Business

Hackers Targeting Bitcoins

July 27, 2018 By Twila VanLeer

Hackers seem to find a way to commit fraud with every new technology that comes along. Now it’s bitcoin, a virtual currency that is increasing in popularity.

Malicious hardware has been showing up on people’s handsets, TVs and smart fridges to facilitate their “crypto-jacking.” The effects for both individuals and companies has been severe. Depending on the severity of the attack, it may seem the losses are too small to be noticed, but over a period of weeks or months, the loss can be great.

Some companies see a huge increase in their power bills as the hackers do their thing, according to Threat Intelligence Group Manager for Checkpoint, a watchdog organization.

Hackers make use of the victims’ processing power, because that is what they need to “mine” virtual currencies. Computers make the complex calculations that verify a running ledger of all transactions in virtual currencies around the world. Besides installing malicious software, the fraudsters also can work through a web browser, latching onto the victim’s computer processing power to mine

digital currencies while the user is on the site. When the victim switches, the mining ends.

Industry experts first identified crypto-jacking as a threat in 2017, when virtual currency prices were rushing to record highs.

At that time, the price of bitcoin, the most widely used of the virtual currencies, increased six-fold from September to December. It has continued to increase.

The hackers were ready. The first big instance of this type of theft was in September, centered on Coinhive, a legitimate business that allowed website owners to make money by allowing customers to mine their v-currency instead of relying on advertising income. The frauds were almost first in line to use the service.

Monero is their favorite target, according to industry researchers. They estimate that more than 5 percent of Monero is mined through crypto-jacking, with losses of more than $150 million dollars and that doesn’t take into account mining that occurs through browsers. The thieves try to infect as many devices as possible, a method dubbed “Spray and Pray.”

The level of sophistication among the hackers increases with each new wrinkle in virtual currency and victims are reacting by adding protections to their equipment.

Sales Tax Ruling Benefits E-Tailers

June 30, 2018 By Twila VanLeer

Sales Tax Online Shopping — The losses in sales tax revenues from the online sales have cost states as much as $33 billion each year

The recent U.S. Supreme Court decision that will allow states to have online retailers collect sales taxes, just as local retailers do, will go a long way toward leveling the advantage the online businesses have historically had.

The court’s landmark 5-4 vote on the issue will take away the special break the e-tailers have enjoyed and overturns a 1992 decision that they were exempt from collecting sales taxes.

The Supreme Court ruling specifically addressed a South Dakota situation. That state filed a 2016 lawsuit against online retailers Wayfair, Overstock.com and Newegg over the issue of state tax collection. The high court decision means that online merchants can no longer claim an exemption from collecting sales taxes based on the fact that they have no presence in the states where they sell their wares.

Justice Anthony Kennedy, representing the majority of the justices, said that vast marketing changes no longer justify the practice. It has given the e-commerce marketers an “arbitrary advantage over their competitors who routinely collect state sales taxes,” he said.

The losses in sales tax revenues from the online sales have cost states as much as $33 billion each year, Kennedy noted. In 1992, only 2 percent of Americans had internet access. That figure today is about 89 percent and the percentage of online sales rises regularly. Today, some 9 percent of all retail sales are made on the net, and the rate is growing at four times the rate of the increases in the brick-and-mortar outlets.

Retailers in general applauded the Supreme Court action, realizing that it levels the playing field among merchants online and off. “The Supreme Court has acted correctly in recognizing that it’s time for outdated sales tax policies to change as well,” said Matthew Shay, president and CEO of the National Retail Federation.

Retailers are urging Congress to step up to the plate and craft additional legislation that will permanently resolve the inequities caused by the sales tax issue. The complexities grow as large e-tailers such as Amazon acquire smaller businesses and the mix between big-box stores and small outlets and the erosion of boundaries between in-state and out-of-state sales increases.

Pay Raises Don’t Keep Pace

June 28, 2018 By Twila VanLeer

With just about every economic factor pointing to a positive time for America, one element of the picture is lagging. Pay raises are not keeping pace in a growing economy, robbing some people of the benefits of the upswing.

Jerome Powell, chairman of the Federal Reserve, was asked during a news conference what was keeping pay from reflecting the general growth and he had no satisfactory answer. It’s a puzzle, he said.

