Greece has been worried about how they are going to finance their debts. Therefore, Greece has been trying to rebuild its economy to pay off creditors. Creditors are pushing for more privatization. Greece's energy minister does not want privatization in energy, which includes, public gas, state controlled electricity, oil and the power grid. However, stakes in these companies had already been promised to private bidders. “The Greek economic plan approved by eurozone finance ministers…promised not to roll back any privatization project already in the works.”
Saturday, February 28, 2015
Thursday, February 26, 2015
Net neutrality becomes the law of the land
Article: http://www.zdnet.com/article/net-neutrality-becomes-the-law-of-the-land/
According to the article, the Federal Communications Commission's board of commissioners today voted 3-2 on party lines to accept a recommendation from its Democratic chair, Tom Wheeler, to "use its Title II authority to implement and enforce open Internet protections" (to protect net neutrality through regulation). Net neutrality in the U.S. case here seen means that ISPs are treated as common carriers and public utilities, and cannot prejudice or reduce the speed of the delivery of certain content based on payment or non-payment of the content provider. Critics of net neutrality argue that large content providers, like Netflix and Google, need to pay for delivery of their content due to the massive strains they place on network infrastructure. Pro-neutrality campaigners argue that eliminating net neutrality would create a closed internet against its original purpose, with content censored or determined by content providers and microtransactions for content becoming commonplace, and creating a system where an unfair double payment is in effect required for accessing the internet. The three fundamentals of the proposal approved today include provisions that prevent ISPs from blocking access to content or services that are not harmful or illegal, impairing or degrading Internet traffic on a content basis, or favoring some traffic over others, including their own.
The move by the F.C.C. comes after a great amount of public and lobby pressure on both sides of the issue, with major figures like Google, Verizon, and Tim Berners-Lee testifying to the F.C.C. over the matter. Ultimately, this move, I believe, will enable the United States to continue to be competitive in digital innovation by classifying broadband as a public utility. ISPs already have an effective duopoly over the Internet at present (namely, AT&T and Verizon), and multiple state-level conflicts are open regarding their pricing and service practices. In such a high-barrier market (to the point where even high-capitalization Google has only limited in-roads despite intense demand for fiber connections due to cost prohibitions), protective regulation is critical of something as vital to the economy as the Internet. The F.C.C. regulation to enforce the open internet will enable small firms to continue innovating without paying content delivery fees beyond the extensive current costs of infrastructure and development, enabling the U.S. to remain competitive with technological developments against competitors abroad, as well as enabling the free flow of information from party to party through preventing its inhibition by ISPs, protecting more perfect information for markets and free expression.
According to the article, the Federal Communications Commission's board of commissioners today voted 3-2 on party lines to accept a recommendation from its Democratic chair, Tom Wheeler, to "use its Title II authority to implement and enforce open Internet protections" (to protect net neutrality through regulation). Net neutrality in the U.S. case here seen means that ISPs are treated as common carriers and public utilities, and cannot prejudice or reduce the speed of the delivery of certain content based on payment or non-payment of the content provider. Critics of net neutrality argue that large content providers, like Netflix and Google, need to pay for delivery of their content due to the massive strains they place on network infrastructure. Pro-neutrality campaigners argue that eliminating net neutrality would create a closed internet against its original purpose, with content censored or determined by content providers and microtransactions for content becoming commonplace, and creating a system where an unfair double payment is in effect required for accessing the internet. The three fundamentals of the proposal approved today include provisions that prevent ISPs from blocking access to content or services that are not harmful or illegal, impairing or degrading Internet traffic on a content basis, or favoring some traffic over others, including their own.
The move by the F.C.C. comes after a great amount of public and lobby pressure on both sides of the issue, with major figures like Google, Verizon, and Tim Berners-Lee testifying to the F.C.C. over the matter. Ultimately, this move, I believe, will enable the United States to continue to be competitive in digital innovation by classifying broadband as a public utility. ISPs already have an effective duopoly over the Internet at present (namely, AT&T and Verizon), and multiple state-level conflicts are open regarding their pricing and service practices. In such a high-barrier market (to the point where even high-capitalization Google has only limited in-roads despite intense demand for fiber connections due to cost prohibitions), protective regulation is critical of something as vital to the economy as the Internet. The F.C.C. regulation to enforce the open internet will enable small firms to continue innovating without paying content delivery fees beyond the extensive current costs of infrastructure and development, enabling the U.S. to remain competitive with technological developments against competitors abroad, as well as enabling the free flow of information from party to party through preventing its inhibition by ISPs, protecting more perfect information for markets and free expression.
