From An Economic Impact Perspective, The Bay Area Got Half Their Wish With Super Bowl 50 Matchup

This article touches on the economic standpoint of the super bowl and which teams would have been optimal for maximizing the economic profit.  The 50th super bowl is being held in Santa Clara, California on Sunday between the Denver Broncos and theCarolina Panthers.  However, the two teams that would have the largest economic impacted based on: (1) how many visitors do you attract to the region, (2) how much do these visitors spend above and beyond the normal flow of visitor spending historically experienced during that same time of year for that region, and (3) is their spending retained within the local economy after the event (as opposed to somehow leaking out of the community).on proximity, travel costs, and fans would be the Denver Broncos and Arizona Cardinals.  Normally when I would think of the Super Bowl I wouldn't consider the large economic impact and factors and found this article eye-opening. http://www.forbes.com/sites/prishe/2016/01/29/from-an-economic-impact-perspective-san-francisco-got-half-their-wish-with-super-bowl-50-matchup/#7dbdde3169ed

2016 Recession?

Are we on the brink of another recession? There is no easy answer to this question, but this article suggests it is a possibility. With the interdependence of America's economy with other nations, the effects of economic turmoil abroad have new implications in the Unites States. Coupled with short-sighted economic decisions within our own government, it could be a recipe for disaster.

To begin the United States has made large investments in emerging countries, many of which, such as Brazil and China have begun to stagnate. Soon their credit bubble is about to pop and there is still no way of predicting what the effects will be. "You only find out who us swimming naked when the tide goes out." This Warren Buffet quote means that since the credit bubble is about to pop, soon it will become apparent how much of these economies are sustainable.

Next the Fed has less flexibility with interest rates than it used to. In 1998, it was operating at 4.75% but now it is at 0.25-0.5%. If there are any cuts it will require depositors to pay the bank. When this is occurring simultaneously with the significant changes in the global economy it's a bad sign that the Fed has less control of the market than they did before the great recession.

http://www.nytimes.com/2016/02/05/upshot/if-there-is-a-recession-in-2016-this-is-how-it-will-happen.html?ref=economy

Med students are avoiding this job — and it could be a problem for all of us

The news shows that currently, there are around 20 million people older than 75 in the US, and there are about 7,000 practicing geriatricians in the US today, which means there is one geriatricians for 3,000 people who are over 75 in the US.

Hafners mentioned that it is difficult to have interest in taking care of older patients for young students.

Lacking of geriatricians, however, does not increase its salary to attract more people to study geriatrics. According to the Medical Group Management Association, geriatrics is among the lowest-paying specialties in medicine.

This is actually a serious problem and I don't know why government did not make some policies for geriatricians, such as rising their salaries.


http://www.businessinsider.com/the-lack-of-people-taking-this-job-should-worry-all-of-us-2016-2

Wages Rise as Unemployment Rate Falls

     The Labor Department Report released on Friday shows generally positive statements with a highlight of a half point percentage increase in average hourly earnings in January. The report also showed a decrease in the rate of job creation, as the unemployment rate fell to an eight-year low of 4.9 percent. The article discusses the most recent statistics of the job market, with an emphasis on the idea that the job market could be tightening enough to force companies to pay more to attract and retain employees, causing the recent increase in average hourly earnings.

     The article discusses the significance of this increase, taking it as a sign that the American economy is holding up well despite a slowdown in China, growing risks in emerging markets, and turmoil in the stock market. Chief United States economist at Barclay's states that due to this and other promising statistics, he doesn’t think the economy is sliding into a recession. However, as an effect of increasing wages, one third of executives said they were worried that labor costs could cut into corporate profit margins.

     The article pertained a lot to class discussion, as we have just discussed the reasons for unemployment.

     http://www.nytimes.com/2016/02/06/business/economy/jobs-report-unemployment-january-fed-interest-rates.html?ref=economy

"Finland's Economic Winter: Permafrost"

