## Sunday, 30 June 2019

### Investopedia/Leslie Kramer: Interesting Facts About Imports and Exports

Investopedia
Economy >  Economics
Interesting Facts About Imports and Exports

By Leslie Kramer
Updated Apr 24, 2019

Imports and exports—the staples of international trade—may seem like terms that have little bearing on everyday life for the average person, but they can, in fact, exert a profound influence on both the consumer and the economy.

In today’s global economy, consumers are used to seeing products and produce from every corner of the world in their local malls and stores. These overseas products—or imports—provide more choices to consumers and help them manage strained household budgets.

But too many imports coming into a country in relation to exports—which are products shipped from the country to a foreign destination—can distort a nation’s balance of trade and devalue its currency. The value of a currency, in turn, is one of the biggest determinants of a nation’s economic performance.
Imports, Exports, and GDP

Gross domestic product (GDP) is a broad measurement of a nation's overall economic activity. Imports and exports are important components of the expenditures method of calculating GDP. Let's take a closer look at the formula for GDP:

GDP=C+I+G+(X−M)where:C=Consumer spending on goods and servicesI=Investment spending on business capital goodsG=Government spending on public goods and servicesX=ExportsM=Imports\begin{aligned} &\text{GDP} = C + I + G + ( X - M ) \\ &\textbf{where:} \\ &C = \text{Consumer spending on goods and services} \\ &I = \text{Investment spending on business capital goods} \\ &G = \text{Government spending on public goods and services} \\ &X = \text{Exports} \\ &M = \text{Imports} \\ \end{aligned}​GDP=C+I+G+(X−M)where:C=Consumer spending on goods and servicesI=Investment spending on business capital goodsG=Government spending on public goods and servicesX=ExportsM=Imports​﻿

While all of the GDP formula's components are important in the context of an economy, let’s look closer at (X – M), which represents exports minus imports, or net exports.

If exports exceed imports, the net exports figure would be positive, indicating that the nation has a trade surplus. If exports are less than imports, the net exports figure would be negative, indicating that the nation has a trade deficit.

A trade surplus contributes to economic growth. More exports mean more output from factories and industrial facilities, as well as a greater number of people employed to keep these factories running. The receipt of export proceeds also represents a flow of funds into the country, which stimulates consumer spending and contributes to economic growth.
How Imports And Exports Affect You

Imports represent an outflow of funds from a country since they are payments made by local companies (the importers) to overseas entities (the exporters). A high level of imports indicates robust domestic demand and a growing economy. It’s even better if these imports are mainly productive assets, such as machinery and equipment, since they will improve productivity over the long run.

A healthy economy is one where both exports and imports are growing. This typically indicates economic strength and a sustainable trade surplus or deficit.

If exports are growing nicely, but imports have declined significantly, it may indicate that the rest of the world is in better shape than the domestic economy. Conversely, if exports fall sharply but imports surge, this may indicate that the domestic economy is faring better than overseas markets.

The U.S. trade deficit, for instance, tends to worsen when the economy is growing strongly. However, the country’s chronic trade deficit has not impeded it from continuing to be one of the most productive nations in the world.

That said, a rising level of imports and a growing trade deficit do have a negative effect on one key economic variable—the level of the domestic currency versus foreign currencies, or the exchange rate.
Imports, Exports, and Exchange Rates

The relationship between a nation’s imports and exports and its exchange rate is a complicated one because of the feedback loop between them. The exchange rate has an effect on the trade surplus (or deficit), which in turn affects the exchange rate, and so on. In general, however, a weaker domestic currency stimulates exports and makes imports more expensive. Conversely, a strong domestic currency hampers exports and makes imports cheaper.

Let’s use an example to illustrate this concept. Consider an electronic component priced at $10 in the U.S. that will be exported to India. Assume the exchange rate is 50 rupees to the U.S. dollar. Ignoring shipping and other transaction costs such as import duties for the moment, the$10 item would cost the Indian importer 500 rupees.

Now, if the dollar strengthens against the Indian rupee to a level of 55, assuming that the U.S. exporter leaves the $10 price for the component unchanged, its price would increase to 550 rupees ($10 x 55) for the Indian importer. This may force the Indian importer to look for cheaper components from other locations. The 10% appreciation in the dollar versus the rupee has thus diminished the U.S. exporter’s competitiveness in the Indian market.

At the same time, consider a garment exporter in India whose primary market is the U.S. A shirt that the exporter sells for $10 in the U.S. market would fetch them 500 rupees when the export proceeds are received (again ignoring shipping and other costs), assuming an exchange rate of 50 rupees to the dollar. If the rupee weakens to 55 versus the dollar, the exporter can now sell the shirt for$9.09 to receive the same amount of rupees (500). The 10% depreciation in the rupee versus the dollar has therefore improved the Indian exporter’s competitiveness in the U.S. market.

To summarize, a 10% appreciation of the dollar versus the rupee has rendered U.S. exports of electronic components uncompetitive but has made imported Indian shirts cheaper for U.S. consumers. The flip side is that a 10% depreciation of the rupee has improved the competitiveness of Indian garment exports, but has made imports of electronic components more expensive for Indian buyers.

Multiply the above simplistic scenario by millions of transactions, and you may get an idea of the extent to which currency moves can affect imports and exports.
Effect on Inflation and Interest Rates

Inflation and interest rates affect imports and exports primarily through their influence on the exchange rate. Higher inflation typically leads to higher interest rates—but does this lead to a stronger currency or a weaker currency? The evidence is somewhat mixed in this regard.

Conventional currency theory holds that a currency with a higher inflation rate (and consequently a higher interest rate) will depreciate against a currency with lower inflation and a lower interest rate. According to the theory of uncovered interest rate parity, the difference in interest rates between two countries equals the expected change in their exchange rate. So if the interest rate differential between two nations is 2%, then the currency of the higher-interest-rate nation would be expected to depreciate 2% against the currency of the lower-interest-rate nation.

In reality, however, the low-interest-rate environment that has been the norm around most of the world since the 2008-09 global credit crisis has resulted in investors and speculators chasing the better yields offered by currencies with higher interest rates. This has had the effect of strengthening currencies that offer higher interest rates.

Of course, since such “hot money” investors have to be confident that currency depreciation will not offset higher yields, this strategy is generally restricted to stable currencies of nations with strong economic fundamentals.

As discussed earlier, a stronger domestic currency can have an adverse effect on exports and on the trade balance. Higher inflation can also affect exports by having a direct impact on input costs such as materials and labor. These higher costs can have a substantial impact on the competitiveness of exports in the international trade environment.
Economic Reports

A nation’s merchandise trade balance report is the best source of information to track its imports and exports. This report is released monthly by most major nations.

The U.S. and Canada trade balance reports are generally released within the first ten days of the month, with a one-month lag, by the U.S. Department of Commerce and Statistics Canada, respectively.

These reports contain a wealth of information, including details on the biggest trading partners, the largest product categories for imports and exports, and trends over time.
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Forex Trading Strategy & Education 5 Reports That Affect the U.S. Dollar Advanced Forex Trading Concepts The Pros and Cons of a Fully Convertible Rupee Related Terms An Explanation of Net Exports Net exports are the value of a country's total exports minus the value of its total imports, which is used to calculate the GDP in an open economy. more The Indian Rupee: How the INR Is Managed and Circulated The Indian rupee is the currency of India; its currency code is INR. Discover the types of coins, notes, and how the central bank manages the rupee. more Weak Dollar Definition A weak dollar is a sustained period of depreciation in the United States' currency. more Balance of Payments (BOP) The balance of payments (BOP) is a statement of all transactions made between entities in one country and the rest of the world over a defined period of time, such as a quarter or a year. more The ABC on GDP: All You Need to Know About Gross Domestic Product Gross Domestic Product (GDP) is the monetary value of all finished goods and services made within a country during a specific period. more Managed Currency Definition A managed currency is one whose monetary exchange rate is affected by the intervention of a central bank. more About Us Advertise Contact Privacy Policy Terms of Use Careers Investopedia is part of the Dotdash publishing family. The Balance Lifewire TripSavvy The Spruce and more Tearsheet.com Tearsheet Weekly By Tearsheet Editors -- June 30, 2019 This week really was all about Facebook's Libra project as industry insiders and outsiders grappled with understanding what it is and what it means across the economy. What is it? Facebook formally announced its Libra project with the publishing of its white paper. It lets people buy things and send money to others with low fees over a blockchain. Association and partnership structure: Facebook has created an association around Libra to help with governance (FB gets one vote like any other partner). The association counts firms like Mastercard, Stripe, Andreesen Horowitz, Uber and Spotify as partners. • Facebook also created a subsidiary called Calibra that has already applied for money transfer licenses around the world. Calbra will provide financial services that will let people access and participate on the Libra network. Read more: • An explanation of Libra for millennials Is Libra really a cryptocurrency? Does it matter? Pushback: Libra will come under scrutiny as lawmakers and regulatory bodies reacted quickly to the announcement. Congressional hearings are already scheduled. Facebook recently hired a UK lobbyist to help with the Libra launch. “They will not get a free pass anywhere,” Sean Park, Founder and Chief Investment Officer at Anthemis told Reuters. “And, given their intention to be global, they will ultimately need literally hundreds, perhaps thousands, of licenses from hundreds of different regulators across the globe.” Facebook's entry into financial services: Libra and its financial services subsidiary Calibra provides a framework for the tech firm to enter more broadly into financial services. FB has subsequently said it's looking at lending. • the partnership structure give FB incentive to build its own products and collaborate with other providers • interestingly, there were no banks announced as Libra partners Sent from Samsung tablet. ### Tearsheet.com/Zach Miller: WTF is multichannel onboarding? Tearsheet.com Tearsheet Search for: WTF WTF is multichannel onboarding? Landing a new customer is just part of the work for financial services. Next, the challenge is to get the customer activated. Zack Miller | December 11, 2018 WTF is multichannel onboarding? Sometimes simple concepts get lost in complicated marketing jargon. That’s exactly what “multichannel onboarding” is: jargon for what is actually a very important part of the customer journey. So much time and attention is dedicated to user acquisition. But what happens next? What happens after a new financial customer is acquired? That’s where multichannel onboarding comes in. What is multichannel onboarding? Multichannel onboarding is the process of getting a new client hooked up, registered, and using the service a financial institution offers. So, after a customer walks into a bank branch, multichannel onboarding is what happens next. It’s the direct mail a customer receives with her new ATM card with instructions on how to use it. It’s the email confirmation a new client receives after signing up for an online bank account. It’s an SMS alert a prospect receives as part of submitting an application for an SMB loan. So, is multichannel onboarding just welcome messages? No, multichannel onboarding is much more than just a fancy welcome package. Sure, multichannel onboarding includes welcome emails and letters that go out to new customers. But there’s really an art and a science to doing this right. Get this right and customers love you. Brazilian challenger bank Nubank literally has hundreds of videos on YouTube that customers recorded “unboxing” their new debit cards. A lot of thought and experimentation went into the package a new Nubank customer receives. The onboarding has become a delightful experience that customers are recording and sharing. Are these just automated emails or letters? Effective onboarding also has to do with timing — like determining how soon after a client signs up for a service does he receive a notification pushing him to complete registration or transferring funds. Done too aggressively and a financial service organization might risk customer defection. If onboarding is done too timidly, an institution may fail to fully engage a new customer and might miss the opportunity to strike while the iron is hot. 45 percent of banks report that it takes 2 weeks or more to onboard their customers, with another 44 percent not sure how long it actually takes at their institution. Is this just direct mail with a fancier name? Multichannel onboarding doesn’t have to be boring or generic. The point here isn’t just a feedback loop, closing the signup and registration process. Onboarding helps users get up and running as engaged clients. When done well, onboarding should activate users. For social media platform, Twitter, the firm never really had a problem getting people to sign up for the service. The sign up was easy and smooth. But Twitter did have a problem getting new users to stick around and use the short messaging platform. After experimentation, the product team found that it could get people engaged and using Twitter if new users were required to “follow” at least 10 profiles. This is effective onboarding — not just getting users signed up and registered but actually up and using the service. Multichannel onboarding is a big focus for challenger banks like N26, Revolut, and Varo Money. These companies, given their deeper technology and product roots, spend a lot of time removing the friction in the signup and onboarding process. Incumbent banks are getting better at customer experience, too. WTF WTF is Square Cash? Square Cash opens Square up to both consumers and businesses. Square is creating an ecosystem with their complementary products. Paige Stern | June 28, 2019 WTF WTF is chargeback protection? Chargebacks are a major drain on merchants. A variety of new technologies provide merchants with chargeback protection. Michael Deleon | June 14, 2019 WTF WTF is banksplaining? Chase famously tweeted out a message that some felt shamed the poor. Banks should stop banksplaining and lead the way to better financial health through products and experiences. Zoe Murphy | May 10, 2019 WTF WTF is decentralized credit scoring? The traditional credit score leaves a lot of people out of the financial system. Decentralized credit scoring can provide broader and more fair coverage. Dan Pelberg | March 14, 2019 WTF WTF is data aggregation? Data aggregation is the underpinning of digital finance. Here's what it is, how it works, and why it's important. Meir Leff | February 11, 2019 More Articles About Tearsheet Tearsheet is the only media company obsessively focused on technology’s impact on the financial services and fintech industry. Read by decision makers across product, marketing, and digital, Tearsheet connects with its audience across web, email, podcasts, the Outlier membership program and in-person events. Subscribe to our newsletter Receive information about Tearsheet programs and events Follow us @tearsheet Join the conversation by following us on Linkedin and other social media. © 2019 Tearsheet. All rights reserved. About Us Masthead Privacy Policy ### Tearsheet.com/Zoe Murphy: WTF is banksplaining? Tearsheet.com Tearsheet Search for: WTF WTF is banksplaining? Chase famously tweeted out a message that some felt shamed the poor. Banks should stop banksplaining and lead the way to better financial health through products and experiences. Zoe Murphy | May 10, 2019 WTF is banksplaining? A little joke about budgeting blew back on Chase hard last week. The bank shared some pretty bland financial advice via Twitter: don’t buy coffee out, bring your lunch to work, and hoof it instead of grabbing a cab. Pretty innocuous, if not bland, financial advice. But the tone got to people. It got to people the same way people are getting fed up with hustle porn and the notion that if you just work harder and longer, you’ll have more than the poor schmuck next door who can’t afford a$400 medical emergency. The tweet tapped into a latent anger at Chase and at financial institutions in general.

