Andrew Chon Ap Econ Summer 2011 Articles

Highly Charge (Electric Cars)

By Neal Rosenbaum, The

Economist July 2nd 2011

Transportation: Movement of people and goods from a location to another.

As popular as electric transportation is in the United States, The Chinese Government is eager to implement a massive load out of electric mobiles onto chinas roads. The super power nation wants to release roughly about 500,000 electric cards, Lorries, and buses, by 2015 and 5 million by 2020. If persuaded effectively, consumers who buy the government sponsored vehicles will be receiving subsidies in large sums of money. Whats even more exciting is that if Chinas hybrid revolution succeeds, the sales would account for 7% of new car sales in China making it the biggest market for electric vehicles, by volume, in the world. But the Chinese Government can take it another step up by insisting that more taxis and government vehicles switch to electric. But still, its harder to influence the minds of the common people which can really help thrive the nation.

The Wall Street Journal

New Unemployment Claims Fall Below Key Level
By Connor Dougherty
Full employment is a condition at the national economy, where all or nearly all persons willing and able to work at the prevailing wages and working conditions are able to do so. Hopefully, new claims for unemployment insurance dropped below a key level last week. Initial claims for unemployment insurance fell 24,000 to 398,000 in the last week of July. When claims are below that level, economists generally concur that the economy is proliferating jobs than it is shedding. Many economists say the trend would have to continue for several weeks before they would be convinced the job market is starting to turn up. One economist, Troy Daving, said that to be convinced there would probably need to be two more weeks of below 400,000. If unemployment claims continue their downward angle, it could look forward to healthier figures for the governments views of the jobs market. In May and June, the economy added an average of 21,500 jobs.

The Wall Street Journal

White House Pushes for Votes on Trade
By Elizabeth Williamson International mostly means something that involves more than one country. Trade between two or more countries clearly defines the term international. The White House and congressional leaders wanted to push votes on long delayed free trade deals and government aid to displaced workers. However it is not clear yet that the president and his allies, including major business groups, have forged support the votes to win passage before congress takes its vacation. President Obama is gambling that he can overcome Republican opposition to his proposal to sum up approval of the long stalled treaties with South Korea, Colombia, and panama. Whats most important is that export related jobs are vital to reviving United States job growth now that former economic starters such as housing and retail consumption are not doing so well. After weeks of bargaining the Obama administration declared Tuesday it had agreed with congressional negotiators on a deal that would allow the White House to submit trade pacts for congress to approve.

The Wall Street Journal

Weaker Dollar Fuels Sales
By Chana R. Schoenberger

The weak dollar is unfortunately affecting U.S companys second quarter results forcing them to pay high prices for raw materials. However the grass is greener on the other side. Other companies report strong export sales, companies such as, Colgate-Palmolive and Caterpiller Inc. are getting a good rise from the weak dollar. The dollars drop is prodiving some relief to companies facing rising commodity prices, which are inflating prices. Kimberly-Clark Corp, which sells consumer goods like toilet paper and diapers, told investors Monday that the hostile commodity environment has worsened over the last three months. This would cause its costs of wood pulp and oil to rise as $750 million dollars this year. ConocoPhillips said the weak dollar might hurt its ability to fund projects in places like Asia, Europe, and Canada. But unlike Kimberly-Clark Corp, the company might see an offsetting benefit.

The Wall Street Journal

Nintendo: Apples Latest Prey
By Nick Wingfield

Price is the quantity of payment or compensation given by one party to another in return for goods or services. The price fluctuation caused much uproar against Nintendo. The unexpected weak demand for Nintendos 3DS handheld entertainment system, which displays game visuals in 3D, had high hopes for a rebound for the company. However, devices from Apple Inc. and cheaper games that can be played online or easily accessed and played with friends via smartphones are dominating the market. The decisions to drop the 3Ds price by about a third, $249 to $169, upset many customers who bought the handheld device at full price. The President of Nintendo, Satoru Iwata, sent apologetic emails that wrote that this was the first time ever that Nintendo had cut such precipitous prices. To compensate, Nintendo offered previous buyers free downloadable software such as games, add-ons, and other virtual experiences. While games for Nintendos handheld system sell for usually $30-$40, mobile and social games tend to be more lenient on customers. Prices such as $1 and $5 entice customers to buy their convenient games rather than Nintendos specialized individual games.

The Wall Street Journal

A Prince of the Coffee Bean
By Jean Guerroro

Production, in economics, is the act of satisfying a need or want. The Honduras has done such an excellent job with its production with coffee that the Honduras passed Guatemala as the top coffee producer in Central America. Central America is known for producing the bulk of the worlds washed Arabicas, the most expensive and sought out coffee beans. The Honduras harvest this season was 3.8 million 60 kilogram bags of coffee compared to 3.5 million bags from Guatemala. Hondura is a poor nation known for its continuous coups but this economic and production triumph is a sweet boost. However there is something underneath all the success. It is claimed that some of the Guatemalas beans were actually grown in Honduras. As Guatemalas coffee commanded ever higher prices, it only encouraged more smuggling, creating a cycle for Honduras coffee industry. When the government started to tax on coffee exports, it only encouraged more coffee smuggling, helping fund technical assistance to growers that boost production and quality.

The New York Times

As Corporate Profits Rise, Workers Income Declines

By Floyd Norris Income is the consumption and savings opportunity gained by an entity within a specified time frame. According to Floyd Norris, these times are not so advantageous in income terms to workers but prosperous for companies. The Commerce Department last week reduced its estimates of economic growth in 2010 and early 2011. At the same time, it said corporate income was much better than it had thought. Using newly available data from 2009 corporate tax returns, the department raised its estimates of corporate profits by 8.3 percent for 2009 and 10.8 percent for 2010. The new figures indicate that corporate profits accounted for 14 percent of the total national income in 2010, the highest proportion ever recorded. The previous peak, of 13.6 percent, was set in 1942 when the need for war materials filled the order books of companies at the same time as the government imposed wage and price controls, holding down the costs companies had to pay.

http://www.nytimes.com/2011/08/06/business/workers-wages-chasing-corporate-profits-offthe-charts.html?ref=income

Business Week

U.S. Economy: Production Stalls on Autos, Housing Starts Drop

By Shobhana Chandra and Bob Willis Output in economic terms is the amount of goods and services by a firm, company, and/or a country. According to Business Week, Output at factories, mines and utilities was unchanged after a 0.7 percent gain in March, figures from the Federal Reserve showed today, led by a drop in auto production after parts supplies were disrupted by the earthquake and tsunami in Japan. Work began on 523,000 houses at an annual pace, down 11 percent, as tornadoes and floods in the South shut down construction sites. Production may reassert its place at the leading edge of the recovery as parts supplies resume, while overseas demand and business investment boost sales at companies like Caterpillar Inc. At the same time, a housing recovery may take years to unfold as foreclosures and 9 percent unemployment hold back demand. Economists had forecast a 0.4 percent gain in industrial production, according to the median estimate in a Bloomberg News survey. Housing starts were forecast to rise to a 569,000 pace.
http://www.businessweek.com/news/2011-05-17/u-s-economy-production-stalls-onautos-housing-starts-drop.html