FLA ECONOMICS

National Financial Capability Challenge

2011-03-08T15:33:00.003-05:00

Challenge Prepares Students for Secure Financial Futures; Runs March 7 – April 8

WASHINGTON – Today, high school-aged students across the country will begin taking a voluntary online exam as part of the 2011 National Financial Capability Challenge. The Challenge is designed to enhance the financial capability of high school-aged youth across the United States by strengthening their knowledge of the basics of saving, budgeting, and investing.

"All of us - parents, educators, policymakers and students - share the responsibility to ensure that young people in our country learn a set of practical skills that will help them navigate important personal financial decisions," said Treasury Secretary Tim Geithner. "This Challenge will help students understand basic finance. It will help them understand what it means to save for retirement. And it will help them understand the risks and benefits associated with debt from things like car loans and credit cards. Empowering students with this knowledge is important for the long-term strength of our economy."

"Our goal is for every student in the nation to get a world class, well-rounded education," said Education Secretary Arne Duncan, "and that includes preparing them to make critical financial decisions. I hope the Challenge not only helps high school students get smart about money, but encourages more states and schools to make financial education a priority in classrooms as early as kindergarten."

The voluntary online exam will be available to students today through April 8. Last month, the Department of the Treasury posted an Educator Toolkit on Challenge.Treas.gov to help teachers prepare students for the exam. From saving for college and retirement to managing expenses like cell phones, the exam tests a wide array of topics that together constitute a basic understanding of personal finance.

All high school teachers and other educators working with U.S. high-school aged students (ages 13-19) are encouraged to register for the Challenge, download the Educator Toolkit, prepare their students, and administer the online exam.

Later this spring, a group of the highest scoring students will be recognized through a national awards ceremony in Washington, DC. The educators and students who place in the top 20 percent nationwide will receive official award certificates.

Some examples of the types of questions students will answer during the exam are as follows:
1. Carolina has $5,000 saved from working at different jobs. She puts her money in a savings account that pays 4 percent per year in interest. How much money will be in her account at the end of the first year and at the end of the second year?
A. End of first year: $5,100; end of second year: $5,400.
B. End of first year: $5,200; end of second year: $5,400.
C. End of first year: $5,200; end of second year: $5,408.
D. I don’t know.
(Answer: C)
2. Marco went to the grocery store to buy a box of cereal. The type of cereal he liked came in three different brands and three different size boxes. To select the brand and the box with the lowest unit cost, he should look at the:
A. largest cereal box on the shelf.
B. most popular brand of cereal.
C. price per ounce of cereal in each box.
D. I don’t know.
(Answer: C)
More than 76,000 students and 2,500 educators from more than 1,500 schools in all 50 states participated in the 2010 Challenge. To learn more about the Challenge or to register for this year, educators should visit Challenge.Treas.gov.

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Interactive | State of Working America

2011-02-26T16:54:00.000-05:00

Interactive | State of Working America

WhatWePayFor.com | Diigo

2011-02-26T07:16:00.000-05:00

WhatWePayFor.com | Diigo

Using Incentives To Recover Sunk Costs

2011-02-26T07:06:00.000-05:00

Gym-Pact bases fees on members’ ability to stick to their workout schedule - The Boston Globe

This Is An Unusual Example Of A Positive Externality

2011-02-26T06:59:00.000-05:00

Tile roof can break down smog - Chicago Sun-Times

How The Average U.S. Consumer Spends Their Paycheck

2011-02-24T05:49:00.000-05:00

The Ethics Of Taxation

2011-02-04T07:45:00.000-05:00

Watch the full episode. See more Religion & Ethics NewsWeekly.

