America's food-truck industry is growing rapidly

In 2008, Roy Choi began selling $2 Korean barbecue tacos from a kitchen on wheels. Since then the food truck industry has grown to a $1.2 billion industry. America now has over 4,000 food trucks and the industry revenue growth rate is at 7.9%. But patchwork and local regulations create more popular areas for food trucks than others. The article mentions that Portland, Oregon has an estimated 500 trucks roaming the city. In Chicago, they don't allow trucks to set up shop within 200 feet of brick-and-mortar restaurants. 

Many restaurateurs are complaining that food trucks are taking away their business but in a report from 2010 in Seattle, it concluded that the restaurants there have grown by 16% in spite of a thriving food truck scene there.

It's interesting to see how society has changed to doing things on the go including getting food on the street on the way to work or back home. I would think that this industry would be be promoted by governments because it gets people on their feet and outside. 

http://www.economist.com/blogs/graphicdetail/2017/05/daily-chart-3

SpaceX Prices its Way to More Business

As we discuss, in our study of economic systems, the different roles of governments around the world, it is interesting to peer into a particular industry that was at the forefront of the sociopolitical battle between the world's largest superpowers in the 1980s. The United States government faced off in an all-out race to space with its ideological foil -- the Soviet Union. In that time, space was an industry that was only operated by large governments and included very little, if any, participation from private firms.

Although the Untied States seemingly "won" the space race, the current technology and launch capabilities possessed by the government have actually regressed from their peak. Thankfully, for the sake of human exploration and perhaps the survival of our gene pool, private companies are stepping in to fill this void left by government. Originally, the United States relied solely on the United Launch Alliance, a partnership formed by Boeing and Lockheed Martin to supply the government, but now have another private partner in SpaceX. Headed by billionaire entrepreneur, SpaceX is working to bring down the cost of space exploration in order to facilitate a mission to mars. In the short run, the American people are benefiting from a more efficient use of their tax dollars and in the long run, they might have the opportunity to vacation on Mars.



https://www.bloomberg.com/news/articles/2017-05-01/spacex-launches-sensitive-mission-for-military-nails-landing

The markets are uninspired by the Trump tax plan

This article looks at how the proposed tax plan which aims to reduce the taxes paid by businesses (any size) to 15% and individual taxes brackets to 10%, 25%, and 35% has led to a lot of discussion about who this tax cut benefits and whether it will be effective in actually stimulating the economy a la Reagan's "trickle down economics." The tax reform also cuts down estate taxes and alternate minimum taxes. He is also allowing firms to not pay taxes on their foreign earnings.

Though it can be argued that the lower taxes on businesses will provide incentives for more entrepreneurial start-ups and make the United States attractive for foreign investment, it also means that people can now declare themselves business owners to evade higher taxes.

While clearly, the tax reform will benefit the wealthy more than the average voter, this Economist article looks at the other shortcomings of this tax reforms. An interesting thing the article points out is that despite Donald Trump bragging about closing loopholes, this new tax reforms creates a bunch of new loopholes of its own.

There is also the issue of trickle down economics, which rarely ever functions the way that conservative idealists hope for it to do. While Donald Trump is certain that this tax reform will pay for itself, the large tax cuts on corporations will certainly not help the budget deficit. With government revenue going down, it does beg to question how Donald Trump intends to fund his lavish wall and increased spending on defense.

Google launches servers in Cuba to speed up YouTube and search

While Cubans currently have Google Search and YouTube, it is now becoming more usable due to faster speeds that will be seen once servers are put in the country. With relations between the United States and Cuba softening, it should be interesting to see what manner of innovation, research, and technology the island nation is capable of. With the potential that the internet offers, I would imagine that we will see a Cuba that will become more and more involved in the world economy relative to its previous status.

