Gas Prices

Gas prices have fallen during the past two weeks, because of lower demand and a price drop for crude oil. The national average price decrease was four and a half cents. The most expensive price for gasoline in the nation was $2.64 in San Francisco and the least expensive was $2.04 in Tulsa. Prices are looking to continue to decrease in the next few weeks; however, the summer months of high gas consumption will in the long run overcompensate any money saved with the price decrease.

Identity Theft

Identity theft has been a common issue during the past few years. Last year, the Better Business Bureau reported over nine million Americans who were victims of identity theft. They all averaged $1000 loss.
People are dumpster diving to get old bills, pre-approved credit cards, bank statements and much more. Many people believe that it is safer to throw these documents in the garbage than it is to deal with them on-line. The best option is to handle with the internet, even though there are bogus e-mails, and web sites the get people to respond back, indulging personal information.
Another risk is the home computer. There are several ways that hackers can get information from the home computer. The best thing to do is get the Webroot’s Spy Sweeper 3.5. This is a Windows program that is a very good spyware protector.
This article discusses the problems of identity theft and offers some solutions for them. The last solution is to be a little paranoid of your own identity.

Blogging Withdrawals!?

I am sad to see our class blogging come to an end. I may be accused of kissing up, but I don't care. I may submit this after midnight just to show that that is not my intent. I have learned a lot from this experience and plan on continuing to blog on the web. I had never heard of it before this class. What a great thing to do--exchange ideas and thoughts on the web. I have found a lot of economic benefit from blogging, besides helping my grade. If you were hoping to convert people to be bloggers Dr.Tufte, you have succeeded

Clicking Collusion

I had never thought of the possibilty of search engines colluding until I was searching for a topic to blog on. I went to Google, typed in the word "collusion" and ironically one of the results listed, on the first page, was an article on how Yahoo! and Google are being accused of collusion. The search engines charge advertisers a certain amount each time an internet user clicks on the advertisement. According to the plaintiffs, search engines, incuding others besides the ones I mentioned, are over reporting the amount of clicks being made on advertisements.

Low Birth Rate

Low Birth Rate
The Korea Times has recently written that the birth rate in Korea is exceptionally low. The government has now passed a bill allowing all fathers three months leave from work if their wives gave birth.
The economic problems associated with the low birth rate is the same for Koreans as it has and will be for U.S. baby boomers. With a sudden drop in population, millions of people will have to be supported in 60 or 70 years by a tiny fraction of the population.
Also "current job insecurity will further deteriorate because a large number of schools will inevitably close. Women might be conscripted to make up for shortages of military manpower. Various pension funds will be depleted, threatening the welfare system in its infant stage. The nation will suddenly become an aged society. Retired people will be compelled to return to work sites."
"The Third World: Staying Poor and Growing Old" by Randy McDonald

Economic Food Chain

"When IBM sneezes it usually means the tech sector gets a cold. Are chip makers going to take a hit?" IBM stocked took a pretty big hit this last week when its stock fell 8%. Tech suppliers are worried that this hit could filter down to them.

IBM blames the sales short coming on the drop in demand for hardware, software, and general computer services. Intel, TI, and other major chip producers are waiting nervously to see the effects on their revenue.

My question is, what would cause such a drop in IBM revenue? This year started out great for IBM yet in March their profits fell.

For more information, refer to the article Chips Slip a Blip.

Finding The Profit

United Auto Group has found that it makes a greater profit outside of the United States. In Drive On it says that sales grew 6% in the U.S. and 22% outside. In order to spread the fixed costs and increase the profits, we can see that United Auto Group has found it extremely beneficial to enter other markets.

Credit Card Bologna!

In the article "Squeezing Small Businesses", it is reported that credit card companies are jacking up the fees for using credit terminals. Credit card companies such as Visa and MasterCard charge merchants a fee for using their services. Recently though, with the hike in bonus points and purchase incentives, credit card companies are passing costs on to merchants. After all, someone has to pay for all of the ‘free’ stuff card companies hand out. Ultimately, this means the consumers will be paying the bill. So...in the long run, all of those fun little points we get for free stuff on our credit cards are paid by, you guest it, you and me.

A struggling giant

Despite climbing sales wal-mart stock has gone flat or even declined. In an article about the giant its says that investors that have invested in wal-mart stock since 2001 have seen a 9.9% decline in their stocks value.

Everyone Deals With The Prisoners Dilemma

Prisoners No More: State Investment Relocation Incentives And The Prisoners Dilemma talks about states facing the prisoners dilemma of whether to offer relocation incentives to intice people to move there or not. The dilemma that states face is, if they offer incentives another state is going to do the same and how far should they go. Each state is trying to improve their economic position but if they conitnue to offer more incentives the benefits are going to become less. Thus, they would have been better off if they hadn't offered any incentives.

Stealth Tax ... Be Prepared

It was a little disconcerting reading this news update regarding the Stealth Tax, or in other words, the alternative minimum tax (AMT). Initially designed to limit deductions of the rich, it is quickly beginning to affect the middle class. Congress has no plans to make changes to this tax as it would be too costly ... but what effect will this have on the economy in the long run? The more the middle class has to spend in taxes, the less they will be spending in the market. Unfortunately, Congress rarely, if ever, looks anywhere beyond elections. So, as I'm guessing many of us may be in this tax bracket in five years or so (and especially for those families planning on several children), we'd best be aware and prepared for the possibility of this "Stealth Tax" affecting us.

Who Makes The BMW X3

I was surprised to see who actually makes the BMW X3 and also where. After reading This Is Not A BMW Plant, I found out that BMW outsources this to Magna Steyr. Magna is a big canadian auto-parts maker with a plant in Graz, Austria. It is in this plant that The BMW X3 is actually built. I always thought we outsourced our vehicels to Japan.

US Seeks to Curb Textile Imports form China

After the expiration of regulations limiting global garment import quota from China produced a surge of new garments. Their production is up over 1000% and they are producing more cotton shirts pants and blouses. Now the American manufacturing trade action coalition is begging the US government to stop this infusion of new clothing. This move would be completely legal because in 2001, when China when it entered the world trade association, China agreed to this action being taken against them. The question keeps coming to my mind, should the US get out of the textile market and let someone who can produce these items at a lower price take over the market?

Space Junk

I saw on T.V. the other night that some people are planning to go in to space and salvage all the “space junk” that is orbiting around the earth and recycle it. They say there are massive amounts of junk flying around earth from discarded shuttle parts to abandoned satellites. They are also talking about dismantling the international space station. This leads me to wonder, we have trashed the earth, are we destined to trash every place we go. If we establish a base on the moon will they have to plan for a land fill there too?

Simple Things Produce Great Rewards?

As I was reading Get The Most Out Of Production Using Marginal Analysis, I thought this is just common sense. I have a certain amount of money or time and then each of these items are going to use this much of it. I then thought, if it were that easy then why do we have so many companies going bankrupt and closing their doors? So my question is what good is this graph if in reality there are so many other factors that effect it?

Amtrak cancels Acela Express

Launched on December 11, 2000, Acela service, Amtrak’s high-speed train system, ran into trouble when they found cracks in 300 of the of the Acela fleet’s 1,440 disk brake rotors. Acela makes 15 roundtrip runs on weekdays between New York and Washington and 11 between New York and Boston. Acela accounts for about 20 percent of Amtrak’s Boston-New York-Washington weekday service carrying an average 9,000 to 10,000 passengers.

This set back comes at a time when President Bush is pushing to revamp the rail system. The President is planning to shut down funding at a time when the whole system is in dire need of additional funds.

With the airlines all increasing their prices isn’t it good to have an alternative source of transportation? Should the Bush administration pull the funding on this system that thousands of people rely on each day or should they help to improve it and make it more accessible to the public?

Pricing Each College Course

Show Me The Money is a great article. I wanted to run and show our administration. I don't know if they already use this to formulate the costs of each course, but if they do, why do they keep it a secret? Most people expect a profit is going to be made by a business or institution. Otherwise there would be no reason for that institution or business to provide the service. With the administration raising tuition and cutting programs, I would be very interested to see what factors they have taken into consideration. I feel that we as students are looked down upon by the administration and are left out of what costs should be cut. Instead we are just told what is going to be done with our fees rather than given a choice.

