Homeland Security has banned laptops in the cabins of US bound flights from 10 airports in the Middle East and Africa. Rumors are circulating that the ban will extend to European airports. This will be a major inconvenience to business travelers, but can also result in losses to companies.
Valuables such as laptops or camera equipment should not go in checked luggage. Airport employees, including those in security, are known for stealing from checked luggage. Trust European airport employees as you would their US counterparts. Theft of company equipment is annoying and costly for a large cap corporation, but could be crippling for a microcap company.
Another downside of a potential laptop ban is the loss of billable hours. Over half of employees prefer to work on the plane. The National Trade and Tourism Office reports 4.9 million passengers flew overseas and 1.9 million travelled to Europe. If they were unable to work on the plane, the total number of billable hours lost at an average of $76/hr. could be as high as $500M.
Productivity issues are small compared to FBI information that says economic espionage costs US businesses nearly $500B per year. Laptops transported in checked luggage are excellent targets for IP theft. The FBI and other officials know that US allies have a history of spying on private sector companies. The French version of the CIA enabled France to win a $1B contract to supply military equipment to India by learning about competing bids. Stealing bid pricing is convenient, but marketing plans, customer lists, supplier lists, and other material could give a competitor an edge or a new competitor could enter the market if certain information fell into the wrong hands.
No commercial measures are foolproof, but these are some hints to help you prevent foreign officials from accessing your data:
Do not have data on your computer that could someone could access in the luggage screening area
Your hard drive can be copied by authorities
If your drive is unencrypted they now have all your files
If your drive is encrypted they try to break the encryption or guess your password
Consider carrying a “burner” laptop for your business trip
Chromebooks or Windows 10S systems that use only a web browser are a better option
Do not have the browser remember your password
Do not check “remember me” when logging into a site
If authorities decide to keep your laptop it’s only a financial inconvenience
Polls show a small gap between the front runners with National Front leader Marie Le Pen tied with François Fillon. A populist win would be a threat bigger than Brexit to the Euro and the EU. Frexit is a possibility along with dropping the Euro and moving to a “nouveau franc” to make exports competitive. National debt would convert to the new currency which would likely be a default. There is high anxiety about the election since polls were wrong about the US Presidential election and Brexit.
The Euro has been on a one month slide against the Japanese Yen. This indicates that Japan is a safer economy than Europe. The Euro recently recovered against the Yen, but is facing resistance. This may change if Marie Le Pen begins to slip in the polls.
There has also been as safe flight to the US Dollar over the past month.
Along with increased demand in the 10-year Treasury Note.
US companies doing business in France have FX exposure the Euro and potentially high impact exposure to introduction of a devalued currency. US companies may wish to insure accounts receivable against further erosion through forward contracts, futures, or options.
A Delta Airlines (NYSE: DAL) spokesperson informed CNN Money that supervisors will now offer up to $9,950, up from $,1350, for passengers who are bumped from overbooked flights. Gate agents may now offer up to $2,000, up from $800. The changes will benefit business and leisure travelers. More flyers will consider Delta as an option among the big carriers. This will contribute to seat shortages where travelers can cash in. If you’re a small business traveler and can score a quick $2000 on a return flight, do it! That is free money for future business travel or for vacation.
United has not announced any changes to compensation for travelers on overbooked flights. American Airlines (NYSE: AAL) spokesperson, Ross Feinstein, said American will work “to ensure we set compensation amounts properly … to obtain the correct number of volunteers.”
Delta’s quick response to the PR nightmare that United (NYSE: UAL) is suffering shows that management is in a clear position to manage upside risk. Some Wall Street analysts have upgraded Delta to “Strong Buy” because of Delta’s aggressive action.
The US Dollar and Japanese Yen continue their week long bullish run against the Korean Won. On April 3, US President Donald Trump stated that the US would act unilaterally if necessary. The statements and deployment of US warships to the region are worrying markets.
China and South Korea agreed to place sanctions on North Korea of it tests a nuclear or long range missile. US Secretary of state Rex Tillerson said a response is likely if other countries pose a danger. A Japanese defense ministry source said it is probably not realistic for the US attack. Per Japanese reports no coordination with US forces for military action has taken place.
We see the situation as headline worthy, but not disruptive to trade and business in the region. Barring any unusual activities by the Federal Reserve we also expect the Won to gain strength after the showdown is over.
