Charles Edison

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

Thursday, September 29, 2011

Halloween Horror

How much longer will people waste money going to Haunted Houses during October at theme parks? Probably never since it is becoming so much like Christmas, Valentine's Day, and the Super Bowl in terms of supply. Just like on these days businesses take advantage of the people by stocking up on their goods, by raising their prices and by starting to advertise the day, Halloween, when it's over a month away. This article exemplifies how theme parks are already opening up their Halloween attractions to reel in some extra money and it is still September. Pretty soon they will be open in August similar to how Christmas music starts playing in November and sometimes sooner. The whole year will be one big marketed holiday, so that people can justify raising their prices and increasing their supply, but would this be a bad thing since spending does drive the economy? I really don't know but it is something to think about.

In this article it is $42 just to walk around and be scared for thirty minutes or so, that is just a bit ridiculous. But not to the companies hosting the event because they're getting a nice return in taking advantage of people. Overall businesses are increasing their supply in goods from about September or August till the end of the year and raising their prices, knowing that it is that time of the year when people spend their money most.

Wednesday, September 28, 2011

World's Most-Visited Tourist Attractions

United States of America has many popular places tourists love to visit. Those most-visited place for the tourists are having local economy support by huge money from the tourists. When local economy is wealthy, it will give more taxes to the government which can help the whole country. Tourists from another country bringing their money into U.S. which is adding more money into the U.S. economy cycle. Government wants the money from outside of country so the money is not only spending in United States, but also the money is from other country. Most people like to be tourists when they are on vocation, which means they have extra money to spend on and will be spending it in the trip. Vocation could be luxury and the costs of one vocation to those place typically are high. Spending money is the force of the economy. Tourists will want to enjoy their vocations so they spend money, it pushes the economy of the place. And because those places are popular and most-visited by the tourists, more people will want to travel there and spend some money at the place.

Tuesday, September 27, 2011

Housing Market Predictions

In a Fox Business article Thursday January 6, 2011, two top real estate experts gave a forecast of the real estate market for the years to come. One expert predicted not much help will come to the housing market until unemployment is solved. Another believed the market would increase slightly as the economy recovers but nothing too substantial. Many believed the housing market will recover though the time it will take is uncertain. There is a surplus of homes in some areas leading to the possibility of recovery but people have yet to buy them. People are afraid of the dropping prices affecting their purchase of their home. Overall the analysts believe the solution is lower mortgage rates and no foreclosure to help stimulate the housing market. Right now only select portions of the market are doing decent. The rest of the market is being killed by consumer fear and economic downturn. The housing market appears to have more of the same in its future but there is still a light at the end of the tunnel.

Monday, September 26, 2011

Gas Prices are Down, Finally

With economy still in a slump and 9.1% of America unemployed, it's good to see at least one issue has seen improvement. Gas prices have lowered to under three dollars a gallon in parts of Texas, Michigan, and Missouri. In Bridge City, Texas, the price of gas was only $2.62 a gallon. Some analysts believe it might reach as low as $2.50 a gallon in some places by Thanksgiving. Some economists are saying that it is to stimulate the economy. More people will decide to go the movies, or eat out, or go shopping. Also it might just drive down the prices of other things too as the price to transport it from Point A to Point B will be lower.

Thursday, September 22, 2011

Injury Plagued New York Giants

The New York Giants's 2011 season is already looking grim in just the third week of the season. The Giants have suffered injuries to ten players already and most of them season ending. Specialization of labor has back fired on the Giants as they have decent receivers and line backers, but they are hurt with no one of equal value to take there job. The NFL is pretty much the definition of specialization of labor as most guys play just one position, but right now for the Giants it would be helpful if the league was not so specialized. Then they could just move someone from another position to fill in, but since players are not acquainted to playing multiple positions at the pro level it would be a inefficient to the team. So instead of being able to move veterans around to help the team contend, they just put rookies out there in the game to fill the spots and hope for the best. Although this specialization of labor keeps a level of demand in the league for backups and rookies. For example since the Giants have multiple injuries they now have a larger demand for players to come and fill that spot. Therefore sports in a way goes against the Law of Demand in that as the injuries become more costly the demand increases. Overall I think economic principles are a bit different when referring to football or just sports in general.

Wednesday, September 21, 2011

Thousands march against nuclear power in Tokyo

Using nuclear power can provide enough electricity for the whole country but the safety issues of the reactor are considered. After 311 the Japan Fukushima nuclear reactor melt down disaster, many country starting to realize its dangerous and the cost of recover could be. Because of the radiation leak, any item could be infect by the radiation in Japan can’t be sold which is lots of area and costing the economy be tough on people. Now, the Japanese wants to use natural energy resource which won’t cost the damage like nuclear reactor did. But for poor natural resource country like Japan would need to find another way to replace the amount of nuclear electricity which isn’t invented yet. The shortage of electricity costing the sacristy, electricity price won’t necessary go up alot, but the demand would still be the same.When there are not enough electricity for the country, Japan government will have the cut down the power for certain area. Also, for those were evacuated for the radiation around the reactor would have to find a second home for them to stay until the area is clear which will take a lots of time. Lands in Japan are limited, it can be use up as much as it can because Japan is one of the best technology in the world. When lands can’t produce anything to sell or be bought, the land lose it value and cost economy to go down. Because of radiation effect too much in Japan, the protesters of nuclear power in Japan are getting more and more.

