Economics in the News – Oct. 25-31, 2021

Economics impacts our lives every day. Below are some of the top storylines from this past week related to economics.

• The banking industry once questioned and rejected the legitimacy of cryptocurrency. Now, several years later, the industry is now adapting to cryptocurrency and has taken steps to embrace it. Seven years ago, three million people globally were counted as users of Bitcoin. Now, that has multiplied with more than 75 million users of Bitcoin worldwide and 220 million users of cryptocurrency, according to Crypto.com.
  
  Banks have adapted to blockchain technology and some banks, such as JP Morgan, have invested in departments to explore all-digital systems. Other banks are offering services to their clients that include holding Bitcoin or are preparing plans that offer customer rewards in Bitcoin. Regulators are scrambling to quickly adapt and write new rules concerning the adoption of cryptocurrencies. [The New York Times] 

• Users of Uber and Lyft are likely going to pay more for their next ride. The two rival companies that created the rise of ride-sharing are elevating their prices due to a short supply of drivers. The prices that customers pay are directly tied to the driver supply in a given market. Customers have paid more than 30 percent more than they paid in Oct. 2019.
  
  Drivers are slowly returning to the road after the federal unemployment benefits expired in September, but it’s slower than the demand for rides. Unemployment benefits were extended to gig and self-employed workers, likely accounting for many of the ride-share drivers. Economists conclude that worries about contracting COVID-19, along with older people stepping away or finding opportunities in other industries are contributors to the lack of drivers. [The Wall Street Journal]
  
  
• Rental car provider Hertz announced that it plans to buy 100,000 electric vehicles from Tesla by the end of 2022. It’s one of the largest purchases of electric-powered vehicles in history. It also reflected the adaptation to electric vehicles as an alternative for the internal-combustion engine.
  
  The announcement sent shares of Tesla stock price soaring with a one-day increase of 13 percent on its cost-per-share. It pushed the world’s most valuable automaker’s market value past $1 trillion. CEO Elon Musk has since cautioned in a tweet that the deal isn’t official yet. [Associated Press]
  
  
• Facebook has a new corporate name. It will now be called Meta. The announcement is part of an effort to improve the battered social media giant’s public image. The Facebook app that is widely popular and used by more than three billion people globally will keep its name.
  
  Facebook plans to refocus its attention on the next generation of online interaction, known as the ‘metaverse.’ The metaverse refers to an immersive virtual reality space where people can play games, meet with colleagues and attend concerts. [NPR]
  
  
• Many schools among the Power Five conferences – ACC, Big 10, Big 12, Pac-12 and SEC – are recognizing that the benefits of partnering with historically Black colleges and universities [HBCU] extend to off the field. The killing of George Floyd last year inspired partnerships between the Mid-Eastern Athletic Conference [MEAC] and Syracuse University, as well as between the Southwestern Athletic Conference [SWAC] and the Pac-12.
  
  Last year, Syracuse agreed to schedule up to 50 games against MEAC opponents over the next 10 years. Outside of the playing field, the deal includes an internship exchange program, as well as visiting professorships. The SWAC also came to an agreement with the Pac-12. That deal will see schools inside the SWAC host their Power Five counterparts – unusual for smaller schools with smaller facility budgets. [The Washington Post]