LED evolution could replace the light bulb

In the upcoming years, LED technology could virtually replace the standard light bulb. This new technology isn’t that new. It was first developed in the 60’s but has seen little use except for in alarm clocks and battery level of video cameras. The large drawback has been producing whit light. In the past they could only produce red, green, and yellow light. Nichia Chemical of Japan was able to make a breakthrough when they produced a blue light. Nichia combined the new blue with red and green to produce a white light.
The big fuss with the LED is they use less wattage and will last up to 50 times as long as a 60-watt bulb.

Mental Illness Among Grad Students

In an article entitled "The Pressure Mounts", by Carolyn Butler in the April 11, 2005 U.S. News and World Report (to which there is no hyperlink), Carolyn states that graduate students are under a termendous amount of stress, causing increased mental illness. A study of University of California-Berkeley granduate and professional schools indicated nearly half the students said they'd had an emotional or stress-related dilemma that sigmificantly impaired their well-being or academic performance in the past year, with 54% of all the students experiencing depression and 1 in 10 having seriously considered suicide. Similarly, a study of law students in the class of 2004 at two institutions found that 63% exhibited significantly higher levels of depression in their final year than they did when they began their professional education. "Students come to law school as quite highly motivated, idealistic, happy people, and then it crashes," says Lawrence Krieger, clinical professor at Flordia State University College of Law in Tallahassee. Graduate school with its competitive climate, relative seclusion in the lab or library, numerous financial concerns, and constant worries about future employment is a hot bed for potential psychosocial triggers. Are these problems on behalf of the schools, students or both? Are graduate schools to demanding or are students not prepared enough or both?

Gas dealer are getting low profit margin in gas price increases

Gas dealers are seeing a slide in profit margins from an increase in gas prices. Gas dealers are experiencing 20 year low. The article stated that the decrease in profit is due to more individuals using credit cards to pay for gas. In addition, more consumers are purchasing unleaded gas as opposed to premium. Gas dealers are finding they have to find other ways to stay competitive. For example, Chevron in Los Angeles is offering 10 cents off gas if you get your car washed at their station. This is truly economics at work. The pressure builds and companies have to find a way to survive the market.

Gas prices and issues the airlines are already dealing with

Gas prices are affecting consumers at the pump in more than one way. The airlines are another often used form of transportation that consumers are going to be seeing a difference in price. Of course these pressures are also affecting the airlines in other ways. The airlines having been battling with bankruptcy, pressures from employees, and cost, the gas prices are only making these dilemmas harder to deal with. In the article, a lot of employees are fighting with the airlines about higher paid executives not taking pay cuts. Gas prices are going to make the fight for survival in this industry all the more challenging. Do you think the rise in prices will detour you from taking any future flights.



Actually totally random question, but was the airplane food ever a factor- It ceases to amaze me that people complain about not getting a meal on the plane. Why would people want the airplane food? I’m sorry, I just always wanted to know that.

PepsiCo’s earnings fizz in first quarter

PepsiCo is the second largest soft drink company and owner of Frito-Lay. Their earnings for the first quarter of 2005 increased an astonishing 7 percent from $6.13 billion a year ago to $6.59 billion. This increase is attributed to a favorable tax change and strong international growth. Is it fair that a very small amount of companies are allowed to make such a large amount of money from an industry that is so wide reaching?

Honda's recall

Honda is having some problems with their ATVs. The company recalled 200,000 ATVs because of problems with steering. The company is contacting consumers that purchased the vehicles to inform them of the problems, and offer free repair. Earlier this year I read an article about Honda and their drop in sales last year. Honda is known for quality, and I wonder how this may continue to affect their future sales. I have also thought on how much consumer demand for Honda is placed on brand loyalty.

Thumbs Down on Air Cleaners

Do you really think that there is a perfect air freshener that will ionize the air? Well according to one consumer there is no such thing. There is not anything that can perfectly clean the air in your house. So it is recommended not to fork out the cash for these expensive air fresheners? Do you think that there is an air freshener that can do that?

Postage Stamp-sized Phone? Maybe

Do you think that it would be possible for a cell phone to be the size of a stamp? That is what Motorola plans to create by the year 2007. That to me is just plain crazy, how are you even going to be able to hear, or dial numbers. But anything is possible with technology today it is crazy how everything is so high tech. Some are even saying that it could just hang on a string off your neck like a necklace. So what are your feelings on the stamp sized cell phone will it really work?

Beef, will we still be able to eat it for dinner?

Now there is a controversy on the condition of the cow before it is slaughtered for human consumption. The debate is if it is safe to slaughter a cow for human consumption if the cow was injured previous to death. Before the debate, it was not allowed. Many consumer groups are opposed to the ratification of injured cows passing inspections. With these kinds of pressures, what kinds of incentives will these leave ranchers to continue ranching? I think that there is too much of a demand in beef, and these frivolous debates will hold little pressure. Last time there was a mad cow scare few people stopped eating beef. What are your thoughts on the matter?

Would you buy trendier products from Wal-Mart?

This article sheds a light of what we may see next time we go to Wal-Mart. The low price leader is paying more attention to trends, namely in clothing. They are realizing that with the increasing prices all around consumers that there may be a notch in selling trendier clothing. One concern they have is hurting their low price reputation. I don’t know would it? Would you buy Lucky jeans or Nike shoes from Wal-Mart. Is price a driving factor or does the store say more about where you purchase your clothing?

MONEY FOR FINGERS

“Anna Ayala's claim that she bit down on the finger in a mouthful of her steamy stew on March 22 initially drew sympathy. But when police and health officials failed to find any missing digits among the workers involved in the restaurant's supply chain, suspicion fell on Ayala, and her story has become a late-night punch line.” -Follow That Finger: Wendy's Doubles Reward for Information

The reason police and Wendy’s suspect foul intention is the litigious history of Ayala. She has personally filed several lawsuits against corporations including General Motors and El Pollo Loco.

Wendy’s has now doubled the reward money to $100,000. The economic side of this story is the monetary damage a case like this has had on Wendy’s. People are scared to find the last four fingers in their chili and have turned to substitute goods leaving Wendy’s short on green.

Economic Speed Bump

The article “Clouds Gather on Wall Street”, gives a concerned bit about the short term economic future of the U.S. Because of rising energy and fuel prices, less consumer goods are being purchased slowing down the economy. Along with energy price hikes, short term interest rates have gone up as well. Here we see a simple trade-off; energy vs. consumer goods.

I have a hard time taking this article’s grim predictions seriously. I think that the above mentioned article is nothing but a short term prediction; a bump in the economic road if you will.

Maintaining Monopolies

In class we are learning about a firm’s strategy to keep other firms from entering the market. Eli Lilly and Co. will keep its patent on a schizophrenia drug until 2011. Do you think that it is better to let companies keep their patents longer, or let other companies produce it cheaper?

Taxes

It is April 15th and there is a very appropriate article on taxes. Various suggestions are given to improve our tax code. One suggests a national sales tax instead of an income tax. I think that a national sales tax would cut down on spending and hurt the economy. It would also create more dead weight social loss. What do you think?

Pork: Your tax dollars at work

With the US being in a state of war, some projects that would otherwise be denied are finding their way into the 2005 fiscal budget. The strategy behind placing these projects on the budget while the country is at war is the President will have to pass the budget if he wants to fund the war.

Tips for the Last-Minute Tax Filers

Why are people so predictable? It’s the same thing every year. Weather it is for Christmas or taxes, people will always put wait tell the last minute. Is our time so precious that we can’t spare the time to get our taxes done? If we look at it from an economic point of view, we would file early, get our return, and then invest it. If you are one of these people this webpage, Tips for the last-minute Tax filers could be your saving grace.

IBM

Has IBM dropped their competitive ball? When Macintosh first came on the personal computer scene, they had a monopoly over the PC market. They have maintained this monopoly (maybe only over their product) by not allowing their product to be duplicated by any competitors. As everyone knows, if you buy a Mac you buy a Mac.

My question is what happened to IBM? Their strategy seemed to be sound in the beginning, but has come back to bite them in the end. They took the opposite approach to the PC market. They let any and everyone make a product that would be interchangeable with the IBM. This was great for the consumer but left IBM with a problem. This being that they had no identity. You can buy an IBM based PC, but not necessarily an IBM. Is there anyway for IBM to regain its identity?

Toyota Prius

Even though there are many hybrid cars on the road, the Toyota prius is taking up a large share of total sales. These gas/electric automobiles are being purchased, new and used, for more than the sticker price. With the gas prices rising with no end in sight, more people are willing to face sticker shock than gas pump shock.