In the 90's Finland switched to the Euro, they had years of prosperity before and after taking on the European Union's Currency but since 2007-2008 crisis Finland has not been able to maintain steady GDP growth. From this economist article, things will not take on a positive turn in the coming year: "Short-term data suggest that the economy will be flat in early 2016, says Jussi Mustonen, chief economist at the Confederation of Finnish Industries".
One of the main causes of this decline comes from their biggest company: Nokia, which was responsible for a quarter of growth in Finland. Nokia was once the largest producer of mobile phones, but in recent years it has been unable to keep up with the technological demands and advances for smartphones.
 An additional problem, is increased wages for lower productivity. Even though in class we find that an increase in productivity coincides with an increase in wages, the opposite is happening in Finland, their wages are 10%-15% higher than trading partners, making Finland a costly country for companies. A shrinking workforce does not help the increased wages. As the work force decreases Finnish companies need to "steal" able bodied workers from other companies through incentives like higher wages.
To add to the negative effects on the economy exports to Russia have decreased from 10%- 5.8% furthering harming Finland's GDP.  In addition, Finland has GDP 3% deficit. Finland ranks second globally for innovation, including a $1.8 billion incentive plan. In addition, wages and labor have been harmed by their national collective bargaining approach, which has caused the wages to stay higher and not reach an equilibrium. This does not help when it is coupled with an inability for companies and workers to reach a medium on increasing working time, to balance with the increased wages. In all Finland has a long road ahead, and needs to lower domestic costs, so they can be more competitive with neighboring countries.

U.S. Trade Gap Expanded in December

The U.S. trade deficit expanded in December, highlighting how a global economic slowdown remains a headwind to domestic growth. 

The trade gap expanded 2.7% from the prior month to a seasonally adjusted $43.36 billion, the Commerce Department said Friday. Exports fell 0.3%, while imports increased 0.3%. 

Economists surveyed by The Wall Street Journal expected a deficit of $43.5 billion in December. 

November’s deficit was revised to $42.23 billion, from the previously estimated $42.37 billion. 

For all of 2015, the U.S. trade deficit grew 4.6% from 2014. Exports fell 4.8% on the year. Imports declined 3.1% last year.

MORE ON THE ECONOMY

• Your Trip to Mexico Is Weighing on the Trade Balance
• High Salaries Haunt Some Job Hunters
• Rate Expectations: Not So Fast, Fed
• Oil Rout Threatens Vicious Cycle for Economy

The reduced trade volumes demonstrate that the global economy cooled last year. That weakness could be spilling into 2016, reflected by financial market gyrations and falling commodity prices.

December’s level of goods exported was the lowest since February 2011. Shipments of food, civilian aircraft and petroleum all slipped during the month. 

Falling exports is in part due to a stronger U.S. dollar, which makes American goods and services relatively more expensive overseas.

The dollar could strengthen further this year. The Federal Reserve is preparing to gradually increase interest rates, which should strengthen the dollar. Meanwhile, many central banks around the world are loosening monetary policy, pushing their currencies in the opposite direction. 

Low commodities prices and a steep increase in domestic oil production during most of last year has slowed imports. Crude oil imports rose modestly in December from November, but were down by $120.5 billion during 2015. That figure is larger than the total decrease in goods imports last year.

The average price of a barrel of imported crude oil declined to $36.60 in December from $82.92 a year earlier.

The latest data on trade will be incorporated into the next broad reading of fourth-quarter economic output, due out later this month. 

The Commerce Department’s initial reading on gross domestic product showed the economy expanded at a 0.7% annual pace during the fourth quarter. That was a sharp slowdown from the third quarter’s 2% expansion.

International trade was a 0.47 percentage point drag on overall growth last quarter.

America’s goods-trade deficit with many of its largest partners expanded last year. 

The deficit with China grew 6.6%. The trade gap with the European Union expanded 7.9%. And the deficit with Mexico grew 8.4%.

The goods-trade gap with Canada, the largest U.S. trading partner and a major supplier of oil, decreased by 58%.

J.C. Penney Wants To Sell Its Headquarters To Raise Cash

In the article by Phil Wahba he talks about how JC Penney wants to sell one of their headquarters that is located in Dallas, Texas. Their reasons for wanting to sell one of their headquarters is because JC Penney has been in debt for a few years now. This was due to a reinvention they had planned about four years ago, which caused their sales to drop about 30%. They wanted to add new improvements to their stores which cost them about $300 million in such projects. Another reason why they are in so much debt is because their annual interest expense was $400 million.

Therefore they believe that if they remain headquartered in Texas and they lease the space they can save more money. Also, since they will have less stores that means they need to cut back on their employees. This year they have cut about 300 jobs. However, recently they have seen some improvements since they have a new CEO. Their sales saw an increase of 4% since the holidays. This is looking good for them because they are also exploring other ways in which they can begin increasing their sales.

