How one company levels the pay slope of executives and workers

As executive pay soars way above what the middle-class earn by over 100 times, Leonard Lee, the founder of Lee Valley Tools, has ensured that his highest paid workers never make more than 10 times the pay of the lowest paid worker. Last year, the ratio of pay in Canada’s largest companies was 122-to-one, up from 84-to-one a decade earlier. Lee notes that along with his form of pay distribution and distributing a quarter of pre-tax profits to its staff, “you get tremendous loyalty from employees if they enjoy their work and they are participating in the income and they have the authority that they need to execute their job.” His flatter pay structure has been noted to pay off in better worker retention and a more engaged staff. However, although this pay structure may seem back the true Canadian value of equal opportunity of all, I believe that it is not a realistic approach for many large corporations who need to meet quarterly targets. This pay structure is much easier for family run businesses who don’t have shareholders and analysts pressuring the company to keep labour costs down.

China becomes world's top gold buyer

With one of the largest and fastest growing economies in the world, it comes to no surprise that China and India are the world’s top gold consumers. Purchasing over 798 tonnes of gold so far this year, the World Gold Council estimates that China will top 1,000 tonnes by the end of this year alone. Although growth may seem to be slowing after decades of rapid expansion, the Chinese middle class have yet to curb their spending habits. Making up a large chunk of the country’s 1.5 billion people, the Chinese’s driving demand for higher carat and heavier pieces of gold jewellery ranks it as one of the top investments in the country, alongside stocks and real estate. Often seen as a sort of safe haven when the economy is tumbling, gold holds no allegiance to any particular country and is often seen as a universally accepted currency. Although many criticize gold as dead money and is seen as a way of putting your money into money, I believe that hedging your wealth or even just speculating the price the rise based on certain events and demands is a poor way to invest an individual’s money.

Saudi billionaire sees a world awash in oil

After the recent discovery of shale oil in the United States, many are criticizing the Saudi elite for ignoring the economic threat posed by the Americans. One of the most influential critics however, comes from Prince al-Waleed bin Talal, a Saudi billionaire who invests in everything from Disney to Twitter to 5-star hotels. The Prince warns that the American shale discovery would soon threaten, not only the Saudi economy, but also that of the members from the OPEC. Although Saudi Arabia has already shrunk its oil production by nearly 700,000 barrels a day, the Prince still feels that the leaders are not progressing fast enough to diversify their oil based economy. He believes that in less than two years, the United States will become a leading competitor in crude oil with prices falling below $80 a barrel if more discoveries emerge within the United States. With about 92% of the Saudi Arabia’s annual budget coming from oil, many share his concern as political figures continue to push for the expansion of oil output. With an enormous stockpile of foreign reserves, I feel that this is giving the leaders a false sense of security as prices will continue to drop as global supply increases.

Rejecting Billions, Snapchat Expects a Better Offer

For many aspiring entrepreneurs, the biggest dream is to launch a start-up and walk away with a ton of cash. However, for two former fraternity brothers at Stanford, that was not the case. Working out of a beachfront bungalow in California, the two brothers created a social media service called Snapchat which lets users send photo and video messages that disappear after a certain time. Quickly gaining a reputation as a way to send provocative photos, it has also become a fun and easy way to trade photos and is one of the most sought-after business in Silicon Valley. William Liaw’s blogpost questions the promotion of “sexting” but defends it in that people are “underestimating its simplicity and committing the straw-man fallacy.” As a company that generates zero revenue, the two aspiring entrepreneurs have recently turned down a $3 billion buyout by Facebook. Expecting much more in the future, the two brothers believe that they may be one of the first social media companies to generate revenue beyond advertising. Although much is still uncertain, I feel that Snapchat made the right decision to hold off on the buyout. Much of the market for generating revenue outside of advertising in the United States have still been relatively untouched and there could be tremendous growth for their company if they play their cards right.

Twitter shares soar in frenzied NYSE debut

The recent launch of Twitter’s IPO have skyrocketed by 73% after a frenzied debut that drove the value of the company up to $25 billion. Closing the first day at $44.90 a share, shares were traded at about 22 times the forecasted sales of 2014, double the multiple of fellow social giants Facebook and LinkedIn. Shadowed for months after Facebook’s disastrous launch in 2012 which was plagued by trading glitches, Twitter’s launch seemed to go off without a hitch and interestingly, market research by analyst PrivCo have showed that Twitter’s IPO have created 1,600 new millionaires! Although far from turning a profit, with a projected loss of $70 million in its most recent quarter, Twitter’s widespread attraction of celebrities and presidents gives them a significant advantage over other social media giants, boasting a star-studded cast and spawning one of the most prominent symbols of this generation, the hashtag! However, like many who criticize the price of the IPO, I too believe that Twitter potentially left billions of dollars on the table. Being overly cautious and not wanting to end up with a disaster like Facebook, I believe Twitter could have priced the shares higher than their IPO.