AP 100 Days Of Oil.avi

2011-01-22T14:00:00.000-05:00

Quantitative Easing Explained

2011-01-10T18:22:00.000-05:00

http://www.economist.com/blogs/multimedia/2010/11/world_population

2010-12-23T18:51:00.000-05:00

http://www.economist.com/blogs/multimedia/2010/11/world_population

Shopping in Hong Kong

2010-12-18T07:39:00.000-05:00

Introducing The Chinese To The Mall

2010-12-18T07:06:00.004-05:00

There's a strong movement in China to cultivate and then release the inner shopper potentially lurking inside each citizen. Click on the link to access a comprehensive article and slide show of the commercialization of China and how eerily it looks like 1950s America. The shiny appliances and cars with alluring women framing the chassis. It's a path we've followed to the precipice of financial peril and it'll be interesting to see how far China will take it.

Following Japan's Path

2010-11-21T15:23:00.003-05:00

This article illustrates the disturbing trend the U.S. is following into Japanese style deflation. The graphic that accompanies the article tells us the Fed is going to have work a lot harder to generate a heartbeat out of the CPI.

Fantasy Land

2010-11-11T21:38:00.001-05:00

The President's bi-partisan debt crisis committee has released their prescription for reversing the tailspin our country's finances have taken. Click on the link to access the tough remedies and then imagine all of the excuses they'll be for why we can't implement them.

A Return To The Gold Standard?

2010-11-10T11:48:00.003-05:00

The head of the World Bank intimated his support for a return to some form of gold standard the other day. In the wake of a flood of money in the global economy and the seemingly reckless fiscal policies of many nations, there is a call for the bygone safety he perceives in gold. Click on the link to access five economists sounding off on the prospect of this move.

Here Comes Inflation

2010-11-10T10:30:00.004-05:00

The spike in commodity prices on Tuesday announced the arrival of an inflation that has been plaguing the economy in heretofore unrecognized ways. Click on the link above and then access the graphics to see the year to date increases in agriculture, gold and oil prices. It was only a matter of time before the expansion of liquidity would impact resource prices. Wholesale prices jumped last month, can retail be far behind?

The U-6 Paints The True Unemployment Picture

2010-11-08T10:06:00.004-05:00

Click on the link above and you'll access an article describing the more comprehensive U-6 unemployment indicator, a broader measurement. In addition, you'll find an intelligent graphic which will display unemployment data dating back to 1948.

Americans Are Misinformed When It Comes To The Economy

2010-10-30T07:03:00.003-04:00

The link takes you to an article declaring the misinformation that is rife in America today. Most of our citizens carry inaccurate opinions on the status of the Economy and the government's finances. This is disheartening since they are about to make some pretty important decisions.

1. What does the reader believe to be the single biggest reason for this level of misinformation in our society today? Explain.

2. Why might it be easy to understand that, faced with the facts, individual households could still be skeptical about the macro realities?

3. If these represent the opinions Americans are taking to the polls, what impact will this have on Tuesday's election and the coming years in our national and state Capitols?

4. Can you make a connection, as students, between the disintegration of objective media, the rise of polarizing and uncivil relations in our politics, the disappearance of well-guided public education, and this level of misdirection among the electorate?

How to Restore the American Dream

2010-10-26T21:00:00.000-04:00

How to Restore the American Dream

2010-10-26T16:41:00.000-04:00

U.S. Falls Out Of The Top 20 On The World Corruption List

2010-10-26T15:47:00.003-04:00

For the first time in the history of this index, the U.S. has been recognized for a deteriorating climate of legitimacy. The recent banking crisis and the Bernie Madoff revelation have led to an increased capacity for corruption in the country. The rule of law and a presumed fairness in the system are essential for a progressive economy.

Why It Doesn't Feel Like A Recovery

2010-10-18T14:45:00.003-04:00

This a terrific article with over-laying diagrams that explains why the economy doesn't feel like it's in recovery mode. The graphs display the difference between potential output and actual output, and how long it will take the economy to recover based on different growth levels.

The Wealthy May Pay Higher Taxes But Work Less

2010-10-16T07:29:00.003-04:00

The article describes the full impact higher taxes may have on those making more than $250,000. The author relates this increase to his own life and admits that he make work less in the future. Not only will his nominal income be tapped but also the future income of his heirs.

The Importance Of Being Banked

2010-10-05T11:52:00.002-04:00

This article offers insight into the cost of living on the Economy's fringe. The disassociation with traditional banking services can cost an extreme amount of money to those who can least afford it.

