Most are aware that having a debt crisis or financial hardship may lead to many increased mental health issues, namely depression, anxiety, and suicide attempts. However, there lies a far less known connection that mental health is often tied to family finances, employment longevity and duration. Mental health should be something to be stressed when the economy leaves the public stressed.

Take for instance, Greece, a country currently faced with financial crisis. Media coverage often reports high unemployment rates, closing of banks, and political uncertainty. However, far less coverage is done on how political and financial uncertainty negatively affects the mental health of the Greek people. New research reveals a 35 percent jump in the suicide rate during the first two years of austerity programs, with a direct correlation in additional unemployment to an incremental increase in the suicide rate among working-age men. Clinical depression rates have also increased from 3.3 percent to 8.2 between 2008 and 2011.

The issue in Greece is that whilst the need for mental health support is increasing, the government’s austerity measures is resulting in dwindling healthcare. Hospitals are overflowing, and less than half of the Greek population is able to afford healthcare. In an attempt to decrease the debt that is causing so many mental problems, the Greek government has forgotten the consequences of allowing existing mental problems to brew without treatment. Those with mental health problems tend to be pushed into poverty, namely due to increased health costs, loss of employment, reduced work hours, and stigma.

No matter the public’s stance on Greece’s austerity measures, the mental health statistics in Greece reflect how factors on a microeconomic level can have large implications on the overall global economy.

Sources:
http://www.thelancet.com/journals/lancet/article/PIIS0140-6736%2811%2961633-4/fulltext

David Stuckler on Austerity and Death

http://www.newsweek.com/greek-crisis-has-seen-rise-suicides-and-depression-353056
http://greece.greekreporter.com/2014/10/26/cases-of-mental-illness-in-greece-have-increased/

It might be possible that the hospitality industry might be on it’s way to completely revolutionizing itself, as can be seen by the new things that have been trending in hotels in the past year. There has been a shift from focus on factors like luxury, comfort and indulgence to factors like social spaces, high-tech facilitated services, and modern renewable energy driven buildings.

What young corporate travelers today while on business trips or work-related trips look for in a hotel is two things: firstly a smooth and easy stay process and secondly to use the hotel as a platform to socialize, meet people and start building a network. Consequently, hotels have been choosing to capitalize on possible social settings. For example, there has been a concept of ‘living room like lobbies’, which are basically huge lobbies with a lot of communal furniture to promote mingling and socializing. This was started by the Citizen M chain of hotels in Amsterdam, which offers not so luxurious and small rooms but these ‘living room like lobbies’. Shared spaces are not only limited to lobbies: even restaurants and bars can be made to have communal tables and settings rather than the traditional way, lounges, that can usually be accessed by frequent customers can provide a kind of shared entertainment experience and even waiting areas like hallways and elevator could be somehow utilized as collective spaces. A hotel in Frankfurt that opened in March by the Lindenberg brand of hotels has shared leisure places like a communal kitchen that hosts cooking classes, and a jogging club in the garden.

Also, with evolving and fast-changing technology, the younger corporate travelers are used to being associated with user friendly and tech savvy services. For example, many airlines are not just switching to online check in but also e-boarding, which lets you proceed directly to security check: which is a part of making the travel experience smooth and error free. Lesser human involvement in this process implies a more systematic method. The same concept has been extending to the hotel industry: some hotels are now coming up with ideas of e-check in, by which they get their room key cards through an automated system after scanning their identification. This process is both faster and ensures that customers are served in a timely manner or is been informed of an accurate wait time through a computer rather than an estimate by a customer service associate.

Lastly, there has been a growing concern for the depletion of resources on our planet and towards issues like global warming and melting of glaciers. This concern will be more and more reinforced every year, and renewable energy is starting to be seen as the future. Young corporate travelers who are usually recent college graduates are very informed about environmental issues and since they will be the ones to actually live through an energy crisis if it were ever to happen, they are very attracted to businesses that are renewable energy driven. Though not many hotels have had a goal to achieve this, it might be something they might consider in the future.

These concepts could soon make a lot of existing luxury hotel chains obsolete, or force them to go through very expensive refurbishments that might take a while and cause the hotel to be out of business for a while, which might not be something they could afford. However, it would be intriguing to see if these small but still significant changes could have a great impact and actually revolutionize the hospitality industry.

 

Uber just completed 2 billion rides on July of 2016 internationally, proving as consumers’ best friend when it comes to transportation.

To the majority of the Trojans, Uber is an excellent app.

Thanks to the recent program between USC and Uber, the Trojans have been saving money and going home safely after late excursions.

Proving how Uber is the students’ beloved smartphone app, the recent findings in Uber demand curve shows how Uber service is more beneficial to the customers than the drivers and the company itself.

Uber, Steven Levitte (author of Freakonomics), and other researchers mapped out Uber demand curve to investigate the impact Uber has brought to the consumer welfare. If the researchers were to map demand curve for regular transportation service, it could have been harder because there is more than one factor. For the transportation service like Taxi, the price may be affected by not only the supply of the drivers but also by the weather, time of the day and other competing services. Different from aforementioned factors affecting transportation demands, Uber’s metrics are unique in two folds: 1. Uber records every occasion where a customer declines the offered price with regular factors such as the time, place, price, and a surge factor; 2. Uber rounds up or down to one decimal place the surge factor it generates to determine how much to charge customers for a given trip.