McDonalds 50th Anniversary Invites Reflections on a Brand Icon

What comes to mind if you are a kid of age 4-12, and asked where you would like to eat? McDonalds, or would think that would be it. Because it targets young families with children with toys in happy meals, another reason is because it has been around for 50 years and established its name. It was the first fast food restaurant that gave moms inspiration, so they could have a break from cooking. The question is do you think that it is well established enough to be around for another 50 years?

Responsibility Waning

People all over the world are lacking responsibility according to the article Personal responsibility waning, experts say. According to the experts, people aren't taking responsibility for their actions. The only way the responsibility gets put on them is if a jury or judge decide the outcome( such as in corporate lawsuits), or if Americans put blame on the government for such items as lack of intelligence in the September 11th incident. Historians, philosophers, political scientists and sociologists cite many reasons for the decline of an ethic of responsibility in America over recent decades, including:
- A culture of narcissism or self-absorption;
- The rise of celebrity worship and entitlement;
- The distractions of the war on terrorism.
They claim that we hold people responsible in a legal sense, but in a moral sense no one takes responsibility. Are Americans getting more and more unethical in their practices, or is this an acceptable social norm these days?

Sony Gets the One, Two Punch.

In an article I read, Sony Computer Entertainment has been fined $90 million by a US district court in a patent case over a vibrating PlayStation controller developed by Immersion Corporation. The ruling also prohibits the sale of the PlayStation and PS2 in the US, but the ban has been stayed pending an appeal. If that wasn’t bad enough, Rambus, the main chipmaker company for the PS3, was in a legal dispute with the German chipmaker Infineon. Rambus filed the suit claming Infineon and micron was in collusion. Later, Infineon did admit to fixing chip prices, and late last year four of its executives were sentenced to prison time and heavy fines.

Are You Ready for a Hybrid?

The big concern and topic today is the constant rise of gas prices. That is why more people are switching to the Hybrid cars. They are still pretty new, but getting more popular. When Honda First came out with there Hybrid the style was well not the best or even considered ugly. But now car companies are starting to make them like any other car with all of the amenities. So what do you think will the Hybrids takeover the car industry because gas prices are going up? Would you buy one if you could afford it?

Tax Deadline April 15

Today is the tax deadline April 15. This date seems to loom in the minds of many, but why is it such a perilous day? According to Internal Revenue Service statistics Americans will spend nearly 27 hours to prepare simple 1040 returns and the accompanying common schedules that follow. That is a lot of time! There must be an economic effect hear. The first question is when are these people getting their tax returns completed? If these people are spending time and money to get there complex tax returns prepared are they working or waiting in line at the local tax service. The second question I pose is, why does tax preparation take so long and why does it have to be so complex and complicated? The tax system in our country needs to be overhauled. It is getting really out of hand and I believe it is costing the country more to tax its people than it actually benefits from tax revenue.

House passes bankruptcy bill

The House approved a bankruptcy reform bill that has already passed the Senate. President Bush said in a statement that he would sign the bill. The reform bill will make filing for bankruptcy more difficult, and it will give creditors more recourse in some instances. This bill applies more to individuals who want to file bankruptcy vs. corporations, but it will have a great effect on corporations because they will able to collect on a larger percent of their accounts. I believe that this could have a large effect the nation’s economy. Do you agree?

Prisoner’s Dilemma Made for TV.

I found a great article that told about a new television show aired in Great Britain. The show’s name is "Shafted” and it is a fitting name. In the game players accrue money like any other game show. At the end of the show the two contestants have an accumulated sum of money and they have to decide if to share the money or to try and get all the money for themselves. Their decision is made without the knowledge of what the other person has decided to do. If both contestants cooperate then they share the money. If they both defect then they both receive nothing. If one cooperates and the other defects, the one that defected gets all the money and the contestant that cooperated gets nothing. This is a great modern example for the prisoner’s dilemma.

Serve a Niche & Make it Big

According to an article in BusinessWeek, Mary Ellen Sheets began her business called Two Men and a Truck with a hand-drawn ad in the paper, one truck costing $350 and two men to lift heavy furniture. Originally her sons started the business but when they left for college the demand was so high Mary just couldn't quit providing the service.
Mary noticed there was a need for short inner-city hauls, and focused on serving that niche of the market. Her strategy and consistency served her well. Today there are 152 franchise locations that serve 27 states, and the business. Look what serving the right niche can do!

Demand Rises for Credit Reports.

Credit report demand has gone up, but the price has gone way down because of a new law. The public can get a report from each of the three credit bureaus for free. This law was enacted to slow identity theft. There are some minor rules; it depends on what state you live in, if you reside in Utah, you can get the reports now. You cannot get your credit score for free, and you can only get them once every year. Go to this website, get your reports, and at least make sure the information is correct.

Long Run Outsourcing.

In an article I read, South Korea signed a deal to outsource to the U.S. I thought why outsource to the U.S.? Outsourcing is for reducing costs by getting cheaper labor. After I read an outsourcing blog by Vincent, I came up with a theory of the future of outsourcing. The original outsourced country will benefit from increased revenue, wages will go up, and eventually start to outsource to cheaper countries. This goes on until ultimately, the cheapest country should get all the work; but also will get a lot of the world’s money. The standard of living will go up, wages will rise, and they will start to outsource to other countries. As technology and education reaches every country, wages will be increased to a world equilibrium. In the long run, the benefits for outsourcing will drop to zero.

Is Growth Bad for Environment?

Growth isn’t as bad for the environment as we may think according to a survey conducted by The Economist. The article Environmental Enemy No. 1 lists three reasons for an energy revolution. First, because recycling and treating chemical waste is energy-intensive, alternative cleaner energy should be developed. The alarming green-house effect is a long-term problem requiring a low-carbon future. Human health is the third reason. The government must provide incentives for the development of clean energy innovations. Currently government subsidies encourage the use of fossil fuels.

Trade Deficit and the Income Effect

The U.S. trade deficit continues to increase. Imports were outdistanced exports by $60.3 billion in November alone. American exports should be more in demand with the falling dollar. “By one estimate, if the dollar depreciates by 10%, the prices of American imports rise by just 2%,” reported The Economist. Why does this not follow the income effect? Americans need to live within their means. Europe is running a trade surplus. Why can’t we do the same?

The Federal Reserve says Americans believe they can live beyond their means because they assume their assets will appreciate. Hoping to even the scale, the Fed raised the interest rates to 2.25%.

Costs of Relocating Radioactive Waste

Congress had two alternatives in dealing with radioactive mill tailings sitting by the Colorado River near Moab. One alternative was to cap the tailings in place. This could result in poison seeping into the river and threatening drinking water. The second alternative was to relocate the tailings at a cost of $400 million. Congress chose the latter believing that the $400 million would be cheaper than paying for health problems and lawsuits that could result if the tailings were capped.

Many were worried that Congress would not relocate the tailings because of the high price tag and because Utah is a politically unimportant state. Money should never be the only deciding factor. If the tailings were capped, the monetary cost may have been less in the short-run but the cost to human health could have been detrimental.

The Real Lump of Coal in Christmas.

What is the lump you ask? Deadweight loss. The article “Is Santa a deadweight loss?” states on average, a gift valued by the recipient well below the price paid by the giver. The most conservative estimate put the average receiver's valuation at 90% of the buying price. Where givers spend $40 billion on Christmas gifts, at least $4 billion is being lost annually. What to do? The best present is cash it is the most flexible. Next Christmas, ask for and give cash.

Effects of Internet Gambling

The small island of Antigua left the sugar and banana industry for internet gambling. The states of Utah and Hawaii where gambling is illegal, strongly oppose this new development. Antigua claims that if the U.S. ties to block other countries from offering internet gambling it would be in violation of a 1993 international trade agreement. The World Trade Organization ruled in favor of Antigua. "In trade-speak, Utah's prohibition amounts to the use of a zero-quota on the supply of Internet gambling services, and that's a violation of market access," said Peter Riggs, director of the Forum on Democracy and Trade. This decision will also prohibit states from having exclusive agreements with Indian tribe casinos. Many of the monopolies states hold on state lotteries would be eliminated. Often proceeds from these lotteries are used to supplement state education.
Of course the U.S. cannot negate on a trade agreement, but what effect will this have on the U.S. gambling market.