Vote Easy / Vote Smart

2010-10-04T18:36:00.002-04:00

Click on the title above and you'll be taken to a pretty slick interactive that will introduce you to the candidates on your ballot and match their preferences to your own. The device covers twelve topics and matches the views of the hopefuls with the positions you establish through simple questions.

The World's Most Profitable Bank

2010-09-29T15:08:00.001-04:00

Click the title above to access a great article on the Federal Reserve. It explains the primary functions of the institution as a fiscal agent for the government and just how lucrative they can be. The article also offers perspective to the unique depth of this latest crisis.

Education And Unemployment/Stay In School

2010-09-24T08:19:00.002-04:00

Could Have Fooled Me!!

2010-09-21T12:56:00.003-04:00

Yesterday, the NBER officially declared that the recession ended in June of 2009. It may be difficult to convince people considering the lingering job shortage and plummeting household wealth being reported nationwide. But, anemic growth is still growth and unemployment is a lagging indicator. The problem will be in what shape the business cycle takes in the long-run; an elongated "U" or a faintly pitched "L"? Click on the title above to access the nation's prospects.

Good Example Of An Inferior Good

2010-09-19T10:42:00.003-04:00

The recession has breathed life into one market recently, used cars. Brokers are paying unimaginable prices for used cars as the demand grows in the face of a shrinking supply. Inferior goods are items that you tend to buy more of when your income declines. People are hanging on to their cars longer instead of trading in and up for new ones. Consequently, the traditional replenishment of the used car market is drying up. Click on the title above to get some of the details.

Taxes Cause Crime?

2010-09-16T19:55:00.002-04:00

Apparently, an exorbitant excise taxes on cigarettes in New York has resulted in a spike in cigarette related crime. Though the intention had been to discourage smoking by making them $10 a pack and raise revenue for the cash strapped state, an added element has been the wave of cigarette thefts in convenience stores around the state. Click on the title to get the details.

A $200 Hamburger

2010-09-15T19:55:00.000-04:00

The Glass Ceiling Is Cracking

2010-09-14T16:18:00.003-04:00

Click on the link above to access an audio clip from NPR on the great strides young women are making in closing the gap and surpassing male peers in salary.

Does The Hangover Make The Party Worthwhile?

2010-09-10T07:06:00.003-04:00

Some states seem to be emerging slowly from the nation's economic funk. But three states, California, Michigan and Florida apparently over-indulged. The key to the sustained hangover gripping these states can be found in analyzing the evidence supporting the theory that the bigger you are the harder you fall. Click on the title above to access the article.

The Most Generous Countries On Earth

2010-09-10T06:54:00.003-04:00

The United States is the fifth most-generous country on earth, tied with Switzerland, according to a new ranking from Gallup’s World Giving Index.
The index is based on surveys and other research on 153 different countries, which together constitute about 95 percent of the world’s population. The survey asks in part about charitable behavior, including donations, volunteering habits and taking time to help strangers. Based on this index, Australia and New Zealand are tied as the most-generous nations on earth.

The top 21 most-generous countries, in order, are:

1. Australia
1. New Zealand
3. Ireland
3. Canada
5. Switzerland
5. United States
7. Netherlands
8. United Kingdom
8. Sri Lanka
10 Austria
11. Lao People’s Democratic Republic
11. Sierra Leone
13. Malta
14. Iceland
14. Turkmenistan
16. Guyana
16. Qatar
18. Hong Kong
18. Germany
18. Denmark
18. Guinea

Gallup’s analysis of the data found that giving money is more strongly correlated with happiness than with a nation’s gross domestic product. ”
“It would be reasonable to conclude that giving is more an emotional act than a rational one,” the report says.
Among the other findings, age and gender affected generous behaviors. Globally, giving money to charity increases with age, largely explained by changes in disposable income. Women are generally more likely to give than men, but only just barely – 30 percent versus 29 percent.
Click on the title above to access the full report.

