Matters of Economy

Importance of the Economy

2004-12-06T11:59:00.000-08:00

After years of dwelling in a recession, Americans finally have a brighter economic future ahead of them. During the last few months, various articles regarding the state of the economy have discussed several factors which indicate signs of improvement. Despite a decrease in consumer confidence, the industries of retail, construction, and automotive have shown slight improvement through increased sales. Many reasons for the sluggish economy point to consumer skepticism, which weighs heavily on the commercial economy. Small business owners are an example of this skepticism. After losing money, they are placing smaller orders, saying that they will buy more when they see the profit. An additional reason for slow economic growth includes the recent hurricane activities in the South. Although the agricultural industry was affected negatively, its effect created thousands of jobs in the construction industry. In fact, nearly 337,000 new jobs were created in the month of October, most of which came from the construction. As a result, many businesses relying on the holiday season for most of its revenue believe that this year's sales will surpass the previous years. Recently, many economists have begun to express their belief that the economy is growing and gaining momentum for the future. As one article stated, the consumer price index has increased showing that the cost of consumer goods is raising. Thus sales will decrease. In the oil industry, the price of a barrel of oil has decreased from sixty-three dollars to fifty-five dollars. This results in cheaper gas and energy prices. Overall, it is widely known that the economy fluctuates over time and no one can predict the future.

by all of Matters of the Economy

Consumer Confidence Levels Drop Again

2004-11-30T22:39:00.000-08:00

Since the month of April, consumer confidence in the United States has continued to fall as Americans have worried about the job market and the expansion of businesses. The reduction in confidence resulted in a twenty-eight billion dollar loss in production from the previous quarter. Before the consumer confidence levels were announced, the government had released a report stating that the economy had actually grown at a faster 3.9 percent annual pace. This growth in the annual pace rose from the estimate of a 3.7 percent pace. Economists believe that the rise in energy beginning in July are accountable for the decrease in confidence. In the article, it was shown that the number of consumers who believe that the conditions will become worse rose from 10.5 percent to 11.9 percent. The percentage of people anticipating fewer jobs will become available increased from 18.3 to 19.7. The effect of consumer confidence lies in the sales of products throughout the United States. With a decrease in confidence, people and economists can expect a decrease in consumer sales. As a result, businesses will continue to struggle. A member of the Consumer Research Center stated, "Looking beyond the upcoming holidays, the continuing erosion in expectations suggests consumers do not feel the economy is likely to gain major momentum in early 2005." Despite a rise in consumer spending from 1.6 percent in the second quarter to 5.1 percent in the third quarter, people are concerned that the economy will slow in the near future.

Consumer Worries

2004-11-30T18:45:00.000-08:00

"Consumer confidence lowest since April; GDP revied upo" describe the situation that this economy has fallen into. Consumers have begun to worry too much about this countries economy. It seems as though the economy grew faster than the government had expected, 3.9 percent faster to be more exact. However, businesses have shown a decline by of about $28 billion. One must note that this number was affected by the unexpected hurricanes that reaped the Southeast. These things along with the spike in energy prices have caused many consumers to have doubt in our economy. However, this doubt has not affected the auto industry by very much. According to a survey, 11.9 percent of consumers feel that the economy will get worse, a number that rose from 10.5 percent. In the third quarter, inflation went down to 0.7 percent, consumer spending went up to 5.1 percent, and US export went up by 6.3 percent.

Article

2004-11-30T09:38:00.000-08:00

http://www.usatoday.com/money/economy/gdp/2004-11-30-gdp_x.htm

Change in the Line Up for Economic Team

2004-11-29T22:55:00.000-08:00

Link Here
President Bush has already stated that 4 out of the 5 top economic officials, which should definitly breath some new life into his economic policies and the way he handles it. Supposedly he wants to go outside of the government to find new officials which has the potential to be a very good decision, as most people that he would get from underneath his own control would most likely not be willing to go very far outside of his own views for fixing the economy. An interesting choice that I saw was a professor from MIT who is labeled for being an expert on Social Security and taxes, which is just the place that George Bush needs aid in as I understand it has been the target of much criticism. As one of the Bush administration people was quoted, they don't need some inbred politician, they need someone who will, even though it may hurt short term, will tell them what needs to be done and how to do it and how long it will take to do it, and if it will be worth it, which it most likely would be otherwise he wouldn't have suggested it. Though certain politicians have been known for making decisions that have thus far not bore the fruit they were supposed to have already, example Iraq and tax breaks.