In my belief, I think that JC Penney will be able to bring their sales up again. It is just a matter of advertising and reaching out to the customers. It seems that for the past few years many have forgotten about JC Penney since they have not advertised as much, however, I did see a lot more advertising over the holidays. 

Website: http://fortune.com/2016/02/05/jcpenney-home-office/

Making a Super Bowl Bet? You Might Owe Tax

With the Super Bowl this weekend, many Americans will be placing bets on who wins the game between the Carolina Panthers and Denver Broncos. Since winnings on bets technically count as a form of income, that winning amount should be reported to the IRS on Form W-2G. However, casinos and legitimate sports betting websites are the only venues that will issue the Form W-2G, and they are only required to issue it if the net income on the bet results in winnings of greater than $600. This concept is similar to that of Keno winnings, where the IRS withholds at least 25% of the winnings. All income is taxable, however, if you were to win money in an office pool or in a group of friends, the odds of that income being reported is extremely unlikely. According to the law, income from winnings from a group should be filled out in IRS Form 5754. The IRS expects these forms to be filled out based on the honor code, but in most cases, these forms will not be looked at by many people betting on the Super Bowl.

http://finance.yahoo.com/news/making-super-bowl-bet-might-175221959.html

Jobs report helps ease concerns a recession might be nearing

I thought that this article was interesting because that the number one thing that people always worry about is when will the next recession happen. This article goes into detail talking about indicators that makes it seem like there is a recession in the near future but also talks about the indicators that show that their are no worries about a recession in the future. The author seems unbiased on the topic and just stated facts that supported both sides and leaves it up to the reader to decide for themselves.

link: http://finance.yahoo.com/news/fridays-jobs-report-could-ease-080158316.html 

In Iowa, Jobs are Plentiful but Workers Are Not

The recent Iowa caucuses have brought attention on the low unemployment rate of the state as well as the demand for a larger labor force. At 3.4 percent, Iowa's unemployment rate is one of the lowest in the country. The tightening of the labor force has created some conflict in Iowa-based industries, such as the need to find a new recruitment strategy. Not helping the situation, is State Rep Steve King who is known for his anti-immigrant stance and policies. In order to create growth, Iowa must find a way to bring people into the state. New business is essential for long-term growth. Some economists have said that these labor shortages have put less pressure on wages than expected. Many workers are joining forces with local unions to protest low wages and benefits. Iowa has the potential for long term sustained growth, it just has to find more workers to create that growth.
NY Times, Patricia Cohen

Subway ups the Prices of its $5 footlongs

The very popular $5 footlong has been a staple in many peoples' fast food diets over the course of almost 10 years. Customers loved the idea of spending that small amount of money on that large amount of food, while also giving them rather healthy options when it comes to fast food. This week, however, marks the end of the $5 footlong era, as Subway has announced that they will be raising the prices of their famous footlong sandwiches to $6.
Obviously, after nearly 10 years of existence, with regards to inflation, the $5 footlong has been decreasing in value constantly, and Subway is finally acting on that. The article also mentioned production costs increasing, which gives Subway no other option than to raise their prices.
In my opinion, this idea will come with backlash and a decrease in sales due to multiple reasons. Earlier, in 2015, the Jared Fogle situation somewhat blackened Subway's reputation, and after some time, Subway has worked to cut off as many of their ties that still remained with Jared. But now, to the average person who doesn't consider the economy and inflation (or doesn't know about inflation in general), they won't understand that Subway had to make the decision to increase their prices. Some people will be angered and for lack of a better term, will boycott Subway in a sense. This of course, is all speculation.

http://www.foxnews.com/leisure/2016/02/04/subway-raises-price-its-footlong-to-6/

Still kicking

Reports of the death of the American consumer are greatly exaggerated

This article written in the Economist's online news print, refutes the claim that Americans are consuming a lot less then they have in previous years.  It also discusses how low prices of oil does not directly correlate to consumers spending more on other goods.  It general it appears the the American economy as a whole is showing healthy spending and saving habits relative to previous times in history.  The 2007-08 financial crisis may have been a catalyst in consumers being less risky with their finances and not spending more than they have.  Another positive sign is that average household debt has been falling and may continue to do so.  In addition, low interest rates have helped to reduce the amount of debt people have.  To read full article click below.

