Charles Edison

"Economics, politics, and personalities are often inseparable." - Charles Edison

Monday, January 31, 2011

Nashville Flood

The article by CNN talks about the Nashville flood last May. It tells how there was an error in communication about how serious the flood will be and explains it in detail. The most important part of this article economically was "more than $2 billion in damages,". This mistake by the National Weather Service and dam operators would us all. Although charity organizations will help the majority of the money will come from state and federal taxes. This will cause a raise in taxes which will take money out of Americans pockets. This hurts the overall economy because there will be less money being put into it. Realistically this flood probably had a small impact on the US economy if it had happened in a much larger place it would have a much greater impact.

Wednesday, January 26, 2011

Social Security Failing to Help Seniors

An article in Daily Finance discusses how senior citizens are struggling because the prices of commodities (particularly corn, cotton, wheat, and gas) are rising, but they aren't seeing any increase in Social Security payments. This is because when the Social Security Administration determines how much the seniors will get, rises in prices in unpredictable products like food and energy often aren't taken into consideration.
As the Law of Demand predicts, since the prices of the commodities are rising, the demand for these products is decreasing. The seniors need these products, but some of them simply can't afford to buy them. Fortunately for them, President Obama expressed a desire to make Medicare and Social Security a priority in government spending in the State of the Union address last night. Hopefully if more money can be given to the seniors, that change in income will allow them to demand more of the products that they need most. If not, some seniors may have to go back to work in order to pay their bills. If they aren't able to, the economy will only suffer more. It's not only the elderly that can't pay their bills. Another article states that adults between 30 and 49 are the largest burden on the economy because they have more obligations than people older and younger than them. To have even more elderly and disabled people added to that burden could do a lot of damage. The bottom line is, something needs to change in order to keep the economy from falling farther into disarray.

Thursday, January 20, 2011

First Lady and Wal-Mart partner on a healthy foods program

This article talks about how Michelle Obama is working with Wal-Mart to provide it's customers with healthier foods. She wants Wal-Mart to try and sell less foods with sugar, sodium, and trans. fats. Also, opening more stores in urban areas like New York City rather than rural areas. Since Wal-Mart has the support and publicity of Michelle Obama, then maybe the store in NYC will be a success and it will multiply within each city. As Wal-Mart becomes more popular the more stores and quantity are demanded and so the prices will decrease. The healthy living aspect will also draw customers in to buying more products from Wal-Mart, since many people these days are focused on healthy living and eating smarter. This will also cause an increase in Wal-Mart customers. Wal-Mart has also emerged in carbon reduction and improving fuel efficiency to its supply trucks and eventually produce no waste at all. Some environmentally conscious people will like that new aspect of Wal-Mart and start shopping there as an effect. This will help the money production for Wal-Mart and customer satisfaction.

Wednesday, January 19, 2011

Wells Fargo Meets Expectations of Increased Profit

An article in Daily Finance discusses Wells Fargo's increase in earnings and paid back loans. It received a bailout from the government during the financial crisis and was able to pay all of it back, plus increase its overall performance. This showcases the benefits of the mixed economic system the U.S. uses. To review, a mixed economic system is one in which the economy is driven by competition and self interest, but government intervention (for things like bailout money and health care) are allowed. Without government help, Wells Fargo may not have been able to make so much progress. Granted, not all businesses bailed out by the government were so fortunate, but Wells Fargo is a great example of those who were. If it was left to fend for itself, the country could have seen the loss of one of its major banks, and some very unhappy people as a result. Government aid in the financial crisis not only helped out businesses, but also the people who lost their jobs as a result of the bad economy. Without at least a little help from the government, the United States would probably be in much worse shape than it is now. Too much intervention, like in a command system, isn't ideal either, but a market economy has no government influence at all. The Unites States' mixed economy is a happy medium that allows for a lot of growth, but also for recovery when that growth declines or stops altogether.