Rising wholesale prices

2004-11-28T08:12:00.000-08:00

It appears that as the oil price go back down; the wholesale items go up in price. Jumping up 1.7 percent, this is the largest jump in 15 years. With an overall increase of 6.8 percent in the energy prices, gasoline has gone up by 17 percent. Seeing that barrels of oil have lowered in price by $8, many economists feel that 2005 will have a better turn out for the consumer. But, this is not the only reason economists feel this way. The Federal Reserve is increasing interest rates to help give the economy a boost. The recent hurricanes that hit Florida are partly to blame for the raise in prices. Some economists are skeptical, saying that the rise in PPI, producer price index, has a chance of not raising the inflation on the retail level. According to recent entries in the CPI, consumer price index, economists expect to see a 0.4 percent increase. Sung Won Suhn feels that we have seen the peak of the oil prices and will soon see them fall again.

Article

2004-11-23T13:19:00.000-08:00

http://www.cnn.com/2004/SHOWBIZ/TV/11/23/rather.anchor.ap/index.html

The Large Increase in the PPI

2004-11-16T23:46:00.000-08:00

After only an increase of 0.1 percent in the month of Oct0ber, the producer price index, also known as the ppi, jumped an astounding 1.7 percent in November. It has been over fifteen years since the percentage was this high. Thus many people are beginning to worry that high inflation will be the result. Economists believe that energy prices made the biggest impact on the producer price index. In November, gasoline prices raised seventeen percent, home heating oil prices increased eighteen percent, diesel fuel saw a twenty-one percent increase, and jet fuel increased seventeen percent. The immense increases in the energy prices even overcame a drop in the prices for barrels of oil to create the large ppi percentage. In the month of October, barrels of oil were placed at fifty-five dollars a barrel. This price was reduced to forty-seven dollars a barrel. Interestingly, the drop in oil prices may actually lower the inflation rate for the United States. Along with reduced oil prices, rising interest rates will also lower the chances of inflated rates. Sung Won Sohn, chief economist at Wells Fargo, stated, "I'm reasonably sure we've seen the peak (for oil) and it's beginning to trend down and that should do a lot to decelerate inflation." Although the initial reaction to the soaring energy prices was one of concern for the possibility of increasing inflation, the rising interest rates and the decreasing of oil prices have reassured many economists that the country's inflation will remain at its current level.

Article for week 11/15-11/19

2004-11-16T08:14:00.000-08:00

http://money.cnn.com/2004/11/16/news/economy/ppi/index.htm?cnn=yes

Rising wholesale prices

2004-11-12T08:12:00.000-08:00

Article: "Four more years!"

2004-11-10T23:13:00.000-08:00

http://premium.money.cnn.com/pr/subs/magazine_archive/2004/11/SELA.html
again I will copy and paste it for everyone:

