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Driving-range chain Topgolf could reportedly IPO as soon as this year with a $4 billion valuation

Mon, 01/06/2020 - 4:25pm

Topgolf International has picked its partner banks for an initial public offering that could arrive as soon as this year, Bloomberg reported, citing people familiar with the matter.

The IPO would value Topgolf at about $4 billion. The partner banks for the deal include Morgan Stanley, JPMorgan Chase, and Bank of America, sources told Bloomberg.

Topgolf has $525 million in outstanding debt, Bloomberg reported. The company has not yet responded to a request for comment.

Topgolf operates driving ranges with group bays, electronic ball tracking, and food and drink offerings. Certain venues host additional entertainment options including concert stages, shops, pools, and rooftop lounges. The company serves more than 20 million customers annually across 50 locations around the world, according to its website.

Topgolf's early backers include Callaway Golf, which invested in the company as early as 2006. Callaway stock climbed following news of Topgolf's IPO, and closed roughly 3.3% higher Monday.

Topgolf's public debut would arrive in the wake of 2019's IPO meltdown. Major startups including Uber, Lyft, and Peloton sank in their first days of trading, collectively wiping out billions of dollars of investor wealth as traders balked at the firms' lack of profitability.

WeWork and Endeavor were days away from entering public markets before analyst scrutiny and market volatility prompted them to cancel their highly anticipated IPOs.

The collection of IPO slumps is now creating two distinct windows for companies to go public in 2020, according to Deloitte IPO expert Previn Waas. Some firms will look to go public before 2020 presidential campaigns ramp up in July, while others will wait until after November to issue their first tradable shares, he said.

"The political climate certainly has an impact and they're certainly trying to time that," he added. 

Now read more markets coverage from Markets Insider and Business Insider:

Apple is 'unlikely' to repeat its 89% leap from 2019 in the new year, Deutsche Bank says

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Join the conversation about this story »

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'Approximately 100 percent' of tariff costs have fallen onto Americans, new research shows

Mon, 01/06/2020 - 4:23pm

  • President Donald Trump falsely claims that China and other nations have paid the tariffs he levied on thousands of products over the past two years.
  • But "approximately 100 percent" of those costs have fallen onto American buyers, according to a new National Bureau of Economic Research paper.
  • The paper, which uses customs data through October 2019, reflects a series of similar independent findings that have been published over the past year.
  • Visit Business Insider's homepage here.

President Donald Trump falsely claims that China and other nations have paid the tariffs he levied on thousands of products over the past two years. But "approximately 100 percent" of those costs have fallen onto American buyers, according to a new National Bureau of Economic Research paper. 

"Using another year of data including significant escalations in the trade war, we find that US  tariffs continue to be almost entirely borne by US firms and consumers," the economists — Mary Amiti of the Federal Reserve Bank of New York, Stephen J. Redding of Princeton, and David E. Weinstein of Columbia University — wrote in a paper that was circulated this week. 

A 10% tariff is associated with about a 10% drop in imports for the first three months, according to the economists, and this relationship becomes more intense as time goes on. So the effects of tariffs, which were increased this fall, may have not yet been fully seen. 

The paper, which uses customs data through October 2019, reflects a series of similar independent findings that have been circulated over the past year.

"The continued stability of import prices for goods from China means US firms and consumers have to pay the tariff tax," New York Federal Reserve economists Matthew Higgins, Thomas Klitgaard, and Michael Nattinger wrote in a November study

The US and China plan to sign this month to sign an interim trade agreement, which was reached in October as the two sides sought to defuse tensions. That stalled several planned escalations, but tariffs were kept on thousands of products shipped between the two largest economies.

SEE ALSO: France vows to retaliate against latest Trump tariffs on wine and cheese

Join the conversation about this story »

NOW WATCH: A big-money investor in juggernauts like Facebook and Netflix breaks down the '3rd wave' firms that are leading the next round of tech disruption

This is how the 5 youngest billionaires in America spend their time and money

Mon, 01/06/2020 - 4:01pm

The five youngest billionaires in America have a combined net worth of $28.5 billion

Kylie Jenner, the youngest billionaire in the world, spends much of her fortune on new homes, customizing luxury cars, and vacations with her baby daughter, Stormi Webster. Jenner is particularly known for flaunting her wealth on social media, as she did after chartering a $200 million superyacht for her 22nd birthday celebrations.

Behind Jenner, there is Snapchat cofounder Evan Spiegel, who, at 29, is also one of the world's youngest billionaires. Spiegel has taken a more private approach to how he spends his time and money, especially since marrying model Miranda Kerr in 2017. 

Spiegel and Kerr reportedly live together in a $12.5 million home in Brentwood, California, and also have an ocean-front Malibu cottage worth nearly $2 million. 

Here's how Jenner, Spiegel, and America's other youngest billionaires spend their time and money.

SEE ALSO: The 15 richest women in America, ranked

DON'T MISS: Meet the 15 youngest, richest American billionaires

Kylie Jenner, the world's youngest billionaire at 22, has a net worth of $1 billion. She spends much of her fortune on luxury cars, vacations with her daughter, Stormi Webster, and accessories like handbags.

Source: Forbes, Business Insider, Business Insider



Her car collection alone is reportedly worth millions.

Source: Instagram, Business Insider



According to E! News, the 22-year-old at one time owned four homes, including three in Hidden Hills, California.

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Source: E! Online, Instagram 



For her 22nd birthday, the makeup mogul chartered a $200 million yacht named Tranquility.

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According to the charter listing, Tranquility costs €1.1 million (over $1.2 million) per week to rent.

Source: Instagram, Business Insider



She also has an extensive collection of rare Hermès handbags.

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Source: Instagram



Jenner also spends plenty of money doting on her 1-year-old daughter, Stormi Webster.

In November, Jenner gave fans a brief "tour" of Stormi's playroom, showing off the baby's monogrammed Louis Vuitton bag and set of decorative skateboards reportedly worth over $12,000.

More recently, Jenner posted about the Fendi stroller and matching Fendi diaper bag she'd bought for her daughter, both reportedly costing thousands of dollars.



Evan Spiegel, 29, has a net worth of $3.6 billion. He's the cofounder and CEO of Snap Inc., the company that owns wildly popular social media platform Snapchat.

According to Forbes, Spiegel is "one of only three self-made billionaires in the world under the age of 30."

Source: Business Insider, Forbes



Spiegel is married to model Miranda Kerr. The two live in a 7,164-square-foot $12.5 million home in Brentwood, California.

Source: Business Insider



They also reportedly own a 1,700-square-foot cottage in Malibu, which Kerr bought for $2.15 million after she first moved to Los Angeles.

The home is eco-friendly, and has a machine that produced sustainable water for the whole house.

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Source: Hollywood Reporter, Business Insider, Instagram



Spiegel proposed to Kerr in 2016 with a 2.5 carat diamond ring that reportedly cost nearly $100,000. They married in 2017, and Kerr wore a custom made Christian Dior couture wedding gown.

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Source: Business Insider, Instagram, Instagram



The pair reportedly had their honeymoon at a resort in Laucala, a private island in Fiji. One night at one of the 25 villas costs between $6,000 and $60,000, with a minimum stay of at least four nights.

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Some sources, however, report that Spiegel and Kerr stayed at the owner's home instead

Source: Business Insider, Instagram



After Snap went public, Spiegel took a "bro trip" on a superyacht that costs $967,415 per week. He reportedly sailed to Italy and Greece.

He also bought himself a Ferrari in 2015. 

Source: Business Insider



Then there is 31-year-old Bobby Murphy, chief technology officer of Snap Inc. He has a net worth of $3.7 billion. Along with Spiegel, he cofounded Snapchat.

Source: Forbes



Forbes reports that Murphy has spent more than $30 million on real estate in Pacific Palisades and near Venice Beach, where Snap Inc.'s headquarters is located.

Source: Forbes



In 2018, he spent $19.5 million on a Palisades home once owned by actor Eddie Albert. A year later, he bought the 4,432-square-foot home next door for $9.5 million. According to Variety, sources say Murphy is hoping to build a bigger estate.

Source: Variety 



Murphy also owns a $6 million home elsewhere in the Palisades, a $2.26 million home in Venice, a $2.1 loft near Venice, a $2.1 million home in Santa Monica, and a $5 million home in Venice.

Source: Variety 



Lukas Walton, 33, has a net worth of $18.2 billion. He is a grandson of Sam Walton, best known as the founder of Walmart. He inherited his fortune after his father died in a plane crash.

Walton also owns stakes in First Solar and Arvest Bank. He is chair of the environmental program committee at his family's foundation, where he has donated nearly $149 million. He currently lives in Jackson, Wyoming.

Source: Forbes



Walton, like many of the other ultra-wealthy Walmart heirs, is pretty private about his life. A 2015 profile about him revealed he was raised in National City, California, where the median income is $30,000 per the 2000 census. He also attended Colorado College where he received a bachelor's in "environmentally sustainable business" — a major he created.

Despite his discrete personal life, according to New York Magazine, he has voting rights on his family's holding company board, Walton Enterprises, which still holds a 50.2% stake in Walmart.

Source: NYmag, Walton Family Foundation



Thirty-four-year-old Julio Mario Santo Domingo III has a net worth of $1.9 billion. He is a disc jockey, and formed Sheik n' Beik Entertainment in 2013 with Herve Larren.

His wealth comes from his grandfather, who once controlled the entire beer industry in Colombia.

Source: Page Six



In 2015, Larren sued Santo Domingo, claiming that Santo Domingo used him for business connections, then excluded him from the earnings for a Florida music festival. Larren filled a $37.8 million lawsuit in New York.

Source: Page Six



Larren alleged that Santo Domingo persuaded him to leave his job at LVMH to help launch Santo Domingo's DJ career.

According to Larren, Santo Domingo used Larren's connections from LVMH, as Larren helped Santo Domingo secure DJ jobs in Paris, London, Monaco and Ibiza.

Source: Page Six



Before the Florida music deal, Santo Domingo fired Larren, accusing him of embezzlement.

Santo Domingo had sued Larren, alleging that Larren took a $1.8 million loan from him (reportedly meant to help launch an online charity auction company), then spent it on his "extravagant lifestyle" instead.

