Societe Generale updates black swan report

Societe Generale has release their latest black swan risk report.  The risks are still the same as the post election report last November.

The key downside risks in order of probability are:

  • Political uncertainty drag (30%)
  • Sharp increase in bond yields (25%)
  • China hard landing (20%)
  • Isolationism and trade wars (15%)

The key upside risks in order of probability are:

  • More capex (10%)
  • Significant fiscal accommodation & fast track reform (5%)

These Apps Are Safe From The CIA

  • No definitive proof CIA has bypassed encryption
  • CIA can bypass security of apps by hacking phone
  • Signal & WhatsApp not found in leaks

A new release from Wikileaks has journalists sifting through the details to bring you the story. The initial reports were not correct that the CIA broke encryption in popular apps. Researchers have had time to look through the information and initial reports were based on assumptions. The good news is there is no mention of Signal or WhatsApp in any of the reported documents. For now, this shows the encryption strength in these apps. The real risk is the installation of key loggers or screen capturing software on a phone. Bypassing encryption would not be necessary to gain access to information if any government agency installed these tools. Business owners should be wary of any links received by email if they do not know the person sending them. Airport and border searches are also areas where someone may try to install monitoring software on your company’s equipment. If you are careful to avoid malware, then the risk of someone intercepting your Signal or WhatsApp conversations are relatively low for now.

Oklahoma has same earthquake risk as California

The United States Geological Survey (USGS) forecast for 2017 says Oklahoma will face earthquake damage risk equal to California. The report is close to last year’s forecast which indicates a trend that is changing the region. The 2017 hazard model is the same as the 2016 report but includes an updated earthquake catalog. The 2016 forecast indicated a high hazard (greater than 1%) for Oklahoma-Kansas, the Raton basin (Colorado/New Mexico border) north Texas, north Arkansas, and the New Madrid seismic zone.

Experts believe hydraulic fracturing or fracking is responsible. Fracking involves injecting water and other chemicals at high pressure into the Earth to extract hydrocarbon resources.

The changes in the area are a reminder to risk managers that tornado is not the only major hazard. A Business Impact Analysis (BIA) is the first step in developing a complete Business Continuity Plan (BCP) that will prepare your small business for natural and manmade disasters. Our services team can provide BCP training and implementation to your company. Contact us today for a consultation.


Map showing chance of damage from an earthquake in the Central and Eastern United States during 2016. Percent chances are represented as follows: pale yellow, less than 1 percent; dark yellow, 1 to 2 percent; orange, 2 to 5 percent; red, 5 to 10 percent; dark red, 10 to 12 percent. Source: USGS



Defense sector bullish after president call for spending

President Trump called for a $20 billion increase in defense spending while cutting other programs. The defense sector rallied after the president made his budget proposal. Here is the market effect:

iShares US Aerospace and Defense ETF (ITA): +1%/day

SPDR S&P Aerospace & Defense ETF (XAR): +1%/day

PowerShares Aerospace & Defense (PPA): +0.7/day

iShares US Aerospace and Defense ETF (ITA): +8.2%/YTD

SPDR S&P Aerospace & Defense ETF (XAR): 8.7%/YTD

PowerShares Aerospace & Defense (PPA): 6.3%/YTD

SPDR S&P 500 ETF (SPY): 5.27%/YTD

The increase in spending will be bullish for the sector and the supply chain. 3rd or 4th+ party suppliers to the major defense companies will benefit from the increase. Is your small business ready? Now is the time to implement an ISO 27001 Information Security Management System or an ISO 28000 Supply Chain Security Management System to show your customers your dedication to protecting their business interests. We provide training and consulting services for many different ISO standards. Contact us today to discuss your goals and needs.

Dallas Fed manufacturing numbers positive

Dallas Fed manufacturing numbers are in for February and showing an improvement.


Jan 17

Feb 17

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Some indices are lower than in previous periods but still positive. 19% of firms reported net hiring. 10% noted net layoffs. Survey respondents noted proposals by President Trump as a factor in positive assessment.

Ethics is the Foundation for Business

Verizon will purchase Yahoo’s internet business for $4.83 billion. Verizon is offering $350 million less than its initial bid. Both companies will share any future cost from the data breaches. Verizon will also waive its right to sue over allegations that Yahoo staged a cover-up of the breaches. The investment fund selling Yahoo will still be liable for penalties from the SEC and shareholder lawsuits. The sale price reductions are reasonable. Other breaches cost companies more than $100 million.

Transparency is the greatest concern for Verizon and the SEC. If Yahoo disclosed the event earlier the harm to investors may have less. Verizon’s bid impact would be less if it were known during due diligence. They instead had to react strongly to the news after due diligence. This proves that transparency is the best policy for all parties in the long run.

A strong compliance and ethics program is the foundation for businesses of all sizes. Business ethics is more than a slogan in a policy manual. The benefits of a compliance and ethics program are attainable without large programs built by even larger consulting firms. Leadership commitment to compliance and ethics is the first step. If the first step is inexpensive, why make the next steps expensive and complicated?

The Society of Corporate Compliance and Ethics has many free resources available to assist with building a compliance program.

A Compliance & Ethics Program on a Dollar a Day: How Small Companies Can Have Effective Programs

Happy 2017

Happy 2017!

With a new year comes new resolutions. Perhaps you want to learn some new skills or you are planning to certify your organization to one of the many ISO standards or you are seeking new insights for your small business. We understand that time is money. Expensive and complex solutions are not acceptable. We will bring you news and how-to guides that inform and simplify your small business. We are sure you will find the information we publish to be useful. Our team is here if you need personalized assistance with a business challenge.