From: Money Magazine
The market: "Four more years!"The prospect of a Bush defeat has been holding back big investors, argues political analyst Greg Valliere. But does it really matter who is in the White House?
Interview by Jon Birger; Greg Valliere
November 2004 Vol. 33 No. 11
One of Washington's longest winning streaks is on the line this ElectionDay. Greg Valliere, chief political strategist for Schwab SoundviewCapital Markets, has correctly predicted every presidential electiongoing back to Jimmy Carter's win over Gerald Ford in 1976. Four yearsago, he predicted a George W. Bush win, and he did so on Memorial Day.This election, Valliere waited till July to make his call, and onceagain he's going with Bush. But the tea leaves also tell Valliere thatW's margin over Democratic challenger John Kerry will be very narrow. By the time you get the next issue of this magazine, we'll all know theanswer. (Barring another hanging-chad crisis, that is.) But it may takea little longer to sort out the implications of the election results forour portfolios. In September, Valliere sat down with MONEY to talk aboutwhich investments have the most to gain from a second Bush term, andwhich ones could win if it's Kerry who dances at the next inaugural ball.
Q. How much do elections really affect the markets? A. For a wide range of stock sectors—health care, energy, etc.—a changein regulatory policy means big changes for shareholders. And in general,you'd have to say that a Kerry presidency would be more adversarial froma regulatory standpoint.
Q. But four years ago, everyone was saying that Bush's tax cuts would beterrible for the bond market. And in 1992, everyone thought Clintonspelled doom for health-care stocks. Both calls were wrong. A. Granted, it's hard to go back and quantify a direct correlationbetween an election and the performance of a specific security. For onething, investors are savvy. They anticipate, and often you have ananticipatory move well before an election. I also think it's incompleteto look at an election's impact without taking into consideration whocontrols Congress. And there's a third factor as well. Not to talkmyself out of a job, but there are factors that sometimes dwarf what'sgoing on in Washington. Where we are in the economic cycle is usuallyfar more important.
Q. In other words, a President's economic success or failure oftentimeshinges upon when he's elected? A. Exactly. In terms of catching the economic cycle on an upswing, it'sbetter to be lucky than good. One could argue that Bill Clinton caughtthe cycle at a very fortuitous time.
Q. Let's assume that Kerry stages a successful comeback. Given thelikelihood Republicans will still control Congress, does that mute thepotential impact? A. Absolutely. It is a mistake to assume that Kerry would be better forbonds. He may be more vigilant about deficits and he may talk to [formerTreasury Secretary] Bob Rubin, but I think the chances of him undoingall the Bush tax cuts are close to zero. The House of Representativeswould become a huge roadblock for Kerry.
Q. You still think Bush will win? A. I've got Bush with a very narrow victory. There are some people nowsaying that Bush is going to win comfortably, and I really reject that.I guess I can't believe that Kerry's campaign will stay this lame. Ithink he'll get more traction on domestic issues—particularly theeconomy—than on Iraq or terrorism.
Q. I'm assuming most of your institutional investor clients prefer Bush. A. They do. I think one reason the markets were so choppy this summer isthat it looked like Bush might blow what had seemed an easy re-election.
Q. The conventional wisdom is that Republicans are better for stocks.And yet stocks have usually performed better under Democrats. What gives? A. Clinton had great stock numbers, but remember, there was gridlockthen. Republicans controlled one or both of the houses for much of theClinton administration.
Q. Are there any sectors or stocks that would benefit from a Kerry win? A. Fannie Mae [FNM] and Freddie Mac [FRE]. They're the rare case whereKerry would probably be more gentle than Bush. The Bush people wouldprobably try to tighten regulation of both of them. Jim Johnson [aformer Fannie CEO] is one of Kerry's top advisers.
Q. You've noted that Bush's Justice Department has been slow to pursueEnvironmental Protection Agency findings of clean-air violations bySouthern Co. (SO), Xcel Energy (XEL) and other power companies. Do youthink Kerry would be tougher? A. I do. There would be a much different climate for those companies. Q. You think makers of generic drugs could benefit under Kerry. Why? A. Kerry could go to his director of Medicare and say, "Look, we shouldcurb Medicare-reimbursement rates for prescription drugs and focus moreon generic drugs." That's why if by late October it looks like Kerry isclosing fast, I think it would be a plus for the generics and a clearnegative for the likes of Pfizer [PFE] and Eli Lilly [LLY]. Q. What should investors expect to see from a second Bush term? A. Making the tax cuts permanent would probably be his top priority. Hehas a chance with the 15% capital-gains and dividend taxes. I think hehas no chance making permanent the abolition of the estate tax orkeeping the top income tax rate at 35%. The votes just aren't there. Q. Do you expect more spending restraint? A. I do. Bush has been embarrassed by conservatives who allege that he'sbeen profligate. The juiciest target for spending cuts isMedicare-reimbursement rates. If Bush is re-elected, there is going tobe an attempt at a sharply reduced rate of payment increases for HMOs,nursing homes and hospitals. I think those stocks could be vulnerable. Q. Speaking of big targets, will Bush do anything about Social Security? A. You'll see something from them on retirement reform. I'd expect tosee another proposal for retirement savings accounts. They might proposeletting people take part of the FICA tax and put that into their ownaccount with some very plain-vanilla investment options. Q. Out of curiosity, how does one become a political analyst for WallStreet? A. My background is journalism—in fact a lot of people here at Schwabhave a background in journalism. Journalists have good BS detectors. Q. I think mine is going off. A. [Laughs.] No, I'm serious. You're always being spun in this city.Everything needs to be taken with a grain of salt. VALLIERE'S TAKE• BUSH WINS But Kerry can stage a comeback.• STOCKS The market prefers Bush.
• DEFICITS Even if Kerry wins, Congress will thwart him on taxes.