The Traps Of Banks

One thing that has drove me crazy is dealing with banks and the fees they pin for everything you do. I have talked to others about this before and found that I'm not the only one who has had this kind of trouble. It turns out that overdraft protection programs are mostly a way for banks to get money. The American Bankers Association says that courtesy overdrafts started because many customers wanted them. (Courtesy overdraft protection is the one that the bank automatically signs you up for, simply by linking your checking account to your savings or a line of credit.) Kevin St. Pierre, a senior banking analyst, says, "We think that bounced check fees or insufficient fund fees were $11 billion in 2004 out of $35 billion in total service deposit service charges." Now that's a big figure. What the banks are doing here is completely legal and very profitable. They make a killing on fees and the simple mistakes people make. Which is one reason why now I do my banking at a credit union.

Why Dog the M.B.A.?

Seems that every time I read an article about the M.B.A. degree, some author or professor at Stanford/Harvard is mentioning that just about every college and university is teaching for it in the wrong way. Some say too much analysis and not enough clinical experience, others feel that students are too young to be taught business administration, never having administered a business (no real world experience). Yet others seem to think that core subjects such as accounting, economics, marketing, and finance get disproportionate attention at the expense of crucial "soft" skills such as leadership, teamwork, communication and the ability to think outside the box of discipline. Is it time for the MBA degree to be more than just a "sifter" of students for employers? Some schools are taking, what the feel, corrective action by adding courses such as leadership, collaboration and the like. Others are allowing M.B.A students to handle the school's own million dollar investments fund. Is this the appropriate remedy to at least appease the critics?

Boy Beat to Death by Baseball Bat

I saw this story on television and was able to find the site for it. After hearing about it, it makes me feel sorry for both families involved. Two boys were standing in a concession line after a baseball game, and the 15-year old began exchanging "words" (making fun, non-the-less, because the other boy's team had lost to the worst team in the league) with a 13-year old, who has now been charged with murder. The 13 year old got mad, and hit the other in the knee and then in the head, killing the boy.

So what should happen to this boy who murdered the other? I frankly don't know. It is sad that this would ever happen, and I again, feel bad for both sides. Although it was wrong, very wrong for a kid to hit another with a bat, it also wasn't right to make fun of someone either. The mother of the victim also released a statement she wanted everyone to hear on the TV broadcast, and said that this boy, who is now in custody, was a good boy and she never had hard feelings towards him. Today's kids have become so violent, things like this are happening more and more in the U.S.. What is happening to our families? I'm just glad I don't have to decide this boy's fate, that's for sure.

Euro's Strength To The Dollar

Has anyone else noticed that the dollar has just been getting its’ butt kicked when compared to most currencies, particularly the euro. Why is this? What have the Europeans done that is making their currency gain value so much. The dollar has lost about 20 percent of its value against the euro in the last two years. The euro is continually catching up to the pound too; maybe in a few years, it will hold the same value. Members of the Bush administration say the threat of a financial crisis is not a concern. But is there one?

Crude Oil Goes Down While Gas Prices Stay High

Yesterday crude oil prices were the lowest they had been in seven weeks at $50.24 per barrel. This seems to be a huge drop from a couple weeks ago when they settled at around $57.00 per barrel. Oil prices are falling because of the US department of Energy's claim that the nations supply of crude oil grew last week by 3.6 million barrels. Gasoline inventories are also up 5.8% from a year ago (Jahn). All of this makes me question, why are gas prices still climbing?

I believe that one of the main reasons that gas prices are staying high is because demand is not decreasing. Think about it, do you ever have to go somewhere and decide rather to stay home because gas prices are too high? There might be times when you decide not to go somewhere that you want to go, but I doubt that is the case with most of us. The thought never really crosses my mind, if I want to go somewhere, I go. The fact is, gas prices can stay high, because we all keep driving.

Ban on Ephedra May be Lifted

In this article from KSL, it talks about how the once-popular drug ephedra may be ruled safe by the FDA after a year of being banned from the market. After being linked to 155 deaths, the FDA decided in a court case to take it off the market, but now ephedra supporters are saying the court ruling was invalid and they want the courts to take another look at the case. This drug was linked to the death of the Baltimore Orioles' pitching prospect, Steve Bechler. So why would the FDA consider bringing back a harmful drug if it is known to kill? Maybe they made adjustments on it, but I don't think I would take a weight loss pill that had that kind of history.

Haiti Plans For Elections

This is the first news I’ve heard from/about Haiti for a while. It was just over a year ago that things started getting really crazy there and we had to send in troops to help keep the peace. I don’t even remember hearing what finally happened to their old, corrupted President after he left the country. But now the country has plans for elections and chaos is getting fiercer. Top diplomats representing U.N. Security Council member nations are in Haiti at the present time to check on the interim government's progress toward November elections. Meanwhile, U.N. peacekeepers on the ground have been forced to adapt to increasing chaos. Just what are we to do with Haiti?

Responsibility Of Outsourcers

Outsourcing is becoming more complicated as it is explained in Outsourcing And SarbOx. Outsourcers are now being held responsible to make sure their clients are in compliance with Sarbanes Oxley. I think this is ridiculous. How can someone be held responsible for another person’s actions? I understand part of the end product comes from another company and could reduce the costs, especially if they are not in compliance with Sarbanes Oxley. However, shouldn’t the perpetrator be punished instead of the bargain hunter?

Bankruptcy bill on its way to president

In an article titled "Tough bankruptcy law passes congress" it says that a law with tougher restrictions on those who file bankruptcy passed the house today by a vote of 302-126. This same bill passed the senate 74-25 early this year. The president says that he is earger to sign this bill into law. The bill will force those with income high enough to file Chapter 13 instead of chapter 7 . Chapter 13 makes those that file bankruptcy repay their debts where Chapter 7 allows complete debt releif.

Beefing Up The Numbers

I recently read an article, A New Lease On Accounting, that has found restaurants, retailers, and cellular services are using their lease payments to make their bottom line look better. Why are all these companies trying to boost their bottom lines? The owners set incentives and benefits if a manager can reach a certain goal. Owners also try to make their company look more profitable than it really is. The incentive there is to increase the shareholder value and make the company look good to investors and creditors. I think that this is unprofessional. As an accountant the financial statements are to be stated fairly and objectively. Employees should receive bonuses only if profits are increased in an honest and ethical way. Punishments should also be affixed to deter employees from misstating the numbers.

More and More Outsourcing

I recently read an article stating that the United Kingdom just passed the United States and became the leading national market for outsourcing, click here to read more. I also came across another article stating that India’s second largest outsourcing has grown 50% last year from reporting revenues $1.1 million a year ago, to its most recent fiscal year ending on March 31, of $1.6 million. Click here if you want to read more about this article. The global economy is growing and its participants are sophisticated enough to embrace outsourcing and if the United States can’t let go of these hang-ups we have about outsourcing we could lose our global position.

Judge Confirms Patent

A Federal Judge validated the patent for the drug Zyprexa on Thursday. Zyprexa is a schizophrenia drug that brought in over four million dollars in sales last year alone. The patent will make it impossible for smaller competitors to market a similar product for at least another six years. This is a great example of the United States Judicial System controlling the market. While the patent helps encourage future research, it hurts the consumers because they will probably have to pay higher prices due to the new regulations given to the drug company.

Judge Confirms Patent

A Federal Judge validated the patent for the drug Zyprexa on Thursday. Zyprexa is a schizophrenia drug that brought in over four million dollars in sales last year alone. The patent will make it impossible for smaller competitors to market a similar product for at least another six years. This is a great example of the United States Judicial System controlling the market. While the patent helps encourage future research, it hurts the consumers because they will probably have to pay higher prices due to the new regulations given to the drug company.

Staples to Copy

Staples, the office-supply chain, will allow citizens in four large cities to make free copies of their tax documents on April 15th. While the company says it is performing the service as an act of volunteerism, I believe they are receiving great advertisement. Not only is there name being broadcasted across the media, but they are also giving potential customers a great experience that may entice them to choose Staples as their source for business supplies. This management decision has already helped boost stock prices, and will probably help increase revenue as well.

Trade-offs

I recently read a blog on the new airbus and I would like the class to see airbus’ competition click here for a picture. It looks sharp, but that’s not all the 7E7, or what is now called the 787, has to offer. For starters, better turbulence control, thanks to computers on board that make rapid changes to the flight controls, to better adapt to turbulence. Also the 787 will have a composite fuselage the first for a large commercial jet transport. The benefit of the composite fuselage is to reduce damage to the plane caused by sky bridges, baggage carts, and trucks while on the tarmac. Also composite material is lighter than current material used for commercial airliners, increasing fuel efficiency. The reason for this blog is to help illustrate the trade-offs between the two planes. Trade-offs are ingrained into economic students brains since their first economic class, it will be interesting to see which commercial airliner will end up dominating in its industry. Click here to read more about Boeing's new 787.