Click Here

How The Fed Unwittingly Confirmed A Recession And A Default Cycle Are Now Inevitable

           While everyone was focused on the "front end" of central bank announcements in the form of Draghi jawboning, Yellen hemming and Kuroda panicking, something more troubling took place on Monday afternoon on the "back end", when the FED released its latest quarterly senior loan officers survey.
What it showed was that in Q4, lending standards tightened for the second consecutive quarter.
This is problematic because as DB's Jim Reid writes, two consecutive quarters of tightening standards "has never happened before without it signalling an eventual move into recession and a notable default cycle. Once we have 2 such quarters lending standards don't net loosen again until the start of the next cycle."
If there is any silver lining, it is that as DB points out, so far the tightening of standards are still only mild, especially relative to recessionary levels. So although it does continue to feel like we're late cycle, it could still be a number of quarters for the full cycle to unravel.
In other words the countdown is on, not only for the Fed to admit policy error, which Bill Dudley hinted at yesterday, but also a countdown to the admission that the US is in a recession and the long overdue collapse in the world's most crowded (if only until recently) trade, being long the US Dollar.

http://www.zerohedge.com/news/2016-02-04/how-fed-unwittingly-confirmed-recession-and-default-cycle-are-now-inevitable

U.S. Economy Barely Grew Last Quarter, Stoking Concerns About Momentum in 2016

The American economy ended 2015 on a flat note, which has caused some concern looking ahead.  The slowdown of the economy was a result of low sales of durable goods, a weak trade picture caused by the stronger dollar and falling business investment, shrinking inventories.  Even with all the concerns, economists still expect the economy to rebound as the year goes on.  Economists on Wall Street predicted the drop in the economy, and others predicted no growth at all.  They believe that the slowdown could have been a lot worse. Although the American economy flattened out during the fourth quarter, 2015 was still a good year over all.  The economy grew 2.4%, which is identical to the growth in 2014, and a lot better than the 1.5% gain in 2013.  Nariman Behravesh, chief economist at IHS, believes that 2016 will be over better than years past.  He expects the economy to expand by a rate of 2.5% in the first half of 2016, with unemployment continuing to drop from 5% to 4.5%.  Behravesh stated, “There are definitely problem areas, but consumer spending, housing and the nonenergy parts of capital spending are still fairly solid.” 2015 ended on poor note, but was still over all a decent year and some economist forecast 2016 to be even better.

Link: http://www.nytimes.com/2016/01/30/business/us-economy-gdp-q4.html?ref=economy&_r=0

Switzerland voting on national wage

Switzerland is planning on voting on a proposed minimum of 2,500 Swiss franc per month (approx. $2,500) regardless if the person is working or not. Additionally, they are trying to push for children to receive 625 francs a month. If Switzerland decides to pass the bill it will be the first country in the world that allows a minimum monthly income for all of its citizens. The groups pushing the bill have stated that people will continue to work even if they could receive 2,500 Swiss francs without working. However, the proposal has received little to no support from left an right sided politicians. This can mainly be attributed to the fact that in the classical economic school of thought, if policies that are introduced to disincentivize people working, production and employments rates will drop.


I found this very interesting and progressive that Switzerland would consider doing this in order to help their lower income citizens. This goes to show how different cultures are around the world because such a bill like this in the United States would be a complete flop. However, based on what we learned about labor an unemployment in class, I feel like it would not be a good idea. This is because when people don't have incentives to work some will choose to do nothing. I feel like this will lead to many problems like unemployment rates going up, production going down, and necessity to obtain a good education going down. I feel like it is important to help out the lower income members of our society, but I also feel like everyone should work and contribute to our society. Without a reason to do contribute there are certainly some people that will choose not to.

So What Would It Mean to ‘Beat China’ on Trade?

In many soundbites from Donald Trump, you hear him say things like, "China is beating us in trade." The article I read investigated that claim. A paper published by economists David Autor, David Dorn, and Gordon Hanson seems to agree with that statement. Trade with China has seemed to increase unemployment and lower wages for American workers. While this sentiment has been played up by many politicians in the past, many economists believed that the negative effects of increased Chinese trade would dissipate quickly and workers would find better jobs elsewhere but it turns out that the labor market adjustment is “gummier than anybody realized.” This problem would not be so impactful in the US economy if China imported as much as they increased exports but, China has run consistent trade surpluses. The article recognizes that Trump is well off base in his policy in trying to fix the issue but there is definitely an impact on the American labor markets from Chinese imports.

