The Blog on the Border « Regional Identity

The El Paso Times just reported that UTEP tuition will go up to 4.5 percent next semester, which will roughly result to $3,300 a semester for a full-time student.

EPT will publish a more in-depth piece tomorrow. For more information, read a blog that discusses Texas tuition hikes by Krista Martinez, Regional Identity author.

March 2, 2010, 12:04 am

Buy Local?

This past Sunday, the El Paso Times published an article that discussed the negative impact national contracts have on small local businesses. Many of the interviewees argued that El Paso’s publically funded institutions, such as UTEP, should include smaller local businesses in their business contracts.

One interviewee, Joe Lopez, CEO of Lopez Marketing Group, said El Paso businesses “can compete with national businesses if given the chance.” He also said most El Pasoans would be willing to pay a little more for a product if they knew it was supplied by a local company.

Lopez’s remarks beg the question, if El Paso businesses can compete with national businesses, why aren’t they? Is it because of inefficient UTEP bureaucracy? Possibly, but probably not. It is in an organization’s best interests, especially during a recession, to reduce costs in order to maximize profit. Local businesses do not have the the economies of scale to challenge national competitors, thus local businesses find themselves forced out of the market. Simply put, UTEP contracts nationally because it is cheaper to do so.

Some argue that UTEP, being a state-funded institution, should consider (pricier) local contracts in an effort to help its local economy. Although UTEP’s food service contractor, Sodexo, does buy some local products, “buy local” proponents do not believe UTEP buys enough. Paradoxically, El Paso benefits when UTEP takes on (cheaper) national contracts. Because UTEP seeks cheaper goods and services through Sodexo, the University is able to offer cheaper food to UTEP students. Consequently, since UTEP students spend less on Sodexo’s burritos and pizza, they have more money to spend on local businesses.

Lopez claims El Pasoans would pay more for locally produced goods. Although this may be true for some El Pasoans, this does nothing to influence UTEP business. Until UTEP students protest Sodexo-produced food in favor of local suppliers, UTEP has no incentive to offer more costly products.

If local firms want to compete with national contracts, they must offer a cheaper or a better product or service. If a business can offer neither, frankly, they should not be in competition.

» 5 Comments

March 1, 2010, 1:58 pm

Profiting In A Recession 101

by Freddy Espinoza

Sure, this might be way to early to prepare for, but for those of you who believe in a “double dip” it might not. I won’t debate whether the next recession will start in a month or in 50 years, but two quarters of GDP growth sounds like the end for the “Great Recession.”

Staying alive in a recession can be done by following common knowledge, stocking up on high dividend utility companies and non-cyclical shares. But why not profit? Shorting cyclical shares sounds good but too risky. There are several ways to profit without shorting.

As signs of a recession appear, investors become risk-adverse; they start adjusting for risk by discounting bigger risk from stocks, lowering shares’ prices. So if volatility is considered a measure of risk, volatility rises therefore option prices increase. Buying out of the money puts sounds like a good idea, building long straddles, that is buying a put and a call at the same strike price, even better. Not into options? With increasing financial products you can find volatility-packaged ETFs such as the VXX. That sounds profitable.

As the saying goes “as GM goes so goes the nation”, lets short automakers! Wait… we said no shorting. If consumers stop buying cars because of the fear of unemployment, they’ll keep their same car; but keeping your old car comes with a price: repairs, part replacements, new tire, AutoZone (AZO), Advanced Auto Parts (AAP), etc. Yup, they profit from it, you should too.

Monetary policy is considered a good way to stimulate the economy. In a recession the Fed is likely to lower interest rates. Since bonds & yields move inversely, buying some t-bills for a short-term profit sounds good. After all, the golden rule is buy low sell high! Even if you get it wrong you keep the interest. Many pros say “don’t turn a trade into an investment”, but its ok to have a fall back plan so go ahead and keep the interest and don’t feel bad.

What I like to call the Ultimate recession portfolio is having 96% of 5% coupon rate treasuries, held to maturity, and 4% options. Considering an increase in volatility, the options can bring huge profits, giving you the upside. Out of luck and the timing was not right? The interest payment from the bonds will keep your portfolio alive (96 *1.05= 100.8), never loosing a penny (interest rate fluctuations ignored since HTM). With current 10-yr t-bill rates at 3.78% it’s a good idea to wait for interest rates to go up.