Southwest's Oil

Southwest Airlines, one of the largest in the industry, is currently enjoying high revenues due to lower prices on crude oil. The company made deals year ago that allowed them to buy oil today at less than half the cost of the current market price. This lower cost has allowed the company the opportunity to keep fares low and save nearly $200 million in gas prices. These reduced prices will shortly end for Southwest, but they expect no change in revenue due to planned fare increases. The author of the article believes the company will raise airline fares by the end of the year, which will allow other competitors in the industry to also raise their prices. This is an interesting phenomenon. Usually we think that the market determines the price, but in this case, it appears that a single company can set the industry price.

Daily News paper at its...Best...Worst?

“Oh boy, here we go again”. Wednesday, April 13, 2005 there was an article in the Cedar City Daily News that again expressed controversy over a former associate professor from SUU, Stephen Roberds. Myself as a student at SUU, and after reading the article, I have one question for the author; Jennifer Weaver, “What in the world does Stephen Roberds have to do with four completely different professors who were just awarded tenure from SUU?
I have always been told that articles from magazines, newspapers, for example, are supposed to be non-bias. I guess I am not really surprised that this article came from the office where Ed Kociela works. I remember in one article that Ed Kociela wrote concerning SUU, and Roberds, in the Daily News paper a few months back quoting himself to be ‘a seeker of truth’. Ed is no more seeking for the truth than a sailor on a boat in the middle of the ocean seeking for water; I suppose Jennifer is on that boat with him. I am not a journalist, nor do I profess to be one, however, even I see red flags go up with this whole story of why Stephen Roberds was fired. I do not know the reason why he was fired, but I do know that it was not how Jennifer stated it in her article speaking of why Roberds was fired, “For being liberal and possessing a hot temper that flared in an October incident where he (Roberds) used the F-word in a debate with a student”. If that truly were the case, Roberds, in my opinion, would have a good case in a lawsuit against SUU. As of today, I have not read one article about Roberds filing a suit. Failing to bring this to court tells me that Roberds has something to hide. If I were a reporter ‘really’ seeking the truth, my first questions would have been about Roberds past working experience, to see if there was any connection between the two jobs. Again, I have not read one article where Ed or his staff has asked such questions.
No matter what people think, I attend a university that according to the Consumers Digest is one of the top 10 in the nation for quality and value, and we have our professors right now to thank for that.

Immigrants and Imports

The debate of protectionism vs. free-trade just received a new twist. In the blog by Don Boudreaux called Immigrants and Imports the idea that immigration is synonomous with importation is presentated. Boudreaux refers to a recent publication that explains how in the years following the civil war the economy grew so much, eventhough there was a policy of protectionism (i.e. high tariffs). At that time immigrants came into the country in droves. Protectionism is meant to protect American workers from foreign workers, but at that time the foreign workers were easily coming into the country. The foreigners brought with them the services, and they would soon produce goods right here in the US.

The foreign goods were produced in the US, but they still came from foreign workers. The argument is that the policy was not protectionism at all,but free-trade through immigration. If society today calls for protectionism, it must also make sure that open-immigration is stopped, or it will all be for nothing.

The Pope and the Profits

In an article in Business Week, The Pope and the Profits , it talks about the profits that are being made by various businesses after the death of the Pope.
E-bay had a huge amount of memorobilla posted on its web page, items from wristbands to comic books. Among the most expensive items were a bottle of holy water blessed by the Pope, at $500,000, and an oil-pastel portrait of John Paul II, signed by him, at $150,000.
Now doesn't this seem a little ubsurd to a certain extent to charge such high prices for items of the Pope and to make money in ways like this? I know that demand is high for items and collectibles pertaining to the Pope, but do we go to far at times? I think that selling items and making money from such things is okay, but I do think that we push it to the extreme.

FDA Can't Make Up Its' Mind

Tell me if this isn’t two-faced. A day after recommending against allowing silicone gel breast implants to be sold to the general public, a Food and Drug Administration advisory panel now says that a company called Mentor should be allowed to sell its product on the general market. Although they did say that there would be a number of conditions to be met. Sounds like the Food and Drug Administration is picking favorites. Sometimes I wonder if there are truly conspiracies when things like this happen. Or perhaps the new company had done more research than the previous.

Bankruptcy Law Nears Passage

The House will take a vote this week on the Bankruptcy Abuse Prevention and Consumer Protection Act. This act will make it harder for people to get rid of their debts by declaring bankruptcy. The bill has already passed in the Senate. This could be huge if it is passed. I wonder what will happen though; what will happen to people that die and have major debt? Will it pass on to the family? What should happen?

Bluetooth Sniper

This was an interesting article about a student that goes to the University of Southern California that developed the BlueSniper rifle, a tool that looks like a gun and can attack a wireless device from more than a mile away. The maximum range of Bluetooth is 328 feet. This gun exceeds that by quite a bit. The student, who works for a technology development company says that the sniper hasn't been used to actually "hack in" to people's personal files and data, but simply assessing the vulnerabilities and what's possible. It is expected that installed Bluetooth products will total about 500 million, double of what it was at the beginning of 2004. According to this article, if you have a Bluetooth-enabled device, you need to be careful of what is in your files. It seems like this is only promoting for hackers and people like this to try and develop something like this too. Hopefully the industry's Bluetooth Special Interest Group will be able to provide some kind of security to protect bluetooth.

Life Expectancy

Would you believe that people are now living longer? Well of course you would because of all the new technology that there is today. It is said that heart disease, strokes, and cancer have all been declining. The average life expectancy rose to a record 77.6 in the year 2003 from 77.3. What are some other reasons that you believe people are living longer?

Alternative To Satellites

Although satellites are cool and we love them, they are a bit costly and if something goes wrong, they are very difficult to repair. Telecom may have come out with a new low-cost alternative to space-based satellites. A new kind of airship called the Stratellite may be that alternative. Apparently, it's an unmanned, helium-filled airship that looks like a blimp and is capable of relaying signals for cell phones, video and the internet to an area the size of Texas. Could it be that satellites will be overrun by stratellites? What would happen to the economy? And I'm sure that if this happens, there will be more improvements on the blimps. Sounds pretty cool to me.

Aspirin and the FDA

Do you think that if Aspirin was invented today that there would be no problems with it. Or do you think that it would be looked at and taken off the market like Vioxx, and Bextra. That is a very interesting question because do you really think that they are that safe or it has been around for so long that they don’t want to mess with it. I personally think that it is not the safest drug but its better than nothing.

A Cure For Alzheimer's?

Alzheimer's disease is a disease that has pestered humankind for quite some time. It mainly affects people over the age of 65. The risk of developing it runs mostly in the genes. Up to the present time, there has been no cure for it. But just recently there are results of a study related to Alzheimer's that suggest there is a new way to stop or even reverse the disease. The experimental treatment uses antibodies to attack a protein thought to destroy brain cells. Scientists say the results are highly preliminary but promising. Wouldn't that be nice to have this cure? It is one lf the most common diseases among our elderly population and the only thing we have been able to do in the past is help slow the sickness from taking over so fast.

Are sport winners more violent then sport losers?

Do you think that winners are more violent then losers when it comes down to it. In this article it is said that winners are more violent. I would have to agree for the fact that they are excited and nothing matters. It gives an example of soccer when Wales was playing, on match days the violence was 21 victims, when they lost it rose to 25, and when they won it rocketed to 33 people. Another factor to consider is alcohol getting involved. What are your feelings about winning and losing? Do you think it affects the violence?

Globalization affecting commodities: supply and demand in action

With commodities hitting a record high in March, refer to this article, the highest level since 1965 when the Bank of Montreal (BMO) started tracking commodity prices indicates to investers a peak in the price surge. What would make commodity prices drop well according to BMO, “In 2006, rising production and slower global economic growth should result in generally lower prices”. This is because of global economic growth, which should relieve any tightness that exists currently in current commodity markets. An example of this globalization is the rising of India’s commodity markets, refer to this article, According to the National Commodity and Derivatives Exchange (NCDEX) started a promising note with the Indian government in order to strengthen the Indian Forward Markets Commission (FMC) to nurture, regulate, and control the Indian commodities futures market. This recognition of derivatives trading as a specialized activity and not a pure speculative activity in India has enhanced the respectability of the entire industry before the investor class. The investor class is expected to give a boost in the trading volumes at commodity exchanges. And as the Global market is introduced to other commodities markets naturedly the commodity prices will decline.