Some high profile celebrities like Elizabeth Warren and Representative Katie Porter took to Twitter to vent.

Hey @Chase, try paying your workers more. Families aren’t spending frivolously; they’re trying to pay rent. pic.twitter.com/XwQi2GisU5
— Rep. Katie Porter (@RepKatiePorter) April 29, 2019

Some of this hullabaloo certainly stems from our culture of outrage and polarization. But part of it derives from our antagonistic relationship with banks. “As my Fast Company colleague Cale Weissman said, this tweet came from a ‘bank worth $400B that charges anywhere from$2.50 and $5 for individual ATM fees and$34 per overdraft—both of which are taxes on poor people,'” wrote Jeff Beer in Wired.
What is banksplaining?

We’ve heard of mansplaining, manspreading, and maninterrupting. Banksplaining is the explanation of something by a bank, typically to a woman but can also be to a man, in a manner regarded as condescending or patronizing. Kudos to my co-host of The Challengers Podcast, Josh Liggett, who coined the term during our latest episode.

In Just buy the f***ing latte, Ellevest’s Sallie Krawcheck responded to the Chase tweet but also to The Latte Factor, a new book on personal finance. In it, an enlightened barista gives a woman the trite, often-repeated financial advice to invest her money instead of splurging on a frivolous, expensive coffee.

In this story and Chase’s bungled social media message, the ex-Wall Street executive sees what she calls the masculinization of money. “While girls are being taught to be careful with money and to save it, boys are being taught to pursue money and to grow it,” she wrote in Fast Company. “It is likely no wonder that the money industries are overwhelmingly male, even as the research tells us that women are better investors than men, both as individual investors and professional investors.”

In spite of their more modern technology and cooler ethos, challenger banks can also fall into banksplaining. In an advert around last Valentine’s Day, UK-based Revolut created a series of media on London’s subway that some felt mocked singles and their purchasing behavior.

Instead of telling customers what to do, banks should gently show them how to improve their financial health through better products and experiences that make it easier to set and hit financial goals. Consumers, sensitive to the power and wealth differentials between them and their financial institution, are done being banksplained.
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Tearsheet is the only media company obsessively focused on technology’s impact on the financial services and fintech industry. Read by decision makers across product, marketing, and digital, Tearsheet connects with its audience across web, email, podcasts, the Outlier membership program and in-person events.
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Join the conversation by following us on Linkedin and other social media.

### Tearsheet.com/Michael Deleon: WTF is chargeback protection?

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Search for:
WTF
WTF is chargeback protection?

•    Chargebacks are a major drain on merchants.
•    A variety of new technologies provide merchants with chargeback protection.

Michael Deleon | June 14, 2019

WTF is chargeback protection?

One of the nuances of the US credit card industry is the power that the system grants the consumer. A consumer can always contest a charge on her credit card bill. This facet of the credit card industry keeps consumers feeling secure that they can always fight fraud.

But with this power comes responsibility. Some consumers can abuse the system. Chargebacks can range from a customer honestly returning something he didn’t really mean to purchase to the completely fraudulent. What’s good for consumers can come at the cost of merchants, who bear the costs of chargebacks.

Payment and fintech providers, like Stripe which just introduced its own chargeback protection, offer tools and solutions to help protect merchants from fraudulent chargebacks.

What’s going on with chargebacks?

When a consumer disputes a charge on his credit card, he can do so by contacting the merchant where he bought the item or service. If the merchant goes along with the consumer’s request, that’s a refund.
SecurionPay’s chargeback whiteboard

But with credit cards, the consumer can also forcibly reverse a charge by contacting his issuing bank. In today’s market, issuing banks provide really good customer service and because of that, consumers will often contact their bank first if there’s a dispute. Banks have become the de facto customer service center for merchants because consumers don’t want to contact a merchant and get pushback.

If the bank approves the reversal, the bank forcibly returns money to the consumer from a merchant’s account. That’s a chargeback. Sometimes, the merchant doesn’t find out until after the refund has occurred.

Aren’t chargebacks good for the customer?

In a way, chargebacks were a boon to consumers and helped propel the growth of the credit card industry. Chargebacks protect cardholders from unscrupulous merchants. The fact that a consumer can do a chargeback puts pressure on merchants to sell high quality merchandise and provide good service.

With a chargeback, the cardholder sometimes comes out smelling like roses, even if he’s committed fraud. The consumer gets to keep the item he purchased and gets the cost of the item refunded from the merchant. The merchant essentially has to pay twice.

How big a problem are chargebacks?

Typically, chargebacks account for a half a percent or one percent of a merchant’s business. But when you look at the total related costs associated with chargebacks, they can run up to ten percent of the merchant’s payment costs. Javelin Strategy and Research estimated the total cost of chargebacks to total $31 billion. That study found some other metrics associated with chargebacks: Merchants are burdened with two-thirds of total costs related to chargebacks 60 percent of merchant chargeback costs are in management expenses For every$1 disputed, merchants and issuers incur $1.50 in more costs How does chargeback protection help a merchant? Because it’s a large and growing market, there are a variety of techniques, technologies, and processes merchants can use to prevent chargebacks. One way is to address chargebacks is by addressing the process before a merchant bills a card. In this pre-authorization stage, you can try harder to make sure that the transaction is legitimate. But, if the authorization process is too onerous, a merchant runs the risk of turning away good purchases. Most solutions providers focus on this stage. Companies like Riskified and Signifyed, as well as Stripe and Square, typically take this approach. Verifi, for example, focuses on what happens after authorization. The company has workflows built into some of the major banks. They step in when a bank receives a complaint from a consumer but before it’s filed a chargeback. The complaint is routed to the merchant, who is given a chance to resolve the complaint before it becomes a chargeback. What does chargeback protection cost? There’s a cost to chargeback protection. Merchants that receive this type of protection from the payment processor typically pay a percentage of the transaction. It’s like an insurance policy that shifts the responsibility of chargebacks to the processor and off the merchant. Stripe’s new Chargeback Protection costs 0.4% per transaction, for example. WTF WTF is Square Cash? Square Cash opens Square up to both consumers and businesses. Square is creating an ecosystem with their complementary products. Paige Stern | June 28, 2019 WTF WTF is banksplaining? Chase famously tweeted out a message that some felt shamed the poor. Banks should stop banksplaining and lead the way to better financial health through products and experiences. Zoe Murphy | May 10, 2019 WTF WTF is decentralized credit scoring? The traditional credit score leaves a lot of people out of the financial system. Decentralized credit scoring can provide broader and more fair coverage. Dan Pelberg | March 14, 2019 WTF WTF is data aggregation? Data aggregation is the underpinning of digital finance. Here's what it is, how it works, and why it's important. Meir Leff | February 11, 2019 WTF WTF is multichannel onboarding? Landing a new customer is just part of the work for financial services. Next, the challenge is to get the customer activated. Zack Miller | December 11, 2018 More Articles About Tearsheet Tearsheet is the only media company obsessively focused on technology’s impact on the financial services and fintech industry. Read by decision makers across product, marketing, and digital, Tearsheet connects with its audience across web, email, podcasts, the Outlier membership program and in-person events. Subscribe to our newsletter Receive information about Tearsheet programs and events Follow us @tearsheet Join the conversation by following us on Linkedin and other social media. © 2019 Tearsheet. All rights reserved. About Us Masthead Privacy Policy ### Tearsheet/Paige Stern: WTF is Square Cash? Tearsheet WTF WTF is Square Cash? • Square Cash opens Square up to both consumers and businesses. • Square is creating an ecosystem with their complementary products. Paige Stern | June 28, 2019 WTF is Square Cash? So, what is Square Cash? Square Cash is an app, similar to Venmo, that helps individuals and businesses send and receive digital payments. It’s also outpacing Venmo in terms of new downloads. To pay people or merchants, users can load their Cash accounts with a debit or credit card. To send money to someone who has Cash, you use a username handle, known as a$cashtag. However, you only need the cash app to receive money through Cash but not to send it.