Source: Page Six



Other than legal disagreements with his former business partner, Santo Domingo seems to live a pretty charmed, but otherwise private-from-the-public life.

His brother-in-law is Andrea Casiraghi, a Monegasque prince. His uncle is Alejandro Santo Domingo, chairman of the Santo Domingo Group, who has a net worth of nearly $4 billion.



In 2016, he married reporter Nieves Zuberbühler in a Halloween-themed wedding. The ceremony was held at the Visitation of the Blessed Virgin Mary Parish in Red Hook, Brooklyn.

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Source: Vogue, Instagram , Instagram



He lives in New York City, while his wife is a working reporter. Her last Instagram posts show her traveling the world.

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Source: Instagram 



Apple is 'unlikely' to repeat its 89% leap from 2019 in the new year, Deutsche Bank says

Mon, 01/06/2020 - 3:34pm

  • Apple is "unlikely to come close to repeating last year's returns," Deutsche Bank analysts said in a Sunday note.
  • The tech giant soared 86% through 2019, driven by better-than-expected iPhone 11 demand and a rapidly expanding wearables business.
  • Apple's fundamentals "are likely to come in stronger" than Wall Street's current expectations, the analysts wrote, but uncertainties around 2020 iPhone demand, tariff risk, and a lofty valuation will keep shares from a continued surge.
  • Watch Apple trade live here.

Apple will impress Wall Street in the new year, but don't expect the tech giant to jump as much as it did in 2019, Deutsche Bank analysts wrote in a Sunday note.

The iPhone maker surged 86% in 2019, notching its best annual return since 2009. Strong iPhone 11 sales and growth in its wearables business fueled the massive run-up, and while DB expects strength to continue through 2020, the analysts caution that the stock will "normalize at a higher valuation."

"In our view, such a setup bodes poorly for investors who consider what to do with their AAPL holdings from present levels, as the stock is unlikely to come close to repeating last year's returns," analysts Jeriel Ong and Ross Seymore wrote.

DB still expects the tech giant's 2020 results to please investors. Apple's fundamentals "are likely to come in stronger than present Street modeled expectations," the analysts wrote, citing strong holiday sales across several product lines. They added that investors can look forward to the 5G "supercycle" in Apple's next lineup of iPhones and continued demand for AirPods.

The firm maintained its "hold" rating on Apple stock, noting that risks sourced from its "sharp valuation expansion" are now balanced with "potential reward." Even though DB raised its price target to $280 from $235, the new level still implies a 6.5% tumble over the next 12 months.

"Overall, with uncertainties still existing in the 2020 iPhone growth trajectory, macro risks with tariffs still unsettled (China yet to be fully resolved), and a valuation that reflects a lot of goodness in our view, we are unsure whether the fundamental outperformance can outstrip the high investor expectations for the stock in 2020," the team wrote.

Other analysts are more bullish toward Apple's 2020 prospects. Needham analysts Laura Martin and Dan Medina raised their Apple price target to $350 from $280 on Monday, implying the stock could jump 18% through the year. The company's stock will be driven higher by its compensation structure, relationships with wealthy buyers, and "gatekeeper" status, the analysts wrote.

Despite the price target boost, Needham echoed some of DB's sentiment, downgrading Apple shares to "buy" from "strong buy" due to its significant outperformance against the S&P 500 through the past year.

Apple traded at $299.47 per share at 3:15 p.m. ET Monday, up roughly 2.7% year-to-date.

The company has 27 "buy" ratings, 15 "hold" ratings, and seven "sell" ratings from analysts, with a consensus price target of $273.56, according to Bloomberg data.

Now read more markets coverage from Markets Insider and Business Insider:

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Some Americans are ditching their mortgage to rent in retirement, and it shows how their lifestyles — and finances — are changing

Mon, 01/06/2020 - 3:26pm

  • While conventional advice says that mortgage-free homeownership is important to retirement, many American retirees are finding that renting better fits their lifestyle and their finances.
  • For retirees wanting to live a more active lifestyle than previous generations, owning a huge home doesn't have the appeal it used to.
  • Business Insider is looking for snowbird retirement stories to feature in our Real Retirement series. If you're a snowbird retiree — or retired to Wyoming — and are interested in sharing your story, email yourmoney@businessinsider.com.
  • Read more personal finance coverage.

Retirees Joe and Karen Stermitz are done with homeownership. 

"We owned homes all through our careers, and they turned out to be good investments," Joe Stermitz told Business Insider. They lived all over the US in 16 different homes, both owned and rented. Before Joe retired in 2016, they lived in a 4,000-square-foot home in southern Washington. It just wasn't for them anymore.

These days, their home is a six-by-seven-foot overlanding vehicle they use to travel the world, and they plan to rent something more permanent when their adventure is over.

The couple wanted to start living their retirement dreams sooner rather than later, and found that selling their home was the best way to do that. "Selling the house wasn't so much a strategy as it was a necessity. It was the only way we could retire early," Joe Stermitz said. 

For this couple and a growing number of retirees, a combination of lower expenses, freedom, and flexibility are making renting more alluring than owning.

"I think that renting is a tool that's overlooked by many retirees," Greg DuPont, a financial planner in Columbus, Ohio, said. He has seen retirees going against the traditional advice of having a paid-off mortgage in favor of renting, and considers it to be a smart financial move in some cases. "The whole notion of homeownership and building equity and transferring that equity down to the kids has been kind of a flipped on its ear by what happened in 2008," DuPont said. 

For years, a paid-off mortgage has been seen as the key to a stable retirement. But today, increased costs of homeownership and changing lifestyles make renting a more appealing option than ever for many retirees. "When you start looking at the big picture when planning for retirement, and break free of those traditional notions of homeownership, you end up liberating yourself," DuPont said. 

It's more affordable to rent than buy

DuPont said that his parents have chosen to rent a home. "Even though they're renting a place for several thousand dollars a month, it's really the cheapest place they'll have," he said.

"People don't realize until they start really crunching the numbers that some of the changes in the tax code have reduced the deductibility of property taxes and local taxes, etc.," he added. "That really has made the price distinction between buying a home and renting closer than people think."

Renting isn't all that uncommon for retirees these days.

"Since 2005, Americans in their 50s and 60s have accounted for the largest portion of the country's increase in renters," Lynnette Khalfani-Cox reported for AARP.

For many retirees thinking about moving, the places they're considering have much higher costs of living and homeownership than many other parts of the US. In the Phoenix metro area and the Tampa, Florida, metro area — two of the country's hottest retirement destinations, according to MagnifyMoney — median home values are $259,000 and $242,000, respectively, according to Zillow. Those figures are both significantly higher than the typical median home in cities those retirees are leaving, like Cleveland, where the median home value is $61,000, and Indianapolis, where that figure is around $148,000.

From tax time to upkeep expenses each month, the Stermitzes have noticed a difference since they left homeownership behind. "Without the burden of the house and all of those expenses that come with it — the need to buy fertilizer for the lawn and drapes for the windows — without those, suddenly, you're liberated," Joe Stermitz said. 

Similarly, Edd and Cynthia Staton sold their Las Vegas home and have been renting in Cuenca, Ecuador, since 2010. For them, renting opened up the possibility of a lower-cost lifestyle in another country. "We live in a two-story, four bedroom, 4 1/2 bath penthouse apartment," Edd Staton said. "We don't own, we rent, and we've rented this apartment for almost a decade." While their rent is much cheaper in Ecuador than it would be for a comparable rental in the US, their decision to rent has given them the flexibility to live somewhere that is more affordable.

By the time they left the US in 2010, the Statons had watched their home value plummet by two-thirds. Their decision to rent has helped them save on taxes and other homeownership expenses and, most importantly, given them the flexibility to live where it's affordable. "Our nest egg has actually grown instead of shrunk," Edd Staton said.

Lifestyles and preferences are changing for all generations 

People are tending to rent more frequently and live longer in retirement than they used to. For retirees wanting to live a more active lifestyle than previous generations, and for much of the younger generations, owning a huge home doesn't have the appeal it used to.

"I don't need a big house. I had a big house, a 4,000-square-foot in Washington. But it's nothing," Karen Stermitz said. She and Joe aren't sure they'd want to own a home again. 

"For me, the idea of not being tied to one place is so much more exciting. You get to meet new people and new friends and can work on new charities," Karen Stermitz added. "I like the idea of maybe never owning a home again."

Inheriting a home isn't what it used to be, either. "The reality is that most kids don't want the home that mom and dad have," DuPont said. "They're really not preserving an asset for kids. All they're doing is building a bigger target that could end up being depleted by long-term care costs." 

As the older generation starts to downsize, DuPont said renting could be helpful. "It's either buying a condo with all the regulations just so you have a home that is more size-appropriate or looking at rentals," DuPont said.

"I think that renting is something that really should be used more as people design a future that way," he added. And for many retirees, going the nontraditional way and renting is the right way for them.

SmartAsset's free tool can find a financial planner to help craft your own plan for retirement »

Join the conversation about this story »

NOW WATCH: Behind the scenes with Shepard Smith — the Fox News star who just announced his resignation from the network

Financial Services: 6 Key Attributes to Attract Gen Z

Mon, 01/06/2020 - 1:02am

Now the largest generation worldwide, Gen Z accounts for nearly 68 million people in the US alone. As Gen Zers age, financial services providers will be increasingly pressed to shift focus to the burgeoning demographic.

As digital natives, Gen Zers are more receptive to influence from friends and family than traditional advertising. For marketers, strategists, and developers, understanding Gen Z's unique needs — and creating and marketing products accordingly — will be critical to reaping their value.

In Financial Services: 6 Key Attributes to Attract Gen Z, Business Insider Intelligence provides a six-point framework that highlights core traits of the demographic, which banks and payments firms can use to attract, engage, and retain Gen Zers.

This exclusive report can be yours for FREE today.

As an added bonus, you'll receive a free preview of our Banking Pro Briefing.