Tuesday, January 18, 2011

How Will Apple Do Without Steve Jobs

In an article by USA Today it stated that CEO Steve Jobs will be taking a medical leave from the Apple company. The article focuses on stock but what it really is focusing on is how this will affect the company financially as a whole. The article explains how Jobs was able to help apple when they were struggling to stay alive to one of the most successful electronic companies in America. The question becomes without Steve jobs will Apple still be able to make products that are superior in quality of all other competition. If so the company will be fine and its stock value will stay steady. But if Apple is not able to produce this quality product (which many predict they can't) we will see the Apple stock decrease long term. And this loss of money will be reflected with and upward rise in competing companies.

Thursday, January 13, 2011

Gas prices are raised as price of oil climbs,0,7096207.story

This article shows that as the price of oil increases so does the gasoline we buy to fuel our cars to go to work, school, grocery store, and other places we need to be. The predicted price of gasoline for 2011 is 100$ a barrel. This is very high compared to last year, but in 2008 we hit $100.64. The price of gas prices per barrel will most likely hit 100$, but not any more than that. If it does go higher, then the consumers will cut back on buying gasoline which will make the prices drop back down some. This rise in gasoline and oil prices may be an effect of our economic recession and scarce resources. The more consumer demand of oil to make gas, the more the workers have to get the oil then refine it to produce gas. There isn't an infinite amount of it just to waste, like the oil spill in the Gulf of Mexico recently. That's most likely why prices have raised and will raise even more throughout this year, to make some people cut back on driving because it is a scarce resource. Also it may make people save money in the long run, because most people try to find many ways to save money these days no matter if it is two cents or $20.

Wednesday, January 12, 2011

Falsified Study Leads To Possible Financial Trouble

A report in Daily Finance discussed the recent revelation that a 1998 study conducted by Dr. Andrew Wakefield is fraudulent. His study concluded that some development of autism is linked to vaccinations for common childhood diseases. The article discusses the impacts the discovery of this lie will have on scientific research, but it has also had a significant financial impact. That aspect is further discussed in this article.

Unfortunately, this act of deception has cast a financial burden on a lot of families. A vaccination is normally far less expensive than the cost of treatment for a disease, especially if the disease is serious. A lot of parents chose to forgo the vaccine. They saved money in the short term and believed that they were actually helping their children, with an opportunity cost of a chance of avoiding other diseases for their child. Now they're finding out that they misinterpreted the value of avoiding the vaccines, and now their children may have to suffer for it.

Dr. Wakefield's study definitely affected research at the time of its publication as well. If the public thought that vaccines were causing a serious disorder, support for funding for vaccine developers was probably cut. On the other hand, if they thought that they could no longer rely on vaccines to prevent diseases such as the measles, more money may have been put into finding an alternative method of prevention.
The discovery that Wakefield's study was a lie has an impact on a lot more research than just disease control because it discredited scientific discovery as a whole. It has made the people more wary of scientific publications and developments, especially if they're groundbreaking. If people don't trust scientists, they won't give them funding. If scientists don't have as many resources, they can't work at maximum efficiency, and lack of efficiency means a lack of production of results.

Verizon and The Iphone

On february 10, 2011 the Apple Iphone will be available for Verizon customers. This is huge in the cellular industry because previously the Iphone was only available on the AT&T network. This will change the amount of profit AT&T will recieve. They wont be recieving as many customers from other cellular network companies since they aren't the only company to be offering the Iphone.
Verizon signed the contract with Apple January 11, 2011. This could dramatically increase profit because the Iphone is such a popular phone. It was also a smart descion made by Apple to offer a contract with Verizon. Now Apple has the possiblity of drastically improving sales. This is possible because they arent' limited to just one network company anymore. They have opened another door that was previously closed in the Iphone section of Apple.

The Cleveland Cavaliers Need To Blow Up Their Team Right Now

This Post explains how the cavaliers are in an economic slump. Although it talks mostly about the teams troubles we must understand that this directly affects attendance, and attendance is how these teams are able to make money. The factor that triggered this economic slump for the cavaliers was losing their star play and one of the best players in the league, LeBron James. The fact was that Players this talented are a scarcity, and in order for this team to appeal to a player they must be better than the competition in the areas that matter to that player. Although Cleveland embraced LeBron because he was one of their own, this was not important to him. What was important to him was the talent of his supporting cast and the Cavs did not have the supporting cast that another team would offer.