The Death of the "Death Tax"!

On April 13 the US House of Representatives voted to repeal the estate tax, commonly known as the Death Tax. In the bog The House Votes to Increase Income Tax it is explained how the action will lead to higher income tax on middle income Americans in the near future. The repeal of the estate tax will decrease government revenue, and income tax will have to be increased to take up the slack. An increase of $40 to $50 billion will be required to fill the gap. It may not happen immediately, but someday the government will have to make up the monetary difference.

Is the government simply rearranging taxes instead of cutting them? The blog states that this is but one more example of Republicans reducing the taxes on the rich and increasing them on the poor. How will the economy respond to this tax repeal? I guess we might find out sooner than expected.

Making it to the Top

According to an article on CNN Money, an increasing number of economists’ claim that the US no longer lives up to its promise and that getting ahead is getting so tough that the very idea of the American dream is threatened. Some economists and policy makers worry about the dramatic widening of the gap between rich and poor. The top 1 percent of American families, for example, now own as much as the bottom 95 percent combined, the highest such gap among developed nations. Does this suggest that the American dream may be moving out? Although growing inequality offends many Americans’ sense of fairness, there’s no conclusive evidence – at least not yet – that it has lessened the odds of getting ahead. Getting rich will never be easy, whether you start poor or somewhere north of the middle. But the claim that the rich have pulled the drawbridge up behind them is simply false. In an economy as dynamic as this one, they can’t.

What do we know about tipping?

How do we know what to tip and how much to tip? In the article what do we know about tipping it points out where some tips are higher for others in different areas, an example of this would be tips are higher in sunnier weather. Also, a server at a restaurant can do things that can raise the tip examples are getting at eye level with the customer, or giving additional information. Some people do not believe in tipping at all, a good statement was made about this “Is tipping any harder to explain then why we don’t just leave the restaurant without paying for the food.” I believe that is very true being a server. So how do you feel about tipping?

Do we have too many ideas to choose form?

In the world today are there to many different choices that we can choose from. That is what it is said to believe in the article called we have too many ideas to choose from. I personally think that is true. There are a lot of choices that have to be made that can become very confusing they can make us frustrated and even depressed. Some examples are listening to campaign ads, or news stories it is just way too overwhelming with all of the information given. What do you think is there to many ideas to choose from today.

Taxes-Is My Cat Deductible?

This article, released on ABC News, talks about some of the most unusual tax deductions asked about. One deduction that was made legitimate was if you are a body builder, the baby oil you rub on before competitions can be considered a tax break. Also, women who get breast implants for their "careers" are also eligible to receive a deductible on their taxes, claiming in the category as a "stage prop". In one case, clarinet lessons were considered tax deductible because the orthodontist recommended that a child learn the instrument to correct a severe overbite.

These are just a few of the interesting things this article had to say. It has come to the point where people are searching for every way possible to get any kind of break on taxes each year. Is it getting to a point where it is just ridiculous, or is it okay to try and justify every single cent and try to get all the tax breaks possible? Where do we cross the line?

Are Expensive Shampoos Better?

Every year consumers spend billions of dollars on their hair. Women especially want their hair to shine, to have bounce, to be strong and healthy. Most would say that the first step to having beautiful hair is the right shampoo. But which one is the best? There are hundreds of brands to choose from. Experts say that you don't need to go to the salon to get great products. Great products can be found in the drug store at not even close to the cost. Does expensive really mean better? No, one expert says you should spend no more than 6 dollars on shampoo. Tests have shown that many can't tell the difference in a $4 bottle and a $20 bottle. So the message is pretty clear. But I think I want to take it a little bit further. What about with other stuff like clothing? Does a shirt that has a nice symbol have much better quality than a hangs shirt? I don't think there is that much difference. It's all about the brand image.

The Golden Apple

Apple’s sales were up for the second quarter in a row. They attribute this rise in both profits and revenues to increased sales of Macintosh computers, up 43 percent, and the Apple iPod, up almost seven times.

With the boom in personal entertainment, Apple has a firm grasp on market share with the iPod. This is not the only portable digital audio player on the market but it has turned out to be one of the largest selling models. With the increased memory capacity and the ever reducing cost of this technology, Apple’s grip on the market is continually getting stronger.

Could another competitor to gain control over this market? It’s relatively large with a number of competitors in it. Is there anyway for another producer to knock Apple from the top of the pile?

Will Wendy's Business Suffer?

A woman in San Jose, California, found a 1 1/2 inch long finger in her bowl of chile last month. She has just come out and said she will not be suing Wendy's for this, but investigators are still trying to track down the origin of the finger.

I don't know about you, but I find that horribly disgusting. How can a finger end up in someone's food? Although Wendy's won't be losing any money from a law suit, I think that they will see quite a drop in sales, at least around that area of California. So do you think that the decline will hurt Wendy's at all? Or will people continue to eat at this fast food chain, in hopes they don't also come across such an interesting "treasure"?

Microsoft Warns About Security Flaws

This article was kind of scary to me. Microsoft Corp. Warned that there are five new "critical"-rated security flaws in a few of its programs. These security flaws could allow attackers to take control of a personal computer completely. Oh, and guess which programs they are? Well... Windows, Internet Explorer, Word and Messenger software programs, and even its Exchange Server software (used on networked computers to manage and store e-mail traffic). Do you use any of these programs? I sure do. Computer security experts urged users to download and install the patches, available at www.microsoft.com/security. There are always hackers that are trying to take control of vulnerable systems and spread viruses. I have battled with a virus before on my computer at home and it's no fun. I wonder if these security flaws just happen sporadically, or if they have always been there and no one has caught them until they rise to the surface.

Gas Prices Finally Going Down?

Crude oil prices fall as supply rises. Prices of crude oil of gasoline drop to their lowest in nearly two months after data was released showing the rising supplies of gas and oil. The price dropped to $50.22 a barrel and then another $2 on Tuesday, after reaching a record high of $58 a barrel. So does this mean that us as consumers will also see a drop in prices at the pump? I sure hope so. As prices continue to rise, more consumers are finding alternate modes of transportation, such as buses, or car-pooling to save on gas. This has risen the demand for gas, and thus lowered the barrel prices. Hopefully the prices will drop within the next few months, if not, I fear that many families will be postponing far-away vacations and trips to compensate for such high travel expenses.

Retail Sales Weak In March

Retail sales didn't meet the expectations of economists' forcast of a 0.7% rise in retail sales last month. After a sharp downturn in department store and clothing sales, retail sales only rose 0.3% in March. The Commerce Department seemed so shocked about this but thinking about it, why would they be? it's just a transfer of where the money is being spent. It's on gas! Sales at gasoline stations pushed ahead, rising 2.1%, which reflects the impact of higher prices on oil. So all of this doesn't really take me by surprise.

More People Need Guns

For many years people have tried to make it politically incorrect to carry a gun. In the past few months we have heard of many shootings in our country. Because of these incidents many will cry for more restrictions on guns. In reality wouldn't more guns in the hands of the people be a better deterrent than regulation. The article "Gun Control: Shootings kindle concealed-weapons debate" debates these issues. If every person who went on a shooting spree were met by ten others who shot back wouldn't that be a better deterrent.

Harley Davidson

The Harley Davidson motor cycle company has been around for a very long time. They are one of America’s true icons. In the past, demand was so great that people would be put on waiting lists for months just to own one of these iconic bikes. Because of these long waiting lists, could more bikers be willing to purchase Japanese bikes? Harley has had its share of hard times and they seem to be coming back around. Their stock just experienced the worst plunge in their long history. Maybe the days of having a small monopoly on a certain motor cycle segment are coming to an end.

LexisNexis In Even Bigger Trouble

Well, the loosely regulated commercial data-brokering business, Lexis Nexis, finds itself in more trouble than what it probably expected when the beans spilled on Wednesday. It turns out that they might have exposed the personal information of three times the customers than what they initially reported. The personal information of thousands, even hundreds of thousands of Americans have been put at risk with the string of recent breaches by leading data broker companies, namely LexisNexis and ChoicePoint Inc.. They sincerely apologized and regret what happened but that doesn't change the past. A good portion of the Senate have introduced legislation including requirements that consumers are to be notified when their personal information is breached. For the present time, only California has this provision. The senators promised a crackdown on this so I think it would be a great idea if all the other states would hurry up and follow in the footsteps of California.