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Opening a high-yield savings account online made all the difference in paying off $33,000 of debt

Sun, 01/05/2020 - 1:30pm

  • When my husband and I decided to get serious about paying our $33,000 of debt, we started by making automatic transfers into our savings account.
  • Then, we opened a high-yield savings account with online bank Ally, to keep our savings accessible, but not so accessible that we'd dip into them for regular spending.
  • We ended up loving the extra interest we earned with Ally, and applied the same separation of accounts to my business, too. Now, we've paid off that $33,000.
  • See Business Insider's picks for the best high-yield savings accounts »

A few years ago, my husband and I decided to get serious about paying off our debt, which included $19,000 in student loans and a $14,000 car loan. It seemed like a fairly insurmountable amount at the time, but creating a working plan with visuals put us on the right track, and we paid it all off. Four specific techniques helped us stay on track.

1. Transfer regular spending to debt payoff, then regular savings

One of the critical pieces to paying off our debt, then building savings, was to transfer regular spending to those goals.

When our youngest daughter started kindergarten, that freed up $600 per month. When paying for childcare, these payments were made every Friday in the amount of $150. Instead of that payment just ceasing (creating the potential to spend more — or lifestyle creep, as Dave Ramsey calls it), we rerouted those payments. Instead of a charge out of our checking account weekly, I set up an automatic transfer for that same amount to our savings account. I then used that money on a monthly basis to pay off debt.

We followed the snowball method (paying off the smallest debt first to build momentum), paying the minimum on the student loan while attacking the car loan with the extra $600 and whatever other savings we could scrounge up. Once the car loan was paid off, we switched focus to the student loans, then to building our savings.

2. Make your savings accessible, but not too accessible

After we paid off the debt (which felt like an urgent task) I found myself taking money out of our regular household savings to justify a fun splurge, then wondering why our savings weren't growing very fast. Our regular savings account was just too convenient, since I could transfer money from savings to checking in less than 30 seconds in my online banking portal.

I started researching what it would look like to have a savings account at a different bank so it wouldn't be so easy to transfer money. In my research, I remembered seeing ads for high-yield savings accounts online. That made me a little nervous at first, wondering if I was just sending my money off into a black void never to be seen again.

I found Ally Bank and opened an account. The account had no balance requirement and, even though it's all online, it's still a FDIC-insured, meaning Ally is protected against losses for depositors, just like a brick-and-mortar bank. The withdrawals on the account were limited to six per month, so I wouldn't be tempted to transfer money in and out as regularly as I had done.

3. Interest earned on savings feels like free money

My regular bank pays only .015% on savings accounts, a fact that was also on my mind when looking for another place to house our savings. Currently, our Ally high-yield savings pays 1.6%, but paid 1.9% when I first opened the account. These decimals can add up, meaning that Ally would pay me $160 every year on $10,000 savings, compared to just $15 my regular bank would pay.

If you don't have any savings, this might seem like an unattainable number, but remember that we didn't have any savings either when we were paying off debt. It grows (especially when making money with interest), so start somewhere — anywhere.

4. You can apply the same approach to business accounts, too

Having a slightly less accessible savings account is useful in business, too.

After doing this personally for several years, I came across a similar approach in the book "Profit First" by Mike Michalowicz. He recommends separate accounts for various aspects of the business: income, operating expenses, owners compensation, taxes, and profit, with an additional separate profit account in a different bank.

Whether you are more focused on your business accounts or your personal accounts right now, it's always a good time to start saving. Start by paying off debt, then stockpiling what you'd previously been paying on that into savings. You'll be able to earn interest money on your (accessible, but not too accessible) savings before you know it.

Shanna Goodman is the creator of Ampersand Business Solutions.

Join the conversation about this story »

NOW WATCH: Behind the scenes with Shepard Smith — the Fox News star who just announced his resignation from the network

FREE SLIDE DECK: The Future of Fintech

Sun, 01/05/2020 - 1:01pm

Digital disruption is affecting every aspect of the fintech industry. Over the past five years, fintech has established itself as a fundamental part of the global financial services ecosystem.

Fintech startups have raised, and continue to raise, billions of dollars annually. At the same time, incumbent financial institutions are getting in on the act, and using fintech to remain competitive in a rapidly evolving financial services landscape. So what's next?

Business Insider Intelligence, Business Insider's premium research service, has the answer in our brand new exclusive slide deck The Future of Fintech. In this deck, we explore what's next for fintech, how it will reach new heights, and the developments that will help it get there.

Join the conversation about this story »

8 pieces of advice to help you retire when you want, according to people who have done it

Sun, 01/05/2020 - 12:30pm

  • Retiring on your terms takes far more planning than just leaving work when you're ready. Taking steps today can help you retire when you want.
  • From paying off debt or a mortgage, to figuring out the best way to allocate your invested assets, these eight retirees explain their best pieces of advice for anyone wanting to retire. 
  • Business Insider is looking for snowbird retirement stories to feature in our Real Retirement series. If you're a snowbird retiree — or retired to Wyoming — and are interested in sharing your story, email yourmoney@businessinsider.com.
  • SmartAsset's free tool can help you find a financial planner to build your own retirement plan »

Retirement is more than just leaving work. 

If you want to make sure that you'll be able to retire when you want, retirees from Business Insider's Real Retirement series have some tips from their own retirement experiences, from paying off your mortgage and other debts, to working with a financial planner.

Here are these retirees' best pieces of advice for anyone who wants to leave work someday. 

1. Find a good financial planner and work on your equity allocation

When one of his friends tell him they're thinking about retiring, Dirk Cotton's first advice is to find an expert. "Find a good a retirement planner, because retirement planning is incredibly complex," he said. "They're extremely helpful and worth the investment, and it's worth it to start talking to them in the years before you retire."

He also suggests focusing on your investments. "The major thing that I would say is, 10 years before retirement, you probably want to end up somewhere in the neighborhood of 40% to 50% equity allocation," Cotton, who retired at 52, said. He said this is one of the big things that helped him retire comfortably in 2005 and get through the Great Recession. 

"I weathered that storm extremely well," he said, crediting this advice. "A lot of people had 100% equities when they were saving for retirement, and lost over 50% in a very short period of time."

 



2. Make time for a yearly or quarterly retirement planning check-in

Bill Brown, who retired at 65, says one of the most helpful things he did was regularly set aside a few minutes to strategize. "I did this maybe once or twice a year," he said. "You sit back and you mentally go through, 'How am I doing? What could I change? What should I change?' And then, you alter it."

Doing this helped him and his wife realize they could be doing more to cover themselves with life insurance and long-term care insurance. It helped them to focus on the bigger picture of retirement planning, and keep on track to retire on time. 



3. Start planning sooner rather than later

"I got a late start. From 33 to 43, those quarterly statements I got from a TIAA, I threw them away," David Fisher, who retired at 65, told Business Insider. 

"When I was in my early 40s, I opened one of my quarterly statements that I used to throw away. And I said, 'Oh my goodness, I've got $30,000 to $35,000 in there. That's my money.' Then I became interested and retirement," Fisher said.

If he could turn back time, that's the advice he'd give to his 35-year-old self. "Invest early and invest as early as you can and put away whatever you can afford," he said. 



4. Start maxing out your retirement accounts and live within your means

Corky and Patti Ewing never made more than what is considered a middle class income in their California home. In 2019, they retired comfortably thanks to strategic saving and investment decisions. Corky told Business Insider he'd advise anyone wanting to retire to "max out their retirement accounts, their 401ks or their IRAs."

To do this, he continued: "I'd tell someone to live within their means, because you don't have to try to keep up with your neighbors."



5. Prioritize your spending on experiences rather than things

Karen and Joe Stermitz sold their home in Washington to travel the world and live frugally after they retired in 2017.

"I would tell people just to be frugal. Things don't bring you happiness, experiences do," Karen said. She and her husband started a journey through South America in an overlanding vehicle in 2019. 

"I don't buy things; we don't buy a lot of things. Get away from the focus of the things, and focus on experiences and living life," she said. 



6. Own a home you can afford

"Our home is key to our retirement," said Bill Davidson, who retired at 54. He and his wife Rose moved from Oregon to New Mexico after he stopped working to travel, live affordably, and be mortgage-free.

They chose to build an environmentally-friendly home, which reduces utility expenses considerably. "If you reduce your utilities to almost nothing, that means you're living in environmentally friendly, energy-efficient lifestyle," he said.

"Our home costs about $300 per month," he said. By owning a home they can easily afford and moving to live mortgage-free, the Davidsons are able to spend more on family and travel



7. Keep your credit score up and live debt-free

"I did get a little good advice early on from my godfather about having perfect credit scores and never using credit to finance lifestyle," said Fernanda Dorsey, who is now traveling the world with her husband, Jim, after retiring at 52. "Those pieces of advice were jewels," she added. 

"We've been basically following those two things, so we don't have any debt. When we left work to travel, we had perfect credit scores, and that's good," she said. 



8. Pay off your mortgage

James R., who preferred not to use his last name to protect his privacy, said that staying out of debt and living simply are the keys to retiring whenever you want

"We were already debt-free, that was normal for us," said James, who left his full-time job at 59 to work part-time from home. He and his wife had been living mortgage-free for about 25 years.

By not having debt, he was able to retire when the time was right, and take the opportunity without worrying about it. "When the clock ticked down to 59 and a half, I was 10 years in at work. That was enough to get an additional monthly check from the organization I worked for," he said. "That was the logical time to go."

SmartAsset's free tool can help you find a financial planner to build your own retirement plan »



A phone call to my student loan servicer changed the way I saw my $28,000 debt, and spurred me to pay it off 7 years early

Sun, 01/05/2020 - 11:30am

  • I graduated college with $28,000 in student loans. My minimum student loan payment was $350 a month, which was 20% of my take-home pay.
  • I called my student loan servicer to find out what would happen if I paid an extra $10 a month, and they told me it would take an entire year off my debt repayment. I couldn't believe it.
  • I wanted to become debt-free as quickly as possible, and that moment changed how I started to approach money. It made me realize that how I spent my money, even just a few dollars, could alter my future for the better.
  • I started changing the way I managed my money, and paid off my loans in three years instead of 10.
  • Get a free quote from our partner SoFi to see how much money refinancing your student loans could save »

I graduated college with $28,000 in student loans. That may seem like pennies to some, but I wasn't exactly rolling in dough. As an entry-level newspaper reporter, $28,000 was also my starting salary.

When you're barely squeaking by month-to-month, it's easy to feel trapped by your debt. But as I soon discovered, a tiny change in approach — and mindset — was all it took to feel in control of my financial situation.

