In London, gold prices are soaring and are on their way to keep increasing. Right now the price for an ounce of gold is about $520.30. The price has risen almost 17 percent in the past year. Experts think that there is a chance for gold to be as expensive as $1000 an ounce. Do you think that gold prices will reach this plateau? What do you think is causing the price of gold to increase?
Today, CNN/Money.com reports that Ford Motor Co. is planning to close up to 10 pleants and cut 25,000-30,000 jobs across North America. The restructuring is likely to happen over the next 5 years. The Detroit Newws is quoting people familiar with the plan that the proposal is to be presented to the board of directors today, Dec. 7th. However, it will not be revealed to the public until January 23rd.
The current proposal is much worse than earlier reports. The initial restructuring only had up to 3 plants shutting down and 7000 employees losing jobs. The paper reports that up to 7 of Ford's top executives will depart due to the shakeups in upcoming weeks.
The amount of cuts that Ford is planning is comparable to the closures GM has made. GM is planning to close 12 North American facilities and eliminate approximately 30,000 jobs.
The article states through the first 9 months in 2004, Ford's pretax profits had fallen 1.8 billion, 2.2 through first 9 months in 2005. What future problems will this lead to for Ford Motor Co. Why are profits down so much over the past few years?
"A new study from British researchers at the University of Leicester and the University of Surrey concludes that when restaurants play classical music, diners are influenced to indulge more, specifically by buying fancy coffees, pricey wines, and luxurious desserts, reports Reuters and The Associated Press."
The study was done over an 18 night span in a restaurant in Market Bosworth, England. They alternated between silence, pop tunes, and classical music.
When classical music was played, patrons spent on average $40 per person, compared to $36.75 when pop tunes were featured and $35 when there was silence. Beethoven, Mahler, and Vivaldi encouraged patrons to spend more on dinner, especially on luxuries, such as coffee, dessert, fine wines, and appetizers.
Why is it that classical music makes diners feel more willing to spend money on items that make them feel more sophisticated or cultured?
Earlier on in this semester I commented about Delta Airlines filing bankruptcy soon after another airline filed to. Well things continue to get worse for the company of Delta Airlines. A recent CNN article states that Delta Airlines now faces liquidation. This means they are at risk of being disbanded into other airlines. Delta is at higher risk of liquidation than its sister company Northwest Airlines. This is due to the fact that it has nothing to fall back on like Northwest Airlines. Northwest can fallback to smaller flights located throughout the northwest. My question is whether things like this will continue to happen to Airline companies in America, and what will happen to the economy if Airlines start to be liquidated?
I read an article on Usatoday.com explaining the NBC/iPod deal to give individuals the chance to buy and view shows on their iPods. NBC has entered into this deal after ABC has been making profits from the same idea. It states that NBC's goal is to have all their shows being able to be downloaded by viewers. Shows can be bought through iTunes, annd then transferred to the iPod. The shows are being sold at $1.99 through iTunes, and Apple has sold of 3 billion videos since October. How do you feel new technology has changed the economy? In what direction do you think technology will go in another 20 years, in regards to electronics such as these iPods?
Johnson and Johnson have decided to buy Guidant Corp. which specializes in making heart devices. They have settled on the price 21.5 billion. They have considered backing out though due to the legal issues surrounding the corporation when they recently had to recall thousands of pacemakers. If they were to back out now it would cost them 300 million dollars, plus the man hours and costs of making the arrangements for this transaction, but the latter two are sunk costs. Do you think that this is a bad business decision for Johnson and Johnson Co.? Do you think that Guidant Corp.'s reputation will affect sales? Would it be wiser to pay the 300 million and get out now?
This article is about how the Vioxx trials will affect not only the drug company that manufactured the unsafe drug, called Merck, but also all of us...
Vioxx was the Merck drug that was recalled from the selves last year because it increased the people's chances of having a heart attack. There were several people that died from these heart attacks and many that are bringing their cases before a jury to collect damages from Merck.
Merck is the third largest drug company, but these trials may end up hurting the company a lot. Not only is Merck having to pay damages to the families that were negatively affected by Vioxx, but many employees will end up losing their jobs because of the losses that the company will suffer, which is millions and what could be billions of dollars.
The problem with all of this, and even though Merck is fully aware of and should pay damages, is that there is a chance that the company will have to cut back expenses and employees. This company and this field of drug manufacturing is important to us. These are the companies that manufacture effective drugs that help us live and overcome diseases. Merck could be laying off people that will one day come up with a cure for cancer or AIDS. This is a very serious problem, especially because these drugs and other ones will be important as we ourselves get older and are prone to more diseases and illness.
Should there be a smaller cap on the damages that Merck has to pay to families that is regulated by the government? What are other costs that Merck and us face because of the people going to trial over this? Do you think it is fair that people are going to trial over the Vioxx and gaining millions and billions of dollars? Is it more beneficial for families for receive damages or employees to keep their jobs (and in turn help society)?
In a recent CNNmoney article it was noted that consumer spending has increased over the past few months, starting with September. What does this really mean? Interest rates are going up, the housing boom has slowed, and people are still paying around two dollars for gasoline. Is this increase in spending only due to the upcoming holiday season, or is it a trend that will continue into the next year? The article also mentions that personal savings are still in the negative territory, what does this say about the increase in spending, and peoples attitudes toward the economy?
J. O'Dell
Cobra Beer is going to take a daunting task and make a brewery station in Hyderabad, India. This beer has fewer bubbles than the average beer making it easier for consumption with spicy curry food. The company expects the Indian beer consumption to rise by 40% in the next 25 years. This would be a profitable increase seeing how India has one of the largest populations. Also, what makes India attractive is that a majority of the population is under 25. This will also save cost since duty costs are 400% when imported. This is definitely a long term investment since Cobra beer is 10-20% more expensive than other beers and beer is still an expensive purchase for many buyers. Do you think that this is wide investment? Will Cobra beer be able to profit from this investment?
Embraer aircraft, a Brazilian owned company is ready to unleash its newest commercial jet, the Embraer 190. This new plane can sit up to 110 people. Though Boeing and Airbus have virtually dominated the jumbo jets, Embraer is specializing in the small to medium sized jets. This little nitch allows them to compete with the major airlines and still make a profit. It has currently made 177 orders to airlines around the world. With this new nitch fairly untapped, how will this affect the airline industries? Will other smaller airplane produces spring up?
I found an interesting article in the Washington post titled, "Bush Renews Push for Extending Tax Cuts," in which it reveals Bush's plan to help 'renew' the economy by extending tax breaks to "investment dividends and capital gains." Basically, Bush plans to once again give tax breaks to the investors who are already doing well, in the hope that it will boost the overall economy. Several House representatives- moderate of course, do not condone the decision to approve a bill that would not only give tax breaks to the rich, but would also, "cut people off food stamps, squeeze student lenders, impose new fees on Medicaid recipients and slash federal aid for child-support enforcement." Needless to say that positive sentiments about the overall American economy are not very high, considering the problems this administration has had with national defecit, growing unemployment and unbelievably high gas prices, etc. Despite that fact that employment is steadily growing, gases prices are falling, etc. the gallup poll revealed that "58% feel the economy is gettin worse." Needless to say, not everyone is pleased with the overall job that Mr. Bush is doing for the economic welfare of this country.
Ottakar, a major bookstore retail shop in the UK, has announced that it will be merging with HMV, its largest competitor. But a group of small independent bookstores do not like this idea at all. These small stores feel that this could potentially create a monopoly by HMV bookstores. They have filed a grievance with the Forum of Private Business, which deals with such cases. Some believe that the level of competition will be lessened due to this merging. Ottakar has 137 stores across the UK and if this merge is successful then the new chain would control 23% of the UK market. Do you think that these small stores are overreacting? Is 23% really that much?
Just recently, first class stamps in the UK will rise from 29p to 32p. There is a possibility that first and second class stamps will rise by 3-4p by 2010. Originally, the Royal Mail wanted to charge 39p for first class stamps and 27p for second class stamps. The justification for this increase in price is that it will help pay for modernization and the hole in the pension fund. This is will provide an extra �1.2 billion dollars. In the U.S. we have seen our price in stamps rise to 37 cents. Do you think that if the UK has to keep raising its price in stamps that people will start to e-mail more? How high can the price go before people find an alternative price? Or will people just pay the price no matter what?
This post does not come from a website but is information provided to me by my brother who owns a Pharmacy. A drug vendor supplies the plastic bottles to pharmacies that they distribute your pills in. Wal-Mart uses the same vendor that my brothers pharmacy uses. The drug vendor charges Wal-Mart $10 per box of viles and my brothers pharmacy $33 per box. Before the vendor struck a deal with Wal-Mart my brothers pharmacy was only charged $22 a box. After the deal was made the vendor uped the price. My brother found out about the price Wal-Mart was being charged and called the vender and they now let him buy the viles at $10 a box. this is a great example of price discrimination. This only happens because Wal-Mart bullies the vending company around and makes them give them the viles at such a low price, then they try to stick someone else with the price. Now you know why Wal-Marts prices are lower than most others, because they get a lower, unfair price and get the smaller businesses stuck with higher prices.