The question is now, how do we fixes these issues? There are policies we can enact to help the American market internationally and intranationally. Ben Bernanke asserts that the key to solving this problem is in international diplomacy. Some of China's policies such as the one-child policy have incentivised its citizens to save more than they would normally because they won't have many children to support them later in life which drives down demand for imports. Another economist says that our foreign relations should center around stopping Chinese currency manipulation and their unnecessary trade surplus. We can also create programs in the US to help ease the negative effects on our workers. Mr. Hanson recommends that we make changes "to labor, housing and safety-net policy that would make it easier and less painful for workers to move to new regions and switch to new industries."

To conclude, I will restate that the article finds Mr. Trumps rhetoric of "Us against China," harmful and inflammatory but does point out that some chinese policy has effect on domestic workers. While Mr. Trump and his fellow candidates may want to end this issue, it will only happen with careful diplomacy and strategic domestic labor policies.

Link to Article

Do Janet Yellen and Bernie Sanders Agree on More Than What's the Coolest Hair Color?

This is not a discussion about the coolest hair color, but the influence from raising interest rate adjusted by the Fed.

It is mentioned in the article that "Raising interest rates now is a disaster for small business owners who need loans to hire more workers and Americans who need more jobs and higher wages." We can also rise the real wage by "keep interest rates as low as possible for as long as possible." Indeed, keeping a low interest rate can benefit both firms and households. But in the long run, the higher wages will lead to higher cost of production and higher prices in the future.

If the Fed keeps the low interest rate for a long time, will it slow down the growth rate of consumption?

Link:  http://www.huffingtonpost.com/ian-reifowitz/do-janet-yellen-and-berni_b_9134908.html

“US Economy Barely Grew last Quarter, Stoking Concerns about Momentum in 2016"

In the New York Times article, “US Economy Barely Grew last Quarter, Stoking Concerns about Momentum in 2016,” author Nelson Schwartz explains many aspects of the macro- economy and the results of the end of 2015 and some things to watch for early 2016. Schwartz begins his analysis through his dissection of the components that make up Gross Domestic Product and their growth levels in the last quarter and last year in comparison to years prior. GDP is the general productivity of a nation made up by the components of Consumer spending, Government Spending, Investment, and imports and exports. The article states that last quarter, the economy slowed to around .7%, as previously predicted by economists, yet overall 2015 provided similar numbers to 2014 with GDP growth of 2.5%. This number makes sense for a healthy economy because the average growth is around 3% per year. Schwartz states that a strong dollar in the US is actually negatively affecting NX and making it more difficult for big business to invest and expand overseas. However, domestically speaking, consumer spending on services and housing (which impacts investment) have been strong; CS even grew at 2.2% last quarter. It is predicted that 2016 will provide similar numbers and growth.

Additionally, Schwartz mentions other aspects of the economy like the unemployment rate and interest rates changes by the Fed. Currently, there is a tight labor market since unemployment rates are so low. Some think that the rate could even drop to 4.5% within the year. Consequences of a tight labor market will be the result of higher wages for workers since there are so few people without jobs that employers will have to “steal” workers and provide incentives for them to choose to change employment. The Fed also raised interest rates from near 0% to between .25% and .5% at the end of the year. Schwartz mentions that there might be another interest rate hike since there is improvement in the labor market and inflation is low.

Link: http://www.nytimes.com/2016/01/30/business/us-economy-gdp-q4.html?ref=economy

An analysis of gender labor markets in the US and UK

Comparing the United States and United Kingdom, there is a different and interesting relationship between the gender labor market stocks and the business cycle.  In the U.S., there is a greater rise in male unemployment then female unemployment.  On the other hand in the U.K., there is a greater rise in female unemployment then male unemployment.  So what is the explanation for this? 

The study conducted found a few things.  They found that the unemployment rate is not gender neutral and that over decades as much as half of the variation in the gender unemployment rate gap was caused by changes in male and female rates of transition from unemployment to employment in the U.S. In the U.K, the biggest difference in unemployment rate can be shown by a less strong response to the transition between employment and unemployment for women.  In both countries, mostly for females than males, employment is affected by the entry rate from inactivity.

http://www.sciencedirect.com/science/article/pii/S0164070415001482

Chipotle stock gains after CDC declares E. coli outbreak over

Shares of Chipotle Mexican Grill Inc. jumped Monday morning after the federal Centers for Disease Control and Prevention said two E. colioutbreaks tied to the burrito chain’s restaurants appear to be over.