When I discovered $10 could make me debt-free

My minimum student loan payment was $350 a month, which was 20% of my take-home pay. After rent, gas, utilities, groceries and my loans, there was very little left over at the end of each month.

After reviewing my budget, I decided to put an extra $10 toward my student loans every month. It seemed like such a drop in the bucket, but I decided to call my student loan provider to see how much of a difference it would really make.

The customer service representative said paying an extra $10 a month would mean I'd pay my loans off in nine years instead of 10. I was amazed. I couldn't believe that a measly $10, the cost of a movie ticket, would have such a huge impact on my student loan timeline.

I wanted to become debt-free as quickly as possible, and that moment changed how I started to approach money. It made me realize that how I spent my money, even just a few dollars, could alter my future for the better.

I finally felt in control of my finances

After this revelation, I felt in control of my finances for the first time since graduating college. Instead of a prison, my debt felt like a weight that was slowing me down — and I finally understood how to lighten the load.

I decided to change my spendthrift ways, examining how often I turned to retail therapy whenever I felt sad or bored. Bad day at the office? That meant a trip to Urban Outfitters for a few items I may or may not wear. Missing my long-distance boyfriend? That meant buying a pint of Ben & Jerry's to eat in one sitting.

Now, becoming debt-free was my primary goal, and I was willing to do anything to get there.

I started letting go of my name-brand obsessions. Instead of going to Sephora for makeup and skincare, I found similar products at the drugstore. Instead of buying new books, I checked them out at the library. I printed out coupons and used Groupon at restaurants and salons. I also started trying to find ways to earn more money, like taking online surveys or joining new banks for the sign-up bonus.

My editor even let me start blogging about my personal finance journey for the newspaper's website. When I eventually got a new job, I started my own blog. Writing about money turned into my current full-time career.

That $10 sparked a lot of little changes, but most importantly it made me realize what was actually worth paying for. Back then, it was financial freedom and becoming debt-free. Now, it's traveling abroad and remodeling my home.

When I got a new job, I added the salary increase to my student loans. A year later, I moved in with my boyfriend and a mutual friend. By then, I was putting 50% of my take-home pay toward my debt. Three years after my first student loan payment, I became debt-free.

I nearly went too far in the other direction

After I saw what a difference $10 could make, I was determined to scrimp and save anywhere I could. Very quickly, I transformed from someone who cared about saving money to someone who was consumed by it.

I once spent 15 minutes agonizing over a Redbox movie rental trying to decide if I should spend $1 on a movie. Every dollar matters, I told myself.

I had a hard time allowing myself small indulgences like a 75-cent candy bar at the vending machine. I'd beat myself up for all my past money mistakes, constantly thinking about frivolous purchases I'd made years before.

My money obsession started to make me miserable. I refused to even buy things I knew would make me happy, like a gym membership or art classes. I was depressed and wanted to go back to therapy, but told myself it wasn't worth the cost.

I also avoided doing things with friends, like going out for drinks or seeing a concert. When anyone wanted to hang out, I would push for cheap activities or not join them.

Being hyper-aware of my financial situation also made me secretly envious of others around me. "Must be nice to not care about your student loans," became my constant internal refrain.

Even after I paid off my student loans, the stinginess persisted for years. It took a while to rid myself of the scarcity mindset I had developed.

Eventually, I reached a balance. I went back to therapy, let myself eat out with coworkers, and splurged on fun things. Now, five years after paying off my student loans, I finally have a healthy relationship with money.

Get a free quote from our partner SoFi to see how much money refinancing your student loans could save »

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'Star Wars: The Rise of Skywalker' wins the box office for a third-straight weekend but is tracking slower than its predecessors (DIS)

Sun, 01/05/2020 - 11:27am

  • "Star Wars: The Rise of Skywalker" won the domestic box office for a third-straight weekend.
  • The third installment of the Star Wars sequel trilogy brought in $33.7 million over the weekend, bringing its domestic total to $450.8 million.
  • However, it's still behind what "The Force Awakens" and "The Last Jedi" earned by week three.
  • "Skywalker" could be the first movie out of the most recent "Star Wars" trilogy to not earn $600 million domestically by the end of its theatrical run.
  • Visit Business Insider's homepage for more stories.

Disney's "Star Wars: The Rise of Skywalker" is still doing big business at the domestic box office as it stayed in the top spot for a third consecutive weekend after taking in $33.7 million. But compared to its previous chapters in the Skywalker saga, the movie is a little sluggish by "Star Wars" standards.

The movie's domestic total is now at $450.8 million, a fantastic figure for any blockbuster after three weeks, but at this time two years ago "The Last Jedi" had brought in $531.5 million. And 2015's "The Force Awakens" raked in the domestic cume after the third weekend of an incredible $742.2 million.

At the end of the day it's not how fast you get to $1 billion, but if you get there, and "The Rise of Skywalker" will certainly do that, as the movie's worldwide total to date is $918.8 million. But the performance by "Skywalker" in the coming weeks will be interesting to track, as it might finish its theatrical run without getting to $600 million domestically. A figure that both "Force Awakens" ($936.6 million) and "Last Jedi" ($620.1 million) surpassed.

Sony supplied the rest of the box office power this weekend with three very different titles.

"Jumanji: The Next Level" continues to be a strong counterprogrammer to "Rise of Skywalker" as it came in second place with $26.5 million. Its domestic cume is over $236 million (over $600 million worldwide), proving the franchise will continue on for years to come.

Then it was a battle for third place between "Little Women" and "The Grudge." Greta Gerwig's adaptation of the classic edged out the horror with a $13.5 million take. But the latest reboot of the "The Grudge" has nothing to be upset about. Despite a 16% Rotten Tomatoes score and an F CinemaScore, the movie overperformed with a $11.3 million opening weekend (it was made for $10 million).

Box-office highlights:
  • Lionsgate/MRC's "Knives Out" continued to be one of the top-earning original titles released in 2019 (bringing in $9 million over the weekend, only a 9% drop from last weekend), but its performance in China has shocked everyone. Rian Johnson's whodunit, which he made after doing "The Last Jedi," has brought in over $28 million in the Middle Kingdom, which is more than what "The Rise of Skywalker" has earned there (over $17 million).
  • A24's "Uncut Gems" continued to ride its critical acclaim and award season buzz to bring in some impressive box office numbers, as the Safdie brothers movie starring Adam Sandler brought in $7.8 million over the weekend. That marks only an 18% decline from last weekend contributing to a $36 million cume.
  • Disney's "Frozen II" is the highest-grossing animated movie of all-time with over $1.3 billion worldwide. It passes the first "Frozen," which had the previous record with $1.28 billion.

SEE ALSO: The 6 winners and losers at the 2019 summer box office

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NOW WATCH: Documentary filmmaker Ken Burns explains why country music is universal

1-800 Contacts has been upending the healthcare industry for 25 years — CEO John Graham shares where he sees opportunities for further disruption

Sun, 01/05/2020 - 10:36am
  • 1-800 Contacts has been a pioneer of direct-to-consumer healthcare for 25 years.
  • CEO John Graham said eyecare companies were faster to adapt to a direct-to-consumer model because so many people pay for their contacts and glasses out of pocket as opposed to through insurance. 
  • He said there are two ways to get attention in healthcare — accessibility or cost — and it is usually a compromise between the two. The areas ripest for disruption are the places where you can break that compromise and offer more accessibility while lowering the price. Telemedicine, which allows people to interact with a doctor through their phone or computer, is a perfect example of this. 
  • 1-800 Contacts recently acquired the healthcare platform 6over6, which has created software that could let people take their vision tests at home.

Following is a transcript of the video.

Sara Silverstein: 1-800 Contacts has been around for 25 years disrupting healthcare. What lessons have you learned in the process?

John Graham: I think the two things that we have found is, one, you have to focus on the customer, right? In direct-to-consumer healthcare, it's all about taking care of customers, because if you're always having to acquire new customers, you can't grow a business right? Really you have to focus on the customer.

And then secondarily, you have to focus on your employees, because especially in our business, we have to have such a strong relationship with our customers, and that only comes by taking care of employees. And so, you can continue to innovate, by focusing on those two things.

Silverstein: Direct-to-consumer and healthcare seem to be very unrelated because there are so many frictions in the way historically. What were the biggest stumbling blocks in making that happen?

Graham: We are a very unique part of healthcare in that so many people pay for what we, for their contacts or glasses things like that out-of-pocket, whereas most healthcare tends to be much more insurance-oriented. And so as a consequence, we sit in this area between healthcare and consumer. Where we have to take care of consumers, be very conscientious of the cost of the product that we selling, taking care of customers, be providing simple solutions, but also making sure that health is taken care of.

Silverstein: And when you look at the larger healthcare picture in the US, is there anything that you feel like are areas that are ripe for disruption?

Graham: I certainly think that ours has, and that's where we've made an acquisition in 6over6, particularly because, if you think about the healthcare in the US, there's generally two things that create attention in healthcare right? There's accessibility and cost. And what we have found is, through telemedicine we can break that compromise, we can create greater accessibility, and also drive down costs. And so I think the places that seem the most ripe for disruption, are places where you can break that compromise, I mean.

Silverstein: And what is telemedicine?

Graham: So telemedicine is where you can interact with a doctor, not face-to-face as you and I are, but through some sort of a visit, virtually through your phone or through a computer, or through different things. And so a lot of, there's a lot of that going on in the industry right now, from Teladoc, to Hims, to different kinds of products and, and it's certainly affecting what's happening in optical.

Silverstein: Who do you think is doing well in disrupting healthcare, and what areas do you think people are making mistakes?

Graham: I don't know about the mistakes that are being made, but this certainly the people that seem to be doing the best job, are those that are finding those places, where there's something that's overcomplicated, that they can simplify. At least that's the way that we have tried to focus on the things that we do is, where are the places that are too costly too complicated for really no good reason right? And you can simplify those things down, and just create a much simpler approach for consumers. And usually, when something's simpler, it's more affordable as well. And so I think that when I look out in the market, it seems like that's a common formula, that's working well for people.

Silverstein: And I've heard really good things about the customer service at 1-800 Contacts, and it sounds like, you value those relationships of people on the phone, I've heard specifically that it's easy to get someone on the phone, which is nice. So how important is that? Is that a part of the company's mission or culture?

