U.S. economy expands 2.5% in first quarter Growth misses forecast as government spending falls, imports soar 

 http://www.marketwatch.com/story/us-economy-expands-25-in-first-quarter-2013-04-26

The U.S. ramped up growth in the first three months of 2013 as consumer spending surged, but the details of the latest checkup on the nation’s health underscored the fragile nature of the economic recovery.

Gross domestic product expanded at a 2.5% annual rate in the first quarter, up from a paltry 0.4% at the end of 2012, the government said Friday. Businesses rebuilt inventories at a faster clip and consumers boosted spending by the most in more than two years despite an increase in personal taxes. 

Yet, government spending sank again — the back-to-back drop in military outlays is the steepest since the 1950s — and imports surged in part because of a spike in oil prices. Both of those factors weighed on U.S. growth in the first quarter and GDP fell short of the 3.2% forecast of economists polled by MarketWatch. In recent market action, U.S. stocks moved slightly higher, and Treasury prices fell.The stage has also been set for a more sluggish second quarter.

Heading the Wrong Way

http://www.nytimes.com/2013/04/28/opinion/sunday/the-economy-is-heading-the-wrong-way.html?_r=0

This article is about the economy and how we are still not doing well. With the movie we are watching in class I found this fitting. A lot of people look at the numbers and say we are doing better but this article compares a lot of different factors and shows we are still struggling and numbers are not where analysts expected them to be. We have come a long way since the recession but still have a long way to go.

U.S. economy revved up, but it's probably temporary

http://money.cnn.com/2013/04/26/news/economy/gdp-report/index.html?iid=SF_E_Lead

According to the article, GDP rose at a 2.5% annual pace in the first quarter of the year, driven largely by a pick-up in consumer spending. Consumer spending, which alone accounts for about two thirds of GDP, rose at a 3.2% annual pace, the fastest pace since the end of 2010. However, as significant as it may seems, there is a chance that it will just be temporary. The reason is that consumers funded their spending in part by saving less. Americans saved an average of 2.6% of their disposable income in the first quarter, down from 4.7% at the end of 2012. Moreover, people have been spending more on services than goods due to the fact that this March was also the coldest since 2002, a weather pattern that boosted the demand for heating. Thus, economists have a solid ground in suspecting that the increase in GDP is only temporary.

Hawk-Eye's inventor eyes football expansion

http://www.bbc.co.uk/news/business-22126245

The soccer world has had on-going controversy over goals that are scored that either cross the goal-line or do not cross it.  Referees have had a hard time making calls for when this situation happens in a game.  Sometimes this goal-line controversy could result in an unwanted outcome for a team or alters how a soccer game is played.  To solve this issue a device called, "Hawk-eye" was made in order to end this goal-line issue.  The device will be installed and mounted in stadiums all over the world to try and avoid any future problems in soccer games.  The inventor of Hawk-eye has made a deal with the Barclays Primer League in England over the next five years, that the device will be installed in over twenty stadiums throughout the country.  This deal is rumored to be around ten million British pounds.  The device was bought by the electronic giants of Sony and they are now looking to expand it into more markets all around the world.  This industry remains relatively small because there are only two companies in this market.  It will be interesting to see how these new goal-line technology devices affect games in the future.  The competitor of the Hawk-eye  device is a German device called, "GoalControl."  This market could potentially be very lucrative because there are millions of people who play soccer all around the world and there thousands of soccer stadiums for professional clubs all over the globe as well.  This is the most played sport in the world and there will be a high demand for this product in multiple nations and at big sporting events such as the FIFA World Cup and the European Cup.

Australia Invests in China

http://www.bbc.co.uk/news/business-22276222


China has been testing the financial markets in which they are allowing the yuan to be traded more than it has ever before and allow it to be a more globalized currency like the US dollar.  This article talks specifics of how this is being done now with Australia which is one of the more recent countries allowed including Brazil and the UK.  These attempts to globalized the Yuan are done in hopes for it to be thought of as an alternative global currency to the US dollar  Hopefully this will allow the Chinese economy to flourish, but you never know.

