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Are we already in what will be known as the 2022 financial crash?

Already into May, 2022 has been a tough year for global stock markets. On…
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Already into May, 2022 has been a tough year for global stock markets. On Wall Street the main indices are all down significantly since the start of the year. The S&P 500 has lost a little over 13%, the Dow Jones a little less than 10% and the tech-heavy Nasdaq almost 21%.

Here in the UK the benchmark FTSE 100 index has fared better and sits at almost exactly the same level it opened the year. It has been supported by its heavy weighting to mining and energy companies which, unlike most sectors, have had a great 2022 thanks to spiking oil and gas and metal prices.

nasdaq

Shell is up 28% this year and BP over 15%. The big London-listed miners including BHP, Glencore, Rio Tinto and Anglo American all have double figure gains for the year to date.

glencore plc

The FTSE 250’s performance has been more in line with the major American indices with the mid-cap index down 13%. Germany’s benchmark index the Dax 30 is down over 12% in 2022 and France’s CAC 40 by 10%.

So far, 2022’s stock market losses have mainly been referred to as a “correction” rather than a “crash”. Growth stocks including the Big Tech FAANG+ constituents like Meta Platforms (Facebook), Alphabet (Google), Apple, Netflix and Amazon have slid the most. However, they are also, with the exception of Netflix, worth significantly more than they were two years ago at the start of the Covid-19 pandemic.

A chunk of the gains inspired by accelerated growth as the move towards a more digital economy quickened has been given up but by no means all of it. Despite falling 27% so far in 2022, the Amazon share price is still up almost 9% on its level of May 1 2020. And almost 27% up on the record high it set ahead of the coronavirus crash that took place between mid-February and mid-March 2020.

Apple is down 13% this year but up almost 119% on where it sat 2 years ago and Alphabet has gained almost 80% over those two years. The major U.S. indices are also far ahead of where they were 2 years ago. The Nasdaq by over 45% despite falling 21% in 2022.

So while it has been a bruising 4 months so far for equities this year, particularly growth stocks like tech and biotech, they are still holding serious gains banked over the period between the recovery from the coronavirus crash and the end of last year. Other sectors like mining and energy booming are another reason why very few stock market analysts and expert commentators have used the word ‘crash’ for equity market losses this year.

But with the global economy’s near-term prospects looking increasingly gloomy and the chances of central banks being forced into raising interest rates in a way likely to catalyse a recession increasing as they try to get a grip on inflation, the word ‘crash’ is starting to be uttered in some corners. Could losses over the first four months of 2022 simply be the first stage of a crash coming in stages rather than the quicker, more dramatic collapse of valuations experienced in 2008 when the international financial crisis hit?

In April the Nasdaq dropped 13.3% for its worst month since October 2008 after the Lehman Brothers collapse. Since its most recent all-time high last November the index has shed around $5 trillion in market capitalisation.

Over the past couple of years, a buoyant tech sector has compensated for strife in other sectors of the economy over the coronavirus pandemic. But growth has now also slowed for tech companies and the rest of the economy is still struggling. Recent data out of the USA, Europe and China is ringing alarm bells.

Last month the S&P Global eurozone manufacturing purchasing managers’ index dropped to its lowest level in 15 months at 55.5 from 56.5 in March. The previous two months also represented a deterioration in the index and Eurozone growth has been described as at “near standstill”.

The bloc’s manufacturing output also dropped to 50.7 from 53.1 in March, its worst level in almost 2 years. Any figure below 50 shows a contraction and if the current trend persists, that may well be the case when figures are released next month.

Chris Williamson, S&P Global’s chief business economist, commented:

“Manufacturing output came to a near-standstill across the eurozone in April. Companies not only reported that problems with component shortages had been aggravated by the Ukraine war and new lockdowns in China, but that rising prices and growing uncertainty about the economic outlook were also hitting demand.”

The most recent PMI data also showed China’s manufacturing sector contracted in April for the second month in a row. It dropped to 47.4, which is its lowest level since February 2020 when the Covid-19 pandemic broke out. Manufacturing data from the USA also showed a second consecutive month of contraction to fall to 55.4.

The last time it dropped so low was September 2020 and 15% of respondents to an Institute for Supply Management survey said they were concerned about the ability of Asian partners to reliably deliver over coming months, up from 5% in March.

