High Gas Prices Leads To Semi-Good Results

A recent study by the Federal Reserve showed that in twelve different regions, the rising gas prices actually benefited the economy. While nobody enjoys paying four dollars per every gallon of gas, these high-energy prices may actually be helping the economy. Companies seemed to be way busier which then increased their demand for workers. Companies hired more employees after this rise in gas prices because consumers were buying more of other goods. The price for materials for these companies is much more expensive but economists believe these higher priced consumer prices will not last long but rather it will be temporary. The higher energy prices also resulted in a high demand of auto sales and tourism, while some shoppers shifted to paying for low-priced goods and inferior goods rather than high priced luxury goods. Since so many factories increased their production, so many more workers were hired which thankfully lowered the unemployment rate. So maybe the highly expensive energy and gas prices are not only bad, even though they do result in workers getting less of a pay increase. But still, at least there is an optimistic side to this crisis and that maybe it will help American citizens and consumers since it increases employment and makes some goods less expensive.

-Taryn Dandurand
High Gas Prices Leads To Semi-Good Results

Starbucks Goes Mobile

        Starbucks has come out with a faster way to pay for coffee and it’s as easy as a push of a button. Starbucks has created an app that allows people to fill up a gift card online that exists only on phones so when people get up to the checkout counter, they just get their “card” scanned and the money gets taken off of it. This is a great way to interact the growing technological field with their growing company. This will make Starbucks more “customer friendly” for those who have iphones, and is also getting lots of free publicity off of all the papers and news teams that are talking about the app. Apps can get very popular very fast, almost becoming a trend. If the Starbucks app gets enough popularity people will want to try it out – people will buy drinks just to see what it is like to buy drinks on the iphone. This is a very smart move because with Starbucks on peoples mind (seeing it every time they look at their phone) and making it quicker and faster to buy drinks, Starbucks’ profit can only rise because more people will want to buy drinks and try out their “new toy”. 

 -Kendall Healy

Workers Needed, but Not Found?

Who would have ever thought that there would be a necessity for workers in the current economy? The amount of lay off workers reaches headlines every day. Businesses put out a front that they cannot afford to pay their workers and for that, a massive amount of panic has hit the American economy. However Isbister, president of a growing metal fabricating company reports she is in dire need of workers. This Wisconsin factory is growing and shows much potential, however Isbister reports their marginal revenue can double by adding a mere twenty more workers. With such a down economy one must ask, then what’s the problem? Workers are not in high demand in other areas and are therefore being laid off; the supply of workers should be innumerable. However it seems that the type of work Isbister needs requires specialized labor. She reports that she has had various applicants but consequently had to turn them down due to lack of experience. It seems blue collared workers consider themselves above working in a factory. It is both sad and scary to say that people are finding themselves above work and are therefore beyond helping themselves. The main point here seems to be, how low must this economy get before people realize they must do their part in the business world in order for the economy to make it?

New gaming system?

Microsoft recently created the Kinect gaming system, a console that allows for a person to be the controller. When Xbox released the Kinect gaming system the demand for the Nintendo Wii system went down, also taking away the Wii's first place best-selling position. Nintendo hopes that when they cut down the price of the Wii gaming system, in the next few months, more people will buy the Wii gaming system. Nintendo has been a large company in video games for a long time making it a well respect brand which means that Nintendo has many loyal customers. Therefore when the price of the Wii goes down the followers of Nintendo who could not afford the Wii before will now be able too, which ultimately creates a larger profit for Nintendo. Even though Nintendo is lowering the price of the Wii system I do believe that they will have to do more to win the first place position back from Xbox. There are rumors of a new console from Nintendo, although very little is known. If Nintendo creates a newer more advanced version of the Wii I believe they could take their first place position back from Xbox.

