Economics impacts our lives every day. Below are some of the top storylines from this past week related to economics.
o Several Chinese car manufacturers are opening up in Mexico, looking to establish a presence in North America. The expansion of the Chinese car manufacturers excludes the United States, as the tariffs would double the sticker price of vehicles imported from China. The companies are not yet manufacturing a significant number of vehicles in Mexico.
Although none of the companies have announced intentions of building factories in Mexico, it is widely expected that they hope to export cars built in Mexico to the United States. President Joe Biden and President-elect Donald Trump both wish to keep Chinese cars out of the United States, but that may become difficult in the future if the Chinese built cars are the most affordable on the market. [The New York Times]
o Taylor Swift’s near two-year long Eras Tour wrapped with its final show on Sunday in Vancouver, British Columbia. The mega tour had 149 shows and grossed a total of $2,077,618,725 in ticket sales, as confirmed by the star’s production team -- Taylor Swift Touring. The gross ticket sales are double the gross ticket sales of any concert tour in history.
The gross sales more than doubles the previous record of $1 billion from Coldplay during their 156-date Music of the Spheres Tour. Every date of the Eras Tour was sold out, with 10,168,008 people attending the concerts. That averages out to $204 per ticket, well above the industry average of $131 per ticket for the top 100 tours in 2023. The highest attendance of the tour came in Melbourne, Australia on Feb. 16, 2024, with 96,006. Ticket sales are only a small part of the revenue, as it excludes in-demand merchandise items. It also does not include tickets sold on the secondary market, but ticket company Victory Live said the average price of resold tickets for the tour’s three Vancouver dates was $2,952 – money that Swift earned nothing from. [The New York Times]
o Advertising giant Omnicom announced that had acquired long-time competitor Interpublic in a deal that would create the world’s largest advertising business. The combined entity would have net revenue of more than $20 billion, based on 2023 figures. The deal could face government scrutiny for being a dominant force in the advertising business, with global ad sales expected to top $1.03 trillion.
The two are entrusted by heavyweight name brands, such as Amazon, AT&T, PepsiCo, Unilever, Volkswagen, among others. The intention behind the deal is to better compete with tech giants Google and Meta Platforms. The merger will create an entity that becomes surpasses WPP as the largest player in the industry. [The Wall Street Journal]
o The Russian economy has started to show signs of strain, after a buoyant two-plus years of war and sanctions. However, the value of the Russian ruble has plummeted to its 32-month low, and has remained near its weakest point since the Kremlin invaded Ukraine.
President Joe Biden’s administration ratchetted up sanctions on Russia’s Gazprombank, the last major unsanctioned bank that Moscow uses to pay soldiers and process trade transactions. It has previously not been impacted by sanctions to allow allies in Europe to pay Russia for critical supplies of energy. In targeting Gazprombank, the American government is trying to stifle one of the last major links to the Western financial system. [The Wall Street Journal]
o More parents are struggling with affordable childcare, meaning that they are missing work, working part-time or staying out of the labor force altogether. Child-related work disruptions has risen 19 percent from pre-pandemic levels, while rising 17 percent since the peak of the pandemic, according to an analysis of Census data by the Federal Reserve Bank of Chicago.
According to the Center for American Progress, more than half of the country’s children live in “child-care deserts” without enough licensed care. In addition, the cost of reliable child care is expensive, averaging between $6,552 and $15,600 a year for one child. That is higher than the median rent in some parts of the country. The number of child-care workers have had a difficult time returning to pre-COVID levels, as more than 360,000 workers lost their jobs and many moved on to better-paying jobs. [The Washington Post]