Predicting a recession is an art, which apparently many people are not good at it. Knowing what to do once you have spotted a recession is easy by having a recession plan.

RegionalIdentity.com (Ri) is a not an investment advisor, nor are its contributors.

Ri (and its contributors) invokes the “publisher’s exclusion” from the definition of “investment adviser” as provided under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. Ri occassionally offers impersonalized investment-related advice to its web users and is not tailored to the specific investment needs of current and/or prospective subscribers. Active trading is not for everyone, so make sure you speak with an investment advisor and determine if you ever have a question about Ri posts.

February 26, 2010, 2:18 pm

A Brief Introduction…

by Isabel Belliard

A word from the Regional Identity Marketing Director

As a first generation American and a trilingual marketing major, I can trace my interest into marketing with my love of commercials as a small child. I remember the attractive and creative ideas that I later linked to marketing’s variables of innovation and ingenuity. My undergraduate marketing studies have further enhanced this deeply engrained interest.

At the age of three, El Paso became my permanent home. I have fallen in love with the culture and community of the Sun City. Because of my interest in marketing and my strong conviction and dedication to the El Paso community, Regional Identity and REDA offer an opportunity for me to play a role in two elements I aspire to explore in my academic career. Ri allows me to voice my opinion about current events throughout the Paso del Norte region while simultaneously giving me crucial marketing experience by working with strategic alliances within UTEP and with the Marketing Department of REDA.

As much as I would like to, I will not indulge in writing pages and pages about Ri’s future marketing efforts. Instead, I will keep you all yearning to know more. Trust me, the wait will be worth it. For now, just know that rather than relying on the conventional methods of creating awareness and recognition, it is my intention (along with the rest of REDA’s Marketing Committee) to implement fresh, original, and unexpected ideas. So keep your eyes and ears open for great stuff, courtesy of Regional Identity!

February 25, 2010, 6:51 pm

Senate limits tuition hikes

by Krista Martinez

After years of tuition increases within Texas’ universities, the Texas Senate has finally voted to limit the tuition increase that a Texas university can charge. Texas universities have increased tuition, on average, by 86% since 2003, when Texas State gave the universities’ governing boards the control to set tuition rates and fees. The premise for this shift in tuition rates control was that deregulation of costs would save the state millions of dollars and instead place the burden on students.

Since 2003, UTEP tuition has increased rapidly. UTEP has stated that it has tried to keep tuition costs down, but the University also said that students should expect a 4.9% increase from spring 2009 costs, i.e., $3,084 to $3,184. In comparison, the tuition for a local New Mexico State University student is $2,679 for 12-18 credit hours.

Proponents of the increase, however, say that education is expensive and that UTEP’s costs are less than other schools trying to be Tier 1 schools. The most accepted definition of a Tier 1 university is a university that spends at least $100 million a year on research, which is twice what UTEP currently spends. There are currently only two Tier 1 universities in Texas: UT Austin and Texas A&M.

According to figures from the Texas Higher Education Coordinating Board, the average cost for a resident undergraduate student at the emerging Tier 1 universities was: UT Dallas $4,647, UT Arlington, $4,071, University of Houston, $3,981, UT San Antonio, $3,829, University of North Texas $3,584, and Texas Tech University $3,570. The question is, “Should our tuition costs better reflect the costs of living on the border?”

Since the Texas Senate voted to limit future tuition hikes, universities whose rates currently exceed the state’s median tuition and fee rate would have to hold their tuition and fees at five percent, or at the average rate of inflation, whichever is lower. The new law will allow institutions imposing below-median costs, such as UTEP and Lamar University, to raise their tuition higher than the limits set in the bill.

UTEP has stated that the tuition and fee increases help the students because the additional revenue allows the university to offer more course sections, retain current faculty, improve campus technology, and create more research opportunities. Although tuition and fee rates have risen, UTEP suggests that the University has increased financial assistance programs.

What do your think about UTEP’s tuition increases? Are the benefits worth the increase, or should we say enough is enough?

February 24, 2010, 10:51 pm

Blogs forthcoming

Perhaps the best feature of the new Regional Identity magazine will be the exclusive daily content published by The Blog on the Border. Check back tomorrow for a formal introduction.

April 12, 2009, 6:58 pm

Intro to Economics and Finance

Two members of the Regional Economic Development Association, William Black and Erik Pavia, developed and presented the Regional Identity: Intro to Finance and Economics Program to a class of sixth grade students at Alderete Middle School.

