It's Taking Me Moral Courage to Write This Topic

I know that people who after they read this post are totally going to hate me, but I hope you guys would understand. USA give millions of dollars to third-world countries, and what do we get in return? More countries that hate us, more trash-talk about Americans, and more debt in USA. In this website, it gives some of the countries that hate us. For example, there are many people in Pakistan, according to that article, that simply want to attack or even kill Americans. There have been many bomb blasts to hurt Americans.

Some of these countries hate us because America is such a dominant country that people can't stand it. However, some people hate us because they think that USA just can't keep their own business. All USA want to do is interefere with countries and go to war whenever they get a chance. The second statement, I do agree a little myself. Why do we constantly go to war, while other countries (even Europe) just do they own little thing?

By going to wars, it is not making some countries happy. At the same thing, we also lose lots of money. Another question is why after Afghanistan attacked USA, right after that incident we gave millions of dollars to them. We have also given millions of dollars to Iraq/Iran, and just lately in Africa. By giving millions to other countries, no wonder USA is in such a debt. If the government would just spend money on us, instead of in other countries, we would most likely not have seen recession, our exchange rate would have been stronger, and USA would have been stronger.

Man, I am scared that I am doing this post. Bring on the heat!

Castro and the Embargo

At the end of one of history's longest running dictatorial rules, this article gives a fine overview of the current status of communist Cuba. Realistically, we likely won't see too many changes with power officially transferring from Fidel Castro to his brother Raul.

The part I am most interested in has to do with the embargo. The author argues that if the embargo has failed to deter Castro after nearly 50 years, then what's the point to continue it otherwise. Also, most would agree that the embargo has certainly emboldened Castro and helped to glorify his rule from the Cuban perspective. Finally, it is the people of Cuba who ultimately suffer as they are left near destitute. Certainly the communist policies have contributed the most to this state of poverty, but if we re-opened trade after all these years, we would no doubt benefit along with all the Cubans. I wouldn't mind the opportunity to visit the Caribbean island. I wonder what others think about ending the embargo.


Wal-Mart makes Gains in Troubled Economy

Wal-Mart is posting steady gains while other retailers are struggling as the economy cools off. Wal-Mart is in a favorable position compared to other trendier competitors due to the inelasitic nature of the goods they sell. People always need staple goods to survive whether in a recession or not. As household budgets tighten, buyers that may have once shopped at Target and now opting for Wal-Mart due to their comittment to low prices.

Rising Gas Prices

There is great speculation that rising gasoline prices this spring will lead to a decrease in demand as consumers have to spend more of their budget on filling up their tank. Though gas prices have been high for some time, the article claims that with the threat of a recession, consumers will be more conscious of price. It will be interesting to see if consumers 1) change their driving habits to save on gas, 2) cut back on other products to be able to spend the same on gas, or 3) if we continue to spend on both gas and other products despite the high prices.
Also, even if Americans cut back on consumption and demand stays stagnant in the US, the Middle East and China will continue to drive up demand which means prices are going to rise. With this situation, John B. Hess claims there is "[a]n oil crisis coming in the next ten years" due to both demand and supply.

Starbucks is Shutting Down!

On Tuesday February 26th Starbucks shutdown all of their United States stores for three hours so they could hold a training. For three hours they were going to be obsolete and Dunkin Donuts would have a dominant hold on the market. The Chicago Tribune reports that the 450 Dunkin Donuts in the Chicago area provided small lattes, cappuccinos or espressos for free during these three hours. This was a great move by Dunkin Donuts as it would likely bring in customers that have never set foot into their establishment. In the battle of the caffeine fix provider, if you’re able to get at least one individual to switch from the competitor to your establishment it will make up for the cost of the products you gave away free.


Increase in India Medical Care Because of Low Cost

Medical care is an important issue in today's world. When it comes to medical care, America is one of the best places to have work done. However, the best does not always mean the least expensive. People are starting to find out that they can get the same medical procedures done in India for a fourth of the price it would be elsewhere. The quality of service is just as good in India as it would be in other more expensive locations. This is causing more people with medical problems that do not have insurance coverage to go to India for their medical procedures. This affects the American economy by taking customers out of the U.S., therefore moving profits to other countries. The demand for good inexpensive medical care is high in today's society and India is now starting to meet that demand. This is creating further competition for America and other medical care facilities around the world. This is great for India's economy but will damage the American economy.

Getting the Scoop on Off-Campus Housing

The Journal printed this article yesterday concerning off-campus housing concerns. SUU is working on a website where students can provide information about their experiences with off-campus apartments and managers. These surveys are meant to help students know which units have good management, and which unit managers are struggling. I think this is a good example of how symmetrical information can help to shift surplus. For example, if students publish in their surveys that the managers of XYZ Apartments are not cooperative, the demand for these apartments will go do down and the managers will have to lower rents to attract renters. This would shift some of the surplus away from the apartment owners (suppliers). Do you agree?