Shares of Chipotle were up $22.20, or 4.9%, to $475.17 in morning trading on Wall Street despite a down market. In an update on its website, the CDC said it was closing its investigation, though it was unable to determine a food or ingredient responsible for the contamination. “When a restaurant serves foods with several ingredients that are mixed or cooked together and then used in multiple menu items, it can be more difficult for epidemiologic studies to identify the specific ingredient that is contaminated,” the CDC said.

Chipotle spokesman Chris Arnold said in an email that the company has taken “significant steps” to improve the safety of its food.

“We are pleased that the CDC has concluded its investigation, and we have offered our full cooperation throughout,” he said.

Chipotle’s stock first started to climb when the market opened Monday morning after the Wall Street Journal reported Sunday night that the outbreak was expected to be declared over.

Chipotle's sales have slipped since outbreaks of E. coli were tied to its restaurants. The chain's December sales were down 30%, according to a recent filing with theSecurities and Exchange Commission.  

In November, the Denver-based burrito chain temporarily closed 43 restaurants in Washington and Oregon after 22 E. coli cases were linked to its eateries. Those restaurants have since reopened.

A month later, 141 Boston College students were reported to have contracted norovirus after eating at a Chipotle in Brighton, Mass.

That same month, Chipotle was served with a federal grand jury subpoena in connection with a criminal investigation being conducted by the U.S. attorney's office for the Central District of California in conjunction with the U.S. Food and Drug Administration's Office of Criminal Investigations.

The investigation is related to a norovirus outbreak in August at a Simi Valley Chipotle restaurant. Chipotle has said it will fully cooperate in the probe.

The chain plans to close all of its U.S. stores for part of the day on Feb. 8 in order to hold a meeting with employees across the nation. The meeting is designed to address changes in food-safety procedures, as well as to allow employees to ask questions about the situation.

Article can be found online at: http://www.latimes.com/business/la-fi-chipotle-stock-20160201-story.html

Why Some Still Can't Find Jobs as the Economy Nears 'Full Employment'

          With the unemployment rate at 5 percent for December 2015 and expected to lower to 4.6 percent by July, economists refer to this as 'full employment.' Many Americans do not understand this term because there are still people out of work, which means that full employment does not exist. However, there will always be some unemployment due to situations such as companies shutting down, people moving to be with family, or individuals looking for higher paying jobs. This being said, full employment is when the number of job openings is roughly equivalent to the number of people seeking jobs.

          Many Americans also wonder why it seems that many Americans are hurting if the unemployment rate is at an ideal place. The reason for this is that unemployment rates are greatly affected by factors such as geography and education level. For instance, in West Virginia, there are some counties with unemployment rates of 12 or 13 percent while in Silicon Valley, the unemployment rate is just about zero. In terms of education level, college graduates experience an unemployment rate of 2.3 percent while high school dropouts currently handle a rate of 7 percent. 

         In all, it is good news that the unemployment rate is decreasing. With more Americans having jobs, more money can be spent and the U.S. economy can experience growth. While it is impossible to ever have an unemployment rate of 0 percent, it is important that steps are taken in order to assist those groups of people with higher rates of unemployment in order to insure their well-being.

http://www.npr.org/2016/01/31/464856256/why-some-still-cant-find-jobs-as-the-economy-nears-full-employment

Did the Fed Raise its FFR targets too soon?

The economist article is an analysis of the FOMC's recent press release after their meeting on the 27th of January.

With the fall in oil prices, the entire world's economy, including that of the US has been affected and the radical decrease in oil prices and its consequent impact on the US economy is perhaps something the Fed did not entirely foresee.

At the moment, despite the Fed noting some improvement in labor market conditions, the long-term problem of low inflation continues to stand. The Fed seems rightly concerned about the possible stagnation of economic growth and activity.

The more concerning part however is that the FOMC does not meet until March and the next few weeks seem specifically critical in terms of monetary policy adjustments so that the US economy can have a buffer against potential losses.