Graham: It is absolutely part of who we are. Yeah, when I joined the company about 11 years ago, and at the time the founder was Jonathan Kuhn, who was, he was the CEO and the founder of the company, and he and I talked about, the importance of never outsourcing the call center, because that was so critical to who we are, so much a part of our culture. Because taking care of customers every day was so much a part of who he was.

And so, we actually, our call center, sits right in the same building as us, we don't outsource that, we don't use an IVR, you don't have to click two to find someone that speaks with you or anything like that. We just try to answer as many calls as we can by the second ring. Our average is answering on within six seconds, and just live answer and take care of people. Because realistically we feel like, if we really genuinely care about people, we're not gonna put them on hold, we're gonna take care of them.

Silverstein: And how do you do that? You measure how long it takes for people to answer the phone, and you keep track of that, and have goals around that?

Graham: Yes, and really what it means is that we have to overstaff a little bit. We have to respect our customers' time, more than we reflect our own. And so we tend to overstaff a little bit our call center so that if someone is waiting it's us, it's not them.

Silverstein: And regulation seems to play a big role in certain businesses, healthcare is definitely one of them. Where is regulation very important and helpful? And where do you feel like it is behind?

Graham: Yeah, and we are, we're regulating both of the federal and state level within optometry. And so I think that where regulations can help a lot is making sure that consumers are taken care of, and that there are no health and safety issues. Sometimes it tends to go too far, and require things that drive up the cost of healthcare without a corresponding benefit, for sure and that's what we have seen in our industry.

Silverstein: And with 6over6 people be able to do eye tests in their own home? And, a natural question I think for the way a lot of things are going, is do we need doctors anymore? 

Graham: I think that we do, and we continue to work with doctors because there's certainly, 6over6 doesn't replace doctors, it replaces the equipment that doctors use right? So if you think about, the way that you normally go to the eye doctor, you go and you sit behind that piece of equipment that feels like you've entered the Apollo 13, it's 50-year-old technology, and you have that interaction face-to-face with a doctor. And all we're doing is taking that away and making it so you can just do that with a smartphone. There will still be an interaction with a doctor on the other end, because at the other day we want to want to make sure that you're wearing your contacts in a healthy manner.

Silverstein: What does the future for 1-800 Contacts look like, will you be making your own contacts, are there more sci-fi in-your-house doctors coming? What are you looking at?

Graham: So in our future, I think that telehealth is a big part of our future. First for selling because it really enables us. Our mission is to make vision care simple and affordable. And we focused on that mostly within the US, mostly within contact lenses. And this will just continue to help us do that. We also, it helps us do more with glasses, and be able to help people get glasses.

We're really excited about what 6over6 does for us also in that it'll open up and allow us to do things outside of the US. There is about two and a half billion people worldwide that don't have access to affordable vision care, and if, and most of those people have smartphones, or have access to smartphones. And so the idea that we can get out to billions of people and provide vision really is exciting for us.

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Apple Store employees feel like robots, Goldman's alt-investment 'storefront,' and a foolproof budget spreadsheet

Sun, 01/05/2020 - 10:15am

Hello there!

My name is Joe Ciolli, and I oversee the markets and investing teams at Business Insider. Your usual scribe Matt Turner is out on parental leave, so I'll be handling your weekly dispatch of the hottest and most thought-provoking business news and analysis.

Before I get to the goods, I must offer you the opportunity to sign up for my team's weekly markets newsletter, aptly named Investing Insider. A few clicks and keystrokes can get you exclusive interviews, recommendations, and analysis — delivered straight to your inbox every week.

One of our most popular stories from the past week came from Lisa Eadicicco, who looked into how Apple's push to rule the smartphone industry has made Apple Store employees feel like robots. She spoke to current and former staffers, who gave her the inside scoop on how the store's cultural dynamic has changed over the years. Spoiler alert: it hasn't been for the better.

Meanwhile, Patrick Coffee dove into advertising holding company Publicis' attempt to launch an AI-powered HR and project management app called Marcel. Once touted as a tool that would "break the industry," it's since been hampered by confusion, ridicule, and delays.

And no discussion of the week's greatest hits would be complete without Libby Brandt's story about a Michigan couple who paid off their $200,000 mortgage in four years. It features the meticulous budget sheet they used, which accounts for every single dollar of their monthly income. Their approach may seem extreme, but it's tough to argue with the results.

Goldman is doing its best Blackstone impression

Goldman Sachs plans to add people to a 30-person team helping clients to better understand — and put their money into — a suite of alternative investments managed by the bank, people with knowledge of the effort told Dakin Campbell.

The people asked for anonymity to describe closely guarded details about a high-level plan CEO David Solomon announced in a December memo.

The new team, dubbed the Alternatives Capital Markets and Strategy Group, is part of Solomon's plan to raise awareness about Goldman's alternative investing platform and raise billions of dollars in outside funding.

If that sounds similar to what Blackstone has been doing, that's because Solomon has made the comparison himself. As far back as January 2019, at Goldman's annual partners' meeting, he displayed a PowerPoint slide showing his firm's lagging position compared to Blackstone.

It appears to be game-on in the alts space. Stay tuned for the next twist.

A calculation for investing like Warren Buffett

Bruce Greenwald — the Robert Heilbrunn professor emeritus of finance and asset management at Columbia Business School — has developed a simple calculation for evaluating the extent of a company's competitive advantage.

It's designed to help people determine what a company's competitive "moat" is. The term may sound familiar to followers of legendary billionaire Warren Buffett's approach to investing.

The presence of a moat lessens the probability of a new entrant or established firm eating into the market share or profitability of an investment. In the end, Greenwald says the magic formula boils down to two things: scale and customer captivity.

Finance and Investing

A decade in, robo-advisers like Wealthfront and Betterment are in a tricky spot. Here's why one fintech banker thinks buyers and public investors will be hard to win over.

Jason Gurandiano, global head of financial technology investment banking at RBC, told Business Insider that robos have a tough road ahead as the level of assets they manage is still far too low.

A self-taught coder turned hedge fund manager explains why traders should be positioning for a Trump re-election — and lays out a big bet he's making on healthcare

Lukasz Tomicki, founder and portfolio manager of LRT Capital Management, breaks down why political rhetoric and volatility is helping to create a buying opportunity within the healthcare space that is likely to continue for the next 12 months.

Fidelity's enterprise-cloud-computing group is cutting as many as 100 jobs following a leadership shuffle

As many as 100 roles within the centralized group known as ECC were affected, including cloud technologists and engineers, the sources said. The privately held firm's unit told employees they could either try to find other positions internally or leave the firm, according to the one of the people.

An investor who smashed 99% of competitors in 2019 shares his 5 favorite stock picks — and explains why Amazon could 'easily' triple over the next 5 years

Alex Umansky, a portfolio manager for Baron Funds, boasts a smaller-than-usual portfolio — but one that's dominated peers to the tune of 99th-percentile performance. He says he makes targeted bets with high conviction, and five companies in particular have his attention right now.

Tech, Media, Telecoms

Meet the 36 rising stars of Madison Avenue revolutionizing advertising

Those included span a variety of roles in media and creative as well as strategy, account management, talent, neuroscience, and inclusive design.

VCs predict that remote work, celebrity startup investors, and an exodus from Silicon Valley are the big tech trends to watch in 2020

Venture capitalists took to Twitter to share their tech predictions for 2020. Here's a compilation of the most intriguing forecasts, headlined by investors like Fred Wilson and Brianne Kimmel.

A Harvard student with 300,000 YouTube subscribers shares exactly how much money she made in 2019 as a college influencer from ads

Sienna Santer's channel took off after she uploaded a video of herself moving into her dorm room. A year later, she supports herself financially with the money she earns online.

Walmart is rolling out a self-serve ad platform to compete directly with Amazon for big advertisers

The move comes a year after Walmart started moving its ad business in-house. Walmart's pitch to advertisers is that it has data from 160 million American shoppers that includes e-commerce and in-store sales.

Healthcare, Retail, Transportation

The 19 billion-dollar startups to watch that are revolutionizing healthcare in 2020

Some of these firms — like Bright Health and Clover Health — added hundreds of millions of dollars to their war chests in 2019, while others didn't take on additional funding in the past year. Here's what to know about the companies going into 2020.

Thousands of truck drivers lost their jobs in the 2019 trucking 'bloodbath.' Here's why the $800 billion industry dipped into a recession.

There are myriad reasons for the trucker slowdown. But many recent struggles can be traced back to the industry's highly cyclical nature.

Companies like Walmart, CVS, and Amazon are beefing up their healthcare strategies. Here are their plans to upend the $3.6 trillion industry.

As healthcare costs keep rising for Americans, retailers see an opportunity to win patients over with convenience and lower prices.

VCs at $2.4 billion Lux Capital think 2020 will be the year Big Pharma companies buy startups that ship Viagra and hair-loss pills to your door

As pharmaceutical companies look to revamp their businesses, getting direct access to costumers and better using artificial intelligence in drug development could be key pieces.

Retail of the future

We're hosting an event focused on the future of retail in New York City on Tuesday, January 14. From the rise of direct-to-consumer brands to sustainable fashion, the future of retail is all about connecting with customer passions and values — and it's changing models for growing business.

Join us for a series of conversations with retail entrepreneurs and experts to discuss industry strategies and innovations, and investment opportunities that these innovations create.

Click here for more information and to apply to attend.

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Meet secretive Nutella billionaire Giovanni Ferrero, who built a $32 billion fortune off Tic Tacs, Butterfingers, and his namesake chocolates

Sun, 01/05/2020 - 9:37am

Nutella has a devoted fan base that supports Nutella cafes and even a Nutella-themed hotel in Napa Valley. But no one might love it more than Giovanni Ferrero, the Italian billionaire who built a multibillion-dollar fortune from the chocolatey spread.

Ferrero's father invented Nutella in 1964, and its immense popularity in Italy helped grow the family chocolate shop into a multibillion-dollar business that now also produces Ferrero Rocher, Tic Tac mints, Kinder chocolate, and Butterfinger bars, Forbes reported. Despite the ubiquity of its products, both Ferrero himself and the company have maintained an extremely low profile, to the point where their security measures have been compared to those of NASA.

A representative of the Ferrero Group did not immediately respond to Business Insider's request for comment on Ferrero's net worth, career, or personal life.

