💼BIGGEST IT OUTAGE EVER? + BUDGETING 101 INSIDE!
Explore the massive Microsoft-CrowdStrike outage, Netflix's latest earnings, and essential budgeting tips with the Informed Investor in this week's How Do I Know That?! Enjoy the read!
🗓️Saturday, July 20
🍵Weekly RoundUp
📱Big Tech & Startups
Microsoft-CrowdStrike issue causes 'largest IT outage in history':
Businesses worldwide grappled with a major IT outage on Friday, affecting financial services, healthcare systems, airlines, and TV broadcasters. The outage, caused by an issue with a recent CrowdStrike update, led to grounded flights and disrupted services globally. CrowdStrike CEO George Kurtz confirmed that a defect in a single content update for Windows hosts was identified and fixed. Microsoft cloud services were also affected but have since been restored. Experts suggest this may be the largest IT outage in history.
OpenAI debuts mini version of its most powerful model yet:
OpenAI has launched GPT-4o mini, available to free users, with audio, video, and text capabilities. The model will be made available to ChatGPT Enterprise users next week.Amazon Prime Day drives U.S. online sales to record $14.2 billion:
Online spending during this year's 48-hour Amazon Prime Day event was up 11% year-over-year, driven by back-to-school shopping and a product refresh cycle.
Meta reportedly unhappy with how much money its VR division burns :
Meta has told its AR/VR teams to cut spending by around 20%, aiming to release new Meta Quest 4 headset, Quest Pro sequel, and AR glasses in the next three years while shifting focus to AI.
Google reportedly in advanced talks to acquire cyber startup Wiz for $23 billion Google may be acquiring cybersecurity firm Wiz for $23 billion, marking Google's largest acquisition yet.
SpaceX rocket accident leaves the company's Starlink satellites in the wrong orbit:
A SpaceX rocket malfunctioned, leaving 20 Starlink satellites in an incorrect orbit, likely leading to their reentry and burn-up in the atmosphere.
🚀Science & Futuristic Technology
WHAM! Nuclear fusion experiment hits new record for magnet strength:
A fusion experiment set a record for the strongest steady magnetic field confining plasma, producing a 17 tesla magnetic field, more than twice as powerful as high-resolution MRI scanners.
Researchers track individual neurons as they respond to words:
A study found that neurons' responses to language change based on context, with certain areas lighting up if the patient hears specific words, providing insight into the mechanism of human language comprehension.
'Supermodel granny' drug extends life in animals:
Researchers discovered a drug that increases laboratory animals' lifespans by nearly 25%, by lowering levels of a protein called interleukin-11, which is associated with higher levels of inflammation and aging factors.
🎁Other
Saudi money makes a big splash in video games
The Saudi government plans to invest $38 billion in video games by 2030, holding the inaugural Esports World Cup in Riyadh and partnering with major video game companies and influencers.
📊 Earnings Watch
Netflix beats estimates as ad-supported memberships rise 34%
Netflix's Q2 earnings surpassed expectations, driven by a 34% growth in ad-supported memberships. Global paid memberships rose 16.5% year-over-year to 278 million. Earnings per share were $4.88, with revenue at $9.56 billion. The company continues to focus on expanding its ad-supported tier and live content.
TSMC second-quarter profit beats expectations as AI chip boom continues TSMC's Q2 earnings exceeded expectations due to strong demand for AI chips. The company reported revenue of NT$673.51 billion ($20.82 billion) and net income of NT$247.85 billion, up 40.1% and 36.3% year-over-year. TSMC plans to start mass production of 2-nanometer chips in 2025.
ASML bookings surge as AI chip demand boosts purchases of its critical semiconductor tools :
ASML reported Q2 earnings and sales that beat forecasts, with net sales at 6.24 billion euros ($6.8 billion) and net profit at 1.58 billion euros. Net bookings rose 24% year-on-year to 5.6 billion euros, driven by strong AI chip demand despite export restrictions to China.
BlackRock’s ETF business just keeps growing, but the search for revenue goes on :
BlackRock's ETF business contributed significantly to its total revenue of $17.8 billion in 2023. Assets under management reached $3.85 trillion, with strong inflows of $83 billion in Q2. BlackRock is exploring new revenue streams like annuities and private equity.
💡 Informed Investor: Budgeting Basics
Creating and sticking to a budget is one of the most fundamental aspects of personal finance. It’s not just about tracking your spending but also about planning for your financial future. Today, we will introduce you to the world of budgeting and explore how it can transform your financial life.