In this article the author cites data which reports that only 5% of Cubans have home internet access with the majority of citizens frequenting internet cafes in order to get online. However, as many more Cubans gain home access to the internet, what will this mean for the strict economic policies within the country? Moreover, what will this mean for the black markets within the country as well?

Link: http://money.cnn.com/2017/04/28/technology/google-cuba-faster-internet/index.html?iid=SF_River

Trump’s immigration crackdown is going to crush the economy

After backing off from building a border wall and funding it with taxpayer dollars, President Trump plans to add more border patrol agents and immigration and customs enforcement officers. Such a deportation force is estimated to cost around $5 trillion over a ten year period. This crackdown on undocumented immigrants could result in job losses which have not been seen since the Great Recession. For example, if farmers lost all their undocumented workers, we could see a significant rise in food prices. The biggest argument is that undocumented immigrants take away jobs from "Americans." Studies show that undocumented immigrants take upon more seasonal work and at wages that most Americans refuse. As baby boomers retire, our labor force is about to face a massive shift and at a time like this we need immigrants and their contributions to our GDP. It is predicted that if Trump continues with his policies and his crackdown there will be a significant labor gap which will cause a hinderance in creating the output necessary to generate growth. I agree with the writer, taxpayer money should be used make immigrants more included in American society rather than treating them like second class citizens. They promote growth as they are ready to work at lower wages, and boost the agriculture and tourism sectors. Such industries rely heavily on the labor of unauthorized workers. Those against undocumented workers overlook the daily costs consequently higher prices of food and basic services which we would then have to deal with undocumented workers. It will be interesting how far Trump will take his deportation agenda and how severely it will affect our economy.



http://www.cnbc.com/2017/04/26/trumps-immigration-crackdown-is-going-to-crush-the-economy-and-one-sector-in-particular-commentary.html

Under the Trump Tax Plan, We Might All Want to Become Corporations

The Trump administration has finally outlined its new tax proposal, which leans heavily on tax cuts. President Trump wants to slash individual tax rates -- cutting the top rate from 39.6% to 35% -- and reduce the number of tax brackets from seven to three for individuals, which would be set at 10%, 25% and 35%. Today's rates are 10%, 15%, 25%, 28%, 33%, 35% and 39.6%. He also wants to cut the top tax rate for all businesses to 15%, far below the current top rates of 35% for corporations today.

The plan would give millions of Americans the opportunity to cut their taxes by essentially turning themselves into small business entities. Therefore, if the Trump administration’s tax plan were to become law, in the future a whole lot of people may just become corporations. Also, The rate would dramatically reduce corporate flight to low-tax countries.

However, as we learned in class, tax is the most important part of the revenue for a nation. If the tax plan were to pass, the will be a great shortage of national income. President Trump then will need to figure out whether to find a way to cover the gap or cut the spending.

https://www.nytimes.com/2017/04/28/upshot/under-the-trump-tax-plan-we-might-all-want-to-become-corporations.html?_r=0

Undocumented immigrant population in steady decline over past 10 years

This article mentions how in the past years the immigrant population in the United States has decreased. In 2016, there was reportedly an estimated of 11 million immigrants, which was a decrease from the reported 12.2 million in 2007. The journalist, Octavio Blanco, mentioned how in 2016 “Mexicans represented an estimated 50% of the total undocumented immigrant population,” and for the first time they did not represent the majority. Although, the number of undocumented people from Mexico has declined, the number for Central American and Asians have increased. I wonder if this has to do anything with the current U.S administration or if this is just one of the many factors that played a role in this.

Link here. 