Tuesday, September 20, 2011

Chief Economist of European Central Bank Resigns

Juergan Stark, the chief economist of the ECB, resigned on friday, September 9, 2011 over his opposition to the ECBs bond buying program. Apparently Stark opposed the purchasing of many government bonds from ailing economic european countries. He believed it jeopardized the independence of the bank. He did not want the politics of Europe mixing with economics; he believed these decisions would cause a command economic system. Also he feared for the stability of the euro. He believed these purchases would inflate the currency and cause further economic strife. This sudden resignation is yet another blow to the Christian Democratic Union(CDU). This will make the second instance of a prominent economist abandoning their approach to saving the euro. This resignation is a great loss to all European economists. Read more here.

Monday, September 19, 2011

The "Buffett Tax"

Earlier this year, billionaire Warren Buffet stated that many billionaires like himself actually paid less in taxes than many of his employees due to loopholes in the system. On Monday, Obama is expected to officially announce the 'Buffett tax" on millionaires. It would raise taxes on people who make over $1 million a year. The new set of taxes would be part of the plan to save $3 trillion over the next 10 years. Although it sounds like a good plan (at least to me), other than helping out the debt, Obama is suspected of having an ulterior motive. Some suspect the only reason this move is being done is because it would garner more voters for the 2012 election. I believe this is long overdue, although I'm not the biggest fan of his ulterior motive.

Thursday, September 15, 2011

Obesity on the Rise

According to the article below, half of the U.S. will be obese by 2030. The stated solution is to have the government market healthier foods more aggressively and to educate the people more on how to eat. But in our mixed economic system it is difficult for the government to step in and play down foods like McDonald's, Pizza Hut, and Taco Bell when they are at such a high demand. People like to eat good tasting, cheap food, but right now in America the healthier foods have to go through a more rigorous test to get put out on shelves at stores and therefore raising the price of this good. Since healthier foods are not a necessity to Americans they are an elastic good, which also means that the rise of price for these healthier foods will cause the quantity demanded to decrease according to the Law of Demand. So basically the solution is to raise the demand for the goods by lowering the price for the public and marketing the healthier products more to make them more desired. This is just an economic solution to obesity, but it is largely based off of individual's decisions. For example it is very difficult for a person after they just ate three grilled stuffed burritos from Taco Bell for $5, to give that up the next meal and eat a healthier food that cost twice that of Taco Bell. Healthy eating is a habit that must be perfected day by day, it's not always the most enjoyable activity. But more aggressive marketing and the lowering of prices on these healthy foods could lead many Americans to be more willing of eating healthy.

Wednesday, September 14, 2011

Record number of Americans living in poverty

When the economic in a country or a society goes down, the unemployment tends to go up and more people lives in poverty. It happens because there are no jobs available for the people and daily supply or inelastic demand value increased from the previous year. An inelastic demand like gasoline has never been stop using and the value increased throughout last year. There were 46.2 million Americans lived in poverty last year which is the highest since it started record. The unemployment percentage rate has been increasing for four straight years. Because adults are living in poverty, the children from the family are also living in poverty which was more than a fifth for last year. Income of the individual person or family is one consider of being poor and be able support himself. Government has been trying to cut off the tax from the people and they have the money to put into the society and increase the demand. Tax cut makes people have more money to spend on whatever they need or want; it helps the economic when they do spend it. Because it’s not always the case that people would spent the money they saved from tax, but people do spend their money if they have jobs. Government would need to have a stronger unemployment insurance system to avoid people losing their job and live in poverty.

Tuesday, September 13, 2011

Back to the Future Nikes auctioned for charity

Last week Nike began auctioning off their special edition back to the future nikes on ebay. As seen in the Back to the Future part two; these shoes have LED lights through out the sole, heel , and instep. Their official name is nike MAGs and they will be auctioned off on ebay everyday through september eighteenth. The bidding starts at only $0.99 but if you check here the bids are rapidly increasing. All proceeds go to the Michael J. Fox Foundation to help those with Parkinsons Disease. Nike has seemingly engineered this event perfectly. Nike is a signature brand heightening the paradox of value in their favor. Also heving only made 1,500 pairs Nike has added scarcity to the equation; further heightening the value of the shoes. Lastly they made the event an auction which allows Adam Smiths theory of competition to further heighten the bidding. So far this event has been a huge success and there is still plenty of time.

Monday, September 12, 2011

Apple vs. Samsung

Three days ago, Germany's Dusseldorf Court announced it's decision on whether the Samsung Galaxy Tab 10.1 should be banned in Germany. The tablet was banned because Presiding Judge Johanna Brueckner-Hofmann believed that "Apple’s minimalistic design isn’t the only technical solution to make a tablet computer, other designs are possible". The verdict surprised many, as what Apple wanted seemed quite severe. This verdict could possibly spread to other countries in the European Union, not just for the Galaxy Tab 10.1 but maybe all other tablets that use to the same basic design. This would give Apple a monopoly in one of the biggest tablet markets in the world.