Why Do I Need a Budget?
Budgeting helps you:
Control Your Spending: A budget lets you see exactly where your money is going, helping you make informed decisions about your expenses.
Save for Future Goals: Whether it’s for a vacation, a new home, or retirement, budgeting helps you allocate funds towards your long-term goals.
Avoid Debt: By keeping track of your spending and ensuring you live within your means, you can avoid accumulating unnecessary debt.
Prepare for Emergencies: A budget helps you build an emergency fund to cover unexpected expenses like medical emergencies or job loss.
How Do I Make a Budget?
Creating a budget involves a few simple steps:
1. Assess Your Income
Calculate your total monthly income. This includes your salary, side gigs, investments, and any other sources of income. For many young people, financial support often comes from parents or guardians. If this is your situation, consider discussing and negotiating a fixed monthly amount they can provide. This ensures you have a clear, consistent picture of the funds you have to work with each month.
2. Track Your Expenses
Track all your expenses for a month. You can use simple tools like spreadsheets, budgeting apps, or a simple notebook. Categorise expenses into fixed (rent, utilities) and variable (groceries, entertainment) categories. Understanding your spending habits is crucial for creating a realistic budget.
3. Set Financial Goals
Define your short-term goals (e.g., saving for a vacation) and long-term goals (e.g., buying a house, retirement). Clear goals give your budget purpose and direction. Break down these goals into manageable steps and set deadlines to keep yourself accountable.
4. Create a Plan
Allocate your income to cover all your expenses and savings. A popular method is the 50/30/20 rule: 50% for needs, 30% for wants, and 20% for savings and debt repayment. Customize this rule to fit your personal financial situation. For example, you might allocate more than 20% towards debt repayment if you have significant debt. Be flexible.
5. Adjust and Monitor
Regularly review your budget and adjust as needed. Life changes, and so should your budget. Keep track of your progress towards your financial goals. If you find certain categories consistently going over budget, re-evaluate your spending or adjust your budget accordingly. After a certain point, your needs will always remain consistent; it’s the wants you want to manage.
Here Are Some Tips for Effective Budgeting
Prioritise Savings
Pay yourself first. Pay yourself first by setting aside money for savings before you start spending. Automate transfers to your savings account to make it easier. Consider setting up multiple savings accounts for different goals, such as an emergency fund, travel fund, or down payment on a house.
Cut Unnecessary Expenses
Identify and eliminate non-essential expenses. Subscriptions you don’t use, dining out frequently, or impulse purchases can be trimmed to save more. Regularly review your bank statements to spot recurring charges and cancel any services you no longer need.
Use Budgeting Tools
Find the one that works best for you. Many of these tools offer features like goal tracking, spending alerts, and detailed spending reports to help you stay on track.
Stay Flexible
A budget isn’t set in stone. Be flexible and willing to adjust as your financial situation changes. Unexpected expenses can arise, and it’s important to adapt. Build a buffer into your budget for unplanned expenses to avoid disrupting your financial plan.
Building a Rainy Day Fund
"Save a part of your income and begin now, for the man with a surplus controls circumstances." – Henry Buckley.
An emergency fund is crucial. Aim to save three to six months’ worth of living expenses. This fund acts as a financial cushion in case of unexpected events like medical emergencies or job loss. Start small, even if it's just $500, and gradually build up your fund. Keeping this money in a high-yield savings account can also help it grow faster.
Budgeting for Investments
Once you have a stable budget and an emergency fund, consider setting aside money for investments. Diversifying your income streams through investments can help grow your wealth over time. Explore different types of investments such as stocks, bonds, mutual funds, and real estate. Remember to align your investment choices with your risk tolerance and financial goals.
Budgeting is more than just a financial exercise; it’s a way to take control of your life and secure your financial future. Start today, stay disciplined, and watch your financial health improve. Remember, every small step counts towards achieving your larger financial goals.
Remember, as Benjamin Franklin said, "An investment in knowledge pays the best interest." Stay informed, stay disciplined, and you'll be on your way to financial success.
For more insights and updates, subscribe to the How Do I Know That newsletter, where you can find me your informed investor. Feel free to reach out with any questions or share your own budgeting tips and experiences.
Let's continue to learn and grow together!
🔎Infographic Highlight : How Do Americans Watch TV in 2024?
With Netflix out with Q2 Earnings this week, why not look at how Americans watch TV in 2024?
Source: VisualCapitalist