The Study looked into 48 million ride interactions over the first 24 weeks of last year from Uber’s four biggest U.S. markets: New York, San Francisco, Chicago, and Los Angeles. According to the data, the customers follow through 62% of the time without surge pricing (which is almost 80% of the time), and 39% when the surge is above 2 (3.5% of the time). The demand did not match the price. In simple economics, the demand should be high as the supply is scarce; however, the Uber data shows the opposite. As shown in the graph, the demand decreased by 40% as the price doubled.

On the conclusion of the study, the authors stated that Uber demand curve is highly inelastic and made $6.8 billion consumer surplus last year alone. This surplus is twice greater than how much the drivers were paid and six times what Uber itself earned last year. This may be a good news for the college students whose goal is always to save money, but it is clearly not a great news for Uber which has lost $1.2 billion in the first half of 2016.

 

Although it’s been called the “most expensive city in the U.S.”, San Francisco homeowners are challenged with an issue more prevalent than just the neighborhoods steep price tag — homelessness.

According to a recent study by the California Budget Center, the city ranks first in California for economic inequality. With the average household income of the top 1% ($3.6 million) reaching 44 times that of the bottom 99% ($81,094), it’s clear that there is a serious housing and wealth disparity in the city.

While San Francisco is known for its free-thinking, diverse, and innovative culture, the city has long struggled with the issue of homelessness despite spending upwards of $240 million every year to tackle it. Moreover, it is estimated that the 1,600 chronically homeless people cost the approximately $80,000 each per year, with the number rising to $150,000 for the 338 considered “most needy” in the public health database.

The irony of the situation lies in the fact that while San Francisco is deemed as being a progressive, welcoming, and moderately warm city this also means that that there continues to be a large influx of homeless people to the city each year. Which, in turn, poses major challenges to both policy makers and residents who are already battling with the cities extremely expensive housing market.

 

 

 

 

 

 

 

 

 

 

In order to tackle the issue of homelessness in San Francisco and create serious change, policy makers need to look at the issue from both the homeowner and humanitarian perspective.

On the one hand, while it is understandable that homeowners are becoming increasingly frustrated with the issues, lawmakers cannot solely listen to residents complaining about having old mattresses lying outside their $4 million dollar walkup. Similarly, increasing budgets for welfare and rehabilitation programs will not be beneficial if there is not the infrastructure and culture to do so.

Maybe what the city really needs is a change of mindset — in both how people and policy makers view and understand the issue of homelessness?

It is not as simple as just ‘creating housing and offering programs’… it will take an entire community.

 

References:

http://projects.sfchronicle.com/sf-homeless/civic-disgrace/

http://qz.com/711854/the-inequality-happening-now-in-san-francisco-will-impact-america-for-generations-to-come/

http://www.sfchronicle.com/archive/item/A-decade-of-homelessness-Thousands-in-S-F-30431.php

http://www.triplepundit.com/2013/05/hult-gov-policy-homelessness-government-track/

 

 

The art market is not unlike the stock market. The auction floors of Sotheby’s and Christie’s akin to the trading floor of the New York Stock Exchange, men and women gesticulating or waving paddles as prices for the commodity – the work of art being sold – rise. People speculate and they buy to sell. Buying up art has become a show of strength and capital – both monetary and cultural – for the world’s wealthiest people seeking status and future profits. The problem though is that art is not a commodity of quantifiable worth. The price of a Francis Bacon triptych – regardless of how beautiful or one of a kind it may be – is subjective and driven by what a buyer is willing to pay. Art does not have an intrinsic value like gold, oil or other traditional investments constantly being bought and sold on the market.

Speculation is ultimately the largest driver of the art market and has resulted in the distortion of art valuation, and like any market speculation leads to inflated prices and potential bubbles. The art market’s decline in 2009 is indicative of its vulnerability during times of economic turmoil; however, following the world financial crisis prices of art began to rise and inflate again with people believing art to be a safe asset to invest in when other markets are doing poorly (Segal).

Art is enticing because the gains that can be made in the short-term are much higher when compared to other forms of investible assets; and continued low-interest rates have made it easier for lenders to borrow more money, driving up prices as well. Since the 2008-09 global recession, the value of art has more than doubled since financial recovery (Helmore). The problem again is that art, is illiquid, it has no fundamental value and is driven by oligarchs that call themselves collectors. These so-called collectors are really just interested in turning a profit and thus the boom for art, failing to take into account issues of exposure to oversupply; because art, specifically contemporary art is essentially in endless supply, with a new Warhol or Koons or Hirst coming onto the scene. While this is all good and fine as long as people continue to be willing to pay these prices, there is no question that market has been overheated by the “irrational exuberance” of speculators.
Current trends of buying up art as an asset with the expectation that it will be worth more in the future mirror that of the dot-com bubble of the 1990s and the collapse of the housing market in 2009, the prices simply cannot continue to sustain themselves.