According to CNN.com, many residents of high-priced housing markets around the country are moving to more affordable areas. According to the article, the number one reason that people are leaving their homes is the high cost of living, with the number one area needing improvement being housing affordability. For example, California suffers a net loss of about 100,000 residents a year to other states. In recent years, many of these people have moved to nearby states like Oregon and Washington. However, prices have now climbed in those states as well, which is causing Californians to turn to the Midwest, where houses are available for half the cost of similar space in Los Angeles.
What will this do to housing in California? In the Midwest? What is the potential problem with this migration to the Midwest?
According to CNNMONEY, Kroger's third quarter profits rose nearly thirty percent. I kind of find this a little peculiar since all that people talked about when the country was experiencing such high energy prices and when the oil companies were reporting record earnings, was that the other markets such as grocers and merchants like Krogers and WalMart would suffer the worst from these prices. This goes to show that Americans did not seem to adjust their spending due to the high energy prices and seemed to react totally opposite of what was expected. How do you explain this? And why does the market get so out of whack when oil prices sky rocket? It has always been amusing to me to watch these people freak out, but then everything seems to always work out fine.
A recent article on cnnmoney stated that there is a trend starting in America among those who are living in cities with high costs of living. These people who live in busy areas like Massachusettes, New York, California, and Hawaii are thinking about packing up and moving to less expensive regions in the Midwest, or to the quaint Southwestern states like Arizona. People are starting to find out that they can buy homes in these areas that costs less than half the price of living the bustling city life. My question is what will happen to the economies of these two very different communities if this does become a major trend amongst Americans? Will the cities begin to suffer and the rural areas prosper, or will it lead to Americans starting all new economies and societies in what now can sometimes be a struggling rural community?
Very recently a group of researchers in Borneo discovered a previously unknown mammal carnivore in the deep rain forest. This new discovery is just another example of the numerous mysteries that lie in the vast forests of the world. These forests are often threatened by deforestation efforts. As in any economic analysis the costs and benefits of a plan are measured to decide whether or not the plan is a good idea. Land use debates often are hard to decide on due to the lack of actual value to be placed on a forest. This discovery is just one more reason to protect the forests worldwide before the unknown benefits are destroyed in order to profit right now.
When evaluating an environmental policy or protocol like the one set up in Kyoto there are three main ideas to focus on. These ideas are efficiency, cost effectiveness, and fairness. By focusing on efficiency I mean matching the marginal damages of an certain problem, global warming is this case, to the marginal abatement costs of preventing the problem. The major problem facing the Kyoto protocol is the actual determination of the costs involved with increasing global temperatures. Some estimates place these costs “including effects on property values, insurance rates, food and water supplies -- would be in the tens or hundreds of billions of dollars, according to the United Nations and other organizations.” With these numbers actions taken by the protocol would be easily justified. But as always, these number are being debated. Do you think that the costs involved in cutting back greenhouse emissions worldwide match the possible damages to be imposed? Use the three above mentioned keys to decide.
The recently passed budget bill passed has part of its total dollar amount dedicated to finding the true impact outsourcing jobs. As the article discusses there are many US companies that shift parts of their business practices to cheaper foreign labor, but the true impact of these practices has not been easily measured due to lack of cooperation from the employers. This data will possibly help to further explain shifts in the American workforce. For example, in labor economics we have discussed the decline of unionism in the US for private sector firms. One explanation is the structural hypothesis that points to globalization as a major cause. This study may help in further understanding these declines, but will not be easy to come by since data acquisition is very difficult.
Compared to this month last year, the number of domestic airline seats have decreased by 5 percent. That is equal to 3.9 million airline seats, or an average of 126,000 seats each day, that aren't available this December that were last December. The airlines reduce the number of seats to help cut expenses and give them more control over pricing. The article states that the U.S. airlines have lost in the past four years a total of $32.3 billion, and the airlines are predicted to lose $10 billion this year. The capacity reduction will no doubt cause the price for a seat to increase, in the end producing more revenue for the airlines. If the airlines are decreasing their quantity of output, they are obviously trying to increase their profit. Do you think that if the airlines continue to lose money, they will go through a short-term shut-down? Could the airlines eventually have seasonal flights?
Verizon Communications, the second largest U.S. telecommunications firm, is planning to restructure their retirement benefits in hopes of saving around $3 billion for the next 10 years. Once put into action, this will affect 50,000 managers. Those employees who are currently under a defined-benefit plan, which typically consists of a fixed payout at the time of retirement depending on earnings and years of service, will keep pension already earned and receive an 18-month enhancement next June equal to the value of their pension and retiree medical benefits. The company says that these changes, even though they do not affect union workers or those already retired, will save $3 billion pre-tax over the next 10 years. Verizon Wireless is a joint company of Verizon and Britain's Vodafone Group, and their managers do not currently have pension or retirement medical benefits. These companies have begun to phase out the defined-benefit plan because they have found them to be too expensive. Verizon Chairman and Chief Executive said that these changes will provide the company with more affordable benefits and increase their ability to compete in this market.
Do you think this is the most efficient way for Verizon to cut costs and save money? Are there other ways they could in a sense achieve the same goal and still remain competitive in this industry? Also, how much more competitive do they need to become, if they are already the second largest company...should cutting costs even be one of their top priorities right now?
So everyone knows that Walmart most of the time has the lowest price. According to CNN.com Walmart is getting ready for another round of promotions just like the ones on black Friday. Do they really have to do it? Walmart already brings in loads of money even with out these promotions, I am not complaining about this at all. My question in this; Do you think that Walmart is turning into a monopoly by trying to do this again with the 2nd round of promtions? Do they really have to do it because of low sales or are they doing this to make more money? This is definitly somthing to think about.
Declaring something illegal should cause the supply curve to shift to the left; both increasing the price of the good and decreasing the quantity demanded. It also causes producers of the good to go underground, where there are no regulations on the good being produced.
Today, many countries are facing the problem of how to deal with illegal drugs. According to an article on yahoo.com, the Netherlands are proposing a pilot program to regulate marijuana in the same manner as tobacco. The sale of marijuana would then come with warnings of its side effects; much like the sale of tobacco products. Dutch officials believe that this program will allow both the growth and sale of marijuana products to be regulated. If nothing else, this type of system is should deter the use of underground marijuana sales – when the consumer has no way of knowing what they are really putting into their body.
Do you think this pilot program will have positive or negative consequences for the Netherlands? If it helps them control the use of marijuana, do you think that it will be applied to other drugs? If it is successful, do you see the U.S. instituting a program like this in the future?
http://moneycentral.msn.com/content/Banking/creditcardsmarts/P135858.asp
This article talks about those cards that you see at basically every store you ever go to. They are usually at the register when you check out and might be advertised like the following...Gap Credit Card: Save 10% on today's purchase and every Tuesday. They always seem appealing, and you are usually enticed to sign up when the cute girl behind the counter smiles at you, knowing she's getting commission off of it, and asks you if you want one. However, is the customer really getting a good deal? Though most people judge a book by its cover, and don't realize the harms of these, there are actually a great deal of downfalls that come with these cards. They run at extremely high interest rates, and can even devalue your credit history, something not very helpful when applying for that real credit card. My question for you is this...Do you think that these cards are actually hurting our economy. After all, it has been proven that people spend more if they have a credit card than if they only have cash. Thus, more peopling find themselves in debt. Just a thought.
http://money.cnn.com/2005/12/05/technology/xbox_suit.reut/index.htm
Microsoft is facing a suit from an Illinois man, taking them to court seeking damages and a recall of the new XBox, for claims that because Microsoft was trying to leap ahead of other video game makers, that they rushed the production step, and there are power flaws in the system. The game system often shuts down and overheats after long use, and/or online play. He says that because they wanted to gain ground in the multi billion dollar video game industry, that they overlooked some simple problems. He is suing them basically for their ignorance. It was also reported that shares of stock in Microsoft went down after this case went public. Do you think that this case will affect Microsoft, in the future, now that consumers know that their quality has been dropping due to rivalries in the industry, or do you think that this case will not affect them much at all. The court has yet to make a ruling, for this could be just another Bill Gates hater trying to make his affections for Microsoft public.
In today's economic world we hear all kinds of predictions about the future. We see our industrial might being transferred to other countries in order for companies to make more money. It seems that the high pay U.S. workers are accustom could even be unsustainable. To look local, just go up the river and see how many plants are making as much money as they have in the past.