New Government Rule Brings New Flying Experiences

In the article, current airplane companies, such as Southwest Airlines and American Airlines (to name a few) are reportedly supposed to acknowledge and follow the new government rule that forces such airlines to respect the travelers and make the experience more pleasurable.  It limits their sneaky tricks and former guidelines to flying, while replacing them with much more restricted rules and requirements to follow.  According to the Yahoo article, airlines will have to disclose fees more clearly and will be forced to follow the new rules that protect flyers that lose their bags, are held on runways for four or more hours or are bumped off flights for a reason that can be controlled.  This new rule by government will help travelers out, especially when they are stuck on the runway for hours and hours at a time or their flight to a vacation or important business trip may be canceled. But it will most likely have a negative effect on airline companies.  Many companies get their profit from charging people for the extra bags.  Last year alone, their total revenue was over $7.9 billion just from the extra baggage.  Also, another negative side effect for the airlines is the fact that the price of fuel is extremely expensive right now while the demand is likewise extremely high.  Due to the evident law of demand just mentioned, companies will lose much more money than they already have since they will be forced to still purchase the fuel with less money to spend. They are ultimately spending more than they are making and this could maybe even cause some struggling companies to go bankrupt.  The competition between business and the incentive to make a profit is still in place but these rules may ultimately drive people to choose companies with better deals, and the airlines themselves may have to supplement the goods they use to be able to survive and find ways to still attract business in these hard economic times under such conditions.  I would not be surprised if we see some of the things we always see on flights disappear to make up for the loss of the companies income from baggage.

High Gas Prices Leads To Semi-Good Results

A recent study by the Federal Reserve showed that in twelve different regions, the rising gas prices actually benefited the economy. While nobody enjoys paying four dollars per every gallon of gas, these high-energy prices may actually be helping the economy. Companies seemed to be way busier which then increased their demand for workers. Companies hired more employees after this rise in gas prices because consumers were buying more of other goods. The price for materials for these companies is much more expensive but economists believe these higher priced consumer prices will not last long but rather it will be temporary. The higher energy prices also resulted in a high demand of auto sales and tourism, while some shoppers shifted to paying for low-priced goods and inferior goods rather than high priced luxury goods. Since so many factories increased their production, so many more workers were hired which thankfully lowered the unemployment rate. So maybe the highly expensive energy and gas prices are not only bad, even though they do result in workers getting less of a pay increase. But still, at least there is an optimistic side to this crisis and that maybe it will help American citizens and consumers since it increases employment and makes some goods less expensive.

DISH Networks Winning Bid on Blockbuster

Last year Blockbuster filed for Bankruptcy Protection, which worried many people that all of the Blockbuster stores would be closing and cause a shortage of video's. Blockbuster has 2,400 stores around the United States and are planning to shut down 700 of those stores, including all the operations in Argentina. Luckily for DISH network the more popular ones stayed along with the DVD vending kiosks and the DVD mailing and digital download business. DISH network bought Blockbuster with a winning bid of $320million. DISH network bought Blockbuster because they want to enhance its video-on-demand services. With DISH network buying Blockbuster I believe that they will ultimately have a higher profit than before. By enhancing the video, creating a new chain of stores, and with the brand name of Blockbuster and Blockbuster's relationships with content provider's, will help DISH network switch from a linear provider of scheduled broadcast into a provider of on-demand content. DISH networks switch to on-demand content from their usual scheduled broadcast will cause DISH network to have an increase in demand for their products. Therefore, DISH network will benefit by having a greater profit than before from having the winning bid on Blockbuster.

Radiation in Fish

                  Until recently, the massive earthquake and tsunami that struck Japan on April 11^th really didn’t affect Americans very much. Yes, we’ve all seen the Red Cross commercials begging for relief aid and hundreds of pictures and videos circulating around the internet showing the widespread damage that these natural disasters have caused, but our daily life really hasn’t been affected. This could however, change in the future. Seafood exports produce nearly 2.5 billion dollars a year in profit for the Japanese people, with many of those exports destined for the U.S. Last Thursday, a net of squirming eels was pulled up from the seafloor, only one prefecture over from the radiation-sticken Fukushima prefecture – home of the “rogue” reactors. This discovery of radiation in seafood has gotten the attention of food safety regulators both in Japan and in the Untied States, leading to more strict guidelines for imported and exported seafood. Radiation-plagued fish are being thrown out one after another; fish that would otherwise be ready for exportation. The economic effects of this unusable seafood will surely hurt the Japanese economy, but will also raise the price of fish in the United States. Since the supply of clean fish will be drastically reduced, one can expect a hefty increase in price since the demand will be the same. However, wouldn’t Americans rather pay more for certifiably radioactive-free seafood?  I know I would. 