Monday, February 23, 2015
Honda, Grappling with with Quality Problems, Will Replace Its President
Honda, Grappling with with Quality Problems, Will Replace Its President
http://www.nytimes.com/2015/02/24/business/international/honda-replace-president-chief-executive-takanobu-ito.html?src=mv&_r=0
Honda Motor issued a statement on Monday stating that it was replacing its president and chief executive, Takanobu Ito. This might be a sign that the Japanese automaker is trying to fix a lot of its recent quality problems. Honda has faced with a lot safety issues and delays recently especially the issue with their faulty airbags. Most of these problems have been attributed to Mr. Ito's and his team's faulty management.Mr. Ito in a statement mention that it was his decision to step down, claiming “At a time of rapid change and increasingly harsh global competition, I thought it was a good opportunity to bring in young energy to lead Honda,” .
Sunday, February 22, 2015
US job growth hasn't been this strong relative to demographics since the 1950s
http://www.businessinsider.com/us-job-growth-versus-labor-force-growth-2015-2
In the article by Sam Ro, we still see some questions that remain about the health of the labor market as the labor force participation rate remains low and wage growth remains tepid. The underlying job market is much stronger than what most people give it credit for. Jim O'Sullivan of High Frequency Economics relates job growth to the growth of the potential labor force. Labor force participation rate is up 0.9% in the past 12 months. The unadjusted series is up 1.1%. Payrolls are up 2.3% in the past 12 months - 260k per month. A 2% plus pace for employment is far from booming by past standards, but it is exceptionally strong after allowing for demographic trends. The CBO's estimated potential labor force series, used for potential growth calculations, rose just 0.5% in 2014. The roughly four-to-one between payrolls growth and potential labor force growth in 2014 was stronger than in any year since the 1950s. An economy that's creating more jobs than there are people coming into the labor force means that there may be more better opportunities for those who already have jobs. In all the United States labor force market is the strongest it has been since the 1950s, but will this last?
In the article by Sam Ro, we still see some questions that remain about the health of the labor market as the labor force participation rate remains low and wage growth remains tepid. The underlying job market is much stronger than what most people give it credit for. Jim O'Sullivan of High Frequency Economics relates job growth to the growth of the potential labor force. Labor force participation rate is up 0.9% in the past 12 months. The unadjusted series is up 1.1%. Payrolls are up 2.3% in the past 12 months - 260k per month. A 2% plus pace for employment is far from booming by past standards, but it is exceptionally strong after allowing for demographic trends. The CBO's estimated potential labor force series, used for potential growth calculations, rose just 0.5% in 2014. The roughly four-to-one between payrolls growth and potential labor force growth in 2014 was stronger than in any year since the 1950s. An economy that's creating more jobs than there are people coming into the labor force means that there may be more better opportunities for those who already have jobs. In all the United States labor force market is the strongest it has been since the 1950s, but will this last?
Skill gaps and higher education
This post may be a bit unconventional and thus requires a few links. http://krugman.blogs.nytimes.com/2015/02/22/rip-van-skillsgap/?_r=0 is the primary one, including the links to the conference paper in the article (http://www.hamiltonproject.org/files/downloads_and_links/Work_in_Machine_Age_February_2015_FINAL.pdf). It discusses the skills gap/lowering average income of those with higher education in the US and outlines some of the reasons this could be the case. It discusses this and the value of various skills in an increasingly machine-based economy.
However, it leaves out discussion on a number of things: 1) degree inflation -- with more and more people having bachelors or higher degrees (and not that many more jobs actually requiring them), the workforce available goes up, and 2) Same thing applies to general population -- with a higher population and more jobs being exportable, the skills required become available to employers significantly cheaper. http://www.washingtonpost.com/opinions/catherine-rampell-college-is-not-a-losing-investment/2014/04/24/b888eac8-cbd2-11e3-95f7-7ecdde72d2ea_story.html discusses another point: that even though degrees may not be necessary for every job on the market, those of equal age possessing them vs those without generally have a lower rate of unemployment.
All in all, this is an extremely interesting debate that will likely continue for years.
However, it leaves out discussion on a number of things: 1) degree inflation -- with more and more people having bachelors or higher degrees (and not that many more jobs actually requiring them), the workforce available goes up, and 2) Same thing applies to general population -- with a higher population and more jobs being exportable, the skills required become available to employers significantly cheaper. http://www.washingtonpost.com/opinions/catherine-rampell-college-is-not-a-losing-investment/2014/04/24/b888eac8-cbd2-11e3-95f7-7ecdde72d2ea_story.html discusses another point: that even though degrees may not be necessary for every job on the market, those of equal age possessing them vs those without generally have a lower rate of unemployment.