With our country facing such changes it seems that Japan is not the same way. Their export industries are making money. The Article "Sun still Rising- Japanese Invincible Might" argues that Japan has purposely kept their growth quite. It even argues that Japan has a "monopolistic leadership in more and more area of advanced manufacturing". Japan also has industrial wages that are 20 to 30 per cent higher that the U.S. Japan has found a way to flourish in this modern World Trade environment.
My question is what can the U.S. learn from Japan? Should the U.S. worry more about Japan or China and why?
After looking at this website, the new Xbox, has put people of America in a trap. They can buy the xbox360 without all of the pieces needed for it such as the ear piece, the wireless controller, and any other object to play the game for $299. However, they can buy the "better" deal of spending $399 for all of the pieces of equipment needed to play the games that people want to play. The idea of this is an example of the compliments in economics...the ear piece, and controller are both needed to play the game regardless, they are a need to get the full effect of the game. So family members can either A:spend the extra $100 dollars, and not have to worry about getting the wrong things, and spending more time on it...or they can B:spend less money by buying everything seperately, but worry about getting the wrong pieces, or worry about the pieces being out of stock. Either way it is a trap.
President Bush exclaimed that the Economy was looking better than it has been in the past few years. This was cited for the latest job creation and unemployment figures released earlier in the day. The President had a different view from Federal Reserve Chairman Alan Greenspan, who said hours earlier that budget position will worsen in the coming years dramatically. Greenspan said that the rising costs of medical care, will place a burden on the budget. Bush declared that the country's economy continues to gain strength and momentum, "thanks to good old-fashioned American hard work." 215,000 jobs were added in the month of November, and the unemployment remained at 5 percent. Why is our president saying one thing and the Federal Reserve Chairman claiming the complete opposite? I understand that people have different views and see things differently but when important people are informing the U.S. about the economy shouldn't we get the same answer instead of making us wonder if they are telling us the truth or not?
~Jessica Hutchison~
Throughout the years, it has become common knowledge that teachers are undervalued. Based on an article in Newsweek, the average teacher today makes just under $30,000 per year. This amount of money may seem decent for those coming out of college; but for many who have mortgages and kids; this salary doesn’t pay the bills.
Education creates many positives from society’s perspective. Not only do better educations lead to better jobs for individuals, but they also have positive externalities. People who are educated are more productive. Generally, they have higher paying jobs and a decent standard of living. Because they are able to provide for themselves and have what they need to be successful, these people are probably more willing to give back for the good of society. They are also less likely to take from society (lower crime rates, not on welfare).
If all of this is true, then why are teachers – college educated individuals – paid so little in comparison to others? They are the foundation of our education system. Without good teachers, there would be no need for colleges because students wouldn’t be prepared. Good, higher paying jobs would go elsewhere; they would move to areas with an educated population. This situation could lead to economic recession, and if severe enough, maybe even depression.
Knowing this, why does the education system in the US provide so little of an incentive to teach society’s youth? Would better teachers remain in schools if the pay was higher? Do you think raising the wages of teachers will lead to a better education system, or would it just create an overabundance of teachers and not enough jobs to go around lowering teacher’s salaries even further?
Most of us can’t imagine life without the internet. We use if for research, for communication and all sorts of information. For most areas, internet service comes with a fee dependent upon the type of service sought. What would happen if this service was free to all consumers? Do you think it would be good or bad for the economy?
According to an article in USA Today, New Orleans is instituting a free internet system to its residents. It will be a city wide program that anyone can use. The city government, in an attempt to spur economic growth, will run this program.
The article did not go into much detail on how advanced this system will be and what it will entail, but I don’t know how successful this will be. For one, everyone does not want the same type of internet service. Some are willing to pay more for a faster services and higher degrees of internet protection. Also, are government run programs really efficient? Who will decide when it is time to upgrade the system? What will the process be? Wouldn’t competition be a better means of providing the services people seek?
The idea of providing free internet to those that may not be able to afford it is fine, but is it efficient and will it spur economic growth? I don’t know.
It’s that time of the year again and families will soon be hitting the roads again to visit each other and go shopping for gifts and presents. According to one brief post on an AAA survey, “37.3 million Americans will travel 50 miles or more from home… 83 percent making those trips by car.” Obliviously with the rising gas prices and a slow rise in market prices, business revenues around the country are expected to rise. Compare the importance of this shopping season to other times of the year. What kind of important contributions does this make to over all business around the country?
Tourism is a popular activity in the world now and that bring a lot of benefit to government. But at the same time, Tourism can cause the same forms of pollution as any other industry: air emissions, noise, solid waste and littering, releases of sewage, oil and chemicals, and even architectural/visual pollution.
In response to the rising number of tourists and their greater mobility, transport by air, road, and rail is continuously increasing. From a report by the International Civil Aviation Organization (ICAO) stated that the number of international air passengers’ world-wide rose from 88 million in 1972 to 344 million in 1994. Tourism now accounts for more than 60% of air travel and is therefore responsible for an estimated 7% of total carbon globally. This percentage is likely to increase the number of international travelers expected to increase from 594 million in 1996 to 1.6 billion by 2020.
According to the Natural Resource Defense Council (NRDC), fuel burned by airplanes puts nitrogen oxide and water vapour about 30,000 feet. These are two greenhouse gases together give as much as twice the global warming effect as the carbon dioxide released by the airplane. One tree offsets the carbon dioxide emitted by the airplane over 4,000 miles and two more trees offset the greenhouse effect caused by the nitrogen oxide and water vapour.
My question is to increasing the tourists really a good idea for our world?
Some economic issues have arisen as a result of a new generation becoming dominant in the workforce. Generation Y's broadest definition is those Americans born between 1977 and 2002. Because of generation Y's high expectations, ongoing learning, immediate responsibility, and desire to be goal-oriented, there have been changes in workforce trends. One issue discussed in this article is turnover. It says that younger professionals are not afraid to change jobs because of recent business scandals that seem to have been caused, in part, by job loyalty. Another reason for this is that generation Y is not as afraid to question their superiors. It said this generation grew up questioning their parents and are not afraid to question employers. I agree.
70 Community colleges have split up a pot of 125 Million in the competition for the presidents Community-based Job Training grants. Although due to Hurricane Katrina preference has been granted to gulf state community colleges because these affected communities have their programs in strong efforts of rebuilding. Still, these 70 grants have been devided up amoung 40 states. Community-Based Job Training grants will help to support the training and growth of of industry through these slected colleges. These grants will also give studnets skills that their local industries require for employment. the training is targeted at jobs expected for high growth and where demand is exceeding supply. How will this effect unemployment nation wide? Will these grants help demand catch up with supply? Do you think the president is looking out for industry than unemplyment?
"Pathways to Employment" is and intitiative to help struglle victims of recent hurricanes to find employment and training to get back on thier feet. The assistance is based on individuals needs and comes from different offices accross the country. There are 3,500 one-stop career centers in the U.S. This department is sending experieced counseler to help the evacuees find jobs and connect them to supportive services through local and educational opportunities. 15 million will be set aside for this particular area of concentration. They are also usning "specially trained experts" to individuals with dissabilities find jobs and gain benefits and services through local and government services. There are 4,000 Job Corps scholarships targeted to young people/students (ages 16-24) who need to get back on their feet.
In the November 30th Wall Street Journal an article titled "Dear Valued Hybrid Customer...", author Holman W. Jenkins, JR, talks about the issues with the Toyota Prius and other Hybrid vehicles. He states that the Prius gets about 26 percent less gas mileage than advertised and that the car costs $9,500 more than a comparable vehicle. Also in the article Jenkins talks about how Toyota has increased horsepower in one of its SUVs by using Hybrid technology, but gas mileage has remained the same. Is the use of hybrid technology a good idea or is its just a ploy by car manufactures to make money, is the use of hybrid technology to improve horsepower and not increase fuel economy reasonable. Or is it worth paying $9,500 more for a car that will save you annually $580.
The U.S. department of labor has anounced the release of a 3.5 million dollar grant. This Grant will be used to increse the skills of IT workers in Arizona. this grant is part of the presidents High Growht Job Training Initiative. This will help expand industries by providing highly skilled workers. Currently in Arizona there is a shortage of highly skilled workers in the IT field. The money will be put towards new course curricula in engeneering ang testing. The students who pass their final exams will be certified in industry-recognized SQE certifications. With an estimate of 20 Community College instructors, over 1,500 students will be trained in a 3 year period. This training will make it easier for students to take advantage of jobs in high demanding areas. What effects do you think this will have on labor supply and demand in Arizona? What effects do you think it will have Nation Wide? Is this a good way, economically to spend government grants? Will this have a possitive affect on the economy and unemployment?