The Rise of the International MBA

http://www.forbes.com/sites/shawnoconnor/2013/04/26/the-rise-of-the-international-mba/

The article talks about how more college graduates are going abroad to get their MBA degrees.  Over the past five years there have been more students shying away from American graduate business schools and applying to International Business schools.  One of the main differences between American business schools and International business schools is that students applying for graduate school in America have to take an entrance exam to get into the institution, whereas in institutions abroad do not require an entrance exam.  Another main difference is that international business schools have a cheaper tuition and the length of study is only one year long rather than two years like in America.  Havard Business School total two year tuition is approximately 186,000 dollars whereas London Business School is only a fraction of that at 79,280 dollars for fifteen months of completed studies.  The areas that seem to be attractive for obtaining a MBA abroad are mainly in the UK, Spain, France, and the Netherlands.  International Business schools are a practical option for students looking to get their MBA and it is not a bad option either.  Even though American business schools have better job placement after grad school, International Business schools are not far behind in this factor.

Oil above $91 on hope for Europe rate cut

http://finance.yahoo.com/news/oil-above-91-hope-europe-rate-cut-165251966--finance.html

The daily oil gains haven't raised this high since December due to the expectations surrounding talks about the European Central Banks cutting interest rates. Oil supplies have increased 900,000 barrels (0.2%) and set to increase even more to 1.4 million barrels according to analysts. Our national average for prices at the pump is $3.52, which according to records is 33 cents cheaper than last year. The strength of the dollar is also a reason for why we see this increase in oil. Due to the fact that oil trade is done in dollars, it become easier and easier as the dollar value decreases for countries with stronger currencies to buy more oil.

Spain unemployment hits record high

This article talks about the record high unemployment level in Spain. The unemployment levels have reached a record high of 27.2%. Which accounts for more than six million people without jobs. This clearly shows the difficulties the Spanish economy is facing to try and over come the recent economic Crisis which hit the euro zone. It is the fourth largest economy in the euro zone and these figures which were released are wore than what was expected.

The prime minister is expected to present fiscal policy and other measures to tackle the recession and try bringing it to a halt. He also said that the Spanish economy would start growing from 2014 and has also assured that jobs would be created in this process.

http://www.bbc.co.uk/news/business-22290422

Challenging Austerity

http://www.bbc.co.uk/news/world-europe-22269616

Five years after the beginning of the most recent economic crisis, European Commission members are now starting to recognize that austerity measures, although fundamentally right in stabilizing economic indexes during critical financial periods, cannot possibly sustain political and economic support in the long run.  According to the article, austerity policy never had consensus behind it, violating the sovereignty of European nations that were affected by it (Cyprus, for instance) without the support of the population being affected by those policies, lacking hence, democratic legitimacy. Austerity is now considered widely discredited. Nations like France reject it, as President Francois Hollande said only recently that "sticking with austerity would condemn Europe not just to recession but an explosion".  

Austerity, however, was also a key policy in reducing spending and deficits and preventing a break-up of the Eurozone, despite the costs that it implied (rising unemployment, reducing aggregate demand, recession, social unrest and labor force emigration). However, its intellectual underpinning is now being challenged by the international community. Two economists formed a thesis which predicted that if deficit grew above 90% of GDP, growth would decline sharply (also called “the 90% rule”) but this view has raised serious doubts about its accuracy. Deficit targets have been established mostly arbitrarily, exposing how politicized and magnified the deficit cut issue has become. The question that now remains is, to what extent were the devastating effects of austerity an enhancer of the European economic crisis.

German business confidence falls for second month in row

This article talks about a fall in business confidence in Germany for the second consecutive month. The business confidence level fell from 106.7 to 104.4. This survey had an effect on the value of the euro as it fell against the dollar to the lowest value in three weeks. The recent financial crisis in Cyprus and other factors which include the worries in the economic growth of china have shown how weak the global economy is.

Some of the major German companies have also posted a fall in sales and the impact that the Cyprus crisis and the bailout has had on Germany and the world;d is enormous and has lowered business confidence. Financial stimulus would have to be considered if this keeps going on, to make sure that business confidence is restored.

http://www.bbc.co.uk/news/business-22278148

Colorado Ponders the Economics of Marijuana Tax

http://www.nytimes.com/2013/04/25/us/colorado-considers-marijuana-tax.html?ref=us&_r=0

This article shares the ideas regarding marijuana being legalized for recreational use, and how it could be taxed. This states that legislators are considering the excise and sales taxes on marijuana of up to 30% combined.  This being passed could potentially generate millions of dollars in state tax revenue and could stimulate their economy. The goal of this tax is to be high enough to finance the administration of new laws, but not high enough that people are driven away and turn to the black market. Task force members and lawmakers hope to find the right balance between taxing too high and too low.
Not all involved are agreeing with taxing marijuana. For example, Michael Elliott, executive director of the Medical Marijuana Industry Group said that he feared that a too high of a tax would make it too difficult for marijuana business to survive because the black market in Colorado is too involved. Also, people are worried about safeguarding to make sure it doesn't end up with children. There are many different stand points on this idea, and an interesting article to read.