Keep reading to see what we know about the secretive billionaire at the helm of one of the world's largest confectionery empires.

SEE ALSO: White Claw billionaire Anthony von Mandl got his start selling wine out of his car. Here's how he built a $3.4 billion fortune off the hard seltzers and lemonades that have redefined booze for bros.

DON'T MISS: Meet Zhang Yiming, the secretive, 35-year-old Chinese billionaire behind TikTok who made over $12 billion in 2018

Giovanni Ferrero, 55, is the youngest son of Nutella inventor Michele Ferrero.

Giovanni Ferrero was born in Italy in April 1964, according to the Bloomberg Billionaires Index. Ferrero attended the European School, a Belgian boarding school, according to the National Italian American Foundation.

Ferrero went on to study marketing at Lebanon Valley College in Annville, Pennsylvania, according to NIAF.



Ferrero joined his father and brother in the family business after graduating.

Ferrero's first job at the family company was for the Tic Tac brand in Belgium, according to Forbes.

The Ferrero Group originated when Ferrero's grandfather, Pietro Ferrero, opened a chocolate shop in Alba, Italy, in 1946, Forbes reported. The store's main product was Supercrema, a hazelnut spread born from wartime chocolate shortages; it was the precursor to Nutella.

Over 70 years later, the Ferrero Group is the world's second-largest confectionery company. The company sold $11.9 billion worth of sweets in the fiscal year ending in August 2018, Bloomberg reported.

Thanks to various product additions and company acquisitions, the Ferrero Group's products now include Tic Tac mints; Kinder chocolates; Baby Ruth, Butterfinger, and Crunch candy bars; and Keebler, Famous Amos, and Little Brownie Bakers cookies; in addition to Nutella and Ferrero Rocher, according to a July press release.



Giovanni and his brother Pietro became the company's co-CEOs in 1997.

Pietro managed the day to day logistics of the business and product development, while Giovanni focused on the creative aspect, Forbes reported. However, their arrangement ended abruptly when Pietro died in of a heart attack during a 2011 bicycling accident in South Africa, according to Forbes. Giovanni then became the Ferrero Group's sole CEO, while his father Michele stayed on as executive chairman.



Michele Ferrero died in 2015, leaving the company solely in Giovanni's hands.

Ferrero subsequently took over the role of executive chairman in 2015, Forbes reported. Ferrero held both the titles of CEO and executive chairman for two years until he hired Lapo Civiletti to take over as the company's CEO in 2017.



Ferrero doesn't have the personality you'd necessarily expect of a billionaire businessman.

Giovanni was the "more introverted" of Ferrero brothers, according to The Wall Street JournalForbes' Noah Kirsch described Ferrero as "thin, well-dressed, and with a disarming giggle," with "more the air of a game-show host than a billionaire factory owner," after interviewing him in June 2018.

However, Kirsch did note that Ferrero "speaks in streams of corporate jargon ('dimensional thresholds,' 'growth momentum,' 'focalization') inflected with arcane data."



Since becoming the company's sole leader, Ferrero bucked some of its decades-long traditions.

Since taking over as executive chairman, Ferrero made the first acquisitions in the chocolatier's history and hired its first CEO who was not a family member, Forbes reported.

The Ferrero Group bought British chocolatier Thorntons for $170 million in 2015, Butterfinger and BabyRuth maker Nestlé's US candy business for $2.8 billion in 2018, and Kellogg's cookie businesses in 2019, according to a Forbes report and a press release. The acquisitions are in stark contrast to Ferrero's father's business plan, which focused on building in-house brands.

"Tradition is like a bow," Ferrero wrote in an email to The Wall Street Journal's Manuela Mesco in 2016. "The more we stretch the bowstring, the farther we can throw the arrows of modernity and innovation."



Ferrero's innovations seem to paying off. The billionaire added $9.63 billion to his net worth in 2019.

Ferrero is now worth $32 billion, Bloomberg estimates, up 43.1% from the start of 2019. That makes him the 27th richest person on Earth, worth more than both Elon Musk and Michael Dell, according to the Bloomberg Billionaires Index.

Ferrero and his family are the sole owners of the Ferrero Group, according to Bloomberg. Giovanni Ferrero's stake alone is worth over $23 billion, according to the Bloomberg Billionaires Index.



Ferrero doesn't spend all his time working. He also writes novels on the side.

Ferrero has written eight novels, several of which are set in Africa, according to Forbes.

His most recent book, a novel entitled "Il cacciatore di luce" ("The Light Hunter") that follows a African painter who is diagnosed with leukemia, was published in 2016 according to its Amazon page.



Ferrero is married to European Commission official Paola Rossi.

The size of the couple's family is unclear, however. Forbes' Billionaires List and Reuters each say the couple has two children, while the Bloomberg Billionaires Index indicates they have none.



The family lives in Brussels, Belgium.

Ferrero runs the company from Luxembourg however, Forbes reported.

Ferrero's father Michele lived in Monte Carlo and worked in Italy, commuting between the two locations via helicopter, according to The Washington Post, so it's possible Ferrero has a similar arrangement.



Both Ferrero himself and his eponymous company are extremely private.

The Ferrero Group is "one of the world's most secretive firms," The Guardian's John Hooper wrote in 2010.

The chocolate maker allowed journalists to tour its plant in Alba, Italy,for the first time in the company's 65-year history in 2011 and its chairman did his first-ever interview with an American media outlet in 2018.

The Ferrero Group previously banned tours of its factories for fear of "industrial espionage," as the designs of its equipment and Nutella recipe are closely guarded secrets, the Washington Post's Sarah Kaplan reported. One anonymous executive compared the company's security measures to those of NASA, according to The Guardian.

Ferrero's father behaved similarly, hiding the details of his life from the press and wearing dark glasses whenever he appeared in public, the Washington Post reported.



Tesla's success proves that what America needs is business, business, and more business (TSLA)

Sun, 01/05/2020 - 9:24am

If you spend significant time following Tesla, you quickly realize that for the past few years, the debate — acrimonious at times — revolves around two suns: CEO Elon Musk's personality; and the all-electric automaker's Wall Street mood swings.

A financial melodrama, in other words, starring a guy who doesn't have much in the way of filters.

Now that the stock has shot well above $400 per share — and well above Musk's infamous 2018 take-private price of $420 — the bulls are gloating and the bears are covering, and then some. Same old story, and now Musk has even more reason to celebrate a big 2019 for Tesla, as the company sold 100,000 more vehicles last year than in '18: 367,500 in total.

Lost in all this is Tesla's triumph as a great American business. And believe me, new great American businesses are in short supply right now. You might even call them scarce. 

The business of America is supposed to be business — but the country is doing a lousy job of nurturing them.

A decade of bad business

As The Atlantic's Annie Lowrey recently noted, in a look back at the 2010s:

In many ways, the American economy became more sclerotic. Corporate concentration increased, with more industry sectors dominated by a small handful of firms. All the stories about the furious innovation coming from Silicon Valley and other tech-dominated regions aside, the start-up economy continued its long, slow collapse. The number of IPOs has fallen, and there are now half as many publicly listed businesses as there were in the late 1990s. Our cultural obsession with start-ups peaked at a time when companies under a year old were half as common as they were 40 years ago.

Contrast that with Tesla's growth over a decade and a half. The company went from selling almost no cars after its 2010 IPO to selling hundreds of thousands, minting a market cap that, while hardly a measure of its actual value, hit $8o billion — just $5 billion less than General Motors' and Ford's combined.

Tesla achieved this by doing what far more businesses of every size need to be encouraged to do, by government policy, investors, and the finance industry: aggressively attack opportunities, heedless of risk. Tesla's appetite for risk has been staggering, and the risk that it gobbled up has been Grade A prime risk — some might not even call it risk, preferring to label Musk's ambition as impossible. There hadn't been a new automaker established in the US since Chrysler in 1925. Prior to Tesla's 2010 IPO, Musk didn't even want people to invest in the fledgling company, so convinced was he that the risk of failure was too great.

Now that the 2010s are in the books, many analysts, commenters, economists, and politicians are reviewing the decade and finding American capitalism at best severely damaged and at worst in a terminal "late" phase, ready to at last fulfill Marx's prophesy and head for the ash heap of history. 

But Lowrey put her finger on the core problem: What America needs in the 2020s is business, business, and more business. Tesla has proven that it's possible to defy the odds, attack a serious problem — global warming and tailpipe emissions — create hundreds of thousands of happy customers (Thank you, Peter Drucker), and ... wait for it ... deliver to investors a 1,636% return, all-time.

By the way, Tesla also employs about 40,000 people. 

More business, more business, more business

If America had more of that, our current sense of malaise would vanish, our vaunted national optimism would be replenished, and I would go so far as to argue that our currently toxic, tribal politics would lose their grip on the country's psyche. 

So what would it take to revive the country's entrepreneurial energy? Well, Tesla has in Musk an early investor who didn't seem to care if he lost everything. Today's market valuation notwithstanding, the company continues to run close to the edge, with only about $5 billion in cash on hand and a portfolio that consists of just one new vehicle, the Model 3. Tesla has rarely been profitable at a time when every other automaker on the planet had been larding its balance sheet in the longest sales boom on record.

We need, then, investors to invest in risk, and lots of it. We could also use a federal government that does more than talk a good game about business formation, while favoring the interests of Big-You-Fill-in-the-Blank. It would also help if venture capitalists weren't sheep chasing already vindicated business models, and if banks could see the long-term wisdom of lending to businesses that aren't huge.

Remember that Joseph Schumpeter's perennial gale of creative destruction — the Austrian economist's colorful description of capitalism's natural condition — requires, you know, a gale. The motivators of American business need to fill the nation's sails with wind, moving the small boats that might someday grow large enough to head for open water. 

Even Tesla isn't entirely seaworthy yet. Building over 350,000 vehicles sounds good — until you consider that GM built almost three million. Tesla is a medium-sized victory. That took 15 years. And still isn't obviously a win.

But the follow-on effect from Tesla is why more business rather than less would be good for America (and vice versa). By absorbing almost all of the risk of vindicating a scalable market for electric cars, Tesla has de-risked the game for everybody else. In 2010, a lot of auto industry execs thought 2020 would see 10-20% of sales become electric. They were wrong: the market is barely more than 1% globally.