AIDS is a serious disease that affects the lives of many around the world; especially those living in Sub-Saharan Africa. It is estimated that about 70% of people suffering with this disease live in this area of the world (Lairson 425). In Botswana, for example, by 2010 the average life expectancy of a new born is expected to be 29 years and the probability of a 15 year old boy dieing from AIDS is over 50% (Lairson 425).
These statistics paint a picture of just how bad AIDS can be for countries incapable of dealing with AIDS. From an economic perspective, the loss of life due to AIDS will be correlated with declining economic activity in a nation. If people are not expected to live past the age of 29, how productive are they going to be? This will lead to a decline in productivity, a decline in national income, and have effects on everything contingent on income.
According to an article in USA Today, President Bush has introduced an initiative to help people suffering with AIDS through government aid to mission groups. Bush believes that “[b]y identifying and supporting these organizations, we will reach more people, more effectively, and save more lives" (USA Today).
Do you think that this is the best way for the US to help in the AIDS pandemic in Sub-Saharan Africa? From an economic point of view, is there a better (more efficient) way to cure this disease (or at least stop the spread of it)?
Works Cited
Lairson, Thomas D. and David Skidmore. International Political Economy: The struggle
for Power and Wealth. Third Edition. Wadsworth. Canada, 2003.
Coal-fired power plants emit about 48 tons of mercury each year in the United States. This leads to great amounts of health risks, mainly through the consumption of fish. The Environmental Protection Agency developed a plan in reducing mercury emissions by 21% in five years and 70% by 2018. The regulator's federal plan is to achieve 80% reductions by 2008. One major problem with is plan is that plants have already had to spend millions of dollars to reduce emissions of other chemicals that may also help to reduce some of the mercury emissions, just not enough that this new plan is gong to require. Also government officials do not like the idea of assigning states a total number of permits for how much emissions they may have and selling unused permits to other states. Even though this may meet an efficient level of emissions nationwide, officials do not like the idea becuase it will just create "hot spots" for mercury.
Are there any other ways we could meet an efficient level of mercury emissions nationwide without using tradable discharge permits? Is there anyway to meet the standards while not spending millions more dollars?
On November 13, an explosion at a petrochemical plant spilled 100 tons of benzene and nitrobenzene in the Songhua River. 200 miles downstream from Jilin City, where the spill occured, is Harbin. Fortunately the four million citizens that live in Harbin were informed that their water supply would be restored by Sunday evening. Unfortunately, there are several people that live in rural areas outside Harbin that will be without water for much longer. Liu Shiying is one of the people that lives in the rural areas. She says that their water has been off for four days already and only has one clay cistern filled with water for her and her family. The citizens in Harbin were given plenty of bottled water to get through this hard time. Liu said that they would see on tv that water was delivered to the people in the city. The water supply for the people in the rural areas comes from underground wells or straight from the river, both of which have been contaminated by the spill. The only way to get water to these people is to take the dirt and gravel roads away from the city. The Shiying's are not expecting water to be delivered because they live so far away from the. They are just concerned about the little water supply they have left and when they will be able to drink from their well.
Is it possible to pull some economic concepts into this situation? Would the Shiying's be able to trade water with some of their neighbors or find some other way to ration out their water?
Ford Motor Co. is likely to close five plants that employ about 7,500 workers, or about 6 percent of the company's North American work force, the Wall Street Journal reported Friday. These assembly plants are located in St. Louis, Atlanta, and St. Paul, MN. they are also shutting down engine part plants in Windsor, Ontario and a truck-assembly plant in Cuautitlan, Mexico. The company lost $284 million in the third quarter. On Thursday it said sales fell for a third straight month, down 18 percent, and cut its production forecasts for the fourth and first quarters. The company announced that it will eliminate 4000 salaried jobs. Do you think this is because of the gas prices or just because of the fact that Ford is being overpowered by other corporations and automobile companies? Do you think that this is the correct step for Ford or should they keep these jobs and plants rolling?
Delphi hourly workers protested the company's executive compenstation plan with pickets at the auto supplier's plant. They believe it is unfair to pay huge amounts to top management while proposing to cut wages of hourly workers. Delphi filed for Chapter 11 bankruptcy last month and as part of their restructuring plan, proposed cutting production workers' hourly wages from $27 to between $10 and $12.50. Delphi is asking the bankruptcy court to approve a plan that would give stock options and cash bonuses for about 600 executives when the company emerges from bankruptcy. This estimates to be worth more than $500 million. Delphi says the compensation plan is necessary to keep its executive team in place during the bankruptcy process because recruiting new executives would be costly and time-consuming. Members of the UAW believe this compensation plan to be unfair because "it seems they are rewarding incompetence." Bob Nelms, a member of the UAW says, "the same people who bankrupted the organization are being rewarded." Do you think this compensation plan will cause production workers at Delphi to find work elsewhere? Also, will these workers be able to make a living a support a living on the $10 or $12.50 proposed wage cut?
A lingerie store in Augusta, Maine has caused more than a few eyebrows to raise-- the store uses live models in its window display. Yes, you read that correctly- three lingerie-clad women grace the window of a newly-opened store in Maine.
The advertising technique has caused mixed reactions. Some believe that it is distasteful and has actually driven customers with children away from the store. On the other hand, some believe that it is innovative: "It's like a New York thing. It's urban. It's edgy," said Stacy Gervais, owner of Stacy's Hallmark Store and a founder of a downtown merchants group. "We need a shtick _ something that we do that attracts people and gets us remembered."
Now this raises some questions on my part: Does this technique raise the bar in terms of advertising? Can we expect other stores to follow in this boutique's footsteps? Will money that used to go into print advertising and displays now go into hiring live models?
A recent national poll indicates that more than half of U.S. adults say that the low costs that Wal-Mart provides on its shelves bring about other costs in its workforce and benefits. The national poll--conducted by WakeUpWalMart.com, a union-funded group that has been pressuring Wal-Mart to raise employee wages and benefits-- claims that 56% of U.S. consumers believe that "Wal-Mart is bad for America. It may provide low prices, but these prices come with a high moral and economic cost for consumers."
Currently, Wal-Mart is facing a lot of fire from critits. As the largest U.S. private-sector employer, Wal-Mart faces intense pressure at home from unions, environmental gropus and others who say the company pays poverty-level wages, offers poor health-care benefits and gobbles up green space with its massive big-box stores. Wal-Mart is also defending itself in a record-large, class-action lawsuit that charges it with discriminating against women in pay and promotions.
Is Wal-Mart really so bad? Sure, Wal-Mart's got great prices on products, but can you put a price on "moral and economic costs" that apparently so many Americans feel are being imposed? Does this recent poll spell trouble for Wal-Mart?
According to National Academy of Sciences, the average global temperature has raised 1° Fahrenheit in the last century The increasing temperature of the earth’s surface is commonly known as global warming. It causes many negative impacts, which include “more-violent storms, changes in the course of the Gulf Stream”, melting of the polar ice sheets, and rising of the sea level. Since the industrial movement, the world’s economic developed rapidly. The development of economy helps many countries create more benefits. However, the environmental problems, representing by the global warming, which are due to the industrial production became severe and the cost of solving them was significantly high during the last decade.
Since the global warming problems is mainly caused by the use of fossil fuel in the industrial producing, is there kinks of alternative energy sources could be used? such as the solar energy, the nuclear power, or wind projects?
know more about global warming : http://yosemite.epa.gov/oar/globalwarming.nsf/content/index.html
Over the past few years, entertainment industries have voiced their concerns over the downloading of copyrighted material. Consumers have used the internet as a tool to take the work of various artists/entertainers without payment. As many have seen, this issue is difficult to handle. How can the government regulate this piracy when the technology is readily available to the average consumer?
According to an article on yahoo.com, Japan has come up with a solution. Under their current system, consumers in Japan pay a 3% tax on recording devices and other gadgets that can be used to duplicate copyrighted material. This tax is included in the price of the good; so many consumers are unaware that it even exists. This tax is then given back to recording industries as payment.
Do you think this is a fair system? Is the 3% tax really making up for the losses that piracy causes? What about consumers who pay fees to download music legally? Is it fair to charge them twice? Do you think the US should consider a similar set up?
Jobs Back on the Rise
Recently, the Labor Department released the news that 215,000 jobs were added in November, up from 44,000 in October. The Bush administration claims that the increase is due to their policies of cutting taxes and spending. Unemployment remained around 5%. Job growth rates have finally returned to pre-Katrina levels, indicating the the nation is firmly on the road to recovery from the disaster. Average hourly earnings rose along with the new employment, up to $16.32 from $16.29. However, the economy must be monitored closely to avoid "overheating," as mentioned in the article. My question is this: the Bush administration is taking a lot of credit for the increase in jobs and hourly earnings, citing tax and spending cuts. However, surely this policy was not the only cause. What other factors could have contributed to these positive trends in the labor market? One possibility is that consumers have become more confident and are buying more products, producing profits for companies. These profits allow the companies to employ more workers. I'd like to hear what someone else might think about this issue.