All in all, this is an extremely interesting debate that will likely continue for years.
CNN Money Introduces Bitcoin Ticker XBT
http://newsbtc.com/2015/02/22/cnn-money-introduces-bitcoin-ticker-xbt/CNN money has recently launched a new Bitcoin ticker. The ticker features a BTC/USD ticker and will also provide updates on Bitcoin news feed. Bitcoin is an innovative alternative electronic currency which evolves peer to peer technology. It will be interesting to see how this effects Bitcoin as millions of people visit CNN money daily.
A British Lesson on Boosting the Supply Side
http://blogs.wsj.com/economics/2015/02/20/a-british-lesson-on-boosting-the-supply-side/
The article talks about changes in the labor force participation rate and unemployment rate in the United States and the United Kingdom. Both countries have had roughly comparable economic growth and unemployment rates, but the article notes that the labor force participation rate has held steady in the UK but declined in the US, despite both nations having an issue of aging populations.
The author suggests that one possible reason behind this is the raising of the retirement age in the UK which keeps people in the workforce longer and boosts labor supply, coupled with reforms to the safety net which work to do the same thing. This could potentially be an interesting set of things to consider when guiding policy in the United States, although it is worth noting that real wages have fallen in the UK, which is potentially because many jobs created are part time jobs and a larger supply of labor has led to depressed real wages.
Clocking off: Japan calls time on long-hours work culture
The article talks about the work culture in Japan. Currently, Japanese workers are entitled 18.5 days paid holiday per year, however, very few use it which is leading to rising levels of stress. The primary reason for this volunteer spirit and overwork is not only to show worker loyalty but there is also an invisible pressure to match their colleagues hour to hour.
While a dedicated workforce may have helped Japan become a superpower, it also has led to a decline in population, suicides due to overwork, and decrease in labor productivity which could ultimately affect the economy negatively.
What could be a solution to this extreme worker loyalty embedded into the Japanese economic system?
Link
While a dedicated workforce may have helped Japan become a superpower, it also has led to a decline in population, suicides due to overwork, and decrease in labor productivity which could ultimately affect the economy negatively.
What could be a solution to this extreme worker loyalty embedded into the Japanese economic system?
Link
Devaluing the Chinese yuan
Many have been critical of the Chinese economy for keeping the yuan rather weak in value in order to increase their exports. Domestic critics state that they are actually focusing more on trying to keep their currency strong. Sources say that they are likely to start a devaluation policy. The yuan has been one of the top performing currencies of this past year because it is loosely pegged to the dollar. It has tagged along with the dollar in it's increase. The US dollar was up 18% against the world's seven most traded currencies, but only 0.6% against the yuan. This will help China fight deflation in the short future for their economy.
http://www.economist.com/news/finance-and-economics/21644205-devaluing-yuan-would-do-china-more-harm-good-currency-peace
http://www.economist.com/news/finance-and-economics/21644205-devaluing-yuan-would-do-china-more-harm-good-currency-peace
HyperInflation in Japan?!?
http://www.cnbc.com/id/102441129?__source=yahoo%7cfinance%7cheadline%7cheadline%7cstory&par=yahoo&doc=102441129#.
The article talks about how the Japanese common man is worried about the rising prices and inflation. Super market prices have gone up by a massive 34% in 6 months. The Yen has been devalued by 27% since April 2013.
However, facts show that there is not much inflation in Japan. Japan has been combating deflation for decades to achieve a 2% inflation target. The core CPI had a increase of only 0.5% in December. The latest CPI figures will be released on Friday.
The article talks about how the Japanese common man is worried about the rising prices and inflation. Super market prices have gone up by a massive 34% in 6 months. The Yen has been devalued by 27% since April 2013.
However, facts show that there is not much inflation in Japan. Japan has been combating deflation for decades to achieve a 2% inflation target. The core CPI had a increase of only 0.5% in December. The latest CPI figures will be released on Friday.
The Birth of Modern Capitalism
http://www.pbs.org/newshour/making-sense/west-got-rich-modern-capitalism-born/
Modern capitalism was born because of the fruits of slavery. It was the key industry of the United States at the beginning of the nineteenth century, and it transformed the world economy over the next one hundred years. The author credits the industrial revolution, the spread of capitalism, and the Great Divergence to the boom of cotton. It created vast empires that pushed capitalism around the world and begin global capitalism, as we study it today.