Users can transfer their Square Cash balance to their bank accounts, as well.

Okay, so why would businesses use it?

For businesses, it seems to be all about providing convenience for consumers. With the Cash App, the customer can avoid pulling out her wallet, and can complete the transaction all on their phone. With Cash, the customer does not even have to be standing in the store.

Users generally feel that receiving payments through Square Cash is much quicker than using a bank or credit card. Square secures the private payment information of its users through ID verification and encrypting payment data.

Businesses can receive or send direct payments instantly through the app, compared to the minutes, hours or days that it takes some credit cards and other forms of payment.

Businesses also appreciate keeping their earnings all in one place — within the Square ecosystem. As Square rolls out more merchant services, businesses have the option of distributing payroll, sending money back into their personal accounts, or using a Square MasterCard debit card to spend accrued cash. In a way, Square Cash almost serves as its own bank account.

What’s in it for consumers to use it?

Well for one thing, some digital banking apps are popular because of the convenience they provide customers.

Additionally, a cash card that is linked directly to a consumer’s Square Cash account creates a system similar to a bank account — and Square knows this. The payments company has developed a loyalty program called Boost that offers consumers discounts and special deals at their favorite businesses, which comes with using their debit card.

Consumers also appreciate Square’s hook up with Bitcoin. It’s pretty difficult for most people to buy Bitcoin. Square Cash has made it considerably easier for users to buy and sell Bitcoin through their Cash accounts.

So, is it like Venmo?

The two apps are similar, for the most part. The main difference between Venmo and Square Cash is that Venmo is used predominantly by consumers, while Square Cash, because of Square’s roots with merchants, is used by both individuals and businesses.

Yes, Venmo is also a mobile payment service and has been trying to increase its penetration with merchants, but it is also considered a social media app, as users can post about why they are sending money to their friends, or even like and comment on their friends’ payments.

And though Venmo has already managed to establish relationships with several large companies, like Uber, consumers have a limited number of options of businesses that accept Venmo. Venmo does advertises that anywhere users see they can pay online or on their phone with PayPal people can also use Venmo.

In the last year, both Venmo and Square Cash have launched cash cards that are directly linked to users’ account balances. For Venmo this is particularly important, as users can spend their Venmo balance at merchants who don’t accept Venmo this way.

Why is Square pushing Cash so hard?

It has become clear that Square is building an ecosystem. By creating products that complement one another — from its first product the Square Reader to Square Payroll, Online Store, Cash App and now a Square Mastercard debit card, the company is looking to maximize money movement within its own ecosystem.

Square is also currently in the process of reapplying for a bank license. Though the company already lends lending to small businesses, the company is expanding into more core banking offerings. Overall, you could say Square is turning into a challenger bank.

WTF
WTF is chargeback protection?

Chargebacks are a major drain on merchants.
A variety of new technologies provide merchants with chargeback protection.

Michael Deleon | June 14, 2019
WTF
WTF is banksplaining?

Chase famously tweeted out a message that some felt shamed the poor.
Banks should stop banksplaining and lead the way to better financial health through products and experiences.

Zoe Murphy | May 10, 2019
WTF
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The traditional credit score leaves a lot of people out of the financial system.
Decentralized credit scoring can provide broader and more fair coverage.

Dan Pelberg | March 14, 2019
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Here's what it is, how it works, and why it's important.

Meir Leff | February 11, 2019
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Next, the challenge is to get the customer activated.

Zack Miller | December 11, 2018
More Articles

Tearsheet is the only media company obsessively focused on technology’s impact on the financial services and fintech industry. Read by decision makers across product, marketing, and digital, Tearsheet connects with its audience across web, email, podcasts, the Outlier membership program and in-person events.
@tearsheet

Join the conversation by following us on Linkedin and other social media.

From musician to stock trader to entrepreneur and social media star, Adwa Al Dakheel has emerged as the face of ‘new Saudi Arabia’. We speak to the young businesswoman in an exclusive interview
Neil King
Friday 28 June 2019

In the three years since the launch of Saudi Arabia’s Vision 2030 diversification plan, the kingdom’s young people have emerged as leading players in the dramatic shift taking place across the country.

Against the backdrop of dwindling oil supplies, corruption crackdowns and diplomatic tensions, the country’s largest age demographic has been gradually building momentum with their own businesses, initiatives and aspirations.

According to the CIA World Factbook, 41.58 per cent of Saudis are under the age of 25, while 70 per cent are aged under 30. Official statistics from the kingdom show that more than 8.5 million people were aged between 20 and 35 years old in 2016 – 5.6 million of whom were Saudis, and 2.9 million were expats.

Vision 2030 itself has youth empowerment coursing through its veins. The project’s driving force, Crown Prince Mohammed bin Salman – himself only 33 years old – described the nation’s youth as “architects of our future”, and later stated “70 per cent of the population is under 30, and we won’t allow the other 30 per cent to hold them back”.

Education, entrepreneurship, opportunity and participation are all keywords associated with the Vision, with young people being given permission to take up the gauntlet in many various ways.

One of the most prominent figures in this youth movement is Adwa Al Dakheel – a 27-year-old entrepreneur who has already acquired a long list of impressive achievements during her 13-year career to date.

From Forex trader to author, musician to pilot, squash champion to jewellery designer, Al Dakheel is redefining what it means to be a young Saudi woman. And people are taking notice. With around 2 million followers across her social media platforms, she was recently named one of the top three most influential social media figures in the Middle East, alongside Ahmed Al Shugairi and Thunayan Khalid.

As such, the businesswoman has become a major role model for young people in the kingdom – a notion backed up by an Ithraa Consulting Group study that asked university students if they had a role model. An astonishing 80 per cent answered Adwa Al Dakheel.

Her latest venture – Riyadh-based Falak Business Hub – aims to support, develop, build, finance and promote a new wave of Saudi start-ups. The businesses at the hub will all work towards filling gaps in the kingdom’s social landscape, with Falak already having launched one and financed two projects since its soft-launch late last year.

For Al Dakheel, the momentum behind Saudi’s youth movement has been building for some time, and now the kingdom is starting to see the results of young people’s energy.

“What’s beautiful about Vision 2030 and the youth development that came along with it is that the youth were on the edge, waiting for such a thing – waiting for a push to go and do crazy things,” she tells Gulf Business.

“You have the media sector and you have the amazing filmmakers that came out of Saudi Arabia and are now winning awards around the world. You have the business hubs and the start-ups that are also coming out of Saudi Arabia that are different – not duplicated. One of the first e-wallet companies just came out in Saudi Arabia, for example. That’s not something that could have happened 10 years ago because neither the regulations nor the ecosystem were in place. Nothing was facilitating such a change. I’m telling you, the youth were on the edge, waiting for such a development to happen.

“The recent developments in Saudi are so beautifully chaotic that if they are fostered in the right way under a bit of guidance, the sky is the limit. You have the talent, you have the ideas, maybe a bit of infrastructure needs to pivot towards the entrepreneurs’ benefit, but you are seeing it happen now. It’s not just talk – there are also governmental alterations and changes towards our mutual benefit.”

“I lost everything”

If anybody personifies those key aspects of talent, ideas, and change, it’s Al Dakheel.

From the age of 14, when she taught children how to play guitar “at the minimum hourly rate”, she has been on an adventurous and successful path rooted in the notion that anything is possible.

“When I was 14 years old I decided I needed to find an income that would allow me to be financially independent,” she says of those early years, adding that the guitar lessons were her way of raising enough money to enter the world of stock trading.

“That was a world I was curious about, so little by little I managed to save up $4,000 by the time I was 16-years-old. I opened up an account in Forex trading, and the first day I doubled the$4,000 into $8,000. The second day, I lost everything. I was actually minus$126, and this made my financial obsession stronger.”