President Bush has recently announced an initiative to grant temporary legal status to illegal immigrants, and this raises a labor economics question. Illegal immigrants come to this country because they can find under-the-table jobs that are beneficial to both employer and employee alike. Employers benefit because they are not bound by minimum wage laws and also avoid a number of taxes. Illegal immigrants benefit because they still make more money then would be attainable in Mexico. If these immigrants were made legal citizens, would the potential benefits enjoyed by the employers disappear? If so, would this lead to an increased unemployment rate among the new citizens? Or do you think that immigrants would still prefer an “illegal” status because it provides more job opportunities?
An interesting article describing the president's decision can be found at
http://www.time.com
Over the past few months, hurricanes have been a major problem facing the United States. The damages caused have been devastating to many. But as hard as it is for the US to recover, it is probably going to be more difficult for Mexico.
As Cancun was hit by hurricane Wilma, it took a huge loss to its tourism industry. According to an article by MSNBC, tourism in Cancun makes up about half of all tourism revenue in Mexico. Estimating that it will take Cancun at least 2 months to restore the hotels to their pre-storm conditions; will they be ready for holiday vacations? If they can’t fix their problems within this time frame, these hotels could lose out on huge amounts of revenue during the winter tourist season.
Other than lost revenue, are there any other consequences of this storm? How will tourists react? Will they travel somewhere else (substitutes), or will they cancel their vacations all together? What does this do to other industries (compliments) connected to tourism in Cancun (airlines, restaurants, souvenir shops)? Who will suffer more from this storm: the hotels or the little shops that sell their products to tourists?
the shopers favorite holiday black monday, the day after thaksgiving where everybody goes nuts about the deals at wal- mart is being invaded by internet shopers. internet shopers on this holiday has increased nearly 35 percent in the last year alone and sales have almost equaling that of the instore take. so i ask is there any threat of online shoping taking over, will society become so lazy that we cant go to a store to find a pair of pants. also what impact do you think this will have on stores in the long run. and do you think this trend will conmtinue to grow. and finally do you belive that this will affect the economy in any way.
In a report made by Cnn it talk about U.S. auto sales on the slide. It also reported that companies such as Ford and GM are having to lower production of the autos they are making because of the decrease in sales. With these sales continuing to dimish what do you think will happen to U.S. auto companies? Also what do you think they can do to turn around the problem and maybe have a comeback?
full article
http://news.moneycentral.msn.com/provider/providerarticle.asp?Feed=OBR&Date=20051201&ID=5322423
U.S. stock indexes climbed on Thursday, with their biggest single-day gains in a month, while the dollar rallied, oil jumped more than $1 a barrel and gold popped above $500 an ounce to its highest level in nearly 23 years.
But U.S. Treasury bond prices fell on concerns that strength in U.S. manufacturing data would give the Fed another reason to keep raising interest rates.
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does this mean oil prices are going to rise again? Are we doomed with high prices on oil and gas? How is the gold rising going to affect us?
Intel Corp. has announced a plan for new technology, called Viiv that would combine computer capabilities in a a television, such as dowloading music and accessing the internet, all using a remote control for the television. Also, the Viiv computer will be able to pause and rewind television shows, as well as connet to other media players and dvd players. Other technology companies are also trying to make similar models for competition. Ted Schadler, consumer-technology analyst at Forrester Research Inc. said, "There are a lot of companies from a lot of industries who are trying to figure out where the power is and where the check points are." What do you think this means for the technology industry? Do you think that these new products will be able to be made affordable enough to take over the technology industry?
Bill Gates Company last launched its new design in 2001 Windows XP. Being pressured by many competitors he announced on September 13, 2005 about his company new Windows Vista. Gates is planning on pushing this windows launch in 2006. How will this affect the economy? Will this put the little business out of business or even hurt his competitors? Gates is one of the world largest software builders, and with launching this new idea may put him over the top. His business average $33 billion yearly in revenue. This new software is being design for personal computers and Gates said, “would drive a new wave of personal computer upgrades." Everyone always wants upgrade, but sometimes upgrade hurts the economy in the long run. We will have to wait and see what the launch of Mr. Gates Windows Vista will do to the economy!http://money.cnn.com/2005/09/13/technology/gates_windows.reut/index.htm?cnn=yes
A recent report from wakeupwalmart.com (a union-funded group that has been pressuring Wal-Mart to raise employee wages and benefits) showed that out of 1,012 randomly selected adults 56% believed that Wal-Mart was bad for America. The survey asked the participants to pick one of two options that they most closely associated they feelings with Wal-Mart.
Participants could choose: "I believe that Wal-Mart is bad for America. It may provide low prices, but these prices come with a high moral and economic cost for consumers" or that "Wal-Mart is good for America. It provides low prices and saves consumers money every day." Out of the other 44% of America, 36% said Wal-Mart was good for America and 8% declined to answer.
Another poll from Zogby questioned consumers on whether or not they believed Wal-Mart was becoming too powerful in the market. 33% of participants claimed they wer very concerned, while 20% claimed they were not concerned at all.
What do you think? How do you feel about Wal-Mart's power in the market? Do you think that Wal-Mart is on the verge of becoming a monopoly?
Today, many people have kitchen pans lined with Teflon. This non-stick chemical has made cooking a much easier process for people across the country. Companies also use Teflon to line candy wrappers, pizza boxes, microwave popcorn bags and hundreds of other food containers. It has proven to be a success in preventing food products from sticking to their container.
But is this a safe chemical? Due to the accusations of a former employee of Dupont, there is has been an increased concern about the safety of Teflon. Within Teflon, a chemical by the name of zonyl exists. And according to an article on msnbc.com, zonyl was recently put under observation. The concern is that once zonyl gets inside a human body, it turns into a substance known as PFOA, which has been documented as damaging to the health of animals and could possibly be damaging to the health of humans. “The Environmental Protection Agency has been trying to decide whether to classify PFOA as a “likely” human carcinogen” (Associated Press).
Dupont has also faced several lawsuits regarding their use of dioxin – a chemical believed to cause cancer in humans. “[A]n oyster fisherman who claimed dioxin from a Dupont plant caused his rare blood cancer was awarded $14 million in actual damages and his wife received $1.5 million” (Associated Press). They are also facing two other lawsuits in dealing with PFOA; totaling over $100 million in damages.
Has Dupont been reckless in its efforts to increase revenues? Or are these just accusations of a disgruntled former employee? If the FDA decides that the use of Teflon is harmful to the health of people and they ban its use, what will be the economic effects? If it is banned, who will bare the brunt of the costs associated with the abandonment of Teflon: consumers or producers? Do you think that there would be a substantial improvement in human health conditions as a result of the banning? Or will companies just find another product to replace Teflon that will bring its own unique damages with it?
New Technology has arrived and is in action in Bangor, North Wales. This new computerize technology saved a girl from drowning in a pool back in August. This system alerted the lifeguard something was wrong with a person in the pool and by the monitor they lifeguard could locate exactly where and within 40 sec she was saved. With this new creation it would cause the PPF (Production Possibility Frontier) line to shift outward because of this new discovery, causing the number of drowning also to decrease. Do you agree with this new technology and believe that it will actually decrease the deaths?
The article was written by Steve Ranger entitle Computer saves drowning girl from CNET News.com
The number of workers claiming first-time jobless benefits fell last week below pre-hurricane levels, and consumer incomes and spending showed more normal growth as well. Initial claims for state unemployment benefits dropped 17,000 to 320,000 the week ended Nov. 26 from an upwardly revised 337,000 the prior week, the Labor Department said. Well now that a couple months have past the unemployment benefits have dropped means that the country is getting somewhere slowly but surely. But how long will it take to solve this problem? Will it ever be solve, or will those victims of the hurricanes be living off unemployment for life and never have a job?
http://www.usatoday.com/money/economy/2005-12-01-jobless-income-spending_x.htm
The Kyoto Protocol, as I am sure many of you know, is a multi-national effort in an attempt to curb greenhouse gas emissions. The Protocol calls for a reduction of 6% emissions from levels present in 1990. Many nations have joined in, with 34 now participating. The target date for the emissions levels is 2012, but the European Union has just announced that it expects to achieve a level of 9.3% below 1990’s levels by 2010.
How has the European Union progressed so quickly? The answer lies in an efficient system of tradable discharge permits.
Under the scheme, which limits emissions from about 11,500 manufacturing plants and power stations, European governments issue carbon dioxide allowances, which are sold into the market by firms emitting below their limits then traded.
A program called the clean development mechanism allows companies to also invest in environmentally friendly projects in developing countries to earn credits at home.