The dotcom crash played out over two years

The generally steady decline of growth stock valuations this year has, with some notable exceptions like Netflix’s 35% plunge last month, been gradual enough to largely avoid dramatic headlines involving the word ‘crash’.

But does that necessarily mean a different crash has not already started? One that perhaps more resembles the dotcom crash of 2000 which played out over two years? Having peaked at 5048.62 in early 2000, the Nasdaq had almost halved by the end of that year. But it didn’t bottom out until October 9, 2002, by which time it had fallen to 1114 for a drop of almost 80%.

Over two decades ago now the beginning of the tech, media and telecoms revolution that led to today’s giant companies had gotten underway. It drow the Nasdaq from 1000 points in July 1995 to over five times that by its pre-crash peak in early 2020. It’s a remarkably similar pattern to the period leading up to the end of 2021.

The parallels raise the question of whether we have several more months or a year or more of growth stock losses ahead of us. If we do that would mean we are only in the first leg of a drawn-out crash that could mirror that at the turn of the millennium.

There are also, however, important differences. We again have a lot of tech companies worth billions despite having never generated a profit. Some haven’t even generated any income. But the situation isn’t as extreme as it was in 2000 when the U.S. stock market was trading at an adjusted Cape ratio of 50. Last year Cape reached 39 in late November ahead of the start of the current downturn.

Today’s big tech companies are also a lot more established and profitable than those of 2000. Many also have a very wide moat consisting of dominant market positions and vast cash piles. And they are also a lot cheaper than they have been recently which could represent a buying opportunity that appeals to enough investors to stop valuations falling much further.

For example, the Allianz Technology Trust is down 32.6% since November. At 249.4p, the trust’s shares are 15% lower than the 294p value of its portfolio of companies. And the average price to earnings ratio of the companies that the trust holds is x26 times — much cheaper than the x46 it was at the end of 2020.

allianz technology

There could be more pain ahead over the next several months and it could well be enough to drag the major indices, especially those with a heavy weighting to growth stocks, into clear bear territory. We could now be in what will be known as the 2022 stock market crash in future years. But there are also enough reasons to suggest losses will not get close to the 80% decline of the Nasdaq that concluded two decades ago. The tech sector is now driven by companies that are far too profitable and are in far too powerful a market position for that to be likely this time around.

The post Are we already in what will be known as the 2022 financial crash? first appeared on Trading and Investment News.

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Economics

Global IT Consulting Sourcing and Procurement Report with Pandemic Impact Analysis, Supplier Evaluation and Price Trends | SpendEdge

Global IT Consulting Sourcing and Procurement Report with Pandemic Impact Analysis, Supplier Evaluation and Price Trends | SpendEdge
PR Newswire
NEW YORK, July 3, 2022

Over 200 Forbes 2000 companies rely on our actionable insightsMore than 100 CPOs…

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Global IT Consulting Sourcing and Procurement Report with Pandemic Impact Analysis, Supplier Evaluation and Price Trends | SpendEdge

PR Newswire

  • Over 200 Forbes 2000 companies rely on our actionable insights
  • More than 100 CPOs and 500 category managers use our insights daily
  • SpendEdge has the fastest growth rate in number of reports and client base

NEW YORK, July 3, 2022 /PRNewswire/ -- The IT Consulting market size is expected to grow by USD 131.35 Billion by 2025, at a Compound Annual Growth Rate (CAGR) of 9.19% during the forecast period. To know more about this market.

Request For a Free Sample Report

IT Consulting Market Analysis

Analysis of the cost and volume drivers and supply market forecasts in various regions are offered in this IT Consulting research report. This market intelligence report also analyzes the top supply markets, market opportunities, challenges and the critical cost drivers that can aid buyers and suppliers devise a cost-effective category management strategy.

The report provides insights on the following information:

  • Regional spend dynamism and factors impacting costs
  • The total cost of ownership and cost-saving opportunities
  • Supply chain margins and pricing models
  • Competitiveness index for suppliers
  • Market favorability index for suppliers
  • Supplier and buyer KPIs

Get detailed insights on the COVID-19 pandemic crisis and recovery analysis of IT Consulting Market

www.spendedge.com/report/it-consulting-services-market-procurement-research-report

Related Reports on Professional Services Market:

Detect blind spots in your revenue decisions by analyzing interconnected unknowns around the "IT Consulting Market."