Federal Workers Getting Laid off Good or Bad?

As the economy continues to make a down turn more and more federal workers are being laid off. However, America being the great country that it is has provided its citizens with a safe guard for those who have lost jobs. This type of security helps to put many American minds at rest. But when the number of people that get laid off exceeds a normal amout, is this security necessary? Or for another matter, affordable? This Friday, April 8 there are expected to be 2 million workers respectfully layed off from their jobs. Unemployment benefits do not simply come out of thin air, they come from the taxes other Americans have paid. When the unemployment rate rises at such a sharp incline (as demonstrated today) the demand for taxes will without a doubt increase. These workers who believed were being protected by these unemployment benefits will end up having to pay for it themselves through taxes. One must ask themselves, is laying off this many workers going to truly help this economy or simply set us back once again?

-Kinsey Budagher

New Wireless Internet, New Possibilities

According to Associated Press Writer Joan Lowy, there is a new wireless internet network, LightSquared, that could potentially threaten the GPS’s we use throughout America and the lifestyle we have grown familiar to.  It is so powerful it has the ability to interfere with GPS used in airplanes, cars and such that the government uses.  This new wireless network is so powerful that the Federal Communications Commission plans to help the economy by stimulating it with the new network.  They say that it would “bring faster and cheaper Internet connection to all Americans – even in remote corners of the country.” This could be a good or a bad thing for our economy.  It will stimulate and encourage consumers to join this new network, which would reduce the demand for other companies, creating a shift in demand.  Such a change could really weaken our economy as well by weakening other, current companies.  On the contrary, entrepreneurs and companies have the ability to create complements to be used with the new wireless network that will knock out all other completion and bring in more profit.  But at this moment, government is playing a role in regulating the company and requiring them to make sure that before they launch their new wireless internet network, they must be sure that it will not affect the GPS systems.  This new production and invention could either be a smart tradeoff for all or a dangerous new creation. At the moment, the risks are too extreme and for that, Americans will not be able to test out this new incredible wireless internet until all other issues are fixed. 

-Haley R

iPad 2 Supply Begins To Creep Closer to Demand

http://www.computerworld.com/s/article/9215476/iPad_2_supplies_creep_closer_to_demand&vm=r

According to current reports demand for the iPad 2 is now starting to move closer towards the amount of supply of Apple iPads. Apple is promising consumers the delivery of their iPads in 2 to 3 weeks now rather than 3 to 4 weeks. When apple was promising consumers the delivery of their Apple iPad in 3 or 4 weeks supply was not able to keep up with the demand. This struggle of supply to keep up with the increasing demand of the Apple iPad 2 was moving Apple farther away from equilibrium and in turn reducing the firm’s profit. The excessive demand is a result of supply being too low. There are a couple of Global reasons why Apple’s Supply chain is most likely less than normal. The tsunami in Japan that happened in March as well as the problems at one of the country's nuclear power plants are large factors that economists are speculating as factors that have caused this change in Apple’s supply chain. As a result of the Apple’s lack of supply of iPad 2s, people have been selling iPad 2’s for between 40%-53% more than market price.

