving employees a discount on your merchandise is also a form of free advertising for your business. This works well if you offer a discount on shirts, hats and other kinds of apparel. Anything that’s got your company logo on it should be considered for a discount if your employees can use it somewhere outside of your office.

Employee discounts are also morale boosters and a great way to strengthen your teambuilding exercises. Making your employees feel like they’re appreciated motivates them to do those little extras which can in turn increase your sales.

Employee Discounts Work

Keep in mind that employee discounts work. Remember that people who work for you love to shop and save money. These perks also help to better the lives of the people who work for you outside the office by giving them exposure to products and other experiences they might not otherwise get.


Crypto venture capitalist: View bitcoin as a survivor like Amazon after the 1990s dot-com bubble

Kerner:  Bitcoin is the greatest stored value ever created

Kerner: Bitcoin is the greatest stored value ever created   10:59 AM ET Wed, 21 Nov 2018 | 03:07

Investing in bitcoin is not for the faint of heart, but over any given two-year period holders of the world’s biggest cryptocurrency have been rewarded, CryptoOracle partner Lou Kerner told CNBC on Wednesday.

Kerner, whose venture capital firm supports what it calls the “decentralized digital economy,” has a much longer investment horizon.

For example, he said on “Worldwide Exchange,” “If you go back to the internet bubble, which is what a lot of us in crypto look at for direction, Amazon, arguably one of the greatest companies in the history of the mankind, was down over 95 percent over two years.”

In May 1997, Amazon went public at $18 per share. The stock soared, splitting in June 1998, and continued to climb to more than $300 per share by December 1998. Amazon executed its only two other splits in January and September of 1999 right before the dot-com bubble burst in March 2000. In September 2001, Amazon traded for under $6 per share.

Fast forward, Amazon in September 2018 became the second U.S. company to eclipse a stock market value of more than $1 trillion. (Apple was the first, a month before.) But since its all-time high of $2,050 per share on Sept. 4, Amazon lost 27 percent in the October and November rout as of Tuesday’s close.

However, Kerner said that kind of volatility, while troubling, is nothing compared to what longtime bitcoin investors must endure. “There was a day in 2013 when we were down 70 percent overnight. Nobody likes being down like this. But this is what investing in crypto is all about.”

Bitcoin became a phenomenon in 2017, skyrocketing from about $3,600 per coin to more than $19,000 in December of that year. But by February 2018, it fell under $7,000. After bouncing around for most of this year, bitcoin plunged about 30 percent over seven sessions to about $4,100 as of Tuesday. Other cryptocurrencies fared much worse. But bitcoin was actually up nearly 3 percent in early Wednesday trading.

“Crypto has been so weak because most of it there’s no underlying value outside of confidence,” Kerner said. “[But] bitcoin, itself, we think is going to replace gold eventually. Gold is an $8 trillion thing.”

“I think it’s a store of value. I think it’s the greatest store of value ever created,” he added. “It should surpass gold over time. It won’t happen overnight.”

Kerner isn’t the only crypto investor who believes bitcoin will become the new gold. But there’s plenty of skepticism among many Wall Street veterans, including J.P. Morgan chief Jamie Dimon who in September 2017 called bitcoin a fraud only to walk back those comments a bit about three months later.

In putting his faith in bitcoin, Kerner said he subscribes to Amara’s law, which was coined by Stanford professor Roy Amara in the 1970s. It holds that the impact of all great technological change is overestimated in the short run, and subsequently underestimated in the long run. But in the meantime, he said he’s “holding on for dear life.”


Hate winter? Ditch that snow shovel and retire in one of these 7 places where the sun always shines

  • 1. Puerto Vallarta, Mexico

    It’s never cold in Puerto Vallarta.

    High temperatures are in the 80s, and low temperatures mean the mid-60s. That makes this Pacific Coast resort city a longstanding Mexico favorite for winter escapes. “Leave your boots and parkas up north and enjoy sunny days and romantic nights in this seaside hot spot,” said correspondent Don Murray, who also covers the Riviera Maya on Mexico’s Caribbean coast for International Living.

    A typical retired couple can live well here for under $3,000 a month, including all expenses.

    The hidden beach in Marietas Islands, Puerto Vallarta. Mexico.

    Ferrantraite | Getty Images
  • 2. Montevideo, Uruguay

    In Uruguay’s climate, cold weather is practically unheard of. Its location in a temperate zone is responsible for year-round mild temperatures.