Report Metrics

Details

Base year considered

2021

Forecast period

2021 - 2025

Forecast units

USD Billion

Geographies covered

North America, South America, Europe, Middle East and Africa, and APAC

Leading IT Consulting suppliers

Deloitte Touche Tohmatsu Ltd., PricewaterhouseCoopers International Ltd., and Ernst & Young Global Ltd.

Top Pricing Models

Flat-fee model, hourly rate model, and cost-plus model

This procurement report answers help buyers identify and shortlist the most suitable suppliers for their IT Consulting Market requirements following questions:

  • Am I engaging with the right suppliers?
  • Which KPIs should I use to evaluate my incumbent suppliers?
  • Which supplier selection criteria are relevant for?
  • What are the workplace computing devices category essentials in terms of SLAs and RFx?

Table of Content

  • Executive Summary
  • Market Insights
  • Category Pricing Insights
  • Cost-saving Opportunities
  • Best Practices
  • Category Ecosystem
  • Category Management Strategy
  • Category Management Enablers
  • Suppliers Selection
  • Suppliers under Coverage
  • US Market Insights
  • Category scope

Appendix

About SpendEdge:

SpendEdge shares your passion for driving sourcing and procurement excellence. We are the preferred procurement market intelligence partner for 120+ Fortune 500 firms and other leading companies across numerous industries. Our strength lies in delivering robust, real-time procurement market intelligence reports and solutions.

Contact
SpendEdge
Anirban Choudhury
Marketing Manager
Ph No: +1 (872) 206-9340 
https://www.spendedge.com/contact-us

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SOURCE SpendEdge

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Spread & Containment

Visualizing A Decade Of Population Growth And Decline In US Counties

Visualizing A Decade Of Population Growth And Decline In US Counties

There are a number of factors that determine how much a region’s population…

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Visualizing A Decade Of Population Growth And Decline In US Counties

There are a number of factors that determine how much a region’s population changes.

If an area sees a high number of migrants, along with a strong birth rate and low death rate, then its population is bound to increase over time. On the flip side, as Visual Capitalists Nick Routley details below, if more people are leaving the area than coming in, and the region’s birth rate is low, then its population will likely decline.

Which areas in the United States are seeing the most growth, and which places are seeing their populations dwindle?

This map, using data from the U.S. Census Bureau, shows a decade of population movement across U.S. counties, painting a detailed picture of U.S. population growth between 2010 and 2020.

Counties With The Biggest Population Growth from 2010-2020

To calculate population estimates for each county, the U.S. Census Bureau does the following calculations:

      A county’s base population → plus births → minus deaths → plus migration = new population estimate

From 2010 to 2020, Maricopa County in Arizona saw the highest increase in its population estimate. Over a decade, the county gained 753,898 residents. Below are the counties that saw the biggest increases in population:

Phoenix and surrounding areas grew faster than any other major city in the country. The region’s sunny climate and amenities are popular with retirees, but another draw is housing affordability. Families from more expensive markets—California in particular—are moving to the city in droves. This is a trend that spilled over into the pandemic era as more people moved into remote and hybrid work situations.

Texas counties saw a lot of growth as well, with five of the top 10 gainers located in the state of Texas. A big draw for Texas is its relatively affordable housing market. In 2021, average home prices in the state stood at $172,500$53,310 below the national average.

Counties With The Biggest Population Drops from 2010-2020

On the opposite end of the spectrum, here’s a look at the top 10 counties that saw the biggest declines in their populations over the decade:

The largest drops happened in counties along the Great Lakes, including Cook County (which includes the city of Chicago) and Wayne County (which includes the city of Detroit).

For many of these counties, particularly those in America’s “Rust Belt”, population drops over this period were a continuation of decades-long trends. Wayne County is an extreme example of this trend. From 1970 to 2020, the area lost one-third of its population.

U.S. Population Growth in Percentage Terms (2010-2020)

While the map above is great at showing where the greatest number of Americans migrated, it downplays big changes in counties with smaller populations.

For example, McKenzie County in North Dakota, with a 2020 population of just 15,242, was the fastest-growing U.S. county over the past decade. The county’s 138% increase was driven primarily by the Bakken oil boom in the area. High-growth counties in Texas also grew as new sources of energy were extracted in rural areas.