Starting from scratch Al Dakheel raised $1,000 to open a new account not in foreign exchange, but stock trading. “Stock trading is more straightforward because it’s not governed by politics or a country’s actions,” she says. “The risk was less, and for an entry-level trader it was a better choice for me.” Al Dakheel carried this “obsession” with her to college in Boston, US, where she studied three majors – business management, entrepreneurship, and finance – as well as a minor in psychology. There she made a name for herself by winning three trading competitions, bringing a level of fame the then student had not experienced before. “Social media went crazy,” she says. “I was asked to be on a TV chat show back in Saudi Arabia, and after the show I got calls from Alwaleed bin Talal, and all kinds of other people I would only read about. Now they knew that Adwa Al Dakheel exists.” Calling herself an obsessive person rather than a successful person, Al Dakheel threw herself into various other projects during this period of her life. As well being the first Saudi woman to release an instrumental music album, as well as become a squash champion, as well as launching jewelry and perfume brands, and as well as gaining her pilot’s license, she published a best-selling book entitled Proven Billionaires’ Formula, in which she summerises 328 business and psychology books that she read over the course of 18 months. She had also launched a trio of companies. Obsessive is probably the right word. Life changing Her current obsession is Falak – a hybrid accelerator, incubator, co-working space and angel investor. And it’s a project that represented a major shift for Al Dakheel when she drafted plans for the hub between 2016 and 2017. “In November 2016 my life changed,” she explains. “I went with the UNHCR on a humanitarian trip to Bangladesh, to Kutupalong, where it was the most urgent humanitarian crisis that had occurred since who knows how long. “It was a trip that I was completely broken from, but that completely reshaped me. “After that trip that I felt I was the smallest person in the world, because my problems in comparison to these people were a joke. And I realised that business and this world has a much bigger spectrum than just financial profit. “I believe I’ve reached a stage where I am financially independent and sustainable, so now it’s my time to do something for society, and not only focus on financial profit and financial independence, like I was focusing when I was 14 years old. “Everything changed after that trip. I came back and opened Falak. It was a Godsend – God planned it out.” Exiting all of her companies, Al Dakheel went full throttle with Falak, having noticed a lack of genuine accelerators or incubators in the market – especially with a Saudi focus. “A lot of them are in fact real estate companies renting out spaces to entrepreneurs. You do have some acceleration programmes, but these are global. For example, you have 500 Startups which is a global entity and not suited to Saudi content. You also have Flat6Labs, which has a presence in Jeddah but is also a global entity. “You do not have a single Saudi accelerator programme that actually offers value instead of something commercial. In Falak we are truly looking long-term. We’re not looking at quick wins, and I think that’s what make us very different in the market. “We’re not looking at pure cashflow clients that come and just rent the space – we’re looking at the next unicorn start-ups in the region to invest in, to incubate, to accelerate.” With 900 start-ups already waiting to be approved for selection, Falak is off to an impressive start. Geared towards emerging tech businesses, and social businesses powered by tech, Al Dakheel has big plans for the hub – not least through its upcoming accelerator programme, which will run from September to January. “We will invest up to SAR500,000 in the winning start-ups that get admitted to the programme, as well as incubating them for four to five months,” she says. On the investment front, Falak has already put money into three businesses. “The first was an event management company called Evento, the second was an education company that’s basically an Uber for home tutoring, and the third is a home services application. “There is a fourth that we’ve not invested in, but that we’ve built from A-Z. It’s called Ns3a, and it’s an artificial intelligence solution for recruitment. “If we can do this in our first four or five months, imagine what we can do in a few years.” Great responsibility In many ways, Falak is an example of Vision 2030 in motion. Whether you look at it from the perspective of youth leadership, entrepreneurship, diversification, or female participation, Falak features them all, representing the general shift Vision 2030 is aiming for. “The amount of small changes we’ve seen is great,” says Al Dakheel. “For example, Falak is 80 per cent female, which wasn’t planned. Where I want to see further change outside Falak, thought, is an increase in female participation on boards. Certainly in every company we invest in.” And as a young, successful, female entrepreneur, it’s no surprise that Al Dakheel has such a strong following on social media, among university students, and across the kingdom and wider region. But as a role model to so many, how does she shoulder such great responsibility? “I guess it goes back to the same feeling I had through the Bangladesh trip – it’s that amount of social responsibility,” she says. “When you get a father or a mother coming to you saying that their daughter follows you and wants to replicate every single thing that you do – and you see their eyes face-to-face – this is something that not a single person can overlook. “The amount of responsibility that social media carries, none of us as social media influencers actually understood that. After we started seeing people face to face – parents, children, the poor, the rich, every single demographic you could think of – this is when you truly feel like God put you here for a reason. And if you waste this reason on trivial lifestyle matters, you are not worthy of this blessing – because this is truly a blessing.” Citing her mother as the person she continually refers to for guidance, Al Dakheel prefers to steer clear of single role models. “I think every person’s role model should be a hybrid of different role models,” she explains. “No one is perfect, and if you dive deeper you could find a lot of issues, so I think a hybrid model is the way to go. You could have a role model for every specialty. “I have different role models, but actually my main role models are my books. They are written by people who are considered role models, but are a summary of their good parts.” If her record of reading 328 books in 18 months is anything to go by, books are more than just role models for Al Dakheel; rather a central aspect of her very being. “If I don’t read, I honestly feel as though my mental state deteriorates,” she admits. “It’s only when you read that you get to go at your own pace, that you get to research anything you want, that you get to really expand your horizons.” And in terms of recommendations, she is quick to name three books that have helped to shaper her and her business. “I would say The Lean Startup by Eric Ries; Rich Dad, Poor Dad by Robert Kiyosaki; and The Go-Giver by Bob Burg. That last one is one of the best, best, best books, with some of the best advice I’ve received – basically to give more in value than you take in payment. “The Lean Startup is one of the main methodologies we use in our programme at Falak. We also use How to Build a Billion Dollar App [by George Berkowski], and Stanford’s course, How to Start a Start-up. “Another amazing book that I haven’t mentioned is The Click Moment by Frans Johansson. It basically tells you that ‘specialisation’ happened in the 19th century, when people started to be told that if you specialise in a number of things, you’re not really a specialist. The book explains that the biggest companies in the world were never created by people that were purely experts in one single arena – you have to be a 360 manager or business person to truly start something and make it grow. “Look at my life. If I can tell you anything about education it’s that getting my flying license taught me more about business than anything else. Flying teaches you risk management, communication, how to be calm under pressure. This is the beauty of trying out different things, even if you want to be specialised. You have to make your brain circuits open up to different aspects of life.” Growth and happiness Listening to Al Dakheel, it’s not uncommon for pearls of wisdom to drop into conversation. But what straight-up advice would she offer to young people across the region? “Go out of your comfort zone and learn new things,” she says. “You might think you’re only learning this, but what’s happening in the back-end of your brain by connecting all these dots is something you can never overlook. “The second thing is read more. It’s through reading that you get to live multiple lives, that you get to live different experiences while sitting in a single chair. “Lastly, and most importantly, don’t wait for the opportunity – go and look for it. The government will not spoon-feed you; no economy in the world will spoon-feed you. Go and actively look for opportunities.” Following her own advice, Al Dakheel is taking proactive steps for herself and Falak, with ambitions “to invest in the next three unicorns of Saudi Arabia in the next year and a half”. But true to the roots that the UNHCR trip to Bangladesh planted in her, the entrepreneur has an overarching hope for all her future plans. “Continuous growth and happiness. Because growth without happiness is nothing at all,” she says. “This is why purpose-driven companies are the ones that last. Profit-driven companies have a quick win, and then plummet. It’s not only growth we should aim towards – whether a female or male, entrepreneur or businesswoman. Emotional and mental happiness and satisfaction is what’s going to make us work with love and actually make us do something worthwhile.” If any words epitomise the new youth movement in Saudi Arabia, these are they. It’s little wonder that Crown Prince Mohammed bin Salman has so much confidence is these “architects of the future”, especially with Adwa Al Dakheel on the front lines. Photos: Iman Al Dabbagh Also from our network Sheikh Hamdan shares stunning snaps from vacation in the Maldives Kylie Jenner championed this Kuwaiti designer in the new KUWTK promo shoot These are Victoria Beckham's travel essentials and where to find them EW Wrap: All of the stars who wore Arab and Dubai-based labels this week ALSO READ 91% of Saudi’s youth browse internet on mobile phones 91% of Saudi’s youth browse internet on mobile phones Nearly 20 million jobs needed for Middle East’s young population Nearly 20 million jobs needed for Middle East’s young population Rights watchdog says second young Shi’ite faces beheading in Saudi Rights watchdog says second young Shi’ite faces beheading in Saudi Saudi to target young population with new TV channel Saudi to target young population with new TV channel Saudi, UAE nationals, residents nominated for WEF young global leaders programme Saudi, UAE nationals, residents nominated for WEF young global leaders programme Saudi’s Misk Innovation launches accelerator programme with 500 Startups Saudi’s Misk Innovation launches accelerator programme with 500 Startups UAE launches national youth agenda UAE launches national youth agenda Young leaders: Adel Sajan, 30, director of Danube Home Young leaders: Adel Sajan, 30, director of Danube Home Lists Top 100 GCC Companies 2018 Top 100 most powerful Arabs 2018 Top 50 GCC Banks 2017 Top 100 Most Powerful Arabs 2017 Top 100 GCC Companies 2016 Top 50 GCC Banks 2016 Advertisement Most Read Saudi officially launches 'green card' residency scheme for expats Revealed: What UAE residents need to do if they lose their passports abroad Dubai plane in fatal crash was flying 'too close' to larger aircraft - investigation UAE has issued gold-card residency visas to 400 expats so far Kuwait records world's highest temperature this week World's largest offshore oil platforms inaugurated in UAE Amazon to hold 'Prime Day' shopping sale in the UAE next month Etihad warns of delays after suspending flights over Strait of Hormuz, Gulf of Oman Video: Abu Dhabi police seize 423kg of drugs in largest haul in the UAE One dead, 