A Man Like Putin

2010-09-03T01:36:00.003-04:00

This is one of the rare times when a post will venture out of the obvious realm of Economics. This segment from a great PBS show called "Sound Tracks" left me scratching my head. Most people are aware of the heavy handed tactics employed by Vladimir Putin throughout his official and unofficial life in power. But, as you will see, he's adopted the idea of a cult of personality from the old Soviet Union with a dance hall twist. In the end, maybe the Russian people have deserved 800 years of whacked dictators.

PBS Teachers | Lesson Plans | Diigo

2010-08-31T13:07:00.000-04:00

PBS Teachers | Lesson Plans | Diigo

Every Graph You'll Ever Need

2010-08-31T05:18:00.000-04:00

Because Every Country Is The Best At Something | Diigo

2010-08-31T04:53:00.001-04:00

Because Every Country Is The Best At Something | Diigo

Airline Ticket Prices

2010-08-27T06:57:00.001-04:00

The airline pricing system is confounding, but the presence of discount airlines and business travelers heavily influences the prices in some routes. Click on the link to access some clarity to this riddle and also view an accompanying video clip.

Soft Drink Oligopoly

2010-08-25T11:08:00.004-04:00

Though there appears to be a lot of variety and a multitude of choices in the soft drink industry, the vast majority of products emanate from just three firms. The "pseudo-variety" is in reality a proliferation ploy to gobble up all of the remaining shelf space from smaller rivals.

What Do We Do Now?

2010-08-22T09:06:00.002-04:00

Downsizing Boomers Threaten Economic Recovery

2010-08-19T08:17:00.002-04:00

The baby boom generation reflects anyone born between 1946 and 1964. Today there are around 80 million people in that category and the leading edge is in the process of retiring. This group's savings has been ravaged in recent years by the variety of bursting bubbles that has deflated the personal wealth of many. Though it is natural to downsize one's life as age creeps upon us, it is even more likely for today's boomers because of their recent hardships. This couldn't happen at a worse time as the nation attempts to crawl back from the depths of one of its worst recessions. This may make it very difficult for consumers to lead us to recovery.

What Good Are Economists Anyway?

2010-08-15T12:42:00.000-04:00

Let's Avoid The Next Crisis, Ok?

2010-08-15T11:01:00.001-04:00

Three major economists weigh in on what the Fed can do in the future to head off trouble before it multplies.

Let The Bush Tax Cuts Expire

2010-08-12T13:25:00.003-04:00

Though it seems illogical to, in effect, raise taxes during an extreme bout of unemployment, the article suggests just that. The author states that tax cuts are an inefficient form of expansionary policy because people are often inclined to save a portion of what they don't pay to Uncle Sam. Instead, the increased revenues could be used for direct stimulus that would be applied exclusively to the wounds still out there.

Price Holds The Key

2010-08-01T16:58:00.003-04:00

Click on the title and you'll access a passionate plea for more substance in the efforts to wean Americans off of oil. The opinion here is to raise prices through heftier gas taxes based on the assumption that high prices create disincentives and motivates to seek alternatives. At this stage, gas taxes are lower than they've been at anytime over the last 40 years (adjusted for inflation). The implementation would be painful, but price is almost always a market changer.

Will You Be Able To Compensate?

2010-07-31T05:41:00.003-04:00

It's inevitable that the Congress will one day modify Social Security as we know it. Many are increasingly skeptical that the system will survive under its present form yet no one seems to be in a hurry to adapt. The burden will undoubtedly grow on an individual's savings if the trust fund is releaseing a diminishing amount to retirees. The sooner a worker starts saving and the more pessimistic an individual is on Social Security's supplemental powers the better off he will be.

Golden Parachutes

2010-07-30T22:32:00.002-04:00

This is an interesting chart describing the biggest corporate payouts in history.

Eye On Obesity Reduces Anti-Smoking Efforts

2010-07-28T09:32:00.004-04:00

In a classic trade-off, America's health policy priorities are shifting pulling money away from anti-tobacco programs and directing it toward the obesity issue. The consequences may be a compromise that slows the momentum of declining loyalists to nicotine. Should the federal government be involved in these personal choice matters to begin with? Or, is this the front line of defense against runaway healthcare costs?

