• Renting or buying? Where to live?

    Financially, buying often makes more sense than renting, but not always. According to this article on CNN Money (Vasel, 21 Apr 2016):

    If a retiree does not plan to pass the home on to heirs, it's nearly always cheaper to rent than to buy, according to a report from Trulia.

    That's because building equity is one of the biggest factors that favors purchasing a home. But if there are no plans to leave the home behind, or buy another home, it usually makes more financial sense to rent.

    This infographic compares rents in the major U.S. cities:

    You will find more statistics at Statista

    For discussion:

    What factors should you consider when you compare renting with buying?

  • Is the Fed Audited?

    One of the myths of financial markets is that the Fed is not accountable to anyone and no audits take place.

    Not true.

    The Fed is indeed audited, just like other banks. The Fed undergoes both internal audits and external audits. Additionally, the Fed chairman delivers regular reports to congress.

    For discussion:

    How is the Federal Reserve held accountable for its management and its decisions?

    Which portion of the Fed's responsibilities are NOT audited? Why?

  • What Career is Right For You?

    What do you want to be when you grow up? It's a question that may not have a single right answer. And the answer may change as you leave college, start your career, face turns and twists in the road, and finally discover what you're passionate about.

    This video invites you to explore how you can think about what you want to do next. If you are thinking finance, non-profits may be the place where you can marry your passion to your career. Non-profit financial management is not without its own difficulties, however.

    According to this post from Knowledge@Wharton:

    According to McKenna, studies show that while large nonprofits have a difficult time competing with Wall Street or with large corporations on pay, those same surveys show nonprofit careers offer higher job satisfaction, at least initially. “But what happens in nonprofits is burnout,” he added. “Essentially, studies show that workers don’t feel there are opportunities for them to advance, to learn new skills, to broaden what they can do.” At the higher levels of nonprofit management, conflict with board members is most frequently cited as a reason for leaving.

    For discussion:

    What are the benefits of working for a non-profit after college? What are the limitations?

    How can you determine what career choice is right for you?

  • Investment in the Olympics

    With the Rio 2016 Olympics over, several news sources are trying to answer this question: Was hosting the Olympic games worth the cost of investment?

    According to a recent article from Texas A & M University:

    “Politicians tend to advertise that if a city hosts the Olympics, then it is sure to be profitable for the local community,” Dr. Salaga said. “That sounds good in theory, but what is shown time and time again is that the actual total cost of hosting games is much larger than the estimate.”

    In the past, the actual estimated cost for cities hosting the Olympics has almost always surpassed the original estimate. These costs include city renovations, infrastructure and transportation construction. Rio was no exception.

    “This past Olympics in Rio was supposed to cost the city $3 billion and by the end of it all, it exceeded $4.6 billion,” said Dr. Salaga. “When you start thinking in the way of making the games as lavish as possible, it’s not cheap. And most of the time, the taxpayers end up paying for that.”

    This infographic shows the cost of the games in Rio compared with prior Olympic games.

    You will find more statistics at Statista

    For discussion:

    What costs should be considered when a city evaluates an undertaking as large and expensive as hosting the Olympics?

    Can you find any nonmonetary benefits to the host city or country?

  • Is the Fed Controlled by Wall Street?

    On December 23, 1914, President Woodrow Wilson signed the Federal Reserve Act into law. This created the unique U.S. central bank, which is often described as a "decentralized central bank" with its 12 districts.

    The Fed's website says that the creation of the Fed, "stood as a classic example of compromise—a decentralized central bank that balanced the competing interests of private banks and populist sentiment."

    The video below describes how the Federal Reserve is organized and how it is supervised. While bankers do play a role in the Fed, the real accountability is to the American people.

    For discussion:

    Why does the myth exist that the Fed is controlled by Wall Street?

    How is the Federal Reserve structured and who supervises it?

  • Day in the Life of a Corporate Banker

    This video shows what it's like to work as a corporate banker at JP Morgan.