21 wounded in Houthi attack on Saudi airport Editor's Picks UAE residence visas for dependents over 18 can now be renewed UAE's biggest lender FAB to shut Qatar operations amid row with Doha India starts issuing e-visas for Saudi nationals UAE to triple fine for not giving way to emergency vehicles Sign up for our daily newsletter Get the day’s biggest stories straight in your inbox SUBSCRIBE Advertisement Advertise With Us Privacy Policy Contact us Subscribe Copyright © 2019 by Gulf Business. ### The New York Times/Peter Baker and Michael Crawley: BREAKING NEWS Kim Jong-un has accepted President Trump's last-minute invitation to meet for a handshake at the demilitarized zone between the two Koreas. The New York Times Trump and Kim Jong-un to Meet at DMZ Dividing Korea President Trump and the North Korean leader, Kim Jong-un, last met in Hanoi, Vietnam, in February. Those talks collapsed without a deal.CreditDoug Mills/The New York Times ImagePresident Trump and the North Korean leader, Kim Jong-un, last met in Hanoi, Vietnam, in February. Those talks collapsed without a deal. President Trump and the North Korean leader, Kim Jong-un, last met in Hanoi, Vietnam, in February. Those talks collapsed without a deal.CreditCreditDoug Mills/The New York Times By Peter Baker and Michael Crowley June 30, 2019 SEOUL, South Korea — President Trump said he would meet on Sunday with Kim Jong-un, North Korea’s leader, at the heavily fortified Demilitarized Zone dividing the two Koreas in an extraordinary last-minute get-together intended to revitalize stalled nuclear talks. Mr. Kim accepted Mr. Trump’s unorthodox invitation, posted on Twitter just a day earlier, for what will be the third time the leaders have gotten together in person. The encounter will be little more than a brief greeting, not an extended negotiation, but it promises a camera-friendly, history-making demonstration of friendship between countries that have been longtime adversaries. “We are going to the DMZ border, and we will be meeting Chairman Kim,” Mr. Trump said at a news conference in Seoul with President Moon Jae-in of South Korea. “I look forward to it very much.” He added that there was “a lot of good feeling” between him and Mr. Kim. “He understands me, and I think I understand him,” he said. It remained uncertain how the handshake between the two leaders would be orchestrated. Mr. Trump said before leaving Osaka, Japan, on Saturday that he would be perfectly willing to cross over the line into North Korea if need be, which would make him the first sitting American president to visit the long-isolated country, with whom the United States remains technically still at war from the conflict of the 1950s. Advertisement Mr. Kim crossed the DMZ in April 2018 to meet with Mr. Moon, becoming the first North Korean leader to step over the line since fighting between the countries ended in 1953. Former Presidents Jimmy Carter and Bill Clinton each visited North Korea, flying into its capital, Pyongyang, but only after they left office. Mr. Trump met with Mr. Kim in Singapore in June 2018, the first time American and North Korean leaders had met since the war, and produced vague promises to pursue an end to Pyongyang’s nuclear arsenal. Their second summit meeting, in Hanoi, Vietnam, ended in failure in February when the two leaders could not agree on a concrete way to pursue that goal. North Korean leaders went dark after the collapse of the talks, refusing to respond to either the Americans or the South Koreans amid conflicting reports about the fate of the negotiators blamed by Mr. Kim for the failure. North Korea also launched short-range missiles in May in violation of United Nations restrictions, a move that was seen as a reflection of Mr. Kim’s frustration over the stalled negotiations. In recent weeks, however, the North Korean government has re-emerged on the world stage as Mr. Kim exchanged letters with Mr. Trump and met separately with President Vladimir V. Putin of Russia and President Xi Jinping of China in what was seen as a signal of its interest in resuming diplomacy. Advertisement American officials have said they did not think a third meeting between Mr. Trump and Mr. Kim should be arranged unless a substantive agreement could be negotiated beforehand to avoid another setback. But Mr. Trump said that since he was already planning to visit the DMZ during his trip to South Korea this weekend, he decided it was worth seeing if Mr. Kim would agree to a short greeting. “It’s just a step,” Mr. Trump said. “It might be an important step or it might not.” He added: “There’s a good feeling, so it could be very good. As far as another meeting, let’s see what happens today before we start thinking about that.” Mr. Moon, who has staked his presidency on improving relations with the North, showered Mr. Trump with praise for reaching out, declaring that “the flower of peace is truly blossoming” and describing himself as “very overwhelmed with emotion” about the development. “President Trump is the maker of peace on the Korean Peninsula, you really are the peacemaker of the Korean Peninsula,” Mr. Moon said. “I hope that this meeting with Chairman Kim at Panmunjom will bring hope to the people of South and North Korea and it will be a milestone in the history of humankind toward peace.” Advertisement But whatever good may be generated by the symbolic encounter at the DMZ, enormous differences remain between the two sides that have prevented a deal. Mr. Trump has insisted that Mr. Kim give up his entire nuclear arsenal and program, while many experts, including American intelligence analysts, doubt that the North Korean leader is genuinely willing to do so. Follow Peter Baker on Twitter: @peterbakernyt. Related Coverage The Trump-Kim Summit Was Unprecedented, but the Statement Was Vague June 12, 2018 Image Trump’s Talks With Kim Jong-un Collapse, and Both Sides Point Fingers Feb. 28, 2019 Image Trump Offers Kim Jong-un a Last-Minute Invitation to Meet at the DMZ June 29, 2019 Image Trump’s Offer to Say ‘Hello’ to Kim at DMZ Carries Risks and Rewards for Both June 29, 2019 Image Advertisement Site Index Go to Home Page » news opinion arts living listings & more Site Information Navigation © 2019 The New York Times Company Contact UsWork with usAdvertiseYour Ad ChoicesPrivacyTerms of ServiceTerms of SaleSite MapHelpSubscriptions ### Investopedia: What is the formula for calculating profit margins? Investopedia Corporate Finance & Accounting > Financial Ratios What is the formula for calculating profit margins? FACEBOOK TWITTER LINKEDIN By Investopedia Updated Jun 21, 2019 Table of Contents Gross Profit Margin Operating Profit Margin Net Profit Margin Example of Profit Margin Profit margins are perhaps the simplest and most widely used financial ratios in corporate finance. A company's profit is calculated at three levels on its income statement, starting with the most basic – gross profit – and building up to the most comprehensive – net profit. Between these two lies operating profit. All three have corresponding profit margins calculated by dividing the profit figure by revenue and multiplying by 100. Key Takeaways Calculating profit margins help us to understand the relative profitability of a firm or business activity. Margins are typically computed from gross profit, operating profit, or net profit. The greater the profit margin, the better, but a high gross margin and a small net margin may indicate something that needs further investigation. Gross Profit Margin Gross profit is the simplest profitability metric because it defines profit as all income that remains after accounting for the cost of goods sold (COGS). COGS includes only those expenses directly associated with the production or manufacture of items for sale, including raw materials and wages for labor required to make or assemble goods. Excluded from this figure are, among other things, any expenses for debt, taxes, operating or overhead costs, and one-time expenditures such as equipment purchases. The gross profit margin compares gross profit to total revenue, reflecting the percentage of each revenue dollar that is retained as profit after paying for the cost of production. The formula for gross profit margin is: Gross Profit Margin formula Gross Profit Margin formula. Investopedia Operating Profit Margin A slightly more complex metric, operating profit also takes into account all overhead, operating, administrative and sales expenses necessary to run the business on a day-to-day basis. While this figure still excludes debts, taxes and other non-operational expenses, it does include the amortization and depreciation of assets. By dividing operating profit by revenue, this mid-level profitability margin reflects the percentage of each dollar that remains after payment for all expenses necessary to keep the business running. The formula for operating profit margin is: How to Calculate Profit Margins Net Profit Margin The infamous bottom line, net income, reflects the total amount of revenue left over after all expenses and additional income streams are accounted for. This includes COGS and operational expenses as referenced above, but it also includes payments on debts, taxes, one-time expenses or payments, and any income from investments or secondary operations. The net profit margin reflects a company's overall ability to turn income into profit. The formulae for net profit margin are either;: Net Profit Margin Formulas Net Profit Margin Formulas. Investopedia Example of Profit Margin For the fiscal year ended October 2016, Starbucks Corp (SBUX) recorded revenue of$21.32 billion. Gross profit and operating profit clock in at healthy figures of $12.8 billion and$4.17 billion respectively. The net profit for the year is $2.82 billion. The profit margins for Starbucks would therefore be calculated as: Gross profit margin = ($12.8 billion ÷ $21.32 billion) x 100 = 60.07%. Operating profit margin = ($4.17 billion ÷ $21.32 billion) x 100 = 19.57%. Net profit margin = ($2.82 billion ÷ $21.32 billion) x 100 = 13.22%. This example illustrates the importance of having strong gross and operating profit margins. Weakness at these levels indicates that money is being lost on basic operations, leaving little revenue for other expenses. The healthy gross and operating profit margins in the above example enabled Starbucks to maintain decent profits while still meeting all of its other financial obligations. For business owners, profitability metrics are important because they highlight points of weakness in the operational model and enable year-to-year performance comparison. For investors, a company's profitability has important implications for its future growth and investment potential. In addition, this type of financial analysis allows both management and investors to see how the company stacks up against the competition. Compete Risk Free with$100,000 in Virtual Cash
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Related Terms
How to Calculate Net Profit Margin Using Apple's Revenue and Profit
The net profit margin is the ratio of net profits to revenues for a company or business segment. Expressed as a percentage, the net profit margin shows how much of each dollar collected by a company as revenue translates into profit.
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Why Gross Profit Margin Matters
The gross profit margin is a metric used to assess a firm's financial health and is equal to revenue less cost of goods sold as a percent of total revenue.
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Gross Margin Defined
The gross margin represents the amount of total sales revenue that the company retains after incurring the direct costs associated with producing the goods and services sold by the company.
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Operating Profit
Operating profit is the profit from a firm's core business operations, excluding deductions of interest and tax.
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What Gross Profit Tells Us
Gross profit is the profit a company makes after deducting the costs of making and selling its products, or the costs of providing its services.
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Common Size Income Statement
A common size income statement is an income statement in which each account is expressed as a percentage of the value of sales, to make analysis easier.
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### Investopedia/Amy Bell: 6 Reasons Why You Need a Budget