October Improvement

2004-11-10T20:37:00.001-08:00

After months of seeing little improvement, the job market received a large boost in the month of October. The increase of new jobs in October ended the streak of seven months. According to the article "Hiring in October at a seven-month peak," over 337,000 new jobs were created which doubled the number which analysts had initially predicted. Unfortunately, many of the jobs were created in reaction to the hurricanes that devasted the states in the southeast. However, many of the new jobs were created in industries showing that the labor market seems to be strengthening. Along with October, the months of August and September saw improvements in the labor market as well. Due to the upcoming holiday season, the job increase will hopefully aid the businesses that rely on Christmas shopping for most of their earnings. The statistics come at an opportune time for Republicans as well. Within a week after the re-election of George Bush, Republicans are using the statistics from October to show the nation as proof that Bush's tax policies are improving the nation. Another statistic showing improvement says that 2.2 million jobs have been created since August of 2003. Despite the increase in jobs over the last three months, the overall unemployment has risen from 5.4 percent to 5.5 percent. According to the article, this is a positive sign as it shows that Americans have rejoined the job hunt due to "renewed confidence." Overall, Americans should be pleased encouraged by the statistics.

A Boost from Young Americans

2004-11-09T23:56:00.000-08:00

In the past, young Americans generally were not concerned with the matters of the economy or the state of the stock market. However, the current generation of teenagers have changed that as their impact on the economy has become too large to ignore. It is believed that the great amount of money collected in the late 1990's from the stock market played the greatest role in earning the attention of teenagers. It is known that college students or those who have recently graduated possess more money, more debit-cards, and even more bills from cell phones, cars, and the internet than ever before. The marketing firm Student Monitor recently discovered in a survey of 1200 college students that twenty-three percent have savings bonds, thirteen percent own stocks, eleven percent have bonds, and seven percent are in mutual funds. The large increase in the involvement of college students has caused the creation of an industry of financial education programs. In the article, it was noted that there are two obstacles for students to overcome, possessing too much and possessing too little. The argument concerning possessing too much claims that students are overly concerned about their financial status. People believe that students should be content with being poor. However, students in today's age are searching for jobs in order to support their desire to own items such as cell phones, laptops, and iPods. The problem lies in the fact that students are working for items that are necessities. In the argument for kids having too little, it was stated that students are already in large debts with credit card payments and student loans. Unfortunately, these students do not have the resources to bounce back. Overall, young Americans are strengthening the economy with their involvement and investments.

Article: What the Election Really Means to You

2004-11-09T23:17:00.000-08:00

http://premium.money.cnn.com/pr/subs/magazine_archive/2004/10/ECO.html
I believe you have to be a subscriber to read my article, so I will copy and paste it for everyone:From: Money Magazine
What the Election Really Means to YouVoting your wallet on Nov. 2? Before you do, look beyond the wrestling on the campaign trail and focus on the economy your candidate would truly deliver Michael Sivy Additional reporting by Carolyn Bigda, Tara Kalwarski and Stephanie D. Smith October 2004 Vol. 33 No. 10

