Week 8
http://www.google.com/finance might be a good place to go for news about the economy. Please focus on items that have to do with the whole economy (not just one product) and on items that seem substantial (not cute or weird human interest stories).
http://www.bloomberg.com/news/2012-10-15/retail-sales-in-u-s-increased-more-than-forecast-in-september.html
ReplyDeleteThis article explores the recent 1.1 increase in US retail sales. This result contrasts the median forecast by economists, which called for a .8 percent rise. It is very likely that this increase in retail sales is a result of employment growth and higher home values. Additionally, as inflation in China has cooled in September and is now moving at a much slower pace; many economists believe that the greatest uncertainties are currently "related to the sovereign debt crisis in Europe and concerns about the pace of growth here at home." The greatest growth sales was in the automobile industry, with a whopping 1.3 percent. What would encourage retail sales to continue to grow? According to this article, the answer lies in continuing to promote a stronger labor market. Payrolls rose 114,000 in the month of September, after a 142,000 increase in August, according to the US Labor Department. These numbers have certainly reflected in the 1.9 percent increase in household purchases in the third quarter of 2012.
http://www.nytimes.com/2012/08/12/business/two-ways-to-see-chinas-problems-economic-view.html?_r=0&adxnnl=1&ref=economics&adxnnlx=1350342135-3ZvZx9JihoQDX0BcYlUpVA
ReplyDeleteThis article provides two distinct reasons to why China is in a financial crisis. First, China’s real estate bubble is deflating. China is especially suffering due to excess capacity. Which, simply means that there has been to much investment in capital goods. China's Government also invests approximately 40%-50% in these capital goods. However, they favorite certain companies and business. For example, Beijing is accused of manipulating the value of its currency to subsidize its manufacturing. Secondly, it is becoming harder to stimulate the Chinese economy effectively. China faces competition with other countries that have lower rates. China drastically needs to economically rebalance itself, and start to produce goods that can be domestically consumed.
The article that I read was about whether or not the United States’ economy will bounce back in 2013. The overall consensus of the article was that even though the housing market and the automobile industry is progressively getting stronger, the Government and the poor economies of China and Europe will significantly affect the United States’ economy’s recovery. It is agreed among economists of the National Association of Business Economics that the upcoming year will look very similar to this year, economically speaking. Unless Congress and the White House can agree on tax cuts and budgets, the United States is going to fall into a recession, and no one is going to want to take the blame for the recession. However, because China and Europe’s economies are unstable, investors of America are going to keep more investments and products stateside, therefore boosting GDP and the economy as a whole. The housing market and automobile industry are also predicted to have a nice upcoming year, but they will not drastically affect the economy. In conclusion, there is not much promise for the United States’ economy in 2013.
ReplyDeletehttp://www.csmonitor.com/Business/2012/1015/Will-US-economy-rebound-in-2013-Forecasters-say-not-much
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ReplyDeletehttp://www.cnbc.com/id/49410259
ReplyDeleteThis Monday, which is the hot-blooded trade day, show that the euro ended flat against the dollar. Lenders have been very discouraged to buy Euros this past week. It seems that Madrid will ask for financial aid. Because of this the Euro has been trapped in a very tight spot between (roughly) $ 1.28 and $ 1.31 since mid-September. Angela Merkel, a German Chancellor, agreed that there should not be any “uncontrollable developments” in the euro zone. The European Central Bank said that it would buy bonds of countries that concern for bailout. But for Spain this would not be good, since it would bring down the country’s borrowing cost and increase in investor hunger for risk.
http://www.forbes.com/sites/nathanvardi/2012/10/15/the-mexican-mircale/
ReplyDeleteThis week’s article was about Mexico’s miraculous economic recovery. Back in 2008 everything looked bleak for Mexico with the war that was being waged between the drug cartels and the Mexican government. Mexico fell into a very bad recession which looked as if they were no going to get out of any time soon. They miraculously recovered in 2012 despite the weak us economy and the ongoing drug war. The economic growth has been predicted to grow at a 5% in 2012 after GDP had grown at 3.9% and 5.5% in the past two years. Pemex, an oil company that is dominate in the Mexican economy, recently announced that they found oil in deep water in the Gulf of Mexico. This means that the economic growth will go up more. Mexico success can be noted by the people that are returning or staying in Mexico.
The euro ended “flat” today as countries in the euro zone await news on Spain’s predicted request for a bailout. If Spain does request a bailout, the European Central Bank is expected to “lower its cost of borrowing by buying its debt.” The uncertainty of when the bailout will be requested has trapped the euro in the range between $1.28 and $1.31 since the middle of September. The last time the euro ended flat, it came in at $1.2954, “recovering from a low of $1.2889 on reported buying by sovereign investors and companies.” The bailout could prove helpful for Spain, as its borrowing costs would decrease and investors would feel more inclined to make risks. Italy, however, is not looking forward to it, considering a 100 billion euro aid request Spain’s euro zone partners could cost Italy roughly 1.5 percent of its economic output.