Bring Back The Draft

2010-07-27T07:48:00.001-04:00

1. Wheelan proposes a modified draft. In what ways is his proposal like the deductible on your auto insurance policy? Do we need another conscription tax to put a check on our troop commitments in times of humanitarian crisis?

2. How is deficit financing (issuing government bonds instead of collecting taxes) like the moral hazard problem surrounding foreign intervention and invasion by the U.S. military?

3. In what way is Wheelan's proposal subject to the same criticism Friedman leveled against the draft nearly 40 years ago?

4. Despite enlistment bonuses and aggressive recruiting, the U.S. military has had difficulty increasing manpower during the Iraq war. Politicians and the electorate cannot decide to invade or intervene if would-be soldiers won't enlist. Do you think the free market for military labor that Friedman championed provides enough of a check on the moral hazard of a volunteer army? Or do you agree with Wheelan that some form of conscription is needed to discourage hazardous decision making?

22 Reasons Why The Middle Class In America Is Disappearing

2010-07-26T11:13:00.004-04:00

1. 83 percent of all U.S. stocks are in the hands of 1 percent of the people.
2. 61 percent of Americans "always or usually" live paycheck to paycheck, which was up from 49 percent in 2008 and 43 percent in 2007.
3. 66% of the income growth between 2001 and 2007 went to the top 1% of all Americans.
4. 36 percent of Americans say that they don't contribute anything to retirement savings.
5. A staggering 43 percent of Americans have less than $10,000 saved up for retirement.
6. 24% of American workers say that they have postponed their planned retirement age in the past year.
7. Over 1.4 million Americans filed for personal bankruptcy in 2009, which represented a 32 percent increase over 2008.
8. Only the top 5 percent of U.S. households have earned enough additional income to match the rise in housing costs since 1975.
9. For the first time in U.S. history, banks own a greater share of residential housing net worth in the United States than all individual Americans put together.
10. In 1950, the ratio of the average executive's paycheck to the average worker's paycheck was about 30 to 1. Since the year 2000, that ratio has exploded to between 300 to 500 to one.
11. As of 2007, the bottom 80 percent of American households held about 7% of the liquid financial assets.
12. The bottom 50 percent of income earners in the United States now collectively own less than 1 percent of the nation’s wealth.
13. Average Wall Street bonuses for 2009 were up 17 percent when compared with 2008.
14. In the United States, the average federal worker now earns 60% as much as the average worker in the private sector.
15. The top 1% of U.S. households own nearly twice as much of America's corporate wealth as they did just 15 years ago.
16. In America today, the average time needed to find a job has risen to a record 35.2 weeks
17. More than 40% of Americans who actually are employed are now working in service jobs, which are often very low paying.
18. For the first time in U.S. history, more than 40 million Americans are on food stamps, and the U.S. Department of Agriculture projects that number will go up to 43 million Americans in 2011.
19. This is what American workers now must compete against: in China a garment worker makes approximately 86 cents an hour and in Cambodia a garment worker makes approximately 22 cents an hour.
20. Despite the financial crisis, the number of millionaires in the United States rose a whopping 16 percent to 7.8 million in 2009.
21. Approximately 21 percent of all children in the United States are living below the poverty line in 2010 - the highest rate in 20 years.
22. The top 10% of Americans now earn around 50% of our national income.

Why Starbucks Lost Its Mojo

2010-07-26T08:27:00.001-04:00

Why Starbucks lost its mojo - CSMonitor.com
This article addresses the motives behind the purchases we make. More often then not we buy things for what they say about us, not because we necessarily have a craving. Starbucks sold an image, but now their logo is so ubiquitous that it is no longer trendy. They same thing happened to Nike. The "swoosh" became so commonplace and thus mainstream, killing the coolness. Both companies had a nice run, though.

A Holiday Case Of Supply And Demand

2010-07-26T08:14:00.002-04:00

Click on the title above to explore a classic conundrum that baffles economists and shoppers every December. Why are there shortages of the items we want? This article focuses on the X-Box, but also addresses some memorable frustrations in shopping history.