George Bush and John Kerry disagree about lots of things, but whenit comes to economics, they have the same message: Vote for me, andyou'll be better off. It's a simple, direct appeal to voters'self-interest, and each candidate has backed it with economicproposals that a cynic might regard as fairly naked attempts to buysupport. But if you really want to protect your family's economicinterests in this election, you need to look beyond such short-termcalculations as whether, say, Bush's tax cuts or Kerry'shealth-care proposals will put more money in your pocket.Presidential candidates think in four-year chunks of history. Youcan't afford to.Ultimately, your interests are best served by an economy that willstill be healthy when you retire and still competitive when yourchildren and grandchildren join the work force. Whether youconclude that Sen. Kerry or President Bush is better able toproduce that outcome is, of course, highly subjective. But that'snot to say that there is no real difference between their economicvisions. The two diverge sharply on crucial matters like taxes, thedeficit and energy--and they would each make different trade-offs.So don't kid yourself: On Nov. 2 you'll be making one of thebiggest decisions about your money that you'll make all year, andyou should understand what you're voting for.Taxes and the deficitThe federal budget deficit this year is $455 billion, or 3.8% ofGDP. It could remain above $400 billion a year through 2008 unlesssomething is done. Running a deficit isn't necessarily a bad thingwhen the economy is ailing, as it was from 2000 to 2003. Continuingto build up federal debt in a recovery, however, is shortsightedand dangerous: As economist Milton Friedman points out, a tax cutthat adds to the deficit today is just a tax hike on futuretaxpayers.One way to close the deficit would be to raise taxes modestly. Butthe boldest strokes of Bush's administration have been his two hugetax cuts--and his chief concern in a second term would be to ensurethat they are made permanent. Bush claims that he can cut thedeficit in half within five years, largely by reducing spending.But he doesn't plan on cutting defense, and he can't cutentitlements or interest on the national debt. "Outside thoseareas, there's just not enough money to get you there," says DavidKelly, economic adviser at Putnam Investments. The Republicansrespond that growth will close the gap--which is not an answer butan evasion.Kerry plans to roll back Bush's tax cuts for households earningmore than $200,000 and to sharply reduce tax breaks for capitalgains and dividends. That might raise anywhere from $650 billion to$900 billion over 10 years. But he has a host of spending plansthat add as much as two or three times what his tax increases wouldbring in. In other words, Kerry's proposal is no different fromBush's. Pray for growth.Besides the deficit, Americans' low savings rate worries manyeconomists. Because we save less than 1% of income, down from morethan 7% in 1990, we have become dependent on borrowing fromforeigners. That isn't a problem as long as foreign investors seelots of opportunity here. But if that inpouring of capital everslackens, interest rates could soar, choking off growth. "We haveto save more--period," says Richard Berner, chief U.S. economist atMorgan Stanley. Kerry has no real plans for increasing the savingsrate. Bush's ideas are still very vague. Among them: replacing partof the income tax with a consumption tax, and privatizing part ofSocial Security.Despite all the talk about reining in government spending, neitherparty is willing to take on entitlements like Social Security andMedicare. Both programs promise the elderly more than the countrycan afford, especially once the baby boomers retire. Partialprivatization of Social Security is arguably desirable as a way ofboosting the savings rate. But the Republicans' claim that it willsolve the program's looming funding crisis is disingenuous. TheDemocrats' unwillingness to deal with the issue at all is simplypolitical cowardice.Industrial policyIt may be a cliché, but Republicans do tend to look at problemsfrom the business executive's point of view. Removing impedimentsto growth is the top priority. "Our focus," says Bush's topeconomic adviser, Stephen Friedman, "is keeping America the mostproductive place in the world." By contrast, Democrats have a morebottom-up view that favors cushioning the sharp ups and downs of afree market. Neither candidate is ideologically consistent,however. Bush imposed protectionist steel tariffs for 2002 and2003, while Kerry wants to cut corporate income taxes.Nevertheless, Bush's ideas for improving the business climate havethe merit of simplicity: cut taxes, loosen regulation and offertargeted reforms. The President wants to make health benefits moreaffordable for small businesses by allowing them to band togetherand buy group coverage. He favors massive reform of laws oncorporate liability and class-action