The Group of 20 meeting of finance ministers and central bankers from the world's top economies has concluded without recommending any specific spending package to prevent another global financial crisis. The G20, which met for two days in China, did indicate that governments need to do more than promote low interest rates to improve the faltering global economy, and that countries must work together more on foreign exchange policy. Some analysts interpreted this as a criticism of Chinese economic decisions. The county's rapid devaluation of the yuan in recent months has angered many other countries — including the U.S. — because the move gives China an economic advantage.
The daily business briefing: February 29, 2016
G20 meeting in Shanghai concludes, no specific spending packages promised
NFL salary cap set at $155.27 million for 2016
The NFL Players Association confirmed that the 2016 salary cap has been set at $155.27 million. That's a nearly $12 million increase from last year. The bump is due to several developments, including a new Thursday night TV package and a recent arbitrator's ruling that the league had earlier failed to apply certain revenues to the cap. The salary cap limits the total amount of money that individual teams can spend on player salaries.
Starbucks to open first store in Italy
Starbucks announced Sunday that it will open a store in Milan in 2017. While the company's CEO, Howard Schultz, decided to bring espresso drinks to the U.S. after visiting Milan and Verona in the 1980s, until now the coffee chain had opened no stores in Italy. Starbucks said it was expanding to Italy with "with humility and respect." Only about 10 percent of the company’s stores are located in Europe, the Middle East, and Africa.
Stock prices down slightly in Europe and Asia
Stock prices fell moderately in Europe and Asia Monday after the G20 weekend meeting failed to result in a new plan to promote economic growth. Investors are also worried the U.S. Federal Reserve could raise interest rates before the end of the year. "Markets looked at the G20 meeting and found it a tad disappointing,” said Peter Lowman, CIO of Investment Quorum, a London-based wealth management firm.
Harvard Business Review argues it's time to stop paying CEOs performance bonuses
A recent article in the Harvard Business Review recommended that companies stop giving CEOs performance bonuses. "We argue in favor of abolishing pay-for-performance for top managers altogether, wrote London Business School professors Freek Vermeulen and Dan Cable. "Instead, most firms should pay their top executives a fixed salary." Vermeulen and Cable say that performance bonuses and stock options have been ineffective because such salary schedules tend to promote fraud, executives actually perform worse when they have explicit goals to reach, and performance is notoriously difficult to measure effectively.