Economic Stimulus Package

I was taught, and have come to believe there is no "free lunch". Unfortunately many Americans believe there will be a "free lunch" - that they will get a benefit without having to pay for it. Whether it is spending on a credit card beyond their means of repayment, or overextending to purchase a home in an inflated market, Americans seem to be blissfully ignorant of the consequences of their decisions. Now it is time to pay the piper. The housing bubble has burst, the debt burden is catching up to people, consumer confidence and spending drop, and "Presto" we have fears of recession. And in an election year! What is an incumbent to do? Well, pass an economic stimulus package of course. This will provide the "free lunch" that everyone needs to feel like they can go out and spend some more. Knowing Americans they probably will use the money to make additional purchases rather than paying off debt, saving or investing. The effect on the economy will be transitory, but perhaps it will be the right medicine at the right time. And we as taxpayers will be paying for this $168B stimulus package in the long run.


Best And Worst Cities For Renters

Other factors can affect supply and demand in the rental market like an uncertain housing market. Job growth also affects renters. Salt Lake City has one of the fastest rates of new construction, but it isn't fast enough to keep up with job growth. A 3.1% uptick in jobs is the highest of any city measured, and the result has been a steady stream of new citizens moving to the city. More jobs, more people and higher wages have lifted prices in both the rental market and sales market there. Expected construction also adds a wrinkle to the present rental market. More inventory slows price growth.
The article points out that rental demand can be altered by more than price and quantity. Economic uncertainty and volatility in property values can also change consumer behavior.


Subsidizing Fat Cats

Malaria is becoming an ever increasing concern. Where, decades ago, viruses like West Nile and Malaria were somewhat contained to Africa, today these diseases are becoming more and more widespread. This article talks about a new treatment for Malaria. Many Africans that are using older remedies to treat Malaria are finding that they are becoming resistant to the effects. A new remedy has come on the market that is less prone to resistance. It is a little too expensive, however, for the average African. A possible plan has been proposed to subsidize the cost to Africans. However, some people are against the plan. They feel that since there are so few suppliers the subsidy will end up going straight to profits.

I tend to side with those against the subsidy. Unless there is some way for the subsidy donors to demand that the suppliers charge a lower price for the treatment, there is no guarantee the treatment will get to Africans at a lower price. Especially where there are so few suppliers, the suppliers have, in essence, a monopoly on the market.


Rental Price Ceilings: All in Favor Say "I"

What's your position: impose on the free market with price ceilings and floors or let the invisible hand guide the market without governmental impositions? The article "The Housing Bust Shakes up Rentals" from Business Week (02-12-2008) is a good discussion of a rental market without price ceilings.

Those in favor of rental price ceilings claim that rent control keeps housing affordable for lower income individuals. However, the article from Business Week illustrates that the market can and will return to an equilibrium price on its own without the imposition of a price ceiling. The article discussed how the rental market became flooded with properties during the housing boom in 2005 and 2006. By 2007 there was an overabundance of properties without sufficient demand to occupy them. This alone was enough to start driving the market towards an equilibrium without the influence of a price ceiling.

A negative consequence of price ceilings is that property maintenance becomes less of a priority for landlords. With rent control in place, landlords start to realize less profit and start to cut back on expenses that are impacting the bottom line. There are some expenses they have control over (i.e. maintenance, property improvements, etc.) and there are other expenses that are fixed (utilities, property taxes, property management, etc.) When rent controls are imposed, landlords are forced to cut back on those variable expenses, thus properties become neglected and the landlord evolves into a "slumlord."

Some worry that without rent controls, rents will skyrocket beyond anyone's affordability level. Now where is the logic in that? If rents become too high, the number of vacancies will increase. In a free market where there are no rent controls, the landlords will respond to the increase in vacancies by lowering rents and offering incentives to renters. I suggest this is a much better way to run a market than imposing controls that create a false market run by a bunch of "slumlords."


Tax Cut 2008

Will the government really stimulate the economy by issuing these rebates? The government is going to give an extra rebate of $600 if you are single or $1200 if you are married, plus an extra $300 per child. In this article it says that the rebate is just going to be a 2008 rebate that are received on the 2007 tax return. This seems to me like the government is looking for a quick fix, and if the people who get this extra rebate spend their money the stimulus package will have a postitve effect.


Should we Offshore Customer Service?

Offshoring is a key nowadays for a business to survive in this very competitive world. Companies that offshore are the ones that can be successful or hold a competitive advantage over others. How come? It is because by offshoring, businesses can pay a fraction of what they would pay over here. They also can get more talented employees overseas.

However, do you guys think offshoring customer service is a good thing? I mean, in this article, it said that offshoring customer service would hurt businesses a lot. It made a point that when a person tries to call to get a question answered, he/she gets a person in another country with a different accent that is hard to understand. I think companies should be really careful offshoring customer service. If a customer gets mad, he or she would hardly come back to shop at that company. Without customers, an organization cannot survive.