suits, as well as looserenvironmental and commercial regulation.Kerry, by contrast, offers a mix of old-time pro-labor goodies andwonkish industrial policy. He favors raising the minimum wage to $7an hour by 2007, extending unemployment benefits, strengthening theright to unionize and requiring equal pay for women doing the samework as men. However fair-minded these initiatives may be, they'llraise companies' costs and certainly won't promote economic growth.Kerry's best idea when it comes to spurring economic growth is toramp up spending on basic scientific research. "The thing to do isincrease the budget of the National Science Foundation," says Yaleeconomics professor Robert Shiller, referring to the government'sprimary supporter of nonmedical, nonmilitary research. Kerry alsowants to actively promote broadband Internet access.Bush has little in the way of science policy. Spending onnonmedical research has declined as a percentage of gross domesticproduct during the past 30 years, and Bush has cut the NationalScience Foundation's fiscal 2005 budget.Energy independenceEconomists distinguish between normal market forces and externalevents known as exogenous shocks. Such shocks are unpredictable,but some still need to be anticipated by government policy.One obvious shock would be a disruption of the oil supply. InAugust, oil reached record highs of as much as $48 a barrel. Inpart, this reflects fears that terrorists might target globalproduction. But the real energy problem is that demand is growingtoo fast. Asia accounts for most of that growth, but U.S. oilconsumption jumped a hefty 3.2% in the second quarter.Bush's energy policy includes improvements in efficiency andelectricity generation, but mostly it relies on stepped-up domesticoil production. At the rate U.S. demand is growing, that's aninadequate solution. Kerry wants to invest in alternative fuels andcreate incentives for auto companies to make more efficient cars.Problem is, such proposals usually turn out to be expensive andineffective. The only alternative technologies that succeed arethose that arise out of market demand, such as the new hybridgas/electric cars.There is a better solution, however: Slap a stiff tax on oil orgasoline, as virtually every other oil-import-dependent country hasdone. Neither party has the nerve for that, of course.Human capitalLet's start by dispelling one myth: Free trade and outsourcing arenot destroying high-wage jobs. On the whole, well-paying jobs aregrowing more than twice as fast as low-paying ones. The realproblems are that high-paying blue-collar jobs are disappearing,those workers are not being retrained and U.S. schools are notturning out enough highly skilled graduates to keep the U.S. workforce competitive.Both candidates agree on the importance of offering new trainingto workers whose jobs move overseas. Bush, in his guise as theEducation President, has a wide array of programs to promoteelementary and secondary education, along with mandated standards.Kerry has similar plans and says he'll spend a bit more. Hisfreedom is constrained by the need to please the teachersunions--always strongly Democrat--but some of his proposals appearto be beneficial nonetheless.Choosing between themIn one sense, the choice is pretty clear. A Bush administrationwould rely on standard free-market principles: Cut taxes andregulation, open the world to trade and let it rip. Most economistswould say that this is the course most likely to produce highgrowth.The benefits of this growth, however, would go mainly to theproviders of capital and the most highly skilled workers, while thecosts would be largely borne by the employees left behind. A Kerryadministration would try to moderate the vicissitudes of thisprocess. Sometimes such intervention has the desired effect; othertimes it unintentionally makes things worse. Either way, it willalmost certainly produce slower growth.There's one other factor. Pressure is going to mount to reduce thedeficit. And neither candidate can fulfill all, or even most, ofhis campaign promises and simultaneously bring the deficit down. Sowhat's likely to give way when the choices get really hard?Bush won't want to reverse course and raise taxes--his tax cutsare the hallmark of his first term. He won't want to stint ondefense, education or health-care initiatives like theprescription-drug benefit. That means most other social spending isgoing to be under continuous and relentless pressure. If you don'tlike the way government has off-loaded more and more financial riskonto your shoulders in recent years, you really won't like a secondBush administration.Kerry can't be seen to do any less social spending than Bush. Hemay trim a little from defense. But when the time comes to stanchthe red ink, Kerry will have to raise taxes--and not only on thoseearning $200,000 or more. Taxes may be the price we pay for acivilized society. On Nov. 2, you get to vote on just how muchcivilization you want to pay for.