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Budgeting & Savings > Budgeting

6 Reasons Why You Need a Budget

By Amy Bell
Updated Jun 21, 2019

If you've heard it once, you've heard it a thousand times: BUDGET YOUR MONEY! Financial experts and money advisors have been shouting this mantra from the mountaintops for years.

This is just one of those financial lessons that cannot be preached enough. If you and your family want financial security, following a budget is the only answer.

Still not convinced? Here are six darn good reasons why everyone should create and stick to a budget:
1. It Helps You Keep Your Eye on the Prize

A budget helps you figure out your long-term goals and work towards them. If you just drift aimlessly through life, tossing your money at every pretty, shiny object that happens to catch your eye, how will you ever save up enough money to buy a car, take that trip to Aruba, or put a down payment on a house?

A budget forces you to map out your goals, save your money, keep track of your progress, and make your dreams a reality. OK, so it may stink when you realize that brand new Xbox game or the gorgeous cashmere sweater in the store window doesn't fit into your budget. But when you remind yourself that you're saving up for a new house, it will be much easier to turn around and walk out of the store empty-handed.
2. It Ensures You Don't Spend Money That You Don't Have

Far too many consumers spend money they don't have – and we can owe it all to credit cards. As a matter of fact, the median credit card debt per household reached $2,300 in June 2019, according to a recent study from ValuePenguin. Before the age of plastic, people tended to know if they were living within their means. At the end of the month, if they had enough money left to pay the bills and sock some away in savings, they were on track. These days, people who overuse and abuse credit cards don't always realize they're overspending until they're drowning in debt. However, if you create and stick to a budget, you'll never find yourself in this precarious position. You'll know exactly how much money you earn, how much you can afford to spend each month and how much you need to save. Sure, crunching numbers and keeping track of a budget isn't nearly as much fun as going on a shameless shopping spree. But look at it this way: when your spend-happy friends are making an appointment with a debt counselor this time next year, you'll be jetting off for that European adventure you've been saving for – or better yet, moving into your new home. 3. It Leads to a Happy Retirement Let's say you spend your money responsibly, follow your budget to a "T" and never carry credit card debt. Good for you! But aren't you forgetting something? As important as it is to spend your money wisely today, it's also critical to save for your future. A budget can help you do just that. It's important to build investment contributions into your budget. If you set aside a portion of your earnings each month to contribute to your IRA, 401(k) or other retirement funds, you'll eventually build a nice nest egg. Although you may have to sacrifice a little now, it will be worth it down the road. After all, would you rather spend your retirement golfing and taking trips to the beach or working as a greeter at the local grocery store to make ends meet? Exactly. 4. It Helps You Prepare for Emergencies Life is filled with unexpected surprises, some better than others. When you get laid off, become sick or injured, go through a divorce, or have a death in the family, it can lead to some serious financial turmoil. Of course, it seems like these emergencies always arise at the worst possible time – when you're already strapped for cash. This is exactly why everyone needs an emergency fund. Your budget should include an emergency fund that consists of at least three to six months worth of living expenses. This extra money will ensure that you don't spiral into the depths of debt after a life crisis. Of course, it will take time to save up three to six months' worth of living expenses. Don't try to dump the majority of your paycheck into your emergency fund right away. Build it into your budget, set realistic goals and start small. Even if you put just$10 to $30 aside each week, your emergency fund will slowly build up. 5. It Sheds Light on Bad Spending Habits Building a budget forces you to take a close look at your spending habits. You may notice that you're spending money on things you don't need. Do you honestly watch all 500 channels on your costly extended cable plan? Do you really need 30 pairs of black shoes? Budgeting allows you to rethink your spending habits and re-focus your financial goals. 6. It's Better Than Counting Sheep Following a budget will also help you catch more shut eye. How many nights have you tossed and turned worrying about how you were going to pay the bills? People who lose sleep over financial issues are allowing their money to control them. Take back the control. When you budget your money wisely, you'll never lose sleep over financial issues again. Of course, this is just the tip of the iceberg. There are countless other advantages to following a budget. So what are you waiting for? Time to start budgeting! Related Articles Wealth Management 7 Financial Lessons to Master by Age 30 Budgeting This Is the Year to Start Budgeting Personal Finance Setting Financial Goals for Your Future Budgeting 4 Easy Techniques for Budgeting Money Lifestyle Advice 10 Ways To Prepare For A Personal Financial Crisis Savings Why You Absolutely Need an Emergency Fund Related Terms Budget Definition A budget is an estimation of revenue and expenses over a specified future period of time and is usually compiled and re-evaluated on a periodic basis. Budgets can be made for a variety of individual or business needs or just about anything else that makes and spends money. more How is your financial health looking? An individual's financial situation and stability is called financial health. Here are a few ways to improve it. more Personal Finance Personal finance is all about managing your income and your expenses, and saving and investing. Learn which educational resources can guide your planning and the personal characteristics that will help you make the best money-management decisions. more Millennials: Finances, Investing, and Retirement Learn the basics of what millennial need to know about finances, investing, and retirement. more Retirement Retirement is when a person chooses to leave the workforce. more Debt Consolidation Debt consolidation is the act of combining several loans or liabilities into one loan. Debt consolidation means taking out a new loan to pay off a number of liabilities and consumer debts, generally unsecured ones. more About Us Advertise Contact Privacy Policy Terms of Use Careers Investopedia is part of the Dotdash publishing family. The Balance Lifewire TripSavvy The Spruce and more ### The Washington Post/Seung Min Kim and Simon Denyer: Kim Jong Un will join Trump for a meeting at the Korean demilitarized zone, Trump and South Korean President Moon Jae-in confirm The Washington Post Democracy Dies in Darkness Sign In Newsletters & alerts Gift subscriptions Contact us Help desk Accessibility for screenreader Politics Kim Jong Un will join Trump for a meeting at the Korean demilitarized zone, South Korean President Moon Jae-in says President Trump speaks to South Korean business leaders in Seoul on Sunday. (Susan Walsh/AP) By Seung Min Kim and Simon Denyer June 30 at 12:14 AM BREAKING: Kim Jong Un will join Trump for a meeting at the Korean demilitarized zone, South Korean President Moon Jae-in says. President Trump also confirms he’ll meet with Kim, and says he’ll look forward to it. Trump had broadcast his offer to meet Kim at the border in a morning tweet in Osaka, Japan, at the G-20 summit on Saturday, with a senior North Korean official responding soon after that the offer was “interesting.” This story will be updated. SEOUL — President Trump said he will travel to the demilitarized zone (DMZ) between North and South Korea on Sunday, and that he understands that North Korean leader Kim Jong Un “very much” wants to join him there for a short meeting. “I understand they want to meet, and I’d love to say hello,” he said Sunday morning local time, referring to North Korea and Kim. “It’s going to be very short, but we are in territory that’s very close. We don’t have to take long trips to countries, so it’s good for both of us. “Let’s see what happens,” he added. “They are trying to work it out, not so easy.” Trump had broadcast his offer to meet Kim at the border in a morning tweet in Osaka, Japan, at the Group of 20 summit on Saturday. A senior North Korean official responded soon after that the offer was “interesting.” Trump will be joined at the border by South Korean President Moon Jae-in, raising the possibility of a first trilateral summit among the three leaders. Later, Trump met Moon for a bilateral meeting, and said he expected to meet Kim at the border. “It looks like they’re in the final stages to work out a very quick meeting, because I’ll be at the DMZ anyway, at the border,” he said. “I’ll look forward to saying hello to him, if that finally works out.” “I guess there’s always a chance that it might not, but it sounds like the teams would like that to work out, so that’s good.” Trump’s trip to South Korea comes four months after the breakdown of his second summit with Kim in Hanoi, but the president again boasted of his relationship with his North Korean counterpart. “We have a very good relationship, the two of us. I don’t know beyond the two of us, but let’s say the two of us,” he said in a speech Sunday to South Korean business leaders. Asked later about meeting Kim, Trump said it still had not been finalized. “You don’t lose anything by speaking,” he said. “He very much wants to. We are trying to work it out. “It will be very short, but that’s okay,” he said. “A handshake means a lot.” Later, Trump meet Moon for a bilateral meeting, and again congratulated himself for calming tensions on the Korean Peninsula, arguing that the region would have been engulfed in war if he had not been elected president. In the process, he again misrepresented what had been achieved, claiming that North Korea had ceased ballistic missile tests and was continuing to send back remains of U.S. servicemen killed in the Korean War. In fact, North Korea has tested short-range ballistic missiles since the Hanoi summit, while the Pentagon says contacts with Pyongyang over the return of remains have ceased. Moon, who has invested heavily in improving his country’s relationship with North Korea, also praised Trump effusively for reaching out to Kim. “Yesterday President Trump gave a big hope to the world through his tweet,” Moon said. “Seeing that tweet made me feel that the flower of peace is blossoming on the Korean Peninsula.” Moon will be coming to the DMZ but it is unclear if he will join in the planned meeting between Trump and Kim, with North Korea’s foreign ministry saying only last week that it did not want Seoul mediating, and telling South Korean authorities to “mind their own business at home.” Moon made it clear he would be taking a back seat role on Sunday. “I will come along today but the center of today’s conversation is the dialogue between North Korea and the United States,” Moon said. “I hope there would be a big progress in the dialogue between President Trump and Chairman Kim.” Most Read Politics 1 2020 Democrats defend Kamala Harris after Donald Trump Jr. tweet about her race 2 Analysis Trump’s apparent ignorance of basic political terms is on full display overseas 3 They’re not ‘wonder twins’: Gorsuch, Kavanaugh shift the Supreme Court, but their differences are striking 4 Kim Jong Un will join Trump for a meeting at the Korean demilitarized zone, South Korean President Moon Jae-in says 5 In troubled Florida, Democrats reckon with the presidential debates and an economy that can seem cruel ### Dr. Mercola: If diagnosed with a tumor, get these 5 tests immediately Mercola.com Hemp Oil ADVERTISEMENT The metabolic approach to cancer treatment Analysis by Dr. Joseph Mercola Fact Checked June 30, 2019 Visit the Mercola Video Library Story at-a-glance - > Dr. Nasha Winters is a naturopathic physician who specializes in supporting patients with cancer. She also trains clinicians and consults with those treating cancer patients > Winters requires five specific tests before she will conduct an initial consultation with a patient. They’re markers to assess the health of the whole body and whether cancer is progressing, stable or regressing > The first is a blood chemistry panel, an inexpensive blood test showing complete blood count (CBC). Importantly, it shows your neutrophil-to-lymphocyte ratio (NLR), which is prognostic for overall survival. A chem panel (CMP) is also required, which assesses organ function and electrolyte status > The lactase dehydrogenase (LDH) test is a widely underutilized yet most important test as it is a marker of metabolic function. If LDH is elevated, your mitochondria are functioning poorly > When high-sensitivity C-reactive protein, LDH and erythrocyte sedimentation rate measurements are within functional ranges, the patient has a good handle on their disease and prognosis is good Cancer kills an estimated 1,600 Americans each day. In China, 8,100 people a day succumb to the disease. It’s so common, it’s a rare individual who does not know someone who has been diagnosed with cancer — which is why the topic of this interview is so important. Dr. Nasha Winters is a naturopathic physician who specializes in cancer treatment. While she has treated cancer patients in the past, she’s developed a more efficient model where she now focuses on training clinicians and consulting with those treating patients. I’ve been very impressed with her work. She has embraced the ketogenic diet and integrates it as a strategic tool in the therapeutic planning. She also uses many other, less well-known strategies. If you’re affected by cancer and believe her skills may be helpful, you can have your clinician consult with her to fine-tune your treatment. I believe if you catch the cancer early enough, most are likely curable. But you need to catch it early, and you need to have the proper know-how. It’s also important to avoid strategies that are going to set you back. “My life’s goal is to eventually be able to … make a tiny little dent in that statistic,” Winters says. “Where we can be effective is with the folks who … are in a position where they’re still well enough and motivated enough to explore beyond their standard of care options, because that’s often not enough, frankly, in today’s time. And then also, I think the biggest impact that we can have … is we can help people look under the hood long before it’s a problem. Because really, the only true cure is prevention. We’ve got sort of layers of this. We’ve got the folks who don’t yet have cancer or don’t yet know they have it. We have the folks who are already diagnosed or in a relatively good state of health, whether it’s a Stage 1 to a Stage 4. Then we have some of the folks who are really damaged from years of unsuccessful treatments that have left their bodies broken and maybe not as responsive to this approach.” The facts speak for themselves Almost without exception, people will say they thought they were healthy up until they received their cancer diagnosis. However, that’s simply impossible. Cancer, like many other diseases, does not manifest until you’re about 80% of the way down the proverbial hole. The first symptom is not the cancer diagnosis itself. Most cancers take years to progress to the point of being diagnosable. Cancer is a res ipsa loquitur factor, meaning “the facts speak for themselves.” In other words, you, in some way, shape or form, were not leading a healthy lifestyle — or you simply failed to counteract the inevitable toxic exposures we’re all subject to in today’s modern world. As noted by Winter: “No matter how much you try, we are being exposed to many things that we don’t see, that we are not aware of, that are definitely damaging our container in a way that our cells are having a harder and more difficult time … to respond and repair the way they should. That’s one of the strategies I’m helping physicians understand. Because our medical system is not geared towards prevention … We’re very much waiting for a house to be engulfed in flames before we decide to spit a little bit of water on it, right? My strategy has always been ‘Test, assess, address and then adjust accordingly and repeat as often as needed.’” Advertisement Save 38% on Liver Support 90-Day Supply Test, assess and address — The complete blood count test Winters recommends, and in fact requires, five specific tests before she will conduct an initial consultation with a patient. They’re markers of how advanced the cancer is and how well you’re doing as you’re progressing through treatment. The first is a blood chemistry panel. This is a simple and inexpensive blood test showing complete blood count (CBC) with differential. That includes things like your white blood cells, red blood cells, hemoglobin, hematocrit and platelets. Most importantly, it shows your neutrophil-to-lymphocyte ratio (NLR), which is prognostic for overall survival. One of the reasons why immunotherapies are seeing such a low response rate — only about 20%, according to Winters — is because of this neutrophil-to-lymphocyte ratio. As explained by Winters, when your neutrophils are too elevated and your lymphocytes too low, you do not have a normally functioning immune system. As a result, treatment with some of these new, innovative immune therapies used in oncology may “tilt the teeter-totter of your immune system into a dangerous place of overreactivity,” she says, adding “For a$12, paid-out-of-your-pocket, walk-in lab test, you get a really good sense of where your immune system lies.”