The nation’s counties are evenly divided between population increase and decline, and clear patterns emerge.

Pandemic Population Changes

More recent population changes reflect longer-term trends. During the COVID-19 pandemic, many of the counties that saw the strongest population increases were located in high-growth states like Florida and Texas.

Below are the 20 counties that grew the most from 2020 to 2021.

Many of these counties are located next to large cities, reflecting a shift to the suburbs and larger living spaces. However, as COVID-19 restrictions ease, and the pandemic housing boom tapers off due to rising interest rates, it remains to be seen whether the suburban shift will continue, or if people begin to migrate back to city centers.

Tyler Durden Sat, 07/02/2022 - 21:00

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Economics

The Best Cities to Buy a Starter Home

Competition for starter homes is intense. What’s a buyer to do? Look to these cities to break into the real estate market.

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Competition for starter homes is intense. What's a buyer to do? Look to these cities to break into the real estate market.

Who wants to buy a home? A lot more people than there are homes to buy, and the outlook for first-time buyers is particularly grim.

About 26 million Americans plan to buy a home in the next 12 months, but just 5-6 million homes were sold in each of the past five years, according to a NerdWallet survey conducted in December 2021.

Millennials, aged about 26-41 years, are the largest group trying to buy homes, about 37%, according to the National Association of Realtors, and first-time buyers made up 31% of all home buyers. The supply of starter homes decreased by more than half from 2017-2021, according to an analysis by Realtor.com, which defined starters as single-family homes, condos, and townhomes under 1,850 square feet.

While median monthly asking rent in the U.S. surpassed $2,000 in May, the national median sale price topped $431,000, according to Redfin data.

And it’s not just low inventory and high prices, the competition is fierce for first-time homebuyers. Urban renters headed for the suburbs during the pandemic to compete for those entry-level homes, baby boomers looking to downsize also go after smaller properties, and to make matters worse, first-time home buyers must compete with investors who pay cash to fix and flip homes. These cash-rich flippers now make up about 10% of homebuyers

Lastly, builders have largely been unable to offset the decline in starter homes.

For the house hunter who still has the moxie to try, turn to this list of cheapest cities to buy a home. To find the cheapest places for homebuyers and the best places for starter homes, StorageCafe, an online platform that provides storage unit listings across the nation, looked at data from 108 U.S. cities with populations ranging from 90,000 to 8 million. The metrics include property values, number of sales between 2015 and 2021, housing affordability, cost of living, unemployment rate, homebuyers’ ages, the ratio of renters to owners, income levels, FHA lending limits and average mortgage rates. They scored each city on these metrics then ranked them based on their potential with regard to starter homes.

Here are the best cities for first-time homebuyers:

1. Fort Wayne, Ind.

  • Median property value: $113,144
  • Cost of living index: 87
  • Homebuyers' age: 35
  • 2021 average mortgage rate: 3.14%

The analysis used average mortgage rates from 2021, and rates have since gone up, hovering near 6% in June, but last year's rates might still give you a sense of where rates tend to be lower.

2. Columbia Md.

  • Median property value: $264,055
  • Cost of living index:106
  • Homebuyers' age: 39
  • 2021 average mortgage rate: 3.00%

3. Pittsburgh

  • Median property value: $170,042
  • Cost of living index:104
  • Homebuyers' age: 38
  • 2021 average mortgage rate: 3.03%

Shutterstock

4. Fishers, Ind.

  • Median property value: $258,679
  • Cost of living index: 92
  • Homebuyers' age: 38
  • 2021 average mortgage rate: 3.14%

5. Columbus, Ohio

  • Median property value: $164,229
  • Cost of living index: 92
  • Homebuyers' age: 39
  • 2021 average mortgage rate: 3.16%

aceshot1 / Shutterstock

6. Carmel, Ind.

  • Median property value: $244,670
  • Cost of living index: 104
  • Homebuyers' age: 40
  • 2021 average mortgage rate: 3.01%

7. St. Paul, Minn.

  • Median property value: $286,151
  • Cost of living index: 92
  • Homebuyers' age: 38
  • 2021 average mortgage rate: 3.14%

8. Cary, N.C.

  • Median property value: $308,611
  • Cost of living index: 94
  • Homebuyers' age: 43
  • 2021 average mortgage rate: 3.02%