With employment at the highest in several decades, there still are unfilled jobs as employers fail to find qualified workers. Those factors would logically portend an era of healthy pay raises, but it hasn’t happened, at least in the country’s leading industries.

Powell could offer only a guess: the economy’s relatively low productivity growth. In essence, he suggested, American workers aren’t generating enough extra value for each hour on the job.

Some economists lay the blame on failure of companies to invest in capital equipment that would improve productivity. Others say that earlier technological breakthroughs have not been duplicated.

Bottom line, as Powell said, “It’s a mystery. A puzzle.”

Part of the mystery, as Powell said in 2017 when he was a Fed governor, is that inflation remains below the central bank’s 2 percent target after years of monetary stimulus. He estimated that inflation will run slightly above that target over the next few years, fueled by President Trump’s tax cuts, low unemployment and a gaping federal budget deficit.

In the meanwhile, hourly wages are flat in many fields, according to the Labor Department, and have actually fallen slightly in others.

Navigating The Trade Wars

June 21, 2018 By Twila VanLeer

Small businesses are warily watching to see how the effects of international trade wars will affect them. Will they have to massage their own practices to compete with a new set of trade realities? With steel, for instance, being one of the topics for international wrangling, might a producer of steel barbed wire have to rise to stay even?
Government agencies involved in international trade issues are suggesting that small businesses:

Stay Informed. Not being prepared for the upshot of the disputes could be fatal. Even if a small company does not import raw materials or machinery from China, for example, they could be affected by suppliers down the line who do. The U.S. has published a list of some 1,300 products that could be affected by tariffs. If any of those products are used by small businesses in the United States, they need to be aware.

Look for Alternatives. Small companies may not be able to maintain global supplier networks, but they can look for other way to cultivate relationships in Asian markets. A consultant may be available to guide you through the intricacies of the current markets so you have more than one source to obtain imported items.

Create Ties to Larger Partners: Small companies that are part of larger supply chains have a better chance of getting to multinational companies to purchase raw materials and survive trade disruptions. When then-President George W. Bush imposed tariffs on steel imports in 2002, that’s how some small businesses absorbed the shock. The large auto companies now use their purchasing power to negotiate long-term steel prices and pass the benefit on to suppliers.

Use the Loopholes: If a small business hasn’t been able to find the type of steel it needs in the United States, it can petition for an exemption from tariffs. There is a process to request an exclusion from steel and aluminum tariffs.

More New Jobs Than Skilled Workers

June 8, 2018 By Twila VanLeer

With 223,000 new jobs reported in the United States in May, the unemployment rate dived to a new 18-year low of 3.8 percent., the lowest since 1969. But the flip side is a shortage of skilled workers to fill that record number of available jobs.

The number of hires reported for the month was in excess of 200,000, which left some 20,000 jobs unfilled. The good news in the job market shows that the country’s economy is exhibiting plenty of vigor. In many industries, the addition of jobs has been accompanied by rising salaries.

The plentitude of jobs was attributed in large part to the retail marketing industry, which added 31,000 jobs to the total. Health care hirers accounted for 29,000, construction firms added 25,000 workers and manufacturers took on 18,000.

Economists were surprised by the healthy increases in construction and manufacturing, two areas of the economy that have complained most about worker shortages.

Although some job sectors saw improved worker pay, the big raises that were anticipated have not materialized. But wages are rising gradually. Hourly pay rose by 8 cents, to $28.92 an hour, in May, making the 12-month increase 2.7 percent.

The current economic expansion could become the longest ever if the indicators continue to show improvement for another year.

Some companies have offered higher pay and benefits, are providing training and established partnerships with vocational schools to widen the potential employee pool. In some instances, restrictions on felons have been relaxed.

If pay isn’t increasing as much as workers would like, they at least can rejoice in a slow inflation rate. The Fed has not been prone to increase the prime interest rate, which means people wanting to buy a new home or car are not affected by rising commercial interest rates. It is expected now that the Fed will only bump up the rate a small amount this year, unless there is a dramatic upturn in inflation.

The rosy May report is not expected to nosedive when the June figures come out, the gurus are guessing.