But that market is almost surely going to grow in size in the 2020s, especially in China, where Tesla is now operating. To repeat history, we can't count on more Elon Musks coming along. But we can look at Tesla, ignore the endless jabber around whether the short or long position on the stock is correct, and focus on what's genuinely been achieved: a real American business — that should be an inspiration to risk-takers everywhere.

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NOW WATCH: Here's how the million-mile battery could lead to Teslas lasting a lifetime

Goldman Sachs says these 10 stocks are dangerously overvalued and could tumble 20% — and their list includes Apple, which they see plunging 35% this year

Sun, 01/05/2020 - 9:05am

  • Goldman Sachs is forecasting a much more difficult year for stocks in 2020, and says it's going to do serious damage to Apple and several other tech and consumer discretionary companies. 
  • David Kostin, the firm's chief US equity strategist, says Apple could drop 35% this year as momentum fades. He also thinks its earnings growth in the next few years looks relatively unimpressive.
  • Kostin calls for a sell-off of 20% or more in 10 stocks, and six are in the consumer or tech sectors.
  • Click here for more BI Prime stories.

Investors had a lot to be happy about in 2019 as all kinds of assets went up — but when almost everything rises, some are inevitably going to be overpriced.

In forecasting a much slower year for the market, Goldman Sachs chief US equity strategist David Kostin is pointing out the stocks that he thinks are most likely to be riding for a big decline in 2020.

Kostin expects the S&P 500 index to inch up less than 5% this year to a final target of 3,400. That's below the market's long-term average and represents a big slowdown compared to last year's dramatic gain.

But a more sluggish and volatile market could dish out a lot of pain to stocks that have had a lot of momentum recently. And his concerns are centered around technology and consumer discretionary stocks, which have dominated throughout the almost 11-year bull market.

"In 2019, Info Tech returned 50%, the best of any sector, and accounted for 32% of the rise in the overall index. Only two other sectors, Financials (+32%) and Communication Services (+33%), outpaced the market," he wrote in a note to clients.

Kostin says both of those sectors are overvalued based on their likely growth over the next five years.

Foremost among those companies is the biggest name on the market. Apple has doubled in value in a year, stretching its market cap to $1.3 trillion, and Kostin says the rally — which included a 31.5% surge in the fourth quarter — has gone way too far.

Goldman estimates that Apple's profits will come up well short of Wall Street forecasts this year, and that the tech giant will see its earnings grow at about the same rate as the rest of the market over the next two years.

Perhaps less surprising is that he believes some big-name retailers still have a lot of pain and suffering ahead of them after they struggled badly last year.

So at least Apple will have company if it's going to disappoint investors. Kostin says nine other S&P 500 stocks are on track for declines of 20% or more this year.

Those stocks are ranked below in increasing order of how far they'd have to fall from their December 31 closing prices to reach Goldman Sachs' price target.

SEE ALSO: We interviewed Wall Street's 7 top-performing investors to get their secrets for success — and their best ideas for 2020

10. Amcor

Ticker: AMCR

Sector: Materials

Price target: $8.50

Downside to target: 21.6%

Source: Goldman Sachs



9. Hormel Foods

Ticker: HRL

Sector: Consumer staples

Price target: $35

Downside to target: 22.4%

Source: Goldman Sachs



8. Walgreens Boots Alliance

Ticker: WBA

Sector: Consumer staples

Price target: $45

Downside to target: 23.7%

Source: Goldman Sachs



7. Globe Life

Ticker: GL

Sector: Financials

Price target: $80

Downside to target: 24%

Source: Goldman Sachs



6. Nordstrom

Ticker: JWN

Sector: Consumer discretionary

Price target: $31

Downside to target: 24.3%

Source: Goldman Sachs



5. PVH

Ticker: PVH

Sector: Consumer discretionary

Price target: $75

Downside to target: 28.7%

Source: Goldman Sachs



4. MarketAxess Holdings

Ticker: MKTX

Sector: Financials

Price target: $270

Downside to target: 28.8%

Source: Goldman Sachs



3. Macy's

Ticker: M

Sector: Consumer discretionary

Price target: $12

Downside to target: 29.4%

Source: Goldman Sachs



2. Seagate Technology

Ticker: STX

Sector: Information technology

Price target: $41

Downside to target: 31.1%

Source: Goldman Sachs



1. Apple

Ticker: AAPL

Sector: Information technology

Price target: $192

Downside to target: 34.6%

Source: Goldman Sachs



Central bank chiefs in Dallas, Minneapolis, Philadelphia and Cleveland will help determine interest rates in 2020. Here's where they stand ahead of the next Fed meeting.

Sun, 01/05/2020 - 8:01am

  • Federal Reserve policymakers became divided over how to keep the economy in a healthy place last year. 
  • That could change in 2020 as the central bank shifts the power of its policy-setting committee.
  • Here's where they stand on interest rates ahead of the next policy meeting in late January.
  • Visit Business Insider's homepage here.

When the Federal Reserve began a string of interest rate cuts last year for the first time since the global financial crisis a decade ago, policymakers had become divided over how to keep the economy in a healthy place. 

With growing recession fears and escalating trade tensions, some called for more aggressive stimulus measures. Others thought action was unnecessary against a backdrop of historically low unemployment levels and robust consumer activity. 

That could change in 2020 as the Fed shifts the power of its policy-setting committee. The leaders of four regional central banks — Chicago, Boston, St. Louis, and Kansas City — will lose votes in 2020 as part of a routine rotation that takes place each year

Instead, the chiefs of Federal Reserve offices in Dallas, Minneapolis, Philadelphia and Cleveland will vote on the 12-member Federal Open Market Committee. Here's where they stand on monetary policy ahead of the next FOMC meeting in late January.

SEE ALSO: American businesses are warning the Trump administration against plans to tariff European wine and cheese. Here's what they're saying.

Dallas Federal Reserve President Robert S. Kaplan

Kaplan backed the three interest rate cuts made in 2019 but has said that another was unlikely unless the outlook worsened. 

"I don't think we should be making any moves at this point on the Fed funds rate," Kaplan said in a CNBC interview Friday at the American Economic Association conference. "We'll keep revisiting that as the year goes on."



Cleveland Federal Reserve President Loretta J. Mester

Mester pushed back against the string of interest rate cuts at the end of 2019 but said that it was a tough call to make. 

"I would have preferred that we just hold the interest rate where it was and wait for more signs the economy was slowing down more than anticipated," Mester said at the University of Maryland in November.



Minneapolis Federal Reserve President Neel T. Kashkari

Kashkari is viewed as the most dovish new member of the FOMC. While he has signaled a likely pause in the near-term, he repeatedly called for interest rate cuts last year. He has said the Fed should not increase borrowing costs until inflation hits a 2% target. 



Philadelphia Federal Reserve President Patrick T. Harker

Harker supported the first of three interest rate cuts in 2019 but that was enough for him. He said the following were unnecessary and has advocated for a wait-and-see approach in the past. 

"I'm of the mind that we stay put for now and see how things work out," Harker said at a November event in New York.



These 7 charts show all the ways Satya Nadella transformed Microsoft from a tech has-been to a trillion-dollar giant in 6 years (MSFT)

Sun, 01/05/2020 - 7:00am

  • Business Insider analyzed Microsoft's securities filings and market data since Satya Nadella took over as CEO in February 2014 to gauge his impact on the company.
  • The following charts show Microsoft's performance over the years, including changes in market value, revenue, headcount, and growth in the cloud.
  • The charts also chronicle Nadella's leadership, from unwinding the failed Nokia acquisition led by his predecessor to finding a bright spot in the cloud computing business.
  • Click here to read more BI Prime stories

Satya Nadella is credited with leading a grand reinvention of Microsoft.

The central pillar is the cloud computing business – and it has propelled Microsoft into becoming one of the most valuable companies in the world.

Business Insider analyzed Microsoft's securities filings and market data since Nadella took over as CEO in February 2014 to assess his impact on the company.

The following charts chronicle Nadella's leadership over the years, from unwinding the failed Nokia acquisition led by his predecessor, writing off billions of dollars and laying off thousands of employees, to finding a bright spot in the cloud computing business and doubling down.

Got a tip? Contact this reporter via email at astewart@businessinsider.com, message her on Twitter @ashannstew or send her a secure message through Signal at 425-344-8242.  

SEE ALSO: Amazon Web Services could cut prices and change its market strategy as it tries to fend off Microsoft in the cloud wars, analysts predict

Microsoft market capitalization

Microsoft's market capitalization under Nadella has increased to more than $1.2 trillion at the time of this writing from $315.9 billion in January 2014, the month before he took over.

Microsoft Chairman John Thompson recently pointed to Microsoft's growing market value as one of the reasons to justify why Nadella makes 249 times more in compensation than Microsoft's median employee.



Microsoft employees

Microsoft's headcount declined significantly in Nadella's first couple years on the job, in the aftermath the company's failed $7.6 billion acquisition of Nokia, led by former CEO Steve Ballmer.

Microsoft closed the Nokia deal in April 2014. The acquisition was contentious within Microsoft and the friction between Ballmer and Microsoft's board of directors that was generated by the Nokia acquisition is ultimately what led to his decision to resign.

The company ultimately took a write-down for almost the entire purchase price and laid off thousands. Microsoft's headcount has started to climb since then.



Microsoft revenue

Microsoft revenue has steadily increased under Nadella, expect for in the 2016 fiscal year – which could be seen as an inflection point for the company.

At the time, Microsoft was experiencing declines in the business segment that includes its Windows operating system and its struggling mobile business.

But a bright spot emerged. Microsoft's cloud computing business was turning into a significant money-maker. In 2016 Microsoft started publicly disclosing the revenue growth for its Azure cloud business – 113 percent that year. The promise of Microsoft's cloud business helped the company regain favor from investors.

Microsoft crossed $100 billion in revenue for the first time in fiscal year 2018 and topped that last year with $125.8 billion in revenue (non-GAAP).



Microsoft commercial cloud revenue

It's hard to know exactly how much money is generated by the central pillar of Microsoft's cloud business – Microsoft's Azure cloud computing platform – because the company doesn't report its standalone revenue.