Dota 2: How Valve is making five-a-side wizard death a healthy eSport

As one of the fastest growing industries, the world of eSports has taken the world by storm over the past two years. From games like Starcraft 2 to Riot’s League of Legends, the eSports industry have generated prize pools of nearly $3 million and brought together millions of viewers online. However, it was the most recent tournament that was held this past summer that really propelled the industry into the eyes of many potential sponsors. Valve held its annual tournament for Dota 2, The International, in Seattle and proved to be one of the most enormous milestones for eSports as a whole. With over 4.5 million viewers worldwide and a prize pool of over $2.8 million, this event alone showed just how quickly the industry is growing. Jason Cion’s blogpost also discusses the rising takeover of eSports with the sponsorship of many major companies. Building a solid foundation for all of eSports in general, “its model takes a triangular partnership between developer, professional player and community which is then able to support or tap into satellite companies and auxiliary businesses.” With companies like Nexon immediately hopping onto the fertile grounds left behind after The International by sponsoring a $200,000 tournament, the eSports industry can significantly expand the markets of many new sponsors to countless new consumers.

After the recent shutdown of the United States government, the US Commerce Secretary Penny Pritzker has warned that prolonging the federal shutdown will start having a greater effect on business not just in the United States, but around the world. Her comments came at the Asia-Pacific Economic Cooperation (APEC) as leaders gathered to voice their own concerns about the situation. Just last Friday, one of the world’s largest defence contractors, Lockheed Martin, announced that it would put 3,000 workers on unpaid leave, with the number scheduled to rise if the shutdown continued.. Lockheed Martin employs over 123,000 people worldwide and over 70% of their revenues come from military sales. Lockheed Martin’s announcement came just days after United Technology, which makes Blackhawk helicopters, laid off 2,000 workers as production was halted because there were no government inspections on finished products. As one of the largest economies in the world, the shutdown of the United States government could have a drastic impact on the world economy. After the financial crisis of 2008, the world economy is still recovering from the hit and is not in a position to withstand a lengthy shutdown of one of the world’s largest and most influential economies.

Undergoing major economic changes in the 1980s, Hong Kong’s per-capita GDP ranks higher than that of Italy and not far behind the likes of Britain and France. When much of the manufacturing activities that put Hong Kong on the map moved across the border in the 1980s, service sectors like banking, trading, and real estate moved in and now employ nearly 90% of the workforce. However, as enticing as that may sound, Hong Kong is a very tough city for the unskilled or semiskilled, many being unable to reintegrate into the changing city. In the neighbourhood of Mong Kok, 22 men live in 450 square foot apartment, each having his or her own cubicle just a little larger than a single bed, stacked above one another in a dark and dank passageway. Is it known that at least 170,000 people live in these cubicles all over Hong Kong. As the soaring prices for housing pushed more and more low-income people out of the market for regular housing, rent on these spaces skyrocketed by nearly 20% while the cost on a per-square-foot basis is nearly one-third more expensive than a regular apartment.

With the recent release of the iPhone 5C to target the mid-segment mobile market, Samsung will also launch two new smart phones in India this month. Priced at about Rs 5,000 – 15,000 (around $80-$240), the new phones will target the mid-end to high-end market and will also offer access to local languages like Hindi, Punjabi, Tamil, Bengali, Telugu, Kannada, Malayalam, Marathi, and Gujarati. Samsung holds about 49% of market shares in India’s smart phone industry, offering 17 different phones from the Samsung Star to the S4, and hopes to attract non-English speaking customers. Vineet Taneja, a representative from Samsung, said that the “competition now in the smart phone market is how to make the phone size small without compromising on the screen size,” just days before the launch of one of Samsung’s largest and most high-end phones, the Galaxy Note 3. However, Samsung has long neglected the market for Phablets in India although, as The Times of India points out, “Indian consumers love Phablets.” While Apple does not have any Phablet sized phones as of yet, Samsung has a clear advantage over other brands in not only innovation, but also owning a large share of the smart phone market.

After the unveiling of the iPhone C, a report by the China Labor Watch claimed that the phone was being produced under illegal and abusive conditions. Through interviews with about 90 employees and an undercover investigator, it was revealed that workers were forced to stand 12-hour shifts with only two half-hour breaks for six days a week. Staff members “[worked] without adequate protective equipment” and was exposed to various chemicals, noises, and lasers for 69 hours a week. Workers slept in crowded dormitories with some having 8 per room and only by working 100 hours of overtime a month can workers secure an income that matches the city average. The factory, owned by Jabil Circuit, said that the problems were uncovered in August and steps are being taken to investigate the allegations made by the China Labor Watch. After the controversy at the Foxconn factories, Apple has made various improvements by implementing new regulations and improving the overall conditions in many factories. As one of the most influential companies in China, Apple can be a driving force behind improving conditions in China by providing jobs to millions of Chinese workers. Workers' rights 'flouted' at Apple iPhone factory in China