    In this video, the manager discusses some of the responsibilities of her work, and she talks about balancing responsibilities at home and at work.

    Though the excerpt below from a blog post on Knowledge@Wharton: discusses work/life balance for women on Wall Street, the lessons learned are valuable for any new graduate seeking to enter the work force:

    In the hurly burly of Wall Street, the panelists stressed, it is important for a person to know what his or her priorities are. “What really is work/life balance?” asked Surina Shukri, a vice president in JP Morgan’s Natural Resources Investment Banking group, who recalled spending many late nights at the office as a first-year analyst. “It doesn’t necessarily mean you work x hours and play y hours. It’s really a matter of knowing what’s important to you. Your priorities are going to change over the course of your career.”

    For discussion:

    1. What interested you the most about life as a corporate banker? What interested you the least?

    2. What are the struggles faced by those who seek a work/life balance? How should they manage their work/life balance?

  • Stop Living Paycheck to Paycheck

    This infographic from CareerBuilder via FinanceGraphics shows what it takes to stop living paycheck to paycheck and gain financial freedom.

    In this US News and World Report article, some common sense ideas to stop living paycheck to paycheck include:

    1. Get a handle on your money situation
    2. Cut spending from your budget
    3. Look for ways to increase your incoming cash
    4. Focus on a bright future.

    The article goes on to describe that sometimes the paycheck to paycheck cycle is only a temporary stage. It is possible to gain financial freedom and stop living paycheck to paycheck.

    For discussion:

    What are some tips you can offer someone who is trying to gain financial freedom?

  • Ford versus the Investors

    Growing a business from a sole proprietorship to a corporation has its benefits and its drawbacks. As a privately held company, the owner has the sole decision making authority, but also has to come up with all the money. Becoming a larger company means greater growth possibility, but with that growth comes shared responsibility and shared corporate goals.

    Ford Motor is an example of the original owner--Henry Ford--having a different vision for the company than the vision held by investors.

    Henry Ford created the most important industry in the American economy, though he didn't quite have the support of his investors. His investors wanted a car for the wealthy, but Ford wanted to create transportation for the regular man.

    For discussion:

    For each of the types of business organization, list the benefits and the limitations:

    • sole proprietorship
    • partnership
    • corporation

  • History of Wall Street

    This History Channel describes why Wall Street is named Wall Street.

    From the Library of Congress:

    The history of the New York Stock Exchange External Link begins with the signing of the Buttonwood Agreement by twenty-four New York City stockbrokers and merchants on May 17, 1792, outside at 68 Wall Street under a Buttonwood tree. In the beginning there were five securities traded in New York City with the first listed company on the NYSE being the Bank of New York.

    For discussion:

    How is the NYSE organized today? How do trades take place on the NYSE?

  • Cost of the Olympic Games

    And so begins the summer Olympics in Rio 2016. From the NY Times (Romero, 5 Aug 2016):

    Political leaders certainly hope that the Olympics will be a turning point in the fortunes of Brazil and Rio, whose quest to host the Olympics began in the early 1990s — a time when the city was wallowing in crisis, enduring a long decline after authorities built Brasília, the new capital, from scratch deep in the country’s interior and transferred much of the federal bureaucracy there in the 1960s.

    Still, the International Olympic Committee frequently frustrated Rio’s ambitions. It was only in 2009, when Brazil’s star was on the rise as the economy prospered from a commodities boom, that Rio was finally awarded the Games. Elated crowds celebrated on the sands of Copacabana.

    But the cost of hosting the games is always the subject of talk.

    You will find more statistics at Statista

  • The Story of Warren Buffett

    He's the "Oracle of Omaha." His investing is legendary and he often offers his top rules for investing. He has been known to tell investors to stay away from leverage. "If you're smart, you don't need it. If you're dumb, you have no business using it."

    For discussion:

    What are some lessons you can glean from the biography of Warren Buffett?