Instead, Microsoft breaks out "commercial cloud" revenue, which includes Azure, but also Office 365 and other cloud services. Commercial cloud revenue has increased to $38.1 billion during the company's 2019 fiscal year from $2.8 billion during the 2014 fiscal year when Nadella took over.

The way Microsoft reports cloud revenue makes it difficult to compare with market-leading Amazon Web Services sales reached $25.7 billion in 2018, its last full fiscal year. 



Microsoft net income

Microsoft's net income in Nadella's first full fiscal year as CEO took a big hit due to costs related to its failed $7.6 billion Nokia acquisitions. 

The company wrote off more than $7.5 billion related to the deal and said it incurred $2.5 billion in "integration and restructuring expenses," mostly related to its phone business.

Microsoft's net income has climbed since then, except for 2018 when the company said it took a $13.7 billion charge related to new federal tax laws in 2018. 



Azure revenue growth rate

Azure growth has slowed since the company first revealed a figure for its revenue growth in 2016 (it still doesn't break out Azure's actual revenue figures).

While the growth has declined, analysts chalk it up to the "law of large numbers." Basically, the bigger these platforms get, the harder it is to post the triple-digit growth figures that they did when the platforms were younger. Amazon Web Services revenue growth has consistently slowed, too.



Microsoft research and development spending

Microsoft has spent an increasing amount on research and development since Nadella took over, but that's only because the company's revenue has increased.

Microsoft has consistently spent 13 or 14 percent of its revenue on research and development since before Nadella was CEO, so the increase likely doesn't represent a change in strategy or more R&D investment.

Amazon, for comparison, spent 12.4 percent of its 2018 sales – $28.8 billion – on what it calls "technology and content," which is generally accepted as the company's R&D spending though some analysts say it's not an exact comparison.



Goldman Sachs studied a century of history to nail down the 5 biggest triggers of recessions — and concluded that 2 pose risks we've never seen before

Sun, 01/05/2020 - 6:05am

  • Two of the five triggers of all US recessions over the past century pose new dangers to the US economy, according new research from Goldman Sachs economists. 
  • They ultimately concluded that while the odds a so-called soft landing are better than widely thought, new risks could crop up.
  • Click here for more BI Prime stories

Investors placed the longest economic expansion in history on death watch last summer when recession fears ran rampant. 

Although their concerns have receded and the stock market has rallied forcefully into a new year, recession remains a top concern

There's some good news amid the gloom. Since World War II, the length of time the economy has spent in a recession has been shrinking, Goldman Sachs data shows.

The fact that we're still experiencing a record-long expansion is proof that the economy has become more durable. Also, the Federal Reserve's emergency support after the financial crisis persists to this day and is keeping both financial markets and economic data in good shape. 

To explain this resilience even further, Goldman economists dug into the past century of recessions to unearth the most common catalysts.

Their analysis turned up five major factors which can be split up as follows: the first three have lost their potency over time and do not pose any imminent threat. However, there are brand new risks embedded in the final two. 

Here they are, complete with Goldman's assessment of the ongoing threat level: 

1. Industrial shocks and inventory imbalances

The manufacturing sector's risk to the economy has diminished since the 1980s. Thanks to improvements in technology and smarter forecasting techniques, manufacturers have become better at forestalling shocks to their output. 

In addition, the manufacturing sector now contributes far less to economic growth than services, which adds about two-thirds. 

2. Oil price shocks

The US first sunk into a recession on account of an oil spike in 1973.

But since then, price fluctuations have been having a diminishing impact on how the economy fares. The shale boom of the 2010s was partly responsible for this cushioning, as investment in the infrastructure used to extract and refine oil offset the hit to consumption that came about because of higher prices.

3. Aggressive rate hikes  

The Fed has historically hastened recessions by hiking interest rates too quickly in the face of inflation.

"The most important structural change is the improvement in monetary policy that has flattened the Phillips curve and firmly anchored inflation expectations on the Fed's 2% target," said Jan Hatzius, Goldman's chief economist, in a note. 

This means the Fed can show more restraint even when inflation pressures are bubbling.

4. Financial imbalances and asset price crashes

The combo of excessive subprime lending and a housing bubble proved lethal and led to the Great Recession. 

Despite the clean-up efforts of banks and regulators after the recession, financial risk remains "an important threat in principle," according to Hatzius. 

He cited two rising trends to back up this assertion. First, the share of gross domestic product that is derived from financial assets is near historic highs; in other words, the financial sector matters a lot more to the economy. Secondly, there is a higher correlation between US and other developed-market stock returns, meaning that the domestic market is more sensitive to foreign shocks.

Hatzius sees the risks stemming from these two trends as lying dormant for now — but they will be new when they arise.

5. Fiscal tightening 

Herein lies the second and final source of new risks on Hatzius' radar: optimum decisions on tax policy and government spending — which make up fiscal policy — could be jeopardized because Washington is "plagued by dysfunction." 

Hatzius added: "This dysfunction has created new economic risks arising from events such as shutdowns and debt ceiling fights that can have substantial effects on financial conditions and growth."

The hyper partisanship exists at a time of soaring government deficits. The implication is that even if the right fiscal policy is implemented, it may prove to be less effective at averting a recession.

SEE ALSO: JPMorgan's equity chief told us why ESG investing is 'a bubble in the making' — and explained how to avoid the reckoning when it bursts

Join the conversation about this story »

NOW WATCH: A big-money investor in juggernauts like Facebook and Netflix breaks down the '3rd wave' firms that are leading the next round of tech disruption

6 things most people don't think to shop for that could save a lot of money

Sat, 01/04/2020 - 2:27pm

Personal Finance Insider writes about products, strategies, and tips to help you make smart decisions with your money. We may receive a small commission from our partners, but our reporting and recommendations are always independent and objective.

  • Everyone comparison shops for phones and plane tickets and cars — but what about savings accounts, investment accounts, and financial planners?
  • A little comparison shopping for important products and services could save you significant cash in the long run.
  • Use a free tool to find extra money you could be losing to investment fees or find the right financial planner to help trim your budget and maximize your returns.  
  • Read more personal finance coverage. 

From investment account fees to college costs, we're always looking for ways to save. 

But, saving doesn't always mean cutting corners. Sometimes, all you need to do is shop around. Here are six things to shop for that could ultimately save you a lot of money. 

1. A higher interest rate on your savings account

If you're keeping the bulk of your money in a checking account or a traditional savings account that doesn't earn much interest, you might be missing out on savings. Shopping around for a high-yield savings account could help your savings grow faster. 

These accounts aren't much different from the traditional savings account, but they do earn more interest, meaning you save more money in the long run. Easy to set up and simple to use, they can earn up to 20 times more interest than a typical savings account. 

2. An investment account with lower fees

Investment accounts, including your retirement account, might be charging fees you didn't even know about. While they might be small, even less than 1%, they could really add up over time.

There are a few ways to see if your investment accounts are charging you fees, and how much they are. Personal Capital's online retirement analyzer tool is incredibly easy — it can show you exactly what you're paying in fees, and how much that could add up to in the future. Online tool Blooom can shine a light on your 401(k) fees and recommend lower-fee alternatives. Both tools are completely free, although you have the option to sign up for paid services as well.

You might just be able to put some of those fees back into your pocket. Business Insider writer Eric Rosenberg saved about $300 per year in fees on his accounts by running them through Personal Capital. Over time, that could add up to an extra $50,000 in his account, assuming they hold a steady 10% return for 30 years.

3. Life insurance

Shopping for life can save you money in two ways: You can lock in a low monthly premium for term life insurance now that lasts the life of your policy and you can save your family a significant amount of money if you die during that term.

As Kelly McClure writes for Business Insider, life insurance saved her money on covering her father's funeral costs, settling the financial worries and allowing her to save money for other financial goals. "I found that the insurance payout would not only cover the complete cost of his burial, but would also provide me with a remainder that I later used to buy my first home," she writes.

And Samantha Chavarria writes for Business Insider that her father passing away without life insurance made it harder. "Having to beg and crowdsource in order to bury my dad added a layer of tension I wasn't expecting," she writes. 

Life insurance does a lot more than just pay for funerals. And, the younger you are when you get life insurance, the lower your monthly premium — and with term insurance, that premium is fixed, so it will remain the same for your entire term.

4. A good financial planner

Finding a good fee-only financial planner can be a great way to get objective money advice, set financial goals, and make them happen. 

"An adviser or financial planner is providing the accountability that a lot of us need, whether its spending less, or investing," Kaya Ladejobi, a New York City-based financial planner, tells Business Insider. "Then, there's the coaching and the objectivity that comes with it," she adds. "They can help you do a better job with the resources you have." 

In addition to the accountability factor, they can also help you see ways to grow your money. "If you're thinking about it in the power of compounding, one action that you take with your financial planner can turn into hundreds, thousands, or even millions of dollars in your lifetime," says Ladejobi.

SmartAsset's free tool can help find a financial planner near you »

5. Car insurance

If you've never shopped around for car insurance, you might be paying more than you need to for coverage. 

Every car insurance company looks at personal factors about you differently, from your driving history to your credit score. By getting quotes from several companies, you can make sure you're getting the best coverage possible, and not paying any more than necessary. 

/* Business Insider / Auto Insurance Content Pages */ var MediaAlphaExchange = {    "data": {       "zip": "auto"    },    "placement_id": "RxLRBKtcQejwbKRhebUT0f87Cp5b7w",    "sub_1": "shop-insurance-advisers-savings-accounts-save-money",    "type": "ad_unit",    "ua_class": "auto",    "version": 17 }; 6. Disability insurance

Even for someone who's young and healthy, disability insurance is necessary for anyone who relies on an earned income to live. After a health scare and multiple surgeries, writer Zina Kumok decided to make the jump to get a long-term disability policy.

"The policy costs $21.59 a month and will pay out $3,000 a month in benefits. This will cover all the major essentials, including my mortgage, car payment, groceries, utilities, car insurance, and gas," she writes for Business Insider. Having disability insurance could prevent debt and save money long-term.

While disability insurance is often offered through an employer, it's possible to get a policy even if it isn't, or if you're self-employed. There are two main types, long-term and short-term, and which policy you need is up to you and your budget. 

Shop for disability insurance at Policygenius »

Join the conversation about this story »

NOW WATCH: A 45-year-long study discovered trends in successful hyper-intelligent children



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