Finally the ski season is approaching. I've started researching season pass and single day ticket prices at some of the area ski resorts and have noticed how the prices are generally the same in the midwest area no matter what state, Ohio, PA, WV, or the size of the resort. But I also know that out west, a single day ticket is sometimes twice as much as these resorts. I'm betting it has to do with the quality of skiing and the size of the resorts out there. Personally, I've been to Perfect North, Indiana and Mad River, Ohio, which both are pretty beginner hills. I've also been to Timberline, WV which is a slight step up from the previous two. None of those compare to Mammoth Mountain, CA which boastst the largest ski resort in the nation and a ski season from late October to Late June! I was just curious as to who else enjoys skiing and where you've found the best carving for your buck.
The world is always seemingly worried about a shortage of oil. Yet three days ago the OPEC Chief stated that oil prices and levels were fine. He went even further and said that markets who needed more oil could have up to two million extra barrels per day, if needed. It sure doesn't seem like there much of a shortage of oil. It seems as if the actual price of gasoline is completely irrelevent to the actual supply of oil/gasoline.
In the Consumer Reports for people buying computers online, Apple was the top choice with IBM coming up second, Dell in third and HP falling into fourth place. Dell used to be higher up on the list, however its customer service seems to be the factor that agrivated customers. Dell decided to outsource it's customer service branch which created language barriers between customers and technicians, and also customers complained of very long waits on the phone with the hotlines. Other factors that influenced customer's opinions about the companies inlcude price, products selection, products quality, and ease of use. Does Apple deserve to be the top choice because of its computers or maybe because of other products like the ipod? Do you think that with Apple being the top choice instead of PCs like Dell, that the business world may convert to Apple technology in the future? How will this affect the business world?
Chiquita the fruit company will be expecting some sales losses this quarter due to several tropical storms. Heavy rains destroyed about 1600 of its Honduras fruit farms. Also, they lost some of their fruit farms in Guatemala due to hurricane Stan. These storms will no doubt create a shortage of fruit production for their suppliers and consumers. But Chiquita is looking for alternative places such a Latin America. Is there any way that Chiquita can better prepare for such losses? Should they move to Latin America? How will this affect prices and consumer consumption?
Many people wanted to skip the 6am rush the day after Thanksgiving. It was a rush of people wanting to get there and catch the sales before the product was sold out. However, this year shoppers spent 26 percent more on online purchases than in 2004. Consumers spent $925 million on online retails from Thursday to Sunday. VisaUSA say online buying by their cardholders rose 26 percent. On Monday many continued to shop online getting little work done. Those who shopped online went from 11.1 million to 15 million. Stores such as Barnesandnobles.com said Monday was the biggest this holiday season. The three most popular sites were eBay, walmart, and Amazon. Internet sales were rising at a remarkable rate while shoppertrack, which keeps track of store sales, said it only rose 0.4 percent since last year. To get shoppers to purchase online many of the sites offered similar incentives as of the stores, and many sent emails out telling details about the sales. Were you one of these online shoppers? Do you think this will have an impact on the stores itself?
A recent poll in Europe showed that due to better medicine, working conditions, diet and education people are living longer. This seems as a good thing but the poll also showed less people having kids. According to the article this could create a problem for the future work force. As the present workforce continues to get older and less people having kids, replacements could be an issue. One argument was to allow people to work longer and maybe even pass their pension plans. But the majority of people do not even work until their pension plan, which is 65 yrs old. Also, if there is a younger worker shortage who will pay for the older workers pension? How will European companies fix their potential worker shortage? Will they require their older workers to work longer? How will they draw in the younger workforce?
ESPN, the largest provider of sports in North America is trying to go mobile. Disney, its parent company, has come up with an idea that will allow sports fans to watch games and get highlights and score reports on their phones. Their is one catch, the subscriber will have to buy one of Disney's new phones manufactured by Sanyo Electric Co. and get airtime minutes from Sprint Nextel Corp.'s national cellular network. These phones are not cheap costing $499.99. The billing statement would come from Mobile ESPN, not Sprint. It will range from $64.99 to $224.99 a month. This new idea is very challenging since the cell phone market already has heavyweights such as Verizon, T-Mobile, Cingular and Sprint. Their aim is to pull already existing customers away from their competitors. Will ESPN Mobile be able to exist in this already completive market? Will they have to lower prices to lure customers? Or will the existing companies provide their own sports service?
Online shopping keeps getting more and more popular. It has been reported that people are shopping online during work, and 59% of buying has come from work computers this month. In addition, the Monday after Thanksgiving has been named Cyber Monday because the large amount of people who shop online after the door buster sales the day after Thanksgiving. Online sales are expected to keep increasing, and stores are aware of the change in buying habits. Do you think that with the great sum of people buying online that the stores will reduce sales? In fact, do you think that most stores will have fewer employees this season than normally because of the expected online buying? Will this factor be a problem for families who rely on part time jobs around the holidays to purchase gifts? How will this affect the economy?
The drug company Merck and Company announced recently that it would be making cuts in it's costs. They will be making these cuts by getting rid of 7,000 jobs (11% of it's workforce) and closing various branches of the company including a few manufacturing plants, a research site, and two development sites.
How will these changes in Merck affect the overall prescription drug market? How will it effect the job market in the areas where the plants and sites are located? Finally, how will it effect the overall economy?
Link: http://biz.yahoo.com/ap/051128/merck_cuts.html?.v=12
Full Article [http://moneycentral.msn.com/content/P133917.asp?GT1=7390]
Given the huge amount of ?adult entertainment? we consume as a nation, it?s a wonder Playboy Enterprises' stock performs like it needs a dose of Viagra.
Just look at the size of the porn market:
Americans spend about $5 billion to $8 billion on smut each year.
Sex sites account for 40% of all Internet traffic.
Satellite and cable operators earn about $800 million a year from adult movies, or about 40% of pay TV and on-demand TV revenue.
Now look at how Playboy Enterprises (PLA, news, msgs) continues to struggle:
Playboy magazine lost money last quarter as publishing revenue slipped 8%. Playboy circulation fell again to near 3 million -- which means the monthly places 19th among U.S. magazines.
Founded by Hugh Hefner in 1953, the magazine is now firmly entrenched in circulation rankings below National Geographic, Good Housekeeping and Ladies? Home Journal. So far this year, Playboy's publishing unit has lost $3.4 million.
In the third quarter, Playboy as a company took in just $80.9 million in revenue. The 10 cents a share in profit Playboy earned may seem good -- since that beat last year?s results by four cents. But a closer peek reveals cost-cutting saved the day, along with sharp declines in taxes and interest payments. Without that help, which can?t last forever, the company would have reported a loss of 5 cents per share.
For the first three quarters of the year, Playboy revenue grew an anemic 3%, and the business lost 16 cents a share -- exactly the same amount of red ink spilled in the same period last year.
All of this paints a fairly dreary portrait of Playboy.
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My question is, if the porn industry is making decent money, then what can be expected if the most famous of the porn industry shuts down? Will the income fall, will it increase from some newer trendier playboy? If playboy doesnt start making up money, will our famous adult entertainment known as playboy change how we view the porn industry, and how we buy?
In Environmental Economics, we have discussed many different types of policies that are all geared towards reducing pollution. No matter the specific type of policy, enforcement is always a big problem. This is due to the fact that each individual firm will abate only to a point in which the MPC (marginal penalty curve) is equal to the MAC (marginal abatement curve). To increase the compliance rate, the EPA can raise fines for violations, raise the probability of getting caught, or do a combination of the two.
The EPA published an article on Nov. 15 that shows that the agency has increased the probability that violators of environmental policies will be caught. In 2005, the EPA prosecuted some of the “largest environmental crimes in history.” The specific charges and sentences can be found through the link to the EPA website.
My question to the audience is this: will the increased prosecutions shift the MPC to the left, causing a higher compliance rate, or will they not act as a deterrent?
http://www.epa.gov/compliance/data/results/annual/fy2005.html
http://www.msnbc.msn.com/id/9983120/ [full article]
With sales growth among U.S. consumer-products companies expected to lag behind last year's big gains, this holiday season may prove to be a double whammy for those outfits with already weakened financial profiles. On the heels of one of the worst hurricane seasons on record, in which Katrina and Rita helped drive up already steep energy and commodity prices, U.S. consumers are being forced to rejigger their usual spending habits this holiday shopping season.
Even though energy prices have retreated some in recent weeks, they remain at historically high levels. Lofty prices for gasoline and home heating fuels combined with rising interest rates may force consumers to reconsider big-ticket purchasing decisions.
At the same time, elevated energy expenses are fueling higher operating costs throughout the manufacturing supply chain, including raw materials, factory overhead costs, and transportation. The result: A further squeeze on the profit margins of consumer-products outfits
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With energy prices in record highs, one has to wonder, during this cold winter and natural disasters, how is this affecting the economy? Cold winters, gas heat, less spending this holiday season? Dramatic effects of energy prices, and recent hurricanes are definitly going to affect holiday spending this year.