Outsourcing Creativity

The article "Will outsourcing of creative ad work become a reality?" is quite interesting. India is taking action to lure companies to outsource their advertising needs. Will American business take advantage of this potentially cost saving measure, or will they miss the boat because of the "egonomics" involved in moving creative ideas across national boarders. I believe outsourcing creative work will create an important cost advantage and thus make firms better able to compete in global markets.

Senate Blocks 'Clear Skies Act'

The Senate blocked President Bush’s Clear Skies Act (CSA) by a 9 to 9 vote. The CSA according to a White House release would, “…reduce [air pollution] by 70% using proven market-based approaches that will save American consumers millions of dollars.” (The White House, 2002). The CSA is a modernization of the Clean Air Act written in the 70’s. President Bush’s goal in rewriting this pollution law is double-fold. The CSA will “meet environmental goals and provide affordable electricity” to consumers. (The White House, 2002).

New pollution regulations will be set by the Environmental Protection Agency (EPA) and the Clean Air Act will remain in effect. In a speech in Ohio, President Bush voiced his disagreement with the new EPA rules claiming they are “poor substitutes”. (Vedantam, 2005, 11). “Connaughton and several Republicans said that overly stringent measures would raise the price of power, hit seniors hard and cause polluting industries to leave U.S. shores for countries with lower standards. Voinovich (R-Ohio) and Inhofe (R-Okla.) cited support from some unions and seniors organizations, along with most industry groups,” reported Vedantam. (Vedantam, 2005, 15).

Information on potential effects of the CSA varies so greatly that it is difficult to know which side to take. From the White House perspective, measures outlined in the CSA will reduce incidences of respiratory and cardiovascular diseases. As a result, one-billion dollars in compliance costs will be eliminated. These savings will result in lower electricity costs for consumers. These goals are commendable…cleaner environment, cleaner air, fatter wallets, and healthier Americans.

If this bill reduces compliance costs so much, why aren’t more businesses lobbying for it? Maybe power companies have not been approached about the bill. Detailed information should be sent to business that will be affected by the bill. The lobbying power of these businesses could tip the scales in Bush’s favor.

McDonalds raising the bar

McDonald’s is going to send more employees to Hamburger University. McDonald’s stated to have consistency in their products around the world you have to have consistency in training as well. They feel that the lack of consistent training has been leading to some down sales over the past few years. In addition McDonald’s looks at high turnover rates as well. High turnover leads to additional inconsistency training that doesn’t give the customer the experience that McDonald’s want the customer always leaving with. I wander where this idea of viewing McDonalds as just as a legit of a job as any other will work. McDonalds want to try to change the mind frame of their employees. I also thought it was interesting how they stated that the reason some fast food restaurants pay so low is because of this high turnover. How do you think that these changes will affect McDonalds, or will it?

CEOs and the Principal-Agent Problem

The principal-agent problem seems to have become an epidemic in corporate America. Many CEOs have been fired for poor performance and unethical behavior. These CEOs ruled as monarchs. Fraud committed by Bernie Ebbers has deeply affected WorldCom. New York’s attorney-general, Eliot Spitzer said in The Wall Street Journal: “The honour code among CEOs didn’t work. Board oversight didn’t work. Self-regulation was a complete failure.”

A potential solution is to allow shareholders a larger part in institutional governance. Currently, management rarely complies with shareholder resolutions. The Economist reported that a proposal by the Securities and Exchange Commission to make it easier for shareholders to nominate candidates to boards of directors was shot down by corporate lobbyists. If the SEC can't even get a proposal passed, how are we to reign in the power of CEOs?

Nike Exposed

Nike has disclosed the location of 700 plants. This is a big step for the industry to voluntarily disclose that information. Nike admitted to harassing some workers and having other work overtime. Now that Nike has allowed that information to be addressed to the public. Activist want to have independent observers to check out he plants working conditions. With Nike releasing this information, it seems that it will put further pressure on other companies to release information about their oversea manufacturers. If pressure from activist can make Nike reveal their manufacturers overseas, wouldn’t that kind of pressure also end up making Nike build better plants and paying employees higher wages. Nike has a name to protect; I think now that they have been exposed they will have to be aware of how their demand will fluctuate after such findings.

Are Americans Saving Enough?

The average American saves only 1% of their income vs. 7% in the early 1990's. Americans save less than Japan, Italy, Germany, France, and Britain. Why such a low savings rate? According to the article The shift away from thrift, Americans are able to afford all their wants and needs through borrowing. Homeowners can refinance their homes and take out home equity loans to pay for their desires. The fact is however, people aren't saving nearly enough for retirement. Americans rely on the government for bankrupt pensions, social security, and welfare. Most Americans don't believe they need an IRA, or other form of retirement savings. They all believe that they will be taken care of by the government. These people need to be encouraged to save, otherwise the taxpayers, us, will be taking care of them for the rest of our lives.

U.S. Trade Deficit Exploding

The U.S. trade deficit hit a record monthly high of $61.04 billion in February. Imports of oil and textiles surged but exports didn't do much of anything. The February deficit is up 4.3 percent from the January figure of $58.5 billion. Wall Street's investors worry that the huge amount of foreigner's money America needs to fight the deficit could at some point trigger a freefall in the dollar and make the nation's inflation problems tougher to deal with. As for Democratic critics, they viewed it as further evidence that President Bush's free trade policies aren't working. But the Bush administration says the deficit primarily shows the fact that the U.S. economy has been growing at a much faster pace than the countries' economies with which the U.S. has been trading. This, they say, pushes up imports while dampening demand for U.S. exports. Whatever it may be, there is a lot of stir going on with what is happening. It's not just investors who worry, it's the congress and even economists.

Public or Private Education?

Private schools have a reputation for being better and outperforming those run by the states. But new research shows it might be in part by the caliber of kids who get in. A recent study has shown that when students' socioeconomic status is taken into account, math scores have been better at public schools. Isn't that interesting? I'm sure that these results will have an interesting impact on policy makers when making decisions to direct the future of education.

FDA Opposes Silicone Breast Implants

It's been thirteen years since most silicone-gel breast implants were banned. Inamed Corp. has been hard at work trying to improve them and requested Monday to bring them back to the U.S. market. The FDA was very skeptical and its advisers voted 5-4 that the company hasn't provided enough evidence about how long they will last and what would happen if they break and silicone oozes into the breast, or similar scenarios. Many dermatologists feel uncomfortable with implants, most won't recommend them for the safety issues, yet sales are on the rise. How much money is circulated by the "breast implant" business? All I know is that it's a lot. These types of doctors make more money than most any other types.

Genious or Pure Obsession?

USA Today reported about the changes to the SAT test and gave the results of the first 300,000 students to challenge this high-stress, high-priority exam on March 12. This week, as students began receiving their scores back, the College Board reported that 107 scored a perfect 2400; 800 points in each of the three sections-writing, critical reading and math. The writing section was added this year in addition to the two old sections.

It seems like as time goes on, more and more students are scoring very high scores on the SAT. Is it just because students are getting smarter, or are they just obsessing about it much more than past students? There are so many "SAT prep books" and "pre-tests" and techniques on how to be successful on this exam, it is almost becoming a joke. ACT tests are following on this same line. Students spend hours and hours preparing and studying and strategizing for this huge exam. So where does it become a joke? How far are our students going to go to gain a "perfect score"? Or are we just smart?

Losing White-Collar Jobs Too

Ford Motor Co. told emoployees just this week that it will offer buyout packages to white-collar employees. They are aiming to cut about 1,000 jobs. If Ford can't entice of their white-collar workers with its buyout offer, it may resort to "involuntary separations,"a Ford executive said in the memo. Ford is facing many problems lately, including rising health-care costs and failing U.S. market share. They are not the only ones facing these types of problems though, General Motors Corp. has also offered buyout packages to some of its white-colar employees to cut costs. Once the United States had a competitive advantage in this market, now it appears that we are losing it very noticeably. Will we outsource all of our jobs in this market? Is it a good idea to if we could make money more effectively and increase our standard of living by focusing our efforts to other areas.