 

 

 

 

 

Referenced:

 

http://www.nytimes.com/2012/07/22/business/swiss-freeports-are-home-for-a-growing-treasury-of-art.html

https://news.artnet.com/market/art-market-bubble-report-409136

http://www.artbusiness.com/osoquspec.html

https://www.theguardian.com/artanddesign/2016/jan/17/art-market-mania-phase-bubble-report

 

The college experience is priceless. How can you put a dollar sign on meeting the most diverse, interesting, and intelligent group of people you will ever encounter, and high-fiving complete strangers when your team has 2 touchdowns by the first quarter?

We all know we’re paying too much for college. We all complain and cry a little everyday as the interest bumps up our once “small” loan debt to numbers beyond our comprehension. We pay a large sum of money for an education that sometimes feels wasted on us due to procrastination and the occasional frat party. Some even skimp out on buying textbooks to save a few bucks.

Yet, do we ever blame football? Basketball? The attractive men’s volleyball team? Of course not.

According to the Huffington Post, our greatest unknown fears are put in writing : College football is stealing our education.  The student loan debt crisis is old news but here are the current statistics. There are 43.3 million Americans with student loan debt, he total U.S student loan debt being 1.26 trillion. About 70% of college students end up with $30,000 in student loan debt. All in all, the price of tuition continues to rise and therefore so does the debt.

The issue is not that education is expensive because of course we all know that going in. The issue is that the uptick in tuition may not be going to the things that lead to our success but the athletic department instead. According to the Huffington Post, schools with strong football teams correlate with increased tuition up to 55% or in some cases 65%. Pouring more money into football at many schools leads to faculty or degree programs being cut. Ironically, the claim that athletic departments bring so much to the school has not been proven. The opposite has, that “Over 80 percent of collegiate athletic departments actually lose $11 million dollars or more for their universities yearly.”

It is difficult to claim that USC as a whole has allowed academics to suffer due to football. Evidently, USC graduates do very well. However, is it really necessary to pay the equivalent of a mortgage every year? Especially when our team is realistically pretty mediocre…

Interestingly enough, the White House claims that “student loan debt is an investment in human capital that typically pays off through higher lifetime earnings and increase productivity.” They released an entire study “proving” student debt helps instead of harming the economy. The proof lies in the fact that students with the most debt have usually gone through graduate school which means higher income and opportunity in the future. However, what happens when you get zero financial aid assistance during undergrad? What do you do then?

Perhaps taking a closer look at the White House study would prove me wrong, but at the end of the day, even if high unemployment leads to higher enrollment rates at universities how is the average American expected to manage such large amounts of debt with such an unpredictable job market?

Sources:

https://studentloanhero.com/student-loan-debt-statistics/

http://www.huffingtonpost.com/robert-greenwald/college-football-is-steal_b_8282690.html

http://blogs.wsj.com/economics/2016/07/19/student-debt-helps-not-harms-the-u-s-economy-white-house-says/

If you haven’t heard of Taobao, you’ve at least heard of Alibaba. Operated by Alibaba, Taobao is the number one online marketplace in China. The founder, Jack Ma, was so ambitious that he wanted business for everybody. So he created an online platform in order to deliver C2C business (with a B2C branch called T-Mall). Taobao leads the e-commerce business in China, but also led a major battle between e-commerce and physical retails.

Taobao was founded in 2003; it was doing alright during the first a few years, but the sales volume really started to grow massively since 2011. Its 2015 annual sales volume was ￥3 trillion, which was more than triple to 2011, and the 2011 annual volume was already larger than the first five years combined.

Source: Taobao, 2015 annual sales volume 3 trillion yuan

Source: Statista

Take a guess. How long did it take for this online marketplace to generate ￥1 billion volume (approximately $150,000,000) on 2015’s “Singles’ Day Nov. 11th” (the Chinese version of Black Friday)? Seventy-two seconds. The sales number bumped up to $1.5 billion within 13 minutes, and by the end of that day, Taobao reported the final sales number to be $14.3 billion.

A lot of people have been criticizing Taobao, for “destroying” the physical retail business. Of course, Taobao is the inventor of this shopping culture, but this is the money people would have otherwise spent in physical stores.

But we can’t blame the consumers. One of the biggest advantages you get from shopping on Taobao, is that you can buy good value products within a very reasonable price range. We’re buying products made in China in the U.S., because they are cheaper. But surprisingly, the same products often are sometimes more expensive in China. Because although labor in China is rather inexpensive compares to western countries, the cost of housing and rent is scary. In order to remain in business, many retail stores raise the price of their products. You might find a jacket with a brand you’ve never heard of in a random street shop, and it costs more than $150, whereas you can get a very similar jacket on Taobao for less than $50. Now, more and more consumers go to the physical stores to check out the products, and then go home and shop on Taobao, or other similar sites. This leads to a lot more problems. For example, many retailers stopped renewing their leases and turned to online selling, which causes challenges for shopping malls and shopping districts.

However, can we blame Taobao for starting an unfair market competition? Not really. After all, the cost of making a product is still relatively low. Would physical stores become just a testing site for the consumers?