NBA Playoff Ticket Prices

http://www.rantsports.com/nba/2013/04/19/nba-playoff-ticket-prices-not-as-predictable-as-you-might-think/

The article isn't exactly eloquently written, but the graph provided is very interesting. There is a huge variance between teams and venues as far as ticket prices for so-called "vivid" seats. A vivid seat at a NY Knicks playoff game, for example, is nearly $400 while the same seat at an Indiana Pacers game is around $75. The Lakers, who are the lowest seed in the Western Conference, posted the second-highest ticket price at around $250. Ticket prices seem to correlate with a few factors: strength of team, population of city, and popularity of basketball in city. Oklahoma City, for example, doesn't have a huge population, but it has a very good team and is a so-called "basketball city." The fact that NBA ticket prices are so volatile shows the importance of socioeconomic factors in pricing.

German downturn bodes ill for eurozone

http://money.cnn.com/2013/04/23/news/economy/europe-germany-pmi/index.html?iid=SF_E_River

A fall in Germany's private sector output in April could signal worse times to come for the shrinking eurozone economy. The continued concerns for the economy in Europe and the low confidence has contributed to the continuing stagnation and drop in activity over the past 20 months. The decline in the German economic engine is very worrying for the rest of the Eurozone as Germany was seen as the largest and strongest, this will only decrease confidence further hurting the Eurozone. Though it is slowing now, people are expecting a gradual recovery in the second half of the year.

Tightening Regulations on Payday Lending

http://www.washingtonpost.com/business/economy/regulators-to-rein-in-on-bank-payday-lending/2013/04/23/4cf9da7e-ac43-11e2-a198-99893f10d6dd_story.html?hpid=z1


Those who regulate banks are setting stricter rules on the bank's ability to lend short-term high-interest loans. These types of loans are causing some Americans to get caught living loan to loan and forever increasing their debt. Some states have already banned this type of lending, while others have just limited the amount of loans that banks are allowed to make as well as the interest rates. This new regulation would merely limit borrowers from taking more than one deposit advance in a pay period. It insists that a buyer's ability to repay a loan be taken into consideration. These new regulations might greatly help those who are constantly borrowing and help them to learn how to end the constant cycle of borrowing.

Spain's population shrinks as immigrants flee economic crisis

This article talks about a decrease in Spain's population for the first time in over a decade. The reason for this fall in population was related to the recent economic crisis.The number fell by almost 216,000 all of them being registered foreign residents.This figure doesn't take into account the number of local residents who have left searching for work. The increasing unemployment levels and the bursting of the property bubble have been seen as the major contributes for this flee of foreigners from the country.

Eventhough there was an increase in the native spanish populationn by 10,000 but this doesnt ofset the fall of registered foreign residents. All of these reasons show how Spain no longer remains attractive because of loss of jobs and no jobs being available.

http://www.bbc.co.uk/news/world-europe-22251840

Netflix Surge

http://money.cnn.com/2013/04/22/technology/netflix-earnings/

As college students, we live off of Netflix. When the stock declined in 2011 many users unsubscribed however this article tells us is that the stock has risen significantly (25%) due to specific changes the company has put in place. Because the product changed the expectations of its costumers changed, increasing the interest. Comparing the stock to the world wide phenomenon of Harry Potter, it was not a phenomenon at first but in the long run it blossomed.

Measuring College Prestige vs. Cost of Enrollment

http://www.nytimes.com/2013/04/20/your-money/measuring-college-prestige-vs-price.html?pagewanted=1&ref=economy&_r=0

This is something we have all gone through. Receiving financial aid or loans and using that information to decide what college we want or have to go to for the next four years. This article talks about whether it is worth it for some families to take out a large amount of loans just for their child to go to the student of their dreams, like NYU or Harvard. These schools typically have a much higher tuition rates in comparison to state schools. Advisers suggest that some families should not take out loans they can't afford to pay back just for their child to go to a prestigious school to work on culinary art, for example. In some situations, it may be smarter to go to the school with a more affordable tuition, and get a very much similar education and could end up with a job just as prestigious as if they attend a different school. This is a interesting article to read and hear analysts' opinions on financial aid, loans, and tuition rates.

Boston Bombing, Proves the real reason behind terrorism.

Bombing cost millions?