Hurricane Season Provides Jobs for Many

2004-11-09T09:55:00.000-08:00

"Payroll Growth Jumps, Helped by Hurricanes" provides insight into the results of this years hurricane season. Through all the destruction that occurred, some good cam of it. Multiple jobs were created to help clear the wreckage, roughly 113,000 jobs to be more precise. Even though jobs were created, they were also lost. The unemployment rate went up from 5.4% to 5.5%. The increase was unexpected do to the fact that oil prices had jumped to above $55 per barrel. Economists had predicted businesses to place these things on hold. Bush is the first president up for reelection that that has fewer jobs than when he came in, approximately 371,000 fewer that is. One thing the article does not mention is that the economy began to go downward during the Clinton administration and that the economy is actually on an upturn right now.

Articles for this week

2004-11-09T06:38:00.000-08:00

http://www.usatoday.com/money/economy/employment/2004-11-05-jobs_x.htm

http://www.usatoday.com/money/perfi/general/2004-10-29-young-investor-cover_x.htm

Oil Prices Hurt Consumer

2004-11-08T11:24:00.000-08:00

Over the past few months oil prices have risen dramatically. As a result companies, such as Deere & Co., are making efforts to create alternate energy sources. John Deere is trying to help the consumer by using corn and soybeans as energy sources. In stead of putting extra prices on the consumers, it seems that most busineses are holding off on projects that they would other wise be doing if the oil prices had not spiked so high. Consumers are soon to feel the wrath of these oil prices. For example, Whirlpool plans to raise ptices on its appliances by 5 to ten percent. Many companies that know a price rise is ahead fear that this will effect the amount of business they will get.

Disaster turned to good causes

2004-11-08T09:56:00.000-08:00

Link Here
I think one of the numbers that stands out the most especially in relation to the hurricane, is the 71,000 jobs that were created as a result of more jobs becoming available by construction companies and ones like it that are responsible for reconstruction in the entire southeast that were hit hardest by the hurricanes in October. We are still down 371,000 jobs since George Bush took office in 2001, but he has brought our country a long way amidst the troubles of 9/11 and Enron and others. One interesting point though is that Bush is the first president since Herbert Hoover to have a lower job employment rate then when he took office. This is saying a lot though, as Hoover was president from 1928-32, which as you probably know was during the time period of the beginning of the Great Depression, including the infamous "Black" Tuesday. Our own president faced 9/11, two very important times in our countries history as 9/11 can already be found in history text books, however it wasn't Hoover who improved the well being of our country, it was FDR. Whereas if Bush keeps the rate of jobs increasing at the rate it has been the deficit will be erased by January, which will surely put him amongst the greatest presidents of our time.

High Oil Prices Hurt Consumers

2004-11-02T20:36:00.000-08:00

In the past, Americans have always been concerned with the possible inflation and other economic problems that were caused by increases in oil prices. Fortunately today, as oil prices continue to rise, Americans are avoiding past problems through improved energy efficiency and market competition. The latest oil increase over the last several weeks had Americans expecting an even larger increase in prices. However, due to the fear of losing customers, businesses have decided to trim profits, delay investments, and postpone hiring rather than raise prices. While this tactic has worked up to this point, businesses may soon have to revert back to raising prices as their ability to use other means diminishes. In the article, it is written that, "From major manufacturers to local bus companies, evidence is building that the slack in the system is being used up and soon consumers will feel the effects of $50-a-barrel oil." This statement shows that Americans will eventually receive the effects of rising oil prices. It appears as though the price increases will be reflected on consumers rather than with businesses. In fact, many economists believe that the price increase has taken seventy-five billion dollars off of the nation's economic growth this year. Although this is a substancial amount of money, the effects of the prices would be far more damaging years ago. People can thank the reduction in oil-dependence for decreasing the harm on the economy. The last few years have seen many replacements for oil-based products. Such a replacement includes soy-based color inks. These replacements are allowing Americans to avoid a possible economic catastrophe.

Higher Oil Prices Soon To Squeeze Consumers

2004-11-02T11:46:00.000-08:00

http://www.washingtonpost.com/wp-dyn/articles/A14485-2004Oct31.html?sub=AR

Economy Article shows Cautious Optimism

2004-10-31T13:59:00.000-08:00

Although its heartening to see small-business owners, who currently run quite a large share of the economy, predict better economic progress this year, this article describes how various industries attempt to "fall even" this year by ordering "flat line" amounts of various products. Various financial institutions, such as credit lenders, remain cautious as the economy slowly hedges upwards. The planned hirings occuring by these small businesses remains unoptimistically down, as higher interest rates may shove off potential investments and keep the economy sluggish in the months to come. Although key economic conditions continue to remain without growth, employers continue to remain cautiously optimistic, hoping that the months to come will increase business, which will leave the economy better off as a whole.