Europe's ability to industrialize depended upon their ability to control monocultural production of cotton in the Western Hemisphere. This of course fueled the trade of slaves and perpetuated a dependent relationship between colonizers and colonies. The rise of industrial power in Europe also drove deindustrialization in other parts of the world as markets shifted west. "We do not know if Europe and North America could have grown rich without slavery, but we do know that industrial capitalism and the Great Divergence in fact emerged from the violent caldron of slavery, colonialism, and the expropriation of land."
The article goes on to say that slavery was the most crucial labor regime to the creation of capitalism and it did not die out because of being unprofitable in a modern economy, but because of violent struggle. The legacy of slavery is still felt today in the inequality and instability of the modern, global economy.
Modern capitalism was born because of the fruits of slavery. It was the key industry of the United States at the beginning of the nineteenth century, and it transformed the world economy over the next one hundred years. The author credits the industrial revolution, the spread of capitalism, and the Great Divergence to the boom of cotton. It created vast empires that pushed capitalism around the world and begin global capitalism, as we study it today.
Europe's ability to industrialize depended upon their ability to control monocultural production of cotton in the Western Hemisphere. This of course fueled the trade of slaves and perpetuated a dependent relationship between colonizers and colonies. The rise of industrial power in Europe also drove deindustrialization in other parts of the world as markets shifted west. "We do not know if Europe and North America could have grown rich without slavery, but we do know that industrial capitalism and the Great Divergence in fact emerged from the violent caldron of slavery, colonialism, and the expropriation of land."
The article goes on to say that slavery was the most crucial labor regime to the creation of capitalism and it did not die out because of being unprofitable in a modern economy, but because of violent struggle. The legacy of slavery is still felt today in the inequality and instability of the modern, global economy.
Wal-Mart wage hike may be economy's missing link
http://www.cnbc.com/id/102439152
Walmart has finally decided to raise their minimum wage to $9/hour for entry level employees. It has been predicted that with Walmart's announcement this will give momentum to other companies to raise their minimum wage. If so, this "would generate long-awaited wage inflation, the lack of which has been a main contributor to the lackluster post-recession economic recovery in the U.S., the worst since the Great Depression." While it is still unknown if Walmart has done this because of the increasing pressure to raise the minimum wage or because they wanted to help their hardworking employees. It will be interesting to see how Walmart's new pay will affect their worker retention and customer satisfaction.
Walmart has finally decided to raise their minimum wage to $9/hour for entry level employees. It has been predicted that with Walmart's announcement this will give momentum to other companies to raise their minimum wage. If so, this "would generate long-awaited wage inflation, the lack of which has been a main contributor to the lackluster post-recession economic recovery in the U.S., the worst since the Great Depression." While it is still unknown if Walmart has done this because of the increasing pressure to raise the minimum wage or because they wanted to help their hardworking employees. It will be interesting to see how Walmart's new pay will affect their worker retention and customer satisfaction.
Greece readies reform promises.
Greeks are happy after they achieved a "negotiating success" when the word came that the euro zone finance minister agreed to extend the bailout deal for four months under one circumstance, they provide a list of reforms by Monday. Some of the reforms will tighten up on tax evasion and corruption. The deal will also help Greek free up funds to help ease the effects of 25% unemployment and pension cuts. Prime Minister Alexis Tsipras states he has the nation behind him and without their support the negotiating would have never been successful.
http://finance.yahoo.com/news/greece-readies-reform-promises-eurogroup-134327254.html
http://finance.yahoo.com/news/greece-readies-reform-promises-eurogroup-134327254.html
Jobless claims
The number of Americans filing new claims for unemployment has rose less than expected in the past week. Initial claims for state unemployment did rise, as expected but were expected to increase by much more. This is a good sign that the labor market is heading in the right direction. Unemployment has continued to decrease to its lowest levels since pre 2008 recession. This is a solid indication that the labor market is becoming more stable as the economy improves.
http://www.cnbc.com/id/102399974
http://www.cnbc.com/id/102399974
Dollarization in Zimbabwe and Question of a Need For Reversal
Zimbabwe switched to the American dollar after an 80 Billion percent increase inflation of the Zim in 2008-2009. Initially when switching to the dollar stopped inflation, increased growth, and lead to macroeconomic stability. But now data is not complete and the information that is appearing shows that the GDP is down and shopkeepers complain about corruption. There is also rising deficits alone with bans for certain officials to do buiness with the United States. The goods and services that helped the economy before are now lacking an example is mining. Now the dollar may not be what is best for the Zimbabwean economic system. Should dollarization be reversed? the article feels like chances seem low, what do you think?