Microsoft recently released its new game console, Xbox 360. Strangely enough, Microsoft is losing money on the Xbox consoles. According to the article, the cost of building a console is greater than the console's price. The cost of making and testing the Xbox 360 is around $552.27 while the retail price is only $399. The article also explained that the chip that runs the console costs $106 while the graphics processing unit costs around $141. However, these two costs are projected to decrease as their manufacturing processes become more efficient.
Even though Microsoft is losing money by selling Xbox 360's do you think that they should continue producing them at this point in time?
http://money.cnn.com/2005/11/24/technology/xbox_loss.reut/index.htm
Full Article @ :http://www.msnbc.msn.com/id/5612507/
SINGAPORE - Oil prices were lower Wednesday after the government reported a substantial increase in the nation?s fuel stockpiles.
A barrel of light crude was lately quoted at $57.95, down 89 cents on the New York Mercantile Exchange. Prices slid to five-month lows last week and are about 20 percent above year-ago levels.
In the U.S. Energy Information Agency?s weekly petroleum inventories data, released mid-morning, the Energy Department said the U.S. crude oil supply went up by more than 400,000 barrels last week. Inventories of distillate fuels, such as diesel, increased by more than 1 million barrels, and gasoline inventories rose by 200,000 barrels.
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With Oil prices dropping and the demand increasing, one has to wonder, are the prices going to rise again? With the supply increasing and the price decreasing, you'd think they'd have lots of sales. Is the increasing supply and low costs going to effect consumers buying gas and oil? Can this help our economy? Or is it just a weekly thing, and some people get lucky with cheap gas and oil?
University of Maryland business professor predicts that consumers will buy less in the upcoming year. Gas prices have declined after post-Katrina, but it is still up 5 % over last year's. He doesn't expect people to buckle over the holidays, but he says, "watch out for the post-holiday blues when people realize that they're poorer in the new year that they were a year ago."
With that in mind, mortgage rates are starting to increase once again. It is said that the nation's housing market has made consumers feel wealthier, acting as a bulwark agaisnt the summer's rising energy prices.
Do you think UM business professor Peter Morici is going to be right? Will consumers spend less in 2006 and cause the economy to suffer?
General Motors has absorbed nearly four billion dollars in losses this year. This has led to the decision to eliminate 30,000 jobs and close down nine North American production plants by 2008. The company hopes that this will bring production in line with demand and allow the automobile manufacturer to begin making money once more. The 30,000 jobs represent nine percent of the company's entire global workforce. This has not been an easy decision to take by the United Auto Workers, who have quoted GM's actions as being "extremely disappointing, unfair, and unfortunate" and "devastating to many thousands of workers". The union will be protected by its job security agreements, but contract negotiations in 2007 will now be more difficult. Although GM stands to cut costs by seven billion dollars, it will also cut its amount of production. Also, because the union has stated that negotiations will be more difficult in the future due to the job losses, I'm wondering about the impact this will have on labor-management relations, and how this will affect the company's future.
Oprah Winfrey is not only one of the world's richest women but she is arguably one of the world's most influential women. Her daily talk show, Oprah, is watched faithfully by millions of women across the country. Not to long ago, Oprah hosted a bra and jean fitting segment on her show. She was sponsored by Nordstrom. Just by uttering the words, "If you're watching around the country and you want to know where to go, go to a Nordstrom's nearest you. They're trained to do the fittings." Oprah has increased Nordstrom's sales by 189%. Because Oprah said it was true, it has to be.
What kind of kickback is Oprah getting from saying that she likes a particular brand of clothes or bras? If you were a designer what would you do to convince Oprah, who could increase your sales with a just a few words, that you brand is the best? How much “free” stuff do you think that she receives on a daily basis?
General Motors has been facing some devastating blows in the past year. Delphi, which was once apart of GM, has just filed for bankruptcy and GM is in $12 billion dollars worth of debt to them. Delphi is GM's largest supplier and if GM doesn't pay up they will go on strike. This is would be a crushing blow to GM allowing their competition to take their potential customers. Also, the Securities and Exchange Commission is investigating on GM is dispersing its money to health and pensions. This follows suit to GM's health and retirement costs. Since Asian automakers have no obligation to pay for health care for their employees they are able to save money. This is something that GM cannot compete with. With high gas prices, it is obvious that people are reluctant to buy SUVs and pickups which are its major source of income. This rolls into their weak sales problem. People are now buying more of the smaller more gas efficient cars made by Asian automakers.
What should GM do to try to win back their customers and avoid filing for bankruptcy? Should they make smaller cars to try and compete? Or make SUVs and pickups more efficient?
http://www.msnbc.msn.com/id/10068776/ [for full article]
WASHINGTON - Ford Motor Co. recalled 220,000 vehicles from the 2005 model year Wednesday amid fire worries from a battery cable rubbing against the frame and concern that a fuel tank strap could separate after tens of thousands of miles.
The recall linked to the cable involves more than 98,000 Ford Crown Victoria, Lincoln Town Car and Mercury Grand Marquis sedans. Ford said in a letter to the National Highway Traffic Safety Administration that it has received four reports of fires.
Ford spokeswoman Kristen Kinley said chafing of the cable caused the exposure of wires to the vehicle frame, causing the frame to become electrified in some cases and carry the potential for heat damage or fires.
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With this huge recall from Ford, one has to question if the company can handle the cost? With gas prices on the fritz and shooting up and down, people aren't looking to buy many trucks or SUVs. Even with the larger sedans, consumers are looking for one thing, cars that can save on gas. Is Ford's opportunity cost of still making this cars and sedans worth it? Can they keep up the high cost of maintaining their operations?
For years, many have been aware of the personal dangers of smoking. They have known that smoking can cause different types of cancer and can complicate other health problems. But what many have yet to realize is that their decision to smoke doesn’t just hurt them, but it hurts society.
In this article – published by HealthDay News – some of these costs and the approach that New Mexico is using to deal with these costs are discussed. The issue at hand is that second hand smoke does not just cause problems for people, it also causes environmental and wildlife concerns. And the main objective of New Mexico’s program is to send this message to children before they start to smoke.
The program involves taking injured birds (hawks, owls, falcons) to middle school classrooms once a week and showing the students the effects that human actions have had on the health of these animals. These birds suffer from a variety of problems caused by human action. One of the birds died of lung cancer; another suffers from birth defects believed to be caused by toxins, while a third bird suffers from a broken wing caused by the pesticide DDT. DDT causes a thinning of the bird’s egg shells and increased birth defects if not death.
The students learn about the lives of these animals and how their personal actions can lead to either make things better or worse for them. The program is hoping to connect with these students through the use of the birds; making them aware that there are other costs of smoking besides personal risk and the price of cigarettes.
Do you think this program will work? Should other states set up similar programs? Is there a more efficient way to go about decreasing the number of smokers in the United States?
Above figure shows the sources of sulfur dioxide emissions in the U.S. according to year 2002.How many times a day would you say you washed your hands? Do you use regular soap or anti-bacterial soap? Which do you think is better? Before reading an Article on ABCNews.com, I would have said that anti-bacterial soap is probably better. After all, one of the main reasons people wash their hands is to destroy bacteria; hopefully preventing illness in the process.
But according to a new study by the Alliance for Prudent Use of Antibiotics and the Nonprescription Drugs Advisory Committee, instead of preventing illnesses, the use of anti-bacterial soaps may be creating future strands of bacteria resistant to antibacterial remedies. By using this anti-bacterial soap you may be enabling the evolution of bacteria; making them less susceptible to human control.
So, what does this information do to the market for soap and the market for anti-bacterial soap? If consumers take these studies seriously, they will most likely switch from anti-bacterial soaps to regular soaps. The demand for anti-bacterial soaps will diminish (shift left) and the price will decrease. The opposite would happen in the market for regular soap. The demand would increase (shift right); causing the price to increase.
I do believe that society may have overdone it with cleaning by killing all bacteria. And I do believe that bacteria have the capability to evolve and cause problems for the human population. But what I don’t know is whether or not consumers will be willing to change their mindset that all bacteria is bad based on one study; especially since we really don’t know how valid this study is. Will the FDA get involved? What impact would it have if the FDA agreed/disagreed with this study? Would it change your opinions/mindset?
According to an article in USA Today, recent data has shown that 2004 has set a new record. Last year in the U.S., 1.5 million babies were born to non-married women. Unlike past years, these mothers are not teenagers; they are women in their twenties.
On the surface, this may not seem like an economic issue or even a problem. However, when many of these women earn low incomes and have low levels of education, this presents a problem for the children involved and society as a whole.
Due to their low income family, these children may be brought up in unhealthy environments. They may suffer from lack of health care or a weak education system. With their mother being the only person working to support them, these children may be emotionally affected by parental lack of involvement in their lives.