Slow GDP growth while Trump brags about his accomplishments

This first quarter saw the slowest GDP growth in three years at a mere 0.7, this news comes while Trump is off in Pennsylvania avoiding the correspondent's dinner. His speech followed his usual speaking points, where he distanced himself from the elites at the correspondent's dinner, saying he was thrilled to be with the people who voted for him 100 miles away from DC. But Trump was unconcerned with the controversies that have plagued his presidency so far. He bragged about the appointment of a supreme court justice, and how soon he was going to have a great wall built and healthcare reform. He has created 28 laws since he has been in office, many have been blocked, or lack substance but he remains proud and resilient against criticism. He confessed that "he thought it would be easier" on Thursday so it will be interesting to see what the rest of this first year will look like, will he become a political master? Or simply boast about hollow accomplishments.

http://www.npr.org/sections/thetwo-way/2017/04/28/526012804/gdp-grew-just-0-7-percent-in-first-quarter-of-2017

http://www.npr.org/2017/04/30/526199913/trump-stars-on-stage-he-built-himself-far-from-washington

Theresa May claims this is a Brexit election. It isn’t

While Theresa May believes that the main issue for the June 8th election is Brexit, but some opposition parties disagree. The Labour Party under Jeremy Corbyn "wants to talk about anything else." The Liberal Democrats' leader Tim Faron hopes to garner the 48% of voters who voted Remain in the referendum and win more seats in Parliament.

In general, the British voters have not changed much on their position on Brexit, and even Labour-leaning think tanks have found a vast majority of voters accept Brexit. So then what will be the main issues? Labour wants to focus on the economy, inequality, austerity, and public-spending cuts. The Torres want to make security an issue.  UKIP wants to ban the burqa and sharia law, having won the Brexit vote but having difficulty finding its role.

If May is solely focused on Brexit, that could hurt her. The economy slowing, education cuts are rising, social welfare is fraying, etc. The article states, "...it sometimes seems as if Mrs May’s response to any policy concern, including Brexit, has reverted to a single answer: strong leadership." Luckily for May, more voters trust May due to this than any other party leader. Ultimately, her agenda is "whom they would rather have running Brexit talks and everything else." Because she knows she beats out her opposition, she can remain vague.

"Theresa May claims this is a Brexit election. It isn't." The Economist Newspaper. 27 April 2017.

China's Slowdown in Output

Despite a continued expansion in Chinese factories and mines' outputs during the month of April, the country faced a slowdown in the growth rate in comparison to previous months. The National Bureau of Statistics released information on the purchasing managers' index (an indicator of the economic performance from the manufacturing sector), showing that China's PMI was 51.2, suffering a decrease from a five-year high of 51.8. For reference, a number above 50 illustrates growth in the sector.
Data on the country's first quarter of the year, together with information on trade statistics, have shown an increase in China's GDP growth rate, which led to some "steady accumulation of positive factors", according to Zhao Qinghe, an analyst for the National Bureau of Statistics. However, despite the positive outlook, the Chinese economy is set to face a surge in "downside pressures" and a "shallow slowdown through the course of this year". With the help of additional data, it has been brought to the attention of the people that "China's manufacturing activity might have retreated from its peak".

Source:

http://www.bbc.com/news/business-39762099

It’s a Good Time to Trade Your Student Debt for Home Debt

This article talks about how Fannie Mae is taking steps to make it easier for many student loan borrowers to own a home and refinance a mortgage.  Millions of people have student debt ($30,000+ on average), which has become a large concern because those loans have postponing home buying and causing a drag on the economy.  As an attempt to decrease the concern and fix the drag on the economy, Fannie Mae stated that it was easing the path for student loan borrowers in a few different ways.  First, it is expanding its cash-out mortgage refinance option.  This will let borrowers trade high-rate student loan debt for lower-rate home loans.  Second, borrowers applying for a mortgage may now avoid debt being paid by others from their applications.  The third change helps those with student loans and who are on flexible payment programs by tying monthly loan payments to a borrower’s income.  It will be interesting to see how these changes work out and if they will actually solve the issue.  These changes were announced on Tuesday and are effective immediately.