    “Springtime comes to Montevideo from November on, with daytime temperatures in the low 70s [Fahrenheit],” said Jim Santos, a correspondent for International Living.

    Most expats are attracted to Uruguay for its “tranquilo” lifestyle — a healthy, stress-free approach to living. Two people can live in Montevideo on $3,200 a month.

    Montevideo, Uruguay

    ElOjoTorpe | Moment Open | Getty Images
  • 3. Tamarindo, Costa Rica

    Kathleen Evans, the coastal Costa Rica correspondent for International Living, recommends visiting Tamarindo in December for the best weather. “The seasonal rains are finished in November, so everything is lush and green,” Evans said. “The chance of rain is nearly zero.”

    The days are warm but not hot, and the evenings cool off for a sunset walk on the beach and open-air dinner. Temperatures range from highs in the mid-80s to a low of 73.

    A couple can thrive on $2,500 a month in this coastal town, including housing. Costa Rica offers high-quality, low-cost medical care, good-value real estate, established expat communities and welcoming locals.

    Tamarindo Wildlife Refuge in Costa Rica

    Kryssia Campos | Moment | Getty Images

  • 4. Huanchaco, Peru

    For most of the year, temperatures hover around the low-to-mid 70s and rainfall is virtually nonexistent.

    “Pretty much the whole coast of Peru is sunny at that time,” says Steve LePoidevin, International Living’s Peru correspondent. “Springtime starts in late September, early October, so there’s plenty of time to start planning to avoid the severe North American winters.”

    The prices are also mild. A couple could easily live on a monthly budget of $2,000 or less, according to LePoidevin.

    Huanchaco, Trujillo, Peru

    Jesus Arana | Getty Images
  • 5. Coronado, Panama

    Nearly every morning, the sun shines bright in a cornflower blue sky, according to Jessica Ramesch, International Living’s Panama editor. “When it does rain, it’s usually just for an hour or two in the afternoon,” Ramesch said.

    “Temperatures rarely climb above 88 F during the day, and it’s usually about 10 degrees cooler at night,” Ramesch said. “With ocean breezes and plenty of sun, we’re talking mild, happiness-inducing weather.”

    Depending on how you choose to live — many retirees hire maids and landscape gardeners — a monthly budget for a couple in Coronado could run $1,750 to $2,975.

    Soccer goals made from sticks on sandy beach and seagulls under clear sky, Panama

    Lynn Armstrong | 500px Prime | Getty Images

  • 6. Placencia, Belize

    The official start of high season is November, when the weather in southern Belize is usually perfect, says Laura Diffendal, International Living’s Belize correspondent. During the day, expect temperatures in the low 80s. Evening temperatures in the 70s, and combined with sea breezes, means you won’t need anything more than a long-sleeved T-shirt.

    Placencia is one of the more expensive places to live in Belize because of its popularity with tourists and expats, but the cost of living is still much lower than in the U.S. A couple can live comfortably for $2,500 a month.


Bank of America sees market decline next year: ‘There is now an alternative to stocks’

Caution tape outside the New York Stock Exchange in New York on Jan. 23, 2018.

Adam Jeffery | CNBC
Caution tape outside the New York Stock Exchange in New York on Jan. 23, 2018.

There is a good chance stocks stall out next year as credit conditions tighten and earnings growth slows, according to Bank of America Merrill Lynch.

“We believe the peak in equities is likely before the end of 2019,” wrote Savita Subramanian, equity and quantitative strategist at Bank of America Merrill Lynch, in a note this week. She sees the S&P 500 rising slightly to 3,000 before the end of this year and then falling 3 percent in 2019 to 2,900.

Dow finishes lower for fourth straight day

Dow finishes lower for fourth straight day   1:49 PM ET Fri, 23 Nov 2018 | 02:34

“Our rates team is calling for an inverted yield curve during the year, homebuilders peaked about one year ago and typically lead equities by about two years and our credit team is forecasting rising spreads in 2019,” Subramanian said. “Assuming the market peaks somewhere at or above 3000, our forecast is for modest downside in 2019.”

An inverted yield curve refers to when the yield on short-term sovereign debt, such as the two-year Treasury note, is higher than the rate on longer-dated paper such as the benchmark 10-year Treasury note. An inverted yield curve is typically followed by an economic recession.