ReplyDeletehttp://www.cnbc.com/id/49410259
http://temple-news.com/living/2010/09/27/exchange-rate-raises-cost-of-living-in-japan/
ReplyDeleteOn September 27, 2010, Lee Miller of the Temple News posted an article concerning the Japanese exchange rate. In this article he explains that the Japanese Yen's value has been increasing over time, making it more expensive to live in Japan. In 2010, the Yen reached a "fifteen year high versus the dollar, reaching 83 Yen per dollar in the midst of America’s recession." This is a 32 percent change in value of the Japanese dollar.Although Miller mainly focuses on the effect this will have on boarding students that wish to attend Temple college at Tokyo, he makes points that also show how this affected others moving into Japan and perhaps likely importers. The Japanese government soon recognizes the problems a strong yen causes for the Japanese economy.Miller explains "while a strong currency is good, Japan’s industry relies on exporting its products to the world and building a strong tourist economy." It was then that the Japanese government decided to have the central bank of Japan begin selling yen and buying U.S. dollars in order to weaken the yen. So far, the decline has been stopped, with the yen shortly falling to nearly 86 yen to a dollar. He concludes that even though this is working out for now, it will take a very long time until Japan will be able to recover and become as "affordable" as it once was.
http://thehill.com/blogs/hillicon-valley/technology/261863-us-ambassador-warns-internet-fee-proposal-gaining-momentum-abroad
ReplyDeleteThe article I chose to write on addresses a bill that is currently being proposed by the United Nations. The bill presents the idea of an international tax on internet use. The purpose behind the bill is to tax all internet use (Google, Facebook, and YouTube just to point out some of the most significant names) help poorer countries who lack proper online security against viruses and hackers increased their online defenses and progress forward in the multimedia world. The problem here is that the country that would end up paying the vast majority of these taxes is the United States, given how much we dominate the global use of the Web. The bill is being opposed by the U.S. ambassador, but he has been quoted in saying that America is for funding to help these countries up their internet defense systems, just not for America paying for the majority of an international tax.
http://www.businessweek.com/news/2012-10-15/canadian-dollar-rises-on-slowing-chinese-inflation-before-data
ReplyDeleteMark Carney, Bank of Canada Governor, is doing little to adjust Canadian currency as global economy slows. He is unlikely to raise interest in the short term. The loonie (nickname for Canadian dollar) is worth 1.0197 as of right now. It grew to .3% on the US dollar. Demand around the globe is being condensed due to the instability in organizations such as the Eurozone. Earlier, the Canadian currency fell as an economic recession hit. Carney is thinking that it might be appropriate to have a tighter policy with currency. Rate cuts, however still remain low probabilities. Canada’s key interest rate has now been at 1 percent for two years straight, the longest pause since the 1950s.
Mexico is accusing china of breaking the World Trade rules, by giving tax breaks to their own businesses. This was Mexico’s fourth WTO complaint against China, who is a large competitor in the clothing and textiles. China’s failure to disclose to the WTO has been the subject of strong criticism, especially from the United States. This is giving china an unfair advantage, over their competitors like Mexico, and is seriously damaging the Mexican industry. When just last December Mexico and China signed off on a series a trade agreement so that the Mexico’s economy would not be destroyed by Chinas cheap imports.
ReplyDeletehttp://www.euronews.com/newswires/1692568-mexico-challenges-chinese-textile-clothing-support/
http://www.huffingtonpost.com/2012/10/15/nobel-prize-economics-2012-alvin-roth-lloyd-shapley_n_1966350.html
ReplyDeleteNobel Prize For Economics 2012: Alvin Roth And Lloyd Shapley Of United States Win 2012 Prize
This article discusses the winners for the 2012 Noble Prize in Economics. This award was not an original noble prize, and is now given by The Royal Swedish Academy of Sciences. Alvin Roth and Lloyd Shapley, U.S. Economists, won! They were officially awarded this prize for, "The theory of stable allocations and the practice of market design". Or, in regular words, for their research on methods of combining different economic agents. For example, matching a worker to a workplace(In this article examples of matching a student to a school, or a donor to a patient are used). This award is highly disputed, just as economics is. Instead of awarding one person for concrete evidence, or a discovery, they are awarded for a viewpoint or idea, which creates a unique controversy. This article and video, particularly slams republicans for their ideas about how to improve the economy.
http://www.marketwatch.com/story/softbank-shares-bounce-back-2012-10-15?link=MW_latest_news
ReplyDeleteIn the article that I read it said that shares in Softbank Corp (Tokyo) bounced back after a very sharp fall early on Tuesday, following the company’s official announcement that it will buy 70% stake in U.S. mobile carrier Sprint Nextel Corp. Softbank’s shares had suffered heavy selling in the two prior sessions after news that the Japanese cellphone and internet provider was in advanced talks to buy a very good portion of Sprint. Softbank's heavy weighting helped push the Nikkei less than 8500 on Monday for the first time since July 26. "Now that the deal is official, some share buyback momentum is likely," said a senior strategist at a Japanese brokerage.
dog i was just about to do this one lol mine was http://www.foxbusiness.com/news/2012/10/15/japan-softbank-snaps-up-sprint-in-20-billion-deal/
Deletehttp://economix.blogs.nytimes.com/2012/10/15/fed-official-says-monetary-steps-were-too-timid/
ReplyDeleteOfficials of the Federal Reserve claim that the actions of the Federal Monetary were not strong enough. The reasons, according to the president of the Federal Reserve Bank of New York, being five-fold: weakness, left over mortgage debt, economic problems in Europe, the aging of the American population, and shortcomings of fiscal policy makers.
This statement is meant to be an explanation for why the Fed has recently decided to "expand its efforts".
Although things tend to be looking up (the unemployment rate falling to 7.8), the members of the Federal Reserve are refraining from rejoicing at this point. They will continue with policies the way they are until a definite stability is made evident.
http://smallbusiness.foxbusiness.com/finance-accounting/2012/10/15/one-year-later-checking-in-on-small-business-lending-fund/
ReplyDeleteIf you have a small business, you should be able to borrow money because of the Small Business Lending Fund which was implemented in 2010 by Obama. Yet, the banks are sitting on this money and claim that there are no credit-worthy applicants for loans.
This fund was meant for banks to increase lending to small business so that new jobs could be created. But, because of the economy and worries about regulation, businesses are hesitant to borrow.