Greece and the EU: More on Debt and Democracy
http://www.economist.com/blogs/buttonwood/2015/02/greece-and-eu
The article talks about how Greece and the EU might be making a deal concerning debt and reform. The article states that this could either be a horrible thing, and everything falls apart or the deal could be postponed. In the article, the author also talks about how Greece seems to be retreating in their efforts to extend the loan as opposed to creating a new deal completely. The article ends with the author talking about how this has created many issues throughout different countries. His last argument is that if the EU was like the US they would be able to solve their issues better through debate and national financial aid.
The article talks about how Greece and the EU might be making a deal concerning debt and reform. The article states that this could either be a horrible thing, and everything falls apart or the deal could be postponed. In the article, the author also talks about how Greece seems to be retreating in their efforts to extend the loan as opposed to creating a new deal completely. The article ends with the author talking about how this has created many issues throughout different countries. His last argument is that if the EU was like the US they would be able to solve their issues better through debate and national financial aid.
Deflation is the Economy's enemy
Deflation is defined as a drop in the general level of pricing for goods and services. For the United States deflation could seem like a foreign concept after investors have been conditioned to worry about the effect of inflation over the past decade. In this article it says that if prices are falling too far for too long, consumers could delay purchases in the hope of getting a better deal later and businesses may be less likely to produce products that could be worth less by the day. The ECB is implementing a Quantitative Easing program that involves the purchase of at least 1 trillion dollars worth of bonds from eurozone institutions through September 2016. There are also many dangers that come along with this quantitative easing program. It could cause a rise in inflation which results in the increased prices of products and goods which result in less disposable income for consumers due to increased prices. Monetary policy should focus to reach specific levels that reach a stable middle ground.
article: http://www.businessinsider.com/central-bankers-taming-deflation-2015-2
article: http://www.businessinsider.com/central-bankers-taming-deflation-2015-2
Health care opens Middle - class path taken mainly by women
The pay of registered nurses- now the third-largest middle-income occupation and one that continues to be overwhelmingly female- has risen strongly along with the increasing demands of the job. the median salary of $61,000 a year in 2012 was 55% greater, adjusted for inflation, than three decades earlier. This shift in job market has given women more career advancement opportunities. More man are actually shifting from mechanic and construction jobs to nursing because of the high pay, but they still make up only 10% of the rank.
http://www.nytimes.com/2015/02/23/business/economy/health-care-opens-middle-class-path-taken-mainly-by-women.html?hp&action=click&pgtype=Homepage&module=photo-spot-region®ion=top-news&WT.nav=top-news&_r=0
Wal-Mart’s Problems Go Beyond Underpaid Workers
The beginning of the article talks about how Wal-Mart is going to pay its workers more and train them better. After posting very low customer satisfaction numbers, they decided its time for a change. Wal-Mart has scored the lowest of all retailers for the last five years. Although Wal-Mart is going to take a hit at first with this idea, they say it will yield long-term benefits down the road. Wal-Mart also wants to work on its online presence. Amazon, Target, Kohl's, and Nordstrom all ranked above Wal-Mart. Do you think that by raising employee wages Wal-Mart can provide a better retail environment for its customers?
http://time.com/3715877/walmart-satisfaction-index/
http://time.com/3715877/walmart-satisfaction-index/
Fed rate rise timing back in the spotlight
https://finance.yahoo.com/news/fed-rate-rise-timing-back-091012835.html
The chair of the Federal Reserve Janet Yellen is planning to announce a shift in policy later this week. Interest rates have been at an all time low lately and she plans to increase them sometime this summer. This is a supposed reflection of the US economies growing resilience. However the question is how will this policy effect the global economy. Much of Europe is still struggling and is faced with high wage inflation. China and Brazil are also facing their own issues. That in mind many are arguing that it is not the time for an increased interest rate.
The chair of the Federal Reserve Janet Yellen is planning to announce a shift in policy later this week. Interest rates have been at an all time low lately and she plans to increase them sometime this summer. This is a supposed reflection of the US economies growing resilience. However the question is how will this policy effect the global economy. Much of Europe is still struggling and is faced with high wage inflation. China and Brazil are also facing their own issues. That in mind many are arguing that it is not the time for an increased interest rate.
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