Investors have been fretting this year about the Treasury yield curve possibly inverting. The spread between the 10-year and two-year yields was around 24 basis points on Friday. This has been happening as the Federal Reserve has hiked the overnight rate three times this year. The central bank is also expected to hike once more before year-end. The Fed also forecasts it will raise rates three times in 2019.

As the yield curve continues to flatten, Subramanian expects equity-market volatility to increase and for more of the firm’s “bear market signposts” to be triggered. Currently, 58 percent of these signals are triggered. In October 2007 — roughly a year before the financial crisis — all of the 19 signposts were triggered.

“Still-supportive fundamentals, still-tepid equity sentiment and more reasonable valuations keep us positive. But in 2019, we see elevated likelihood of a peak in the S&P 500,” the strategist notes, adding S&P 500 earnings growth will likely slow down to a crawl after a blockbuster 2018. S&P 500 earnings grew by 25 percent in the first three quarters of the year, boosted in large part by lower corporate taxes.

Cash as alternative

However, Subramanian says investors can now turn somewhere they have not been able to for a long time as stocks stall out: cash. “There is now an alternative for stocks,” Subramanian said, noting yields for cash are higher today than for 60 percent of S&P 500 companies. “Cash is now competitive and will likely grow more so … our Fed call puts short rates close to 3.5% by the end of 2019, well above the S&P 500’s 1.9% dividend yield.”

Expect a small rally within the next few weeks: Expert

Expect a small rally within the next few weeks: Expert   12:33 PM ET Fri, 23 Nov 2018 | 03:51

Many investors operated during this bull market under the mantra “There Is No Alternative” to stocks following the financial crisis as low Federal Reserve rates made assets like cash yield next to nothing, thus making them unattractive to investors.

Subramanian recommended investors buy stocks in the health care, technology and financials sectors.

On health care, she says it is “cheap” compared to historical levels and is trading at a discount to the overall S&P 500. She also notes fundamentals are strong for the sector and that more than half of the companies beat earnings and sales estimates during the third quarter.

Subramanian said tech is now “cheaper” and less crowded after a big sector reorganization moved Netflix and Facebook out of the sector. “Positioning risk is neutral to positive” now, she said.

Financials, meanwhile, should get a boost as companies in the sector ramp up their buyback programs. “Whereas other sectors have been buying back shares for almost a decade, Financials were disallowed until recently. But Financials’ share buybacks have ticked up substantially, and the sector has the second highest dividend growth in the S&P 500.”


Cramer: ‘I have tremendous contempt for this market’ — it’s a bear market not a correction

Bear market is mauling stocks, says Jim Cramer

U.S. stocks are in a “bear market” not a correction, CNBC’s Jim Cramer argued on Monday.

Cramer said on “Squawk Box” he’s not using the traditional measures of a bear market and a correction to make his case. “Who cares about the S&P? It’s individual stocks that are down 40 or 50 percent.”

A bear market is generally defined as an asset or index decline of 20 percent or more from recent highs. The threshold for a correction is measured as a drop of 10 percent or more from recent highs.

“I have tremendous contempt for this market, because every time you try to make money with it, it cuts your heart out. That’s a bear market. People don’t want to call it a bear market. But what do they need?” Cramer asked, rhetorically.

“It’s a bear market rally,” he said. “You go down really hard last week. And then you come in on Monday and it’s up a lot. People come in. They buy it and lose money.”

After tanking nearly 3.8 percent last week, the S&P 500 recovered nearly a third of that decline shortly after Monday’s open on Wall Street, lifting the index out of correction territory. The Dow Jones Industrial Average bounced more than 300 points, or nearly 1.5 percent, distancing blue-chips further away from a correction. The Nasdaq, despite similar gains, remained in a correction by a few percent.

“People come in at 250 [points higher] and get their heads cut off. I just feel ashamed,” said Cramer. “It’s very hard to be very positive about the market unless you’re an idiot. Let it go up for three or four days and then sell some.”

Cramer reiterated that he’s been bearish on stocks since Federal Reserve Chairman Jerome Powell said early last month that interest rates were a long way from neutral. Powell’s remarks touched off a market rout on concerns that central bankers will increase rates aggressively next year. Cramer has been calling on Powell to pause rate hikes, arguing the economy is weakening and inflation is not a problem.

In fact, Cramer warned last week that investors should sell their stocks if they think the Fed, as expected, will raise rates in December. The Fed already increased rates three times this year. After its most recent hike, in September, the Fed projected three rate increases in 2019.