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?