From society’s point of view, these families may be likely to look for government assistance – welfare. People’s tax dollars will be going to support these children.
Based on this information, do you think that it is in the best interest of society to try and lower the birth rate among unwed mothers? Or is it up to each individual? Obviously each individual situation will be different; but looking at this issue from an economic viewpoint, what is best? How can you quantify who will be a good parent?
From an article from the Associated Press:
WASHINGTON - Repairs to New Orleans’ levees may be insufficient to protect residents moving back to the devastated city if another hurricane comes before the tropical storm season ends this month, experts and engineers said Wednesday.
Dozens of breaches continue to mar the city’s levee system, including a large seep at the Industrial Canal last week, according to engineering experts who have examined the floodwalls.
Repairs have gotten better in recent days, the experts told a Senate panel investigating floodwall failures after Hurricane Katrina. But the initial rebuilding process was done with little or no engineering guidance and perhaps substandard materials, they said.
Should they stop letting people return? What are the standards exactly? Will this hurrican season wipe out Lousiana? How can they prepare? Is this going to effect our economy and gas prices even more? Is the effort of rebuilding going at it's full potential? I think the relief is going as well as it can. I think people are doing what they can, and trying to get their lives back together. It's just a matter of keeping them safe after the storm.
The 1995 Honda Civic topped the NICB list as the most stolen vehicle during 2004, according to the "Hot Wheels" study from the National Insurance Crime Bureau.
Cars being stolen, especially older models that are good on gas, may be the reason for this jump. Honda's are built to have excellent gas mileage, and with the gas prices soaring, its no wonder they are the choice of thieves. It's apparent even for thieves, the price of gas, can influence a theft of a old honda civic, over a new hummer.
We talked about the Hazardous Waste in ECON350 class.
"Household hazardous waste typically consists of cleaning products found in most homes as well as lawn and garden products, pesticides and herbicides, fuels and paints as well as batteries found in most garages"
There is a new announcement by the U.S. Environmental Protection Agency (EPA) that an estimated one million pounds of household hazardous waste has been collected in Louisiana in the aftermath of Hurricanes Katrina and Rita.
This collection milestone underscores our pledge to the people in the Gulf Coast region," said EPA Administrator Stephen L. Johnson. "EPA will continue its efforts to dispose of hazardous materials and protect public health."
In a recent episode of “60 Minutes” Prince Charles expressed his concern for the world and the effects of global warming. Global warming has been a topic of debate that has been around for a long time and only seems to get more and more attention as time goes on (and this is certain due to the recent airing of an episode of South Park in which Global Warming is a major theme). What is actually going on with the world in relation to global warming then? If so many are convinced that it is already upon us, yet other like our own president refuse to believe it, then where does the truth fit in. Even more of a pressing matter is whether or not merely trying to ease human consumption is such a problem. Whether or not global warming exists may be under debate, by undoubtedly the world only gets dirtier each year. When will there be too much? Hopefully there will eventually be an economically (because I have just as many money problems as the next guy) and environmentally(because c’mon, who doesn’t like trees let alone fresh air to breathe) sound course of action to be taken to improve the world.
Craig Venter, a world-renowned scientist is hoping to create a new form of energy created from new organisms. This new energy source will produce hydrogen for cars and will produce nonpolluting heating oil for homes. This new energy can also be used to provide power for any electrical device. The new organisms will be created from micro-organisms found in the ocean and from large mammals such as dogs. This could be a cure for the increasing energy crisis currently found by using fossil fuels for cars and electricity. What do you feel about this new idea for fuel? Is there any moral problem by using man-made organisms, or could this be the answer to the energy problem? Or could this just be a far out idea that will be way to costly to use as a viable form or power.
After Hurricane Katrina, people were concerned about all the toxic chemicals that could have gotten into the water. Researchers from Louisiana State University have found that there were higher levels of bacteria in the water, but the concentration of heavy metals and chemicals from gasoline was no worse than it would have been if there was a hard rain. There is still some concern about other dangerous substances such as sewers, gasoline stations, factories, dry cleaners, chemical plants, and oil refineries. It is still to early to give New Orleans a clean bill of health. The main concern now is that the mud, silt, and groundwater probably has some toxic materials still remaining in it. Possibly New Orleans will not be a total loss now that there is not as much contamination as what had been anticipated.
Have you ever wondered what happens to all the old computers, televisions, and other electronic devices that people get rid of? A new report says that the majority of this old equipment is being donated or sold to developing nations throughout the world. This may seem like the a nice thing for the United States to do; however, when 75% of the equipment is not useable, it just creats more problems for the developing nations. A typical computer monitor can contain up to eight pounds of lead, flame retardents, and cadmium. These are all very harmful to the environment. When the developing countries get these computers that do not work, they have to do something with them. These developing countries do not have the infastructure to properly recycle these electronics, so they end up in landfills polluting the groundwater and creating other unhealthy conditions. The United Nations is trying to enforce the Basel Convention treaty that limits the trade of hazardous waste, the United States has yet to sign this treaty. As of now, there have been 30 recycling companies in the United States that have agreed to not send anymore electronic waste to other countries. Is the United States trying to help these other countries or are we trying to get rid of our own waste so we will not have to deal with it anymore?
A new emphasis is being placed on “alternative” sources of energy. The reasons for this are many. Rising petroleum and natural gas prices as well as the limited nature of our current sources of energy are some of the most significant. A largely untapped and unlimited potential source of energy is wind. Over the last decade a few “wind farms” have popped up across the country, though total wind produced electricity only accounts for .5% of total energy. Even though wind is free, it is still often times cheaper to produce electricity from burning coal. Wind-energy advocators claim that the main reason for the delayed utilization of this source is underdeveloped federal legislation. Currently, the government provides a 1.9 cent-per-kilowatt-hour tax credit to new wind farms during the first 10 years of operation. Wind prospectors complain that longer-term government commitment is necessary in order to promote further utilization. This complaint raises an important environmental economic issue. To what extent should the government subsidize an infant energy industry that is currently more costly then existing sources of energy? Obviously, the fact the wind is unlimited and produces no pollutants must be seriously considered.
http://www.cnn.com/2005/US/11/07/energy.wind.reut/index.html
Due to the recent scare of bird flu travelers of all sorts are starting to rethink some of their flight plans. Bob Goldberg, an international lawyer, had his meeting relocated from Vietnam to Singapore. Vietnam had and outbreak of the bird flu. Even though the Center for Disease Control has not stated the disease to be an outbreak airlines are starting to feel the results. When SARS broke out in 2003, it cost the airlines $8 billion in just nine months. Obviously, SARS and the Bird Flu are not everywhere but how will the airlines handle this situation. Will they end as last year lose another $8 billion or will they lure customers in with low air fair.
The once tacky gift of giving money in a card is now coming back in its new form stronger as ever, gift cards. According to the National Retail Federation, gift cards racked in $20 billion dollars in 2004. This is a 36% increase from 2003. It’s expected to go up another 11% over the holiday season. SVS, one of the first companies to get invalid in the gift card business has grown from supplying gift cards to just 1,500 locations to over 75,000 locations nation wide. But this new craze is making retailers very weary. When their customers use gift cards they have to wait at least 30 days before they can receive the revenue. This is could push back some of the merchandise for the upcoming year. How will gift cards affect retailers? Do you think that it will affect them at all
In Britain, women are facing difficulties in receiving pensions as high as those of men. Two of the main reasons for this are lower wages and breaks in employment due to starting and raising families. Historically, women have been shown to have a dominant substitution effect, which in this case means they would work less because of lower compensation. If you analyze this trend, it is self-accelerating and could lead to lower and lower levels of female employment. From a policy-maker's standpoint, would it therefore be beneficial to implement some type of extra incentive for women with families to work? This is not necessarily during the time when the women would be having and raising small children, but perhaps a pumped up pension plan for women who re-enter the workforce after a family. What do you think of this type of policy?
A new savings account called the Roth 401(k) could be made available to employees of specific companies as early as next year. This new account gives people the opportunity to possibly pay less taxes in the long run.
This is how it works: workers pay tax on earnings before setting aside the money for retirement. In exchange, the money grows and can be withdrawn tax-free. It's modeled on the Roth individual retirement account, which works the same way.
It's the opposite of the 401(k) accounts currently used. Those let employees save and invest some of their salary before paying tax, but taxes come due when the money is withdrawn in retirement.
My question to you all is this: Will this cause an Income Effect or a Substitution Effect in regards to Labor Supply. If you look at this as an increase in wage, then the income effect would say that people would work less. The substitution effect says that as wages increase, hours worked increase due to increased opportunity costs. Which do you think will occur?
My gut says that the income effect will take over. If people can save more of their hard-earned money and pay less in taxes now rather than pay more in taxes later, then we will see people retiring earlier. What do you all think?