-Lizzie Sanders

3-D Phone

In entertainment, the introduction of 3-D products is prominent. There have been 3-D movies, television and now 3-D phones. However, there is a special difference between the phone and previous 3-D products. The new 3-D phone will not require its users to wear glasses. Some may say that this can change the way people look at 3-D products completely. The biggest complaint I have heard about 3-D is the fact that they don't want to wear the 3-D glasses. So it would be appropriate to ask whether or not 3-D products will be more successful if the glasses aren't needed. Most likely, ditching the glasses, companies will have an easier time selling the product because users would not have to deal with the disadvantage of the 3-D glasses. In other words the trade-off would be eliminated. Users will no longer have to wear 3-D glasses that many dislike in order to view entertainment products in TV. This advantage will change the view on 3-D products, hopefully making them more successful and user friendly. If consumers respond positively to the new 3-D phone it could benefit the economy in the same way the iphone or android has done. In other words, the demand for this new 3-D phone will have the same effect as the iphone/android had. If the 3-D phone is just as successful, the possibilities the product can have is endless. New 3-D apps and games will be in store for its users making 3-D products a new industry. If the new phone is successful then the demand for all 3-D products could increase as well. The 3-D phone could be the new product that makes 3-D even more successful.

-Alanna

BP Oil

BP is in the process of making a deal with the US government to allow them to start drilling in the Gulf of Mexico – only about a year after, their oil wells exploded. Although they can’t drill any new holes, lowering chances of another spill, drilling in already established holes still could cause a spill and have consequences that BP does not want to deal with again. Should we afford to risk another oil spill just so we can get some oil from a United State’s company instead of an international one? BP has had to supposedly set aside $40 billion to cover the costs of the spill from last year – the one that killed 11 workers. They are apparently taking more time effort and money to be safer and take more precautions when going back out. I think that it will be good for more oil to be coming in from our own companies yes, but because of their reputation I am not sure how much help it will actually help. How much extra money will it take for “precautions” to be taken on top of the $40 billion? For BP it will be good for them to start drilling again, but everyone will be keeping an eye on them to see if they are more careful this time around.

http://www.nytimes.com/2011/04/04/business/energy-environment/04bp.html?src=busln

McDonald’s To Hire 50,000 April 19th

This idea of hiring 50,000 employees is a great way to help stimulate the economy. The excess demand for jobs is so extreme in America since the economic downfall in 2008, there is a desperate need for more supply of jobs. The demand for jobs far precedes the supply of jobs in America today. By hiring workers at McDonalds it will create more opportunity for people to be hired to other jobs because the demand will decrease as more workers are hired at McDonalds.  Workers hired at McDonalds will be given $8.30 per hour, which is a dollar and ten cents higher than minimum wage which is $7.20. Hopefully this will be a motive for people to gravitate towards applying to work at McDonalds. This will help the economy move the issue of demand of job opportunities vs. supply of job opportunities more towards economic equilibrium and farther away from America’s current economic issue of excess demand of jobs. Perhaps this will increase McDonald’s current marginal product of labor meaning that by increasing the number of employees hired, there will also be an increase in output of product. By increasing the output of product McDonald’s will also increase their revenue.

- Lizzie S

Health or Money?

http://healthland.time.com/2011/03/21/the-new-cost-of-preventing-prematurity-will-kv-back-off-the-high-price-of-makena/

http://healthland.time.com/2011/03/30/fda-will-allow-cheaper-version-of-pregnancy-drug-to-be-sold/

This is a great example of the potential downfalls of excess demand. This medicine limits the risk of premature birth, which is a fantastic leap in medical advancements, because of all the potential dangers of premature birth. However, this good was going to be sold at $1500, which is not affordable for many. I think, that the price should be lowered because of how essential this product could be in insuring the health of newborn babies. Unfortunately, if the price is lowered, there will be excess demand, and not everyone will be able to purchase this product, because the suppliers will not be willing to produce that much of a good at a lower price. I think that this is the perfect example of an indispensible good that is too expensive at market price, but if the price is lowered, there will not be enough of the good. Our group believes that if some sort of incentive was offered to the producers of the good, then this medicine could be supplied to all expecting mothers, which would be an amazing step in health. This article points out an uncomfortable position that this puts the parents in. They must choose between the health of the baby and their financial security. Because the demand for products ensuring the health of their babies is inelastic, the effect on the economy in the short term will be negative, because parents will be spending more on this medication and less on other goods. Hopefully, this will encourage companies to create a product that is inexpensive that produces the same result as this medicine.