We know the facts about the bombing in Boston. 3 people lost their lives, over 170 people were injured, and an entire building was destroyed. What effect does this act really have though? After reading this article it brought to light some of the things I did not think of in my terror of the bombing. Yes, this act instilled fear for a short amount of time, but the real effect was the time spent chasing the suspect. People were stuck in their house so they were unable to work, they also were not able to consume products. Also the food, gasoline, and other products were unable to get into Boston as a result making it take a little extra time for them to get back up and running. Lastly, something not mentioned in the article was the sporting events that were cancelled because of it, that is another economic element effected. So when we think of terror attacks don't think a small number of deaths means they weren't successful, as we learned in class GDP not realized can never be gotten back, so during this time we lost GDP we will never be able to get back.

Robots aren't the Problem

http://chronicle.com/article/Robots-Arent-the-Problem-/138007/

This article discusses a common economic talking point - the merit or demerit of mechanization and the coming of 'robots'. It mentions the two polar opposite views on the topic. One side believing that the march of technology will bring utopia and improve standards of living while the other side believes that the result will be a dystopic future with many people losing their jobs and class divides becoming exemplified and strengthened.

It then discusses how these two polar views do not present a complete picture of the issue at hand. While mechanization destroys some jobs, it creates others and opens options that could potentially raise overall living standards and reduce wealth divides. The question all comes down to how we handle the unavoidable advances in technology that will continue to expand mechanization.

3 reasons the housing recovery may not last

http://money.cnn.com/2013/04/18/real_estate/housing-recovery/index.html?iid=SF_E_River

The articles lists down the 3 reasons why the housing recovery may not last:

1. The housing recovery is being led by investors:
Basically investors are taking advantage of low interest rates and depressed home prices and as a prediction, when those rates and prices rise, they will likely pull back.

2. The economic recovery is just not strong enough yet: that's truth. Hiring slowed significantly in March, with just 88,000 jobs added - the weakest showing since last June. Meanwhile, half a million Americans withdrew from the workforce during the month; either because they stopped looking for work or retired and stopped drawing unemployment. Many were discouraged workers, a sign that the economy remains weakened.

3. Government cuts will hurt homeowners: The cuts, including unpaid days off for federal workers, cuts in unemployment compensation and decreased military spending, combined with the expiration of payroll tax breaks earlier this year, will lead to job and income losses that could strip about a percentage point off the GDP this year.

And while current mortgage rates remain extremely low, about 3.5% for a 30-year, fixed-rate loan, they're bound to go up, the industry experts said, making it a lot more costly for people to afford homes.

Inflation is very, very low. Time to worry?

http://money.cnn.com/2013/04/19/news/economy/low-inflation-risks/index.html?iid=SF_E_Lead

The article discusses the bad effects of low inflation as prices have been steady recently. First, when inflation is low, firms are more likely to apply many measures to cut costs, for example cutback in hiring. Second, low  inflation discourages consumers to spend and when people expect prices to fall, they are more motivated to wait for prices to fall as far as they can before any spending starts. And fourth, low inflation often comes along with lower wage and revenue growth.

Factors affecting monetary policy in Canada.

http://www.bloomberg.com/news/2013-04-21/carney-says-next-canada-rate-move-needs-above-2-growth.html

     The article above looks at the last report of the central bank of Canada while under management by its current Governor (Mark Carney). He is moving from this position to take up a position of governor of the bank of England. In this article, he outlines varying monetary policy responses that the Central Bank plans that will help Canada manage certain current conditions or deal with future fluctuations.
     The Central Bank of Canada has maintained low interest rates and would only be increasing this based on a sustained growth in the economy (a sign of recovery). This is similar to monetary policy in America where the federal reserve is also looking for a sign of recovery (sustained job creation) before increasing interest rates. He also mentions how monetary policy decisions are not made by only one man (the governor of the central bank or president of the federal reserve) but are made by groups of economists and analysts.
Overall the article highlights the different policy models used across governments (active, passive, rule and discretion).

Curt Shilling ripping off road island

The famous pitcher Curt Shilling was trying to get into the fantasy business game by developing a new gaming company called 38 games. The only problem in his plan is that he did not have the investment capital to start his company. He went to a desperate company that was the state of road island, they were in economic ruin and were trying to get themselves out of a hole. They initially gave him a 75 million dollar investment fund to make sure that they would get the jobs from this company and also have a little star power to their investors. Only a year later we see that their business has gone under and also the investors had lost out on their capital. It is sad to see an economy so desperate that they would resort to this to try and stimulate an economy.

http://www.nytimes.com/2013/04/21/business/curt-schilling-rhode-island-and-the-fall-of-38-studios.html?ref=business&_r=0