The Fed appears to stick to its stance on the target FFR and hopefully, in an emergency situation will adjust monetary policy to suit the short-term and long-term needs of the people.

http://www.economist.com/blogs/freeexchange/2016/01/no-take-backs

http://www.federalreserve.gov/newsevents/press/monetary/20160127a.htm

Rising Tuition Rates Prompt Change

College tuition is an important discussion in higher education as nowadays a college degree is needed to get higher paying jobs. According to the article, over the last 20 years, the average published price for a year of tuition and fees at a private four-year college has increase 166%. This is a staggering amount. Adjusting for inflation the article found that tuition has rose by 67% at four year private colleges and by 60% at two year public colleges. Meanwhile the median family income in the U.S has decreased more than 7% since 1999. The conclusions from this article are clear, more and more families are finding it hard to pay for a college education for their children. The article found that 63% of prospective students eliminate colleges solely on the basis of price. All is not lost though, as of the last decade 40 college schools have lowered their tuition in response to this alarming evidence. Unfortunately, the article only list the percent of the decrease but does not list the original price of tuition at the schools. While some of the reductions are fairly high, some took place during the beginning of the decade while others are more recent. Inflation rates have changed so the actual reduction in price may be vastly different from what's stated in the article. In the future hopefully the schools will invest in more long term cuts in tuition and that more schools will follow in the future.

http://www.forbes.com/sites/lucielapovsky/2016/01/25/the-lunacy-of-tuition-inflation-must-end-39-brave-colleges-buck-the-trend/#3b6800d5343e

Turning European:Negative interest rates arrive in Japan

Link;http://www.economist.com/news/business-and-finance/21689694-bank-japan-gingerly-joins-ranks-central-banks-penalising


"On January 29th the Bank of Japan (BoJ) said it would cut its benchmark interest rate below zero, to -0.1%, in an attempt to counteract the effects of falling oil prices and China’s slowdown. The BoJ is following the lead of several central banks in Europe, including the European Central Bank (ECB), which first resorted to negative rates in 2014." 

It seems to be a big move for Japan, however,maintaining a sustainable debt level and economy system would be more crucial for now. 

Social Security Changes You Need To Know About Before It's Too Late

A Forbes article explains how there are provisions that phase out two Social Security claiming strategies in the Bipartisan Budget Act of 2015 (a federal statute concerning spending and the budget in the US). In the Beginning of May 2016, married couples will no longer be able to file for and then suspend receiving benefits for the purpose of making their spouses eligible to take spousal benefits. Applications to restrict the claiming of benefits to just spousal are limited to those who were at least age 62 as of January 1, 2016. The ability to use restricted filings will be completely phased out in 2023 when the last of those eligible to use restricted filings turn 70. 

The purpose of this is to decrease the amount of people that decide to claim their retirement benefits at an earlier age. This encourages people to calculate their expected lifetime income streams from claiming at various ages. If people decide to delay claiming their benefits until they reach the full retirement age, the increase is 2/3% per month for each benefits are delayed until the age of 70. Overall, a person will receive a premium on their benefits if they wait until they are at the age of 70. 

An important thing to focus on when people are determining when to claim their benefits, they should consider their expected longevity as well as risk of dying sooner or later than expected. 

The rest of the article provides a more in-depth explanation of the new claiming rule and determining when to claim. 

http://www.forbes.com/sites/investor/2016/01/31/social-security-changes-you-need-to-know-about-before-its-too-late/#7acf71cd6343

To Grade Presidents on the Economy, Look at Policies, Not Results

http://www.nytimes.com/2016/01/31/upshot/to-grade-presidents-on-the-economy-look-at-policies-not-results.html?ref=economy&_r=0

The New York Times article, To Grade Presidents on the Economy, Look at Policies, Not Results , argues against the presumably flawed idea that a presidents success is best measured against the economy of the correlating time frame.  The idea presented by the author, N. Gregory Mankiw, who served as an economic adviser to George W. Bush, is that economic policy decisions last for years, not simply the length of term. Building on this, he additionally argues that because of these effects, each president, from their predecessor, essentially inherits economies.  Mankiw conjures the example of Jimmy Carter, who oversaw anything but economic prosperity yet came into office with high inflation already a problem because of preceeding president Gerald Ford. Contrarily, he uses the example of Bill Clinton who was seen by many as the catalyst of a fruitful economy, though the dot-com failure and drop in Nasdaq composite index is not frequently associated to him. A well timed article, as political debate season arises, we are advised by Mankiw to look beyond economic growth, or lack thereof, beyond GDP, unemployment and inflation, and ultimately at their pursued policies.