Home loans for people with bad credit

More home loans with higher interest rates are going to minorities and low income borrowers. Some of this correlation is probably based on the fact that a lot of low income households are minorities as well. The article stated that it wasn’t right that minorities and low income borrowers should have to pay more for a home loan. I found myself tossed in my opinions when reading the article. I feel that when I decide to purchase a home, I don’t want to be stuck with a high interest rate because I have a lower income; however, if I don’t show financial responsibility at some point, then I don’t deserve a lower interest rate. I understand that you deserve what you get, but if more individuals could purchase a home with less financial criteria, would that make them more responsible? Would that increase incentives to work hard toward that American dream? Over all could home ownership increase the desire to be more financial responsible, or will giving a break to debtors create more debt?

GM's lack for understanding of their own demand

GM stated that it had a negative cash flow this last year in the North American producers. When trying to deliberate the issue with the UAW, both came to the conclusion to go to the government to solve the problem. Some suggestions to solve the problem have been addressed by the excess inventory that GM produced just in the last three years. GM produced 350,000 more cars then they sold. Gm’s ability to figure their demand for their products has cost them money. Excess inventory is pricey. Do you think that it is necessary for GM to go to the government to fix internal financial difficulties? How do you think this push for standardized healthcare will affect the economy? Do you think that GM's problems are healthcare related at all? I really think that American companies need to do a better job at accessing their forecast of demand and find ways to be more competitive in the market; otherwise we need to let other countries produce cars and America needs to focus on what we produce best.

Bleeding airlines can’t gain Altitude

A causal observer of the struggling airline industry might think the nation’s biggest carries are either inept for losing billions of dollars with no end in sight, or pretty clever for managing to stay in business through it all. Neither image would be fair. Analysts say the bulk of the industry has no easy way to turn around its fortunes. Factors such as soaring fuel prices are beyond its control. The pressure to keep fares low has barley let up. And a legacy of inefficient operations will take a few more years – and negotiations – to fix. It’s not necessarily stellar management that has kept the sickest airlines from going out of business. Lenders, suppliers, and regional airlines with vested interest in the carriers’ survival have committed a steady stream of capital to keep the industry hobbling along. While their strategic options are limited, executives haven’t given up. They’re still trying to squeeze labor costs, raise extra revenue where possible, and lobby the government to stop an increase in security fees and ease pension-fund obligations.

The current crisis that is upon airlines is driven by fuel prices. That doesn’t excuse the industry’s other fundamental problems, such as glut and unprofitably low fares, but the high price of fuel has masked significant cost-cutting progress, and we need to continue to lower our costs, said Dan Garton, executive vice president of AMR Corp. So will air carries make it through these hard times? Analysts say yes, that the troubled carries will continue “limping along” until fuel prices drop to more manageable levels, capacity tightens and demand rises enough so that fares can hit profitable levels. Do you think this will ever happen?

Gym Membership Doomed From Day One

I was just perusing a website I check out about once a week called www.theonion.com, which is a satirical paper that is published in New York. It mainly focuses on current events and is one of the funnier sites out there; however, it can be crude occasionally and is not recommended to anyone easily offended. I just read one of the briefs about a girl's (fictional) experience with getting a gym membership and what ensues thereafter.

I bring it up not just to give a shout out to one of the better sites on the web, but, also because I have seen many people I know who at one moment get highly motivated, sign up for extended gym memberships, and then return only a small handful of times. I am sure this is the type of person that gyms generally love to have join them. Is this type of practice ethical on the gyms part or do these new members basically get what they deserve?

Fuel-Efficient Tires

California is pressing for more cars to be fitted with fuel efficient tires. In this article they state that most cars come from the factory with fuel efficient tires on them. The problem is when these tires are replaced. Most people are doing so with less efficient tires. They go on to say that if more cars were fitted with sensors letting the driver know when the tire pressure is low, and drivers were to check their tires more often, this could save more than 500 million dollars annually.

Online vs. Offline Advertising

In this article, online vs. offline advertising, they look at the pros and cons of internet advertising. One item of interest they look at is the instant knowledge they gain about their visitors. They know where they are coming from, what they read on the web site, and how long they were there. This article suggests that online advertising can be very focused on their target markets. What do you think? Do you put more stock in what you see on the television or what pops up in your email? The online advertising maybe more focused, but could it also be more intrusive?

The Fight Continues

MCI announced on Monday that it will not destroy its poison pill that limits any investor from owning more than 15 percent of its stock. This came as a surprise since Verizon decided to buy over 13 percent of MCI's stock over the weekend. This is an interesting decision by MCI management because it leads one to question if they truly want the merger with the favored Verizon Communications. This battle of bids for MCI has gone on long enough, yet it will continue until MCI can decide on who will be the successor of the firm. The poison pill, or amendment to stop one investor from taking over their company, is a very interesting tactic that is being used. Management has decided it wants to sell, but it keeps building up more barriers.

The Stamp Act

The United States Postal Office desires to raise first-class postage from 37 to 39 cents. It sent the proposal to Congress, where if passed, will affect the market of parcel service throughout the nation. The requested increase is needed to pay the millions of dollars that will be paid out by the Post Office to employees in pension fund expenses. With the increased cost of mailing a letter, will electronic mail become an even better communication method? Of course. E-mail will soon dominate the parcel industry, and the market will make the Post Office shut down.

Martha's Money

Martha Stewart, America's favorite criminal, received nearly $1.2 million this past year even though she spent a majority of her time in prison. In thinking about this, one is left to wonder why America supports crime? There must be a large market for white-collared criminals in society if our nation chooses to reward scoundrels such as Stewart. What do you think? Do you demand products or services from criminals, and if not, then who does?

Computer Crimes

When I was reading the article on computer crimes, I was impressed with all the cost associated with protection that our government is trying to take and companies have to take. It is almost a never ending battle of benefits and cost. It cost money to enact laws, to have law enforcement, and to create new technology to catch computer crimes. On the flip side anyone who gets involved in computer crimes will be able to break the codes necessary to commit the crimes. Companies need to stay on top of the newest software protection to secure future business transactions with customers, and keep the business running and functioning. What do you thin that the government should do to combat computer crimes from occurring? Do you think that any thing can be done? What effects do you think that computer crimes have done to computer transactions?

Microsoft and Gateway

Microsoft has settled with Gateway. Microsoft is required to give Gateway 150 million dollars for the next four years, in return Gateway will release any claims against the company. How do you think this will help Gateways image? Even though Microsoft has stated that they have no favoritism with Gateway, because of this litigation will consumers find a greater demand with Gateway? Gateway stated that they look forward to greater collaboration s with Microsoft in the future. How do you feel this will affect the demand for Gateway computers in the future, as compared to their lag in the past?

Hydrogen-Powered Cars

General Motors is banking on the future. Right now GM is reporting that it will lose $850 million in the first quarter. Personally that is the biggest first quarter loss that I have ever heard of. The reason they are losing is because of Japanese auto-makers and their R&D. The R&D cost are so high because of the hydrogen-powered cars that GM hopes will be demanded in the near future. I would like a hydrogen-powered car becuase I am sick of paying high gas prices. The demand of these cars will go up in the future, but is GM banking on that to soon?

Education

Public education is an interesting economic topic. John McDonald addresses the issue of lack of funding in his letter to the LA Times If We Value Education. He suggests that increasing taxes is how education should be funded. I think education credits from the state and then letting families choose where they get an education would solve the lack of funding better than simply raising taxes. In any market, increased competition lowers prices so why not with education?

E-bay

Has anyone tried to buy something on E-bay and noticed that the item you want is always being sold by the same person? That is to say, the seller is making it or providing the selling item. People bid it way up because they think that it is the only one of its sort. Then, the next week, it is back and the beginning bid is $5. It is like the Dutch auction discussed in class and there is no consumer surplus left because it all goes to the seller.

Computers

The computer and technology industry is a monopolistically competitive industry as evidenced by how fast it evolves and how different companies create new products to try and beat out the competition. Advanced Micro may unveil chips early is an article about the race to create a new dual processor. My question is whether people will continue to upgrade because they want the best or will we reach a point that people will be happy with the type of computer they have?

Google Executives

The article Google Chiefs agree to work for $1 explains how various executives have cut their salaries to $1. This relates to the first part of the semester when we were talking about the principal agent problem and how to fix it. For example Google’s cofounder Larry Page only earns one dollar but he sold 400,000 shares of Google stock earning him approximately 70 Million dollars. His best interest is to make Google successful because his livelihood depends on the sell of his stock. Do you think this is the most effective way to solve the principal agent problem?