Black and Pavia developed the hour and a half presentation to teach basic fundamentals of economics and finance to an elementary class.

“One reason we wanted to do this is because some of the material we’re going to cover today isn’t really taught to kids until they reach high school,” Pavia said. “We want to give them just a basic insight into what it is that the economy is-what finance is- just so that when they turn on the news, they’ll have a better understanding as to what it is that everybody is talking about.”

Black and Pavia discussed subjects such as the basis of an economy, supply and demand, liquidity, sole-proprietorships, partnerships, corporations, the value of a company, the stock market and stocks, and globalization.

The students were engaged in the subject matter, despite the lecture’s complexity and the students’ limited prior knowledge. REDA and the students plan to refine the economics and finance presentation for other six-grade students around El Paso.

“What I liked mostly about the presentation was learning about the companies- how they increase and decrease in stocks, importing and exporting goods,” sixth-grader Miranda Guerrero said. “I learned a lot from this experience.”

William Black is an Economics and Finance major at UTEP and can be reached at wcblack@miners.utep.edu. Erik Pavia is an Economics major and can be reached at elpavia@miners.utep.edu.

March 29, 2009, 7:48 pm

Holocaust-survivor meets AMS

In awe, Alderete Middle School students huddled around Holocaust-survivor Sarah Hauptman as she revealed her tattoo number from the Auschwitz concentration camp. For the students, it was a chilling, real-life example of the Holocaust stories they read about in class.

For weeks, students from Sandra Sapien’s sixth grade class read books, watched movies, wrote poems and prepared presentations about World War II and the Holocaust. To better connect her students with the lesson, Sapien decided to bring a speaker who lived through the rigors and horrors of the class history books.

“I felt that students would learn more about the lesson [Holocaust] if they were able to see and hear from a person who actually went through it all,” Sapien said.

Students asked questions about Hauptman’s most frightening experiences, daily meals, and the different forms of punishment she received. Hauptman was quick to answer every question and did not hesitate to reveal anything about her past.

“It is important that people know the truth about what happened [during the Holocaust],” Hauptman said.

Richard Sapien and Ale Montalvo, two UTEP students and members of the Regional Economic Development Association and Regional Identity magazine (regionalidentity.com), attended the sit down with Hauptman and the students to capture the interactions and reflections of the event.

Students valued Hauptman’s bravery and resilience and delivered personal messages to their newest hero.

“You are my hero,” Michelle Barron said to Hauptman, “I love you.”

You can purchase Sarah Hauptman’s autobiography at the El Paso Holocaust Musuem.

March 28, 2009, 12:27 pm

Extreme Entrepreneurship Tour

by Diego Rico

Tuesday, March 24

The national tour event, Extreme Entrepreneurship Tour, came and was a success for the Collegiate Entrepreneurs’ Organization at UTEP. The event, which brought young and successful entrepreneurs from around the U.S., took place at the Magoffin Auditorium where students from the College of Business, Liberal Arts, and Engineering, among others, were able to listen and take advice from those who have already traveled the tough and uncertain road of entrepreneurship.

Two keynote speakers made the event an exciting lecture filled with both humor and wisdom. Rahim Fazal began his career like many other American teenagers, finding a job at a burger place. But working in the freezer of the local McDonald’s was not his idea of a dream job. Rahim created a start-up and was able to sell it, becoming one of the youngest “dot-com millionaires.”

Eric Corl, a 23 year old, also found success as a young entrepreneur who began with a humble bank account amount and was able to work with a team of three to grow to a $6 million valued company. His newest company, Idea Buyer, is an internet business which focuses on making intellectual property more available for those interested in developing and extending an idea for which they need business or financial help, mostly using purchasing and licensing agreements.

“The event was a great learning experience,” said Job Navarette, a College of Business student, the feeling was shared among those who attended; a further indicator that the local C.E.O. chapter at UTEP held a successful event, due in part to the local funding provided by the Kauffman Campus Initiative. An event which had a variety of age groups within its audience, from older and more experienced businessmen and women to young students thinking about creating their own company, was able to inspire and encourage the spirit of entrepreneurship, an independent mentality which shines across the university through its students.