9. Manchester, N.H.

  • Median property value: $276,257
  • Cost of living index: 111
  • Homebuyers' age: 40
  • 2021 average mortgage rate: 3.03%

10. Minneapolis

  • Median property value: $288,926
  • Cost of living index: 105
  • Homebuyers' age: 40
  • 2021 average mortgage rate: 3.01%

11. Nashville, Tenn.

  • Median property value: $318,046
  • Cost of living index: 93
  • Homebuyers' age: 39
  • 2021 average mortgage rate: 3.02%

f11photo / Shutterstock

12. Bakersfield, Calif.

  • Median property value: $216,063
  • Cost of living index: 102
  • Homebuyers' age: 40
  • 2021 average mortgage rate: 3.04%

13. Arvada, Colo.

  • Median property value: $476,672
  • Cost of living index: 114
  • Homebuyers' age: 39
  • 2021 average mortgage rate: 3.00%

14. Alexandria, Va.

  • Median property value: $432,703
  • Cost of living index: 137
  • Homebuyers' age: 40
  • 2021 average mortgage rate: 2.99%

Shutterstock

15. Centennial, Colo.

  • Median property value: $444,747
  • Cost of living index: 114
  • Homebuyers' age: 39
  • 2021 average mortgage rate: 3.00%

16. Denver

  • Median property value: $505,777
  • Cost of living index: 113
  • Homebuyers' age: 39
  • 2021 average mortgage rate: 3.00%

17. Raleigh, N.C.

  • Median property value: $279,304
  • Cost of living index: 94
  • Homebuyers' age: 43
  • 2021 average mortgage rate: 3.02%

18. Germantown, Md.

  • Median property value: $261,511
  • Cost of living index: 157
  • Homebuyers' age: 39
  • 2021 average mortgage rate: 3.00%

19. St. Petersburg, Fla.

  • Median property value: $283,684
  • Cost of living index: 96
  • Homebuyers' age: 53
  • 2021 average mortgage rate: 3.11%

20. Lakewood, Colo.

  • Median property value: $380,165
  • Cost of living index: 114
  • Homebuyers' age: 39
  • 2021 average mortgage rate: 3.00%

21. Aurora, Colo.

  • Median property value: $360,542
  • Cost of living index: 114
  • Homebuyers' age: 39
  • 2021 average mortgage rate: 3.00%

22. Boca Raton, Fla.

  • Median property value: $280,104
  • Cost of living index: 116
  • Homebuyers' age: 51
  • 2021 average mortgage rate: 3.11%

23. Modesto, Calif.

  • Median property value: $319,328
  • Cost of living index: 119
  • Homebuyers' age: 39
  • 2021 average mortgage rate: 3.04%

Shutterstock

24. Chandler, Ariz.

  • Median property value: $388,450
  • Cost of living index: 103
  • Homebuyers' age: 51
  • 2021 average mortgage rate: 3.12%

Shutterstock

25. Las Vegas

  • Median property value: $265,170
  • Cost of living index: 107
  • Homebuyers' age: 50
  • 2021 average mortgage rate: 3.11%

26. Washington, D.C.

  • Median property value: $623,135
  • Cost of living index: 157
  • Homebuyers' age: 40
  • 2021 average mortgage rate: 4.90%

27. Scottsdale, Ariz.

  • Median property value: $478,609
  • Cost of living index: 103
  • Homebuyers' age: 51
  • 2021 average mortgage rate: 3.12%

28. Spokane, Wash.

  • Median property value: $300,881
  • Cost of living index: 107
  • Homebuyers' age: 44
  • 2021 average mortgage rate: 3.06%

29. Peoria, Ariz.

  • Median property value: $373,588
  • Cost of living index: 103
  • Homebuyers' age: 51
  • 2021 average mortgage rate: 3.12%

30. Gilbert, Ariz.

  • Median property value: $409,324
  • Cost of living index: 103
  • Homebuyers' age: 51
  • 2021 average mortgage rate: 3.12%

31. Portland, Ore.

  • Median property value: $484,475
  • Cost of living index: 132
  • Homebuyers' age: 44
  • 2021 average mortgage rate: 3.08%

Check out how all 108 cities ranked and see the methodology for this study at StorageCafe.com

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