Thursday, September 8, 2011

20-Foot Crocs are Just Tradition

The Manila region of the southern Philippines is home to some of the largest saltwater crocodiles on the planet. This past week a 20-foot, 2,370 pound crocodile was captured out of the fear from a local village. Crocodile hunting is a big role in this traditional system as the hunters laid their traps, caught the croc, and then transported back to the village. A classic example of hunting and gathering that has been taught down through the generations in this Filipino village. Although today these crocodiles are on the endangered species list and are not allowed to be hunted without permission for reasons such as fear or humans getting eaten. This is strange to think that crocodiles have so much power and force in this part of the world because in the U.S.'s mixed economic system either the government or the people out of competition would have devised some way of ultimately controlling these crocodiles.

The demand for one of these crocodiles is most likely very high in this Filipino village because of how much meat the crocodile produces. As the Filipino village mayor said the whole town showed up like it was a 'feast'. Also producing such large findings of these crocodiles may attract people to come to the Filipino village. The more people coming to the village, the more money is coming to the village, and one day maybe advancing the Filipino village into a more complex economic system.

Tuesday, September 6, 2011

Wildfires sweep across Texas

There were more than 70 days of 100 plus degrees in Texas over the summer, and only few of rain dropped during those days. Because of the extreme weathers, wildfires happened many time in Texas and it has destroyed over 1000 homes and four people were killed from the fire. The worst of the fires is at Bastrop County Complex fire, already destroyed 550 homes and other properties, 5,000 people evacuate from their house. Everything they lost in the fire need to be rebuild by the owners or find other place to live which would cost a lots of money for both victims from the fire and the state government. Days when there are no rain also meant the water supply on the daily bases is decreasing day by day, and the value of water would go up. Everyone will buy the water from the store if the water supply to the house is cut off which will let the price of water go up. If there are no enough water for the people, the local government will have the limit the water supply so everyone could have limited of water. More than 3.6 million acres were burn down by the wildfires in Texas and cost over 5 billion damage to the state’s agricultural industry. Rains can bring the water for the people and plants and also help to put down the wildfire which haven’t happen in Texas. The wildfire has not only destroy the house but also the livestock of the people and killing people and costing billion of money from the governement.

Monday, September 5, 2011

Nike Air Force 1

Nike is one of the few companies to ever not have their finances go into the red. They changed their name to Nike from Blue Ribbon Sports in 1978. Four years later, Bruce Kilgore designed the Nike Air Force 1, the first basketball shoe to ever feature air technology in it's sole. This one shoe (offered in three different stylings: high, mid, low), along with Air Jordan series, and the Nike Air Max line are the biggest reasons of why Nike's finances have never gone in the red. The AF1 was released with no advertising and was initially seen as a failure, it was only produced for a couple of months. In the late 1980's and early 1990's the shoe was rereleased, around the same time that Air Maxes and Air Jordans were at their peak. In the 29 years since the shoe was originally released it has raked in over a billion dollars for Nike and in 2005 it was estimated to have a profit margin of 70%. Not only that but the Nike hasn't spent a single cent on advertising the AF1. The Nike Air Force 1 is still being produced and worn today. It's regarded as one of the most significant shoes in sneaker culture.

Example of Our Economic System

An article in the Fort Worth Star Telegram had an example of our economic system in action. Our mixed economic system borrows many ideas from the market economic system. The difference between systems being that monopolies are illegal and that the government can intervene if deemed necessary in a mixed system. In Fort Worth a hotdog vendor was accused of having a virtual monopoly; owning the rights to 5 locations. She mainly used only 2 locations; the others were only profitable during certain circumstances such as events. The local government intervened and forced the auction of 3 locations. However the vendor was already on the decline. This auction was the final blow in the vendors business and she was forced to close. The mixed side of our economic system crippled her business and its market roots offered no assistance in her closing. Though rather depressing this is still a good example of our economic system.

Friday, September 2, 2011

Lasers Used to Control Rain

Scientists in Geneva experimented with infrared lasers over the Rhone River, and discovered that the beams could trigger the growth of micron sized water droplets that eventually could turn to rain. Though if too many droplets form in can be ineffective because then no actual rain drops would form because all the moisture in the air would be used up through the micro droplets. The use of infrared lasers to produce more rain would be a huge technological advancement in the United States. For example if the U.S. was producing at maximum efficiency in agricultural output we could use these lasers to bring more rain to the dryer regions throughout the South West or even in the Mid West. Therefore increasing our agricultural mass production through technological advancements. Also these infrared lasers are predicted to bring on competition between different regions because of the ability to steal the moisture out of the air, and thus not allowing the natural cycle of moisture to take place in the next region. This could be good and bad for the U.S.'s mixed market as it can bring on more competition, but it could be more hurtful than helpful to the current system if abused. These infrared lasers are ground-based systems allowing less costly use, and easier use. This could be helpful to a region by increasing its efficiency while still keeping costs down. Overall these rain-making infrared lasers could be a tool of economic utility anywhere in the world.