MARCIANOTECH uploaded a video showing a Samsung Galaxy S8 unlock using a photo of himself. Google introduced the Face Unlock feature in Android 4.0 and is aware that photos can unlock the screen. The feature is a convenience, not a security enhancement.
In a statement to Ars Technica Samsung Electronics Ltd. ( KS:005930) spokesperson provided the following:
The Galaxy S8 provides various levels of biometric authentication, with the highest level of authentication from the iris scanner and fingerprint reader. In addition, the Galaxy S8 provides users with multiple options to unlock their phones through both biometric security options, and convenient options such as swipe and facial recognition. It is important to reiterate that facial recognition, while convenient, can only be used for opening your Galaxy S8 and currently cannot be used to authenticate access to Samsung Pay or Secure Folder.
This is a reminder that businesses should consider the convenience vs. security tradeoff. A fingerprint is more secure, but may introduce other security issues. Government agents can compel you or your employees to unlock a phone using a fingerprint or an iris scan. A PIN is the best choice if confidentiality of your company data is the highest priority.
The Federal Reserve Bank of Philadelphia announces results from the March Manufacturing Business Outlook Survey. The survey suggests manufacturing activity continued to expand. Delivery times and unfilled order indexes were positive. This suggests longer delivery times and an increase in unfilled orders.
Diffusion index 32.8 for March down from 43.3 in February
44% of firms reported increases in manufacturing activity
11% of firms reported decreases in manufacturing activity
25% of firms reported increase in employment
8% of firms reported decrease in employment
60% of firms reported a labor shortage
68% of firms reported skills mismatch between available workers and requirements
47% of firms report positions open for more than 90 days
FRB Philadelphia suggests growth for the manufacturing sector on the region. Broad indicators read positive with most up from February.
Natural Gas (CME: NG) futures closed the day at $2.948. Winter storm Stella did not dump more snow on NYC as expected. Instead it shifted inland causing demand to drop.
Heating Oil/Diesel (CME: HO) futures closed the day higher due to increased demand.
Preparing for storms and natural disasters is important to the success of your business. The ISO 22301 framework is a good starting point for your Business Continuity Program. Section 6 of ISO 22301 states that organizations need to address risks and opportunities to prevent, or reduce, undesired effects.
Having an inclement weather plan and topping off your backup generators with fuel is just one component of preparedness. Prices for emergency fuel always spike before a weather event or immediately following a natural disaster. By refueling or negotiating guaranteed pricing while demand is low your business can save a lot of money. Immediately after a disaster market prices are very high. It may not be possible to receive delivery of fuel due to the event. Planning and executing is one way weather the storm.
If you are new to Business Continuity Planning and would like to learn more about developing your program or how to become certified in ISO 22301 please contact us for a free over the phone or Skype consultation.
The St. Louis Fed published a new study on Economic Mobility in the US. The study leads to a simple statistic: “the probability that a child born to parents in the bottom fifth of the income distribution makes the leap all the way to the top fifth of the income distribution”
Children born to parents in the bottom fifth of the income distribution chance of reaching the top fifth:
There is a high degree of variation between regions in the US. The most optimistic and pessimistic numbers are:
16.8% Top decile USA
4.8% Bottom decile USA
People growing up in San Jose, California are three times as likely to move up the income ladder compared to Charlotte, Atlanta, Indianapolis.
The high degree of variation is not only regional. It is visible at the county level.
Average upward mobility rate:
11% DC Metro Average
9.2% Prince Georges County
14.2% Charles County
Factors affecting mobility during childhood in the more mobile areas include:
moving to low poverty census tracts improves long-term success
moving to a mobile area increases earnings in adulthood by 30%
higher likelihood of attending college
lower instances of teen pregnancy
General factors contributing to upward mobility:
mixed income communities produce a better outcome for kids from disadvantaged backgrounds
areas with less income inequality have higher rates of upward mobility
areas with fewer single parents have substantially higher rates of upward mobility
areas that are more socially cohesive have higher rates of social mobility
Risk assessments are important for international and local ventures. Finding a high-performing economy and a suitable workforce lowers the risk of failure. This information from the St. Louis Fed is an essential source for performing a risk assessment for US domestic businesses and for foreign businesses seeking to enter the US market.