3 risks from the Ukraine crisis

            A week ago in Geneva, the United States, Russia, Europe and Ukraine struck a deal that was supposed to help resolve the crisis in the East-West relations. The agreement has unraveled very quickly. Washington and Moscow are blaming each other for failures that have lead to violence between government forces and pro-Russian militants to escalate. As tensions rise, investors are very skeptical with events in Ukraine reaching far reaching consequences. Three things to keep an eye on include; Western sanctions, Russian gas and the European economy.

http://money.cnn.com/2014/04/25/investing/russia-ukraine-risks/index.html

http://www.nytimes.com/2014/04/23/upshot/the-american-middle-class-is-no-longer-the-worlds-richest.html?_r=0

This article is about how the United States middle class is earning much less than they have in the past couple decades. What we had seen as a steady rise since 1980, the average income of workers has been decreasing since 2010 in the middle class. Researchers at a LIS, a group that produces the Luxembourg Income Study Database has confirmed this and it could spell trouble for american workers. In other countries such as Canada, they are still seeing a steady increase which is causing there economies median income to be much closer to ours. What is even more worrying is the median income of the lower class compared to those in other developed countries, which are very low. These numbers could spell trouble for many Americans.

Recovery Has Created Far More Low-Wage Jobs Than Better-Paid Ones

The recession of the recent years has unfortunately caused a large loss in the number of jobs, primarily in the middle and high wage bracket. According to a recent study the total level of employment has finally passed the pre-recession level. Unfortunately the majority of these jobs being created are lower level paying jobs such as those in the fast food industry. Once again the idea of raising the minimum wage is brought up in the argument that the average age of the minimum wage workers is 35 years old currently. Times are tough in our economy, high paying jobs do not just show up out of anywhere and many people have been forced to take large pay cuts, I still stand firm in my belief however that the minimum wage should not be lowered however. In time I believe this economy will sort itself out, and in my opinion the biggest factor in getting back to a good spot in the economy is consumer confidence. People need to have faith that the economy won't go back into recession and things will begin to move forward. http://www.nytimes.com/2014/04/28/business/economy/recovery-has-created-far-more-low-wage-jobs-than-better-paid-ones.html?ref=business&_r=0

Fed Recognized Change in Unemployment Goal Could Be Misunderstood

The unemployment rate for the past 4 months has remained fairly constant around 6.7%. Although the unemployment rate has been declining over the years, its fixed status is concerning for some. However, Janet Yellen and the Fed are not worried. They believe that although supply of labor is greater than demand for labor, it will soon be at the natural rate. The Fed is optimistic that the unemployment rate will decrease in future months. Therefore they are now using a policy by rule. The Fed has “confidence in the strength of the economic recovery” and will begin to contract. They are reducing “its monthly bond purchases by $10 billion, to $55 billion” and they plan on continuing.

Trickledown Economics - Whats the actual theory?

Lets try and sum up exactly what is the trickle down theory and why it is so inherently controversial?
Basically trickle down theory is the idea that if you give a tax break (essentially a tax cut) to the top earners within an economy, these top earners then save more of their already high income. because they save more of their income, these people are considered to be increasing savings that they would "sensibly" be investing it back within the economy. Either way, these activities will be inherently productive, reinvigorate economic growth and eventually generate more tax revenue from these earners and the supposed people that they will help. This boost in growth is theorized to ultimately help the lower income bracket and thus the whole economy.
What Do i feel is wrong with the trickle down theory?
One basic assumption that I feel is also very controversial when it comes to basic economic theory as well. The assumption that when people have higher savings, they will invest back into the economy. People do NOT have to reinvest. They do not have to put their money into interest bearing accounts within a bank, if there are tax cuts now people will expect higher taxes in the future and will hence save for the future. There are way too many loopholes to predict regarding peoples behaviors and that makes the whole theory subject to alot of controversy. Trickle down economics, Will the rich always share back?Doesnt seem like that to me. 

Total Debt to GDP or Trajectory to predict Growth

In 2010 two Harvard Economists published a paper arguing that countries that had public debt to GDP ratios of over 90% experienced a sharp slowdown in growth. However, a recently published IMF paper that analyzed data from 1821 to 2012 paints a different picture. The paper explains that usually the slowdowns in growth are from factors unrelated to debt levels. If you look at average debt levels over a 15 year period, there is no evidence that countries with over 90% public debt to GDP ratios experience less growth. Countries such as post-war Britain maintained solid growth with over 200% debt to GDP. A more important indicator of growth is the debt trajectory. Countries that had rising debt ratios experienced slower growth than did countries with decreasing ratios. In addition, a new study claims that countries with rising private debt levels also experience less growth. A 2008 paper written at The University of Virginia found that the biggest predictor of financial crisis from 1870 to 2008 was rapid total credit growth. If this is true, it's good news for Europe after their debt levels stabilized in 2013. However, for China, it could spell disaster due to their credit to GDP ratio increase of over 95% from 2007 to now.

http://www.economist.com/news/finance-and-economics/21597933-new-research-suggests-debts-trajectory-affects-growth-more-its-level-breaking

"Obamacare: One more reason to quit your job"

According to the Congressional Budget Office in February workers will clock in 1.5% - 2% fewer hours from 2017 to 2024, this is equal to about 2 million jobs. The Congressional Budget office estimated based on health reform. Workers putting in less hours is not due to the fact that companies are forcing employees out but rather that employees are opting to work less. People that are choosing to work less will earn less but qualify for a larger subsidy. Since start ups and part-time workers are guaranteed individual coverage some may take jobs without benefits. Costs such as $362 a month for single coverage are encouraging  40-54 year old to exit earlier.

Obamacare: One more reason to quit your job

Cities where home prices are hitting new highs

http://money.cnn.com/gallery/real_estate/2014/04/22/housing-market-prices/index.html

This article talks about five cities where the housing market is hitting new highs.  Going through what is making those cities hit those knew highs.  With the economic downturn recently, and the housing being one of the biggest things that led to that, do you think that this housing market increase will lead to other cities being more confident in the housing or start getting back to was it before the recession?

UK unemployment keeps falling amid recovery

The United Kingdom's unemployment rate has fallen below 7% for the first time in five years. Unemployment fell from 7.2% in the previous quarter to 6.9%. This drop in unemployment puts pressure on the Bank of England to raise its record low .5% interest rate. The plan was to raise the interest rate once unemployment fell below 7%. However, because the unemployment rate fell faster than expected, bank governor Mark Carney broadened the forward guidance policy to include other economic indicators such as wage growth and productivity. 
Earnings growth narrowly exceeded inflation for the first time since 2010.  Although he's encouraged by the fall in unemployment and wage growth, David Kern, chief economist at the British Chambers of Commerce was skeptical of the high youth unemployment rate of 19.1%. 

http://www.washingtonpost.com/business/uk-unemployment-down-to-69-percent/2014/04/16/e74caf30-c546-11e3-b708-471bae3cb10c_story.html

Obama Pressures GOP on Unemployment Extension, Minimum Wage

http://www.rollcall.com/news/218_obama_pressures_gop_on_unemployment_extension_minimum_wage-232434-1.html

President Obama is working diligently to raise the minimum wage to $10.10 an hour.  The impact of this move has the potential to create quite a mess in the economy.  Although many on Obama's side will argue the opposite, it is likely that raising the minimum wage would also raise the unemployment level.   Minimum wage is currently at $7.25--so the move to $10.10 would be an increase of 39% which is rather steep and seemingly unattractive to employers.