Unemployment Jump

2004-10-30T23:49:00.000-07:00

Link Here
The number of Americans filing new claims for unemployment benefits rose last week by 20,000, this is obviously stated in the article but nevertheless it is an important statement. Despite what the government may say, or what records may try to show, it is obviously apparent that we aren't out of the gauntlet yet, and just because we have been making small imporvements over the past couple years doesn't mean that we should let our guard down, or start halving our efforts against unemployment. This article does make considerable effort to show that it is not entirely to blame on poor policy making or decision making, that there was a huge influence by the recent marathon of hurricanes in Florida, where most of the recent claims have been filed from. This article brings up another good point that while the current recovering economy is good news we also need to watch out for other such economic issues that can arise in such situations such as inflation, and that the proper precautions should be executed to inhibit any unwanted economic "issues."

Weekly Jobless Claims Fall Sharply

2004-10-28T11:12:00.000-07:00

It appears that the job market is going up do to the fact that less people are filing for unemployment. The unemployment for this week is the lowest they have been since September. The two presidential candidates are always fighting over the Bush tax cuts. The economy has grown at a rate of 3.3 percent since these cut, there has been a loss of 821,000 jobs. Not only has the unemployment rate gone down from the previous week, it is also down from that of this time last year. I believe that the economy is on a verge of going one way or the other. While the economy is on a rise, it is moving very slowing. Which ever candidate wins the presidency, I believe he will make or break the American System.

Bullish Economy

2004-10-28T10:51:00.000-07:00

In the article "Bullish on the Economy, but Only Cautiously So" displays how small businesses have a major impact on the economy. The small businesses are always looking for new ways to improve business. If money is tight and business is not working, then these guys are looking for the next place to open. According to a survey, it is said that 75 percent of small businesses expect to see a better year than before. On this same survey, only few people thought that the economy would be negatively affected and the looked toward the positive side. Of almost 500 businesses, 68 percent said that they looked toward the years to come with confidence. However good these statistics look, actions speak louder than words. People look toward the year with optimism yet are placing conservative orders. Hope seems to be what people are basing their confidence on.

Unemployment looking Up

2004-10-23T13:52:00.000-07:00

Link Here
This article gives a list of uplifting numbers concerning the emplyment rate as of most recent. The number of people applying for unemployment dropped as of last week, which is a good sign for Bush, but what's even better is the unemployment rate compared to what it was this time last year. Unemplyoment was reaching 3.5 million this time a year ago, and the number's from last week show it at 2.8 million, which is great news for Bush in the weeks preceding the election. However, the net loss in jobs since Bush was in office is still just under a million, though it is entirely impossible to pin that all on the president as it is obvious that we have had a bad chain of events in the past 4 years, i.e. Enron, World.com, 9/11 just to name a few. I think it is incredibly easy to point at Bush and say look at the numbers and assume it's his fault, but looking at the recent reports AND the context that the numbers are being taken from,(the exact causes of the drops) it's not so easy to say that it was his fault, when it is very possible that if someone else were in his place we might be in even worse condition.

Hope for Small Businesses

2004-10-21T18:16:00.000-07:00

The state of the economy is an important issue for Americans still deciding which candidate to vote for in the upcoming Presidential election. After several years of having a struggling economy, there is reason for hope in the future for owners of small businesses. In the article "Bullish on the Economy, but Only Cautiously So" by Ellen Rosen, it was found that surveys made by American Express, CIT Group, and Mastercard International discovered that most entrepreneurs believe that businesses and the overall economy will improve in 2005. In fact, the negative outlook was the lowest in the two years that American Express had conducted the survey. While owners are hopeful that the recession is coming to an end, uncertainty has formed in some people's minds. Consumer confidence has dropped slightly since September. A survey by the University of Michigan gave reasons such as high gas prices, slow job growth, and the war for the drop in confidence. Despite the drop in consumer confidence, statistics received on Friday, October 15th showed that retail and food sales had increased 7.7 percent from one year ago. Overall, the cautious optimism from a majority of entrepreneurs is a positive sign for the future. It will be interesting to see the impact that the recent economic optimism will make on the election. Neither candidate would be able to change the economy over night because economic growth takes time.

2nd article for this week

2004-10-21T13:35:00.000-07:00

http://www.nytimes.com/2004/10/21/business/21sbiz.html?oref=login