Overall, you want a 2-to-1 ratio or better of the neutrophil cells to the lymphocytes. If you go much higher than that, that bigger divide between neutrophils and lymphocytes becomes problematic. Conversely, if you have a “switched NLR,” where the lymphocytes are more elevated than the neutrophils, that’s often a symptom of blood dyscrasias and blood cancers “that are not uncommon after standard of care therapy,” Winters says.

Additionally, you want your white blood cell count to be between 5 and 7. Anything lower than that, which is common in conventional therapy, makes the situation more challenging. Platelets elevated above 250 is also prognostic. The sweet spot for platelets is between 175 and 250. Below 175, immune function and blood clotting are compromised; the same is true for levels above 250.

“Oftentimes elevated platelets can be a good example of a cancerous process. In fact, that’s one of the alarms that we’ll see in early-stage cancers,” Winters says. Elevated platelets are also related to viral patterns, and may be indicative of a co-infection causing immune dysregulation.

“The other piece we often forget about is things like the hemoglobin. If the hemoglobin is low and you happen to be someone who’s monitoring your ketones or your blood counts, your hemoglobin A1C, you’re going to get some erroneous numbers because you have to have enough hemoglobin to actually get a true result.

They are simple little tricks that we can use with a basic CBC just to see how somebody’s immune system is during treatment, after treatment and prior to treatment. It’s worth running on your own and paying cash for it just to look under the hood.”

Sadly, most oncologists have never even heard about the NLR ratio or the fact that platelets are a prognostic factor for progression of disease or even early warning signs of cancer, Winters says. In the world of conventional oncology, the CBC is primarily used to make sure the white blood cell count and neutrophils are high enough for you to be able to receive another dose of chemo or targeted therapy.
The comprehensive metabolic panel and lactase dehydrogenase

The second test Winters routinely recommends is a comprehensive metabolic panel (CMP), sometimes known as the chem panel, which is another inexpensive test. This test will provide you with information about your electrolytes, organ functions and cardiovascular function, as well as kidney and liver function.

“This is also a super important clue to see what’s going on,” she says. “For instance, if your creatinine is moving above 1, we know that your kidneys are struggling. They’re not filtering properly. Or if your liver enzymes are starting to move above 20 or 25, we know there are some issues around how your liver is processing things along the way.

If alkaline phosphatase is raising, that can often show us first signs of bone loss or bone metastasis. These are some really powerful ways to assess people’s response to the medications, because those enzymes will often go up when they’re being beaten up by some drugs. But it’s also a really good way to get a sense that there are other organs involved in the overall cancer process.”

In the past, the chem-20 and chem-24 tests included two important tests that must now be ordered separately. One of them is the lactase dehydrogenase (LDH) test, “which is probably the most underutilized and most important test across all chronic illness patterns,” Winters says. It is a marker of metabolic function. If LDH is elevated, your mitochondria are functioning poorly.

“You can even break down that overall LDH into its five constituents of these five isoenzymes and really know precisely where the hiccups are happening in that metabolic process, whether it’s at the level of the bone, the lung, the kidney, the liver, the red blood cell. Pretty fascinating, and again, very inexpensive,” she says.

“This is also the main way to monitor things like lymphoma, most leukemias, multiple myeloma and even melanoma. It is considered sort of the cancer marker for those. Yet it’s a very misused and even misunderstood and forgotten lab test. I can’t tell you how many times I’ve asked doctors to run an LDH for the patient and I’ll get back a low-density lipoprotein (LDL). It would happen 2 out of 10 times.”

So, what exactly is the connection between LDH and mitochondrial function? Winters explains:

“This is where we’re looking at how we are processing lactase dehydrogenase — the process of how we’re fermenting or processing our energy through our Krebs cycle … to produce adenosine triphosphate (ATP). It’s intimately in relationship to the dehydrogenases, whether it’s pyruvate or lactate dehydrogenase.

This starts to give you some clues that all is not well in the mitochondrial building when that level starts to rise. Interestingly enough, one thing I neglected to mention as we started talking about the labs is that labs, of course today, are based on the average of the population in the region in which they’re being run. For instance, if you live in Alabama and you’re running a glucose level, they’re still saying you’re fine in 120 fasting glucose.

If you’re in Colorado, they’re saying that 90 is fine. It even varies from region to region. But overall, you don’t want to be average today with regards to your lab values. When I’m talking about my functional ranges or ideal ranges — for instance, the lactase dehydrogenase through, say, LabCorp — it should be ideally under 175.

I believe the cutoff is around 263. If you run it through Quest, that’s a different metric that they run and should not be under 450. It has a higher cutoff at around 600 or 650. You want to be well under the top end on lactase dehydrogenase for optimal ranges.

When you’re too low, that’s often a major indicator of extreme malnutrition, often muscle breakdown, muscle wasting, sarcopenia, cachexia, which is also a very dangerous place to be in the pendulum of an oncology or chronic illness process.”

The Erythrocyte sedimentation rate test

The second test that used to come standard with the chem panel, but no longer is included, is your sedimentation rates, also known as the erythrocyte sedimentation rate (ESR). “This is a really powerful simple test that just looks at how fast your cells are falling out of solution, falling out of the plasma,” Winters says.

Ideally, you’ll want an ESR rate below 10. Above 10, it suggests it’s more difficult for your cells to exit the thick, fibrinolytic, sticky webbing or scaffolding associated with chronic inflammation, autoimmunity and increased risk of metastasis.

“You don’t typically die from primary cancers unless they’re strategically placed in some valuable real estate in the body,” she says. “However, we do have a higher incidence of death from metastasis. When I look at that [ESR] number, it tells me how smoothly things are flowing through the system of the body.”

The high-sensitivity C-reactive protein test

The fifth test Winters routinely recommends is the high-sensitivity C-reactive protein (hsCRP) test. While this test is typically used as an indicator of cardiovascular health, it’s also a widely underutilized prognostic factor for cancer. Elevated CRP, no matter what kind of disease or condition you have, suggests a poor prognosis and lower survival rate.

CRP differs from ESR in that it is a general marker of inflammation. It doesn’t show you the location of the inflammation. Ideally, you want a CRP below 1. If the lab uses a cutoff of 0.3, you’ll want a value below 0.1. Be sure to get a quantitative hsCRP — i.e., one that specifies your level and not just tells you whether you’re in, under or above range — as this will allow you to monitor your progress more closely.
Common cancer pattern

“Here’s where the interesting pieces come together,” Winters says. While all of those five tests, individually, have good studies backing their role in monitoring the cancer process and other inflammatory processes, what Winters has learned, through 25 years of looking at them, is that when CRP, LDH and ESR are within functional ranges, she knows the patient has a good handle on their disease. When all three are off, the prognosis weakens. Again, the functional or ideal ranges would be:

ESR below 10
CRP below 1 (or 0.1 depending on the measurement used)
LDH below 175 (or 450 depending on the measurement used)

“No matter what the scan, no matter what the tumor markers tell me, I know that patient’s terrain and mitochondrial metabolic health is still robust enough that no matter what the tumor burden, we can still move this vehicle down the road,” she says.

“If I see for instance a thrown-off ESR [alone], I know they’re likely having some type of autoimmune response. We see this a lot in rheumatoid arthritis (RA), Sjogren’s [and] Hashimoto’s flares …

Or if we have, let’s say, a CRP that’s really out of range but the other two are perfect, that could be that you just had dental work or had a really intense workout or stubbed their toe or stepped on their child’s Lego.

The LDH might be that they had a bender, drinking with their friends for the weekend, or have been taking some steroids and their bones are breaking down very quickly, or just went and did a humongous hike and broke down some muscle very, very quickly.

But collectively? That’s the key. When all three are in the functional range, the body is still in control. When [all three] start to rise, that’s when we know we’re on a slippery slope … That basically means the cancer stem cells are lining up to take action. That’s what we don’t have very good success with in Western medical treatment strategies.”

Biopsies will likely become a thing of the past

Thomas Seyfried, Ph.D., a leading expert on cancer as a metabolic disease, is of the strong opinion that biopsies should be avoided, as they may trigger metastasis, i.e., spread, of the cancer. The reason for this is because it isn’t so much cancer stem cells spreading the disease as it is hybridized, morphed macrophages that fuse with cancer cells.

“We’ve seen many times that depending on the timing, let’s say, of your cycle when you have a mastectomy or the type of anesthesia used at a time of a biopsy, or the state of the overall health, or even the size of the core biopsy chamber, that we definitely have that potential to seed,” she says.

Despite such risks, clinicians still had to do the biopsy, no matter what, to help guide the treatment. That is now changing, she says. Blood biopsies are improving, allowing a diagnosis to be made without puncturing tissue. From the research and work summits she’s attended on circulating tumor cells and circulating stem cells, Winters is convinced it won’t be long before biopsies will no longer be used.
Tools for optimizing surgical success

While radiation and chemotherapy are rarely an ideal option, surgery may be indicated in some cases, and your success rate can be optimized by implementing nutritional ketosis. Fasting for a few days before surgery can help define and demarcate the margins of the tumor. Cancer cells will also be less aggressive as they’ll be relatively debilitated.

An important point to be made here is that undergoing conventional treatment — radiation, chemo and/or surgery — first, before adopting a holistic approach, is going to massively set you back and will more or less eliminate any real chance of success. In other words, you need to be brave enough to address the terrain of your body first, before doing any of these invasive and highly toxic interventions. According to Winters:

“If it’s a particular tumor that came on fast in a part of the body that’s blocking something like a vessel, or obstructing the colon or whatnot — those become medical emergencies [requiring immediate treatment].