Link: https://www.nytimes.com/2017/04/28/your-money/its-a-good-time-to-trade-your-student-debt-for-home-debt.html?ref=business&_r=0

The rich are living longer

According to this article and the cited research many Americans are living longer and those at the top are living a lot longer.  Almost a decade more in some cases.  With almost a century of data to back up the claim the article cites also this increase in life expectancy is taking its toll on social security, medicare.  With a close to 13 year gap between the bottom 20 percent and the top 20 percent.  Those in the top 20 percent take out more than $170,000 dollars more than the bottom 20 percent.  This can clearly place a large burden on the already stretched out system.

This is why there have been many talks of increasing the age again which would allow some of this burden to be lifted.  But those whom have lower life expectancy's would be at a greater disadvantage.  









https://www.bloomberg.com/news/articles/2017-04-24/the-rich-are-living-longer-and-taking-more-from-taxpayers

America's Economic Growth Slows to 0.7%

This article discusses the annualized economic growth of the first quarter of 2017 decreasing to .7%. Even though consumer and small business confidence has increased with the election of Trump, this decrease is not a big surprise. One reason it is not surprising is because most measures of actual economic activity have not increased. Additionally, economic growth typically decreases in the first quarter of the year. It will be interesting to see how the economy performs the rest of the year as Trump continues to implement different policies to grow manufacturing and coal industries.

The composition of growth has changed quite a bit. Motor vehicle sales have fallen quite a bit, and alone take half a percentage off of economic growth. Decreasing sales of durable goods such as cars is typically an indication of hesitant consumers. This could be due to political uncertainty recently. Fixed investments have grown 9.4% (annualized). This is very impressive, and it is estimated that the second quarter will be better for the economy.

Article

Costly NAFTA Renegotiations

http://money.cnn.com/2017/04/28/news/economy/trump-nafta-what-a-better-deal-looks-like/index.html?iid=hp-stack-dom

The article depicts the different options that are on the table for a renegotiation of the free trade agreement between Mexico, Canada, and the U.S..  Experts show how the renegotiation can be beneficial to the U.S. for the job market, however, it will be at some cost of the consumers or companies.  The options that are on the table all seem that they will boost prices of goods (the article focuses more on the auto industry).  With jobs being more centered in the U.S. that Trump wants to make happen, chances are, prices  of cars will go up as well with intensified labor and higher quality parts.  I am eager to see the options that our government pursues in the near future.

Free exchange The threat of war can bring much-needed investment

The Article

This article discusses the implications on government, economies, and populations when war seems to be eminent. The cost of war means that governments have to be more efficient in spending, and ensure taxes are being used in the best possible way. Focusing on military strength also forces governments to invest in technology development. Investment increases after or before military rivalries especially in STEM programs.

The political atmosphere causes people to think that war is coming, which might actually have positive reactions in the economy and in developed countries.

Bank of Japan raises economic forecasts, while keeping policy steady

According to the article, the Bank of Japan raised its economic assessment at its policy meeting outcome on Thursday. In the assessment, the real gross domestic product (GDP) growth forecast for the 2017-18 fiscal year increases 0.1 percent to 1.6 percent, while the core consumer price index (CPI) growth forecast decreases 0.1 percent to 1.5 percent. However, the according to a Japanese economist, even though the BOJ raises some forecast, the yield target should not be increased by the end of next year. He thinks even though the bank now sees the economy expanding rather than just recovering, the lower inflation forecast also indicated that BOJ was still struggling to increase inflation. Economists think the bank remains too optimistic about the inflation. The BOJ has taken essentially a "whatever it takes" stance on boosting inflation, saying it would maintain an easy stance until inflation exceeded its target of 2 percent "in a stable manner." 
Low inflation rate has became a serious problem for Japanese economy, one reason account for this, according to the article, is tepid wage growth. Japanese government has tried to address this problem with many measures such as controlling working hours. I'm looking forward to see how Japanese government will do to increase inflation rate in future. 

http://www.cnbc.com/2017/04/26/bank-of-japans-waiting-game-set-to-continue.html