March 9, 2009, 9:57 pm

Has the economic crisis hit you?

by William Black

Corporate layoffs have become as common in the news as sports highlights and the weather. Companies are losing business and therefore cutting jobs but the story doesn’t end there. From retirees’ 401ks to the communities surrounding the businesses, everyone has been impacted in some form.

The purpose of the Regional Identity is to ensure that the students’ voices are heard. This is why we are asking for your stories and experiences from the past couple of months, and for the first time a select few will be featured in an upcoming article on March 26th. If you or someone you know has been affected by the nation’s current economic state we would like you to share the details in a response below in the comments section of this blog.

Your account can be detailed or brief. You may want to talk about a new-found stress, or a job layoff. Maybe you’ve found a silver lining in our time of crisis. Whatever you have to share, we want to know!

» 8 Comments

March 4, 2009, 8:38 pm

You and the News

by Erik Pavia

During the drafting of our constitution, there arose a question of how direct our democratic representation should be. How much power should each citizen directly receive? The literacy rate of Americans was relatively low at the time, so there were those that were skeptical as to the ability of the average person to rule intelligently and responsible. The general public was thought to be uninformed, unreasonable, and uninterested. Such citizens could not be granted with the power to govern themselves. This attitude was obvious in the way that voting rights were granted. Not only did a person have to be white, male, and older than 21, but they also had to own land, just to assure their responsibility. Luckily for us, not everyone felt that all Americans were ignorant and uninterested and voting rights were extended to all ethnicities, sexes, and income levels. The optimists and visionaries who had faith in every woman and man and everything in between succeeded. Weighing in at 19 years young, I’m especially glad that people had enough faith in the youth of the country.

Sadly we failed them.

It has been widely accepted that in order to be responsible citizens, we need to stay informed on the issues that our countries face. It is impossible to develop reasonable ideas and solutions to problems if we do not know what the problems are in the first place. It’s great to have an opinion, but it should be an educated opinion if it is to have validity. I recently heard an argument between two individuals regarding the economic crisis that we hear so much of. One individual was arguing that it was wrong of the government to give General Motors 700 billion dollars. Small businesses needed that money more. The other said that it was smart of the government because if General Motors didn’t survive, then Toyota would become the biggest car company and all the jobs would follow Toyota to its home country, China. You do the fact check. It seemed to me that the issues the two were trying to discuss had some intellectual girth: the recession, manufacturing, innovation, off shoring, or globalization are all topics worth a conversation or two. It’s just hard to take an argument seriously when it’s based in misinformation.

It isn’t only the national issues that are important. Why did ASARCO close? What is the situation in Mexico, and more specifically, Juarez? How close is UTEP to reaching the coveted Tier 1 status in the UT system? Although they may not be as attention engrossing as national news, issues such as these often affect each of us more directly and immediately than the woes of Detroit and D.C.

So what should I care that two people can’t get their facts straight? Thanks to the well wishers mentioned earlier, those people were citizens, taxpayers, and voters. They, along with you and me, help govern our country. Don’t get me wrong. I am very thankful that we all have the right to vote. If it wasn’t for the dreamers, I may not have the right to vote either. I just wish we were all knowledgeable about what was going on in our country. I almost feel embarrassed when people don’t know what the credit crisis is. Those two misinformed persons are my countrymen. They should know better.

You may think that it’s hard to stay up to date on a regular basis (daily, not monthly), but there really is never an excuse. You don’t have cable to watch CNN on? CNN has on demand video at their site. The Wall Street Journal is too expensive? If you’re a student, then it may be more inexpensive than you think. You don’t like clicking link after link after link just to find something of interest or particular importance? Instead of spending precious time scouring the internet for relevant news, you can use sites like Google Reader to help you get all of the news in just one place; despite its apparent complexity, Reader is way easier to use than you may think, and it is feature heavy for those who want a more refined experience.

The point is that staying on top of the news is easier than ever. We have the internet now. And it’s more important than ever to stay connected to the world. Changes in businesses and in policy happen minute by minute, not day by day. The older folks call this the information age for a reason; they say that they get overwhelmed with the amount of information younger people expose themselves to everyday. They still read print for some inexplicable reason. It’s a pitiful of our more tech savvy youth to be less informed then their parents. The older folks call this the information age; they also say that the youth doesn’t keep itself informed. For our sake, and for theirs, please don’t prove them right.

Links

February 4, 2009, 6:22 pm

The end of ASARCO