However, the vast majority of cancer diagnoses are nonemergencies. The real emergency is the diagnosis itself, and the way you react or respond to that emergency will often dictate your success at overcoming or maintaining this process. I’m really thankful for the opportunity to say this on a much larger platform because it’s very important …

I always encourage people, ‘Take a breath. Dive deep into your terrain. Really understand what’s making it tick right now before you choose any intervention. And then you will likely not have to see me again because you won’t likely be in that 70% recurrence rate … [J]ust take a moment and reframe and get clear on what is specifically right for you …

That being said, if I know someone is getting ready to prepare for a surgery or a biopsy — because I treat them the same, whether it’s just a tiny little punched lesion … to look at if this is a melanoma, or something that’s opening up the body cavity … — we like to spend at least a couple of weeks prepping the body.

We like to start things like modified citrus pectin. We start to get them into a fasted state or a metabolic flexible state for the weeks leading up, and a fasted state going into the surgery itself. If we are lucky enough to have their single nucleotide polymorphisms (SNPs), we can really help them decide on the best strategy for pain management.

We do our best to have them avoid opiates at all cost because it’s really related to slowing down wound healing, increasing cancer cell proliferation and destroying the microbiome, as well as all the issues that it has around addiction and at really not helping the pain in the way it needs to be helped …

We also do post-surgical intervention to help them heal up from that wound as quickly as possible. Maybe a bit more protein is needed at that time, maybe a little bit less sodium …

If they’re a woman who is still menstruating, we will try and schedule their surgery where the estrogen levels in their menstrual cycle are at their lowest. That’s an interesting strategy we’ve used for better outcomes … Testing is a very powerful tool, as are some homeopathic remedies … like phosphorus to help with drug reaction and bleeding issues … ”

High glucose and insulin resistance worsen your prognosis

As noted by Winters, when you look at the statistics across all tumor types, all stages and demographics, chemotherapy has about a 3% success rate across the board. Radiation has about a 12% success rate and surgery, about a 50% success rate, with “success rate” referring to debulking or making the tumor smaller — not eliminating evidence of the disease.

She also points out evidence showing that when your glucose and insulin are elevated, radiation becomes ineffective, as cancer cells are desensitized to radiation when they’re being bathed in sugar.

“I think about all the patients who are metabolically unstable, metabolically inflexible, prediabetic … [Treatment at this time] basically means you just created a lot more damaged environment, a lot more possibility for mutating cells and a lot more possibility for recurrence and progression, simply because someone didn’t take the time to just do a simple finger stick or blood draw just to see what your glucose levels were,” she says.

Another factor that makes radiation ineffective is elevated vasoendothelial growth factor. Again, a simple blood test can help you assess how likely it is that treatment with radiation will be successful. Winters recommends patients undergoing radiation to spend a few weeks or months preparing their body for radiation, focusing on lowering insulin growth factor (IGF), hemoglobin A1C and glucose.

She may also add in certain radio sensitizing agents, such as melatonin or astragalus, to improve therapy response. Radiation combined with hyperthermia done on the same day has also been shown to dramatically improve results. With regard to chemotherapy, Winters is a strong advocate against the conventional maximum tolerated dose approach.

“When you do it at that level, you not only create a cytotoxic direct cell kill, but you actually simultaneously enhance an immune response. The way we do chemo today obliterates the immune system. And the only way you can really overcome cancer and stay in … remission … is with a functioning immune system.”

Instead, she recommends using chemo at metronomic or fractionated levels, giving it at about a tenth of what would normally be given, which can be done with great effect provided the patient is sufficiently prepared through nutritional ketosis and other aids.

“We don’t guess,” Winters says. “We actually put together a very precise, bullseye approach to each and every individual. We continue every three months while they’re in the cancering process.

Until their trifecta is perfect, we continue to assess and we continue to tweak the treatment because those cells, once they’ve been exposed to a new treatment over a short period of time, typically three to six months, they will have morphed and mutated into an entirely new animal. We have to be a few steps ahead of that process each and every time …

We can’t hit every single pathway with chemotherapy, or it will kill the patient outright. But there are things like the ketogenic diet, which impacts all 10 of the hallmarks of cancer simultaneously, thereby enhancing the effect of whatever therapy you overlay on it.

None of these therapies should ever be considered individually, nor is there ever going to be such a thing as a single magic bullet for cancer. That is where we get seduced by the pharmaceutical industry and even the nutraceutical and alternative medical industry, to think there’s one cause and one cure for this process. It is just that. It is a process and it’s just as unique in each of us as our fingerprints.”

Nutritional ketosis in cancer treatment

Like me, Winters views nutritional ketosis (a ketogenic diet) as one of several tools to achieve metabolic flexibility. Others include intermittent fasting, exogenous ketone supplementation, certain pharmaceutical interventions or caloric-restrictive patterns of eating.

“We were all naturally meant to be these hybrid engines,” she says. “When we talk low-carb eating, that was actually normal carb eating until about 1850, when we started to process sugar, flour and salt and started to put it in everything. We were all, in essence, low-carbers. It wasn’t a fad. This was just the way it was …

Ultimately, what happens when we [are] in a metabolically flexible state or have ketones in our system at certain times, especially around our time of chemo, radiation, surgery, targeted therapies and hormone-blocking therapies, we enhance those therapies.

It’s like somehow those ketones are like a Trojan horse that carry that toxic therapy right to its target. It gives some support to the healthier cells around it. I see it as a therapeutic tool. I never see it as a standalone by itself.

That, I think, is an important piece to put out there and to realize there are multiple ways to enhance outcomes. But that’s one of the most significant ways to hit multiple targets at once and really lower a lot of the side effects …”

Now, when a cancer patient experiences cachexia (loss of weight and muscle mass), testing becomes crucial. As noted by Winters, “being skinny will not kill you, but being cachectic can,” and you cannot tell whether someone is cachectic or not simply by looking at them.

“We do that when we start to see the weight come off on a scale and folks go in for their chemotherapy. Doctors freak out. Their team starts to tell them, ‘No matter what, don’t lose more weight. Eat, eat, eat, eat, eat.’ Yet, cachexia is an inflammatory, cytokine-driven process. It’s very much driven by sugar. It’s inflammation and metabolic imbalance.

The worst thing you can ever give a patient with cachexia is Boost, Ensure or total parenteral nutrition (TPN). Actually, on many cancer wards, TPN is basically known as the beginning of the end. When you look at the first ingredients of all of those … it’s highly synthetic, highly toxic, four different types of sugars … gluten and all types of things that kick up that inflammatory process even more.”

To assess whether a patient is in cachexia, Winters uses a metabolic panel that shows protein, creatinine, calcium and albumin. Specifically, if protein is below 7 and albumin below 4, then the patient is slipping into sarcopenia and metabolic wasting, which is part of the process of cachexia.

Importantly, if you are in cachexia, sudden refeeding with sugar after not having eaten anything for some time can literally kill you. This is known as “refeeding syndrome.” It’s a very dangerous medical condition that can rapidly shut down your organs. Cachexia itself is also very concerning, and actually kills about 40% of cancer patients, according to Winters.

“We see this a lot in cancer wings around the world. My patients, interestingly enough, patients who have come out of cachexia the best were those who we were able to safely fast or safely kick into ketosis, whether it was exogenous ketones, or start to slowly increase their fat intake to what was tolerated, because the nature of cachexia is an absolute loss of hunger,” Winters says.

“Thanks to things today, such as medical marijuana, we can often restart their endocannabinoid system and re-up their ability to have hunger and kick in that part of the brain that has been shut down with a state of cachexia and actually stabilize them and then reverse it. This is a condition that is not reversible by Western standards …

I try to keep patients between 0.8 and 1 grams of protein per kilogram in cancer patients normally. But when cachexia hits, we start to go up by a couple of tens of a point every few days. We might go 1.2 grams, 1.5, 1.8 or 2 max. I don’t go above 2 [grams].”

This extensive and detailed interview contains far more information than I can provide here, so if this is a topic of interest to you, I strongly recommend listening to it in its entirety. In closing, Winters says:

“You know, a few years ago, I would not have even had an opportunity to sit down with a general family practitioner and have this conversation. And yet, today, every week I’m speaking with conventional oncologists all over the world that are being, frankly, kind of pushed, coerced or forced by their patients to have a consultation with me on their behalf.

At first, they’re a bit resistant, until they realize that I’m simply trying to enhance their outcomes. That I’m not trying to do an either/or. I’m trying to help them understand that the tools in their toolbox can be used differently and can be used a bit more effectively and even more safely.

It’s taken things like some of these tumor cell assays and blood cell assays, like Biocept, Guardant360 or FoundationOne, to help them start to have a common language to understand that there are more targets to address than simple standard of care chemotherapy radiation or surgery …

[It] has really changed the conversation. We’re all more in-dialogue versus an either/or process … I think that it’s becoming a pretty cool, accessible, appreciated strategy among my colleagues.

It’s a lot of fun to see lightbulbs go off and to see them put together all the pieces of their life and education, coming together at once to realize they actually do know this stuff. They just have never quite forayed it or put it together in this way that can really change how their patients are being managed …

No. 2, the limiting factor. For instance, I have a doctor I speak with a lot from University of California San Francisco [who is] very up in the field of this. The problem is, ironically, if he recommended metronomic, which is the lower fractionated dosing of chemotherapy, to his patients, it would not be covered by insurance.

How insane is that? That is considered off-label drug use … It is not considered standard of care; therefore, it is not covered by insurance.

Unfortunately, where we are in this moment, which I am on a mission to change, is that you will likely have to track down people out of network, out of pocket, to get the proper treatment, to actually test, assess and address your cancer to your biochemically unique self to have a good outcome. That sucks, but that’s just the way it is right now.”

You can learn more about Winters’ approaches in her 2017 book, “The Metabolic Approach to Cancer: Integrating Deep Nutrition, the Ketogenic Diet and Nontoxic Bio-Individualized Therapies,” which outlines her process in some detail.

If you would like to engage her services, or more specifically, have your clinician consult with her, visit website, drnasha.com. At the bottom of the homepage, you’ll find a patient resource section with free tools. Go ahead and download the free guide describing the five steps to take when diagnosed with cancer. It gives a lot of the information shared in this interview.

Your clinician will need to go to the doctor section to sign up for a consultation. “It breaks down exactly what’s required — those five labs we discussed,” she says. “Any other relevant data, testing, imaging, anything, I would get it all.” As the patient, you would also be asked to create a chronology of significant events of your life that led to your diagnosis.

Should your doctor refuse to consider a consultation to learn about some of the options, Winters may be able to help you find a local physician that is receptive to collaboration. Even if you don’t do anything with your consultations, it certainly would not hurt to do that first. It’s relatively inexpensive, and will give you a firm base of understanding of where you are and what’s going on in your body.

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