Our Blog Name

“i-Zone”

Reasons why this is the name of our group:

The reason why we have chosen this name is for two reasons. However we will begin by explaining what our name actually means and stands for. The “i” part is linked with the dominance of Apple in today’s technology industry. From i-Phones to i-Pods, they generally have the most market share. Their products are revolutionary and from their previous CEO, Steve Jobs, they as a single company have changed the way many of us live our lives today. The “Zone” part of our group name is to do with the ongoing Eurozone Debt Crisis. Within this, our main thoughts were derived from the European Economic ‘PIGS’ – Portugal, Italy, Greece and Spain. These countries have caused economic chaos around the world and in particularly on the financial markets.

“i”:

As we mentioned, Apple is a massive company. In fact its current Market Capitalization is $417 billion. This is compared to Exxon Mobil’s, which is $411 billion, which in turn makes it the most valuable company in the world by Stock Market valuations. This is just one of the reasons that we have chosen to use them as part of our group name. In an increasingly globalized world, companies like this affect international business and management. We are also interested and have been extremely surprised as to how strong they are financially. In August 2011, the company reported that it had $76.1 billion of cash, more than $3 billion than that of the US treasury Department. Then in its year-end financial statements, the company reported that it held more than $97.6 billion of cash. Although the increase is substantial, we did not look into this. At its current position, the company has enough cash to pay Greece’s debt payments that are due for the next two years. When a company has this much strength, both financially and as a brand, we thought it would be important to take note of it and at the same time, admire it. This is because less than 20 years ago, the company was facing closure and was failing badly. It has managed to turn itself around into, literally the biggest company in the world.

“Zone”:

As a group we believe that the most important topic in the international business world is the current issues that are facing several of the European countries, with regards to their debt levels and issues of whether they will or will not default. We have to begin with Greece, as it is the country that has attracted the most attention for all the wrong reasons. The EU and IMF has agreed a 229 billion Euro bailout and a 50% cut in the country’s debt. However more action is still needed and has been one of the pressing issues at the annual World Economic Forum in Davos. Although the figures are not positive at all, we are interested as to how and why countries like Greece got to this level. It all began with the currency change from the sovereign Dracma to the single currency being adopted, the Euro. The main reason for this was that it made it far easier for the government to borrow money from more countries. Greece went on a big, debt-funded spending spree, including paying for high-profile projects such as the 2004 Athens Olympics, which went well over its budget. As the worlds Global Financial Crisis started, the country was hit by the downturn harder than most, which meant it had to spend more on benefits and received less in taxes. Only at this point did some analysts begin to question whether Greece had accurately measured and reported its economic statistics. Economic problems meant lenders started charging higher interest rates to lend it money.

The image below shows the extent of Greece’s problem’s with its borrowing cots so much higher than all the other countries:

Widespread tax evasion also hit the government's coffers. One of the main sources of revenue for the government, tourism, was also affected as issues in their own countries were affecting holiday goers. Currently, the main issues worrying investors and governments around the world are the cost of borrowing to the Greek government.