Making the Case for Cap-and-Trade - Business - The Atlantic

2010-07-26T08:07:00.001-04:00

Making the Case for Cap-and-Trade - Business - The Atlantic
As the latest attempt to pass an energy bill goes up in smoke, there is one thing for certain, a lot of ignorance surrounds this issue. Click on the link above to get an understandable description of the cap and trade system. Every economist worth his salt would tell you that the answer to global warming has to be disincentives to produce the causes of global warming. A pigouvian tax, for instance, increases the private cost of the action to equate or surpass the social cost. The cost of polluting is currently not a deterrant.

Flatulence Tax

2010-07-25T15:58:00.001-04:00

Aplia Econ Blog: News for Economics Students: Bovine Intervention
In an extreme case of externalities, farmers in Europe are levied a tax on their cows because of the methane released when the bovine...uh, you know...fart. Cows are considered significant contributors to the greenhouse gases that impact our atmosphere, but this pigovian maneuver has farmers steamed.

Greatest Econ Rap Of All-Time

2010-07-24T13:29:00.001-04:00

Keynes vs. Hayek. The link takes you to the video as well as the lyrics so your students can follow along. Very factual and hits on some broad themes.

Comparative Advantage

2010-07-24T13:17:00.000-04:00

Paradox Of Choice

2010-07-21T20:50:00.002-04:00

If you can get past this guy's outfit, you'll find this to be a very relevant and intriguing presentation.

Where Do Currency Symbols Come From?

2010-07-20T07:57:00.002-04:00

A Recession Like No Other

2010-07-19T17:25:00.003-04:00

Staring Into The Abyss

2010-07-19T17:23:00.002-04:00

Come On Rich People, Pick It Up!!!

2010-07-19T17:21:00.001-04:00

How Much Would Your Social Conscience Allow You To Pay?

2010-07-19T08:10:00.004-04:00

In a previous post I offered an article describing the race to the bottom for wages in the garment industry. This article describes an unusual factory in the Dominican Republic that is bucking the trend and paying a living wage to its workers while freely allowing for unions. The factory makes t-shirts and sweatshirts for over 400 colleges and universities in the U.S., but because of higher labor costs has to charge a premium price for their garments. Many universities have grown uncomfortable with the knowledge that their items are produced in what are perceived to be "sweatshop" conditions. Thus, they applaud the efforts occurring in the Dominican. Many consumers might consider paying extra to support these fair labor practices, but how often does one know the origin of the product? Without effective marketing, many consumers may pass over the unfamiliar brand for the more recognizable logos. Thus, some see this as a noble experiment that will eventually fail. Meanwhile, many garment workers are realizing lifestyles they never thought imaginable.

The Evolution Of Economic Policy In The U.S.

2010-07-18T15:34:00.002-04:00

History Now. The Historians PerspectiveThis is a thoughtful essay on the tangle over the years between Classical and Keynesian Economics. The origins of both are discussed as well as the favor for each that's been passed back and forth throughout the twentieth century. In the midst of the recent crisis a debate rages again as some perceive a failure in the markets and the need for government intervention. As the worst seems past, the balance in our economy between the two theories continues to be a contentious issue.

Free Speech As An Economic Stimulant

2010-07-17T11:56:00.003-04:00

Iceland was one of the major victims of the 2007-08 global financial crisis betting the proverbial farm on the derivatives market and losing badly. Now, in an attempt to remake itself, the country's Parliament is proposing sweeping reforms to establish a safe haven for free speech in an attempt to draw the world's media organizations to headquarter in this tiny island nation. The legislation known as the Icelandic Modern Media Initiative is meant to attract organizations into publishing online from Iceland, by adopting the strongest press and source protection laws from around the world. This could be especially debilitating to Britain where the laws make it quite easy to bring suit against journalists and publications.

Race To The Bottom

2010-07-17T11:10:00.003-04:00

It has often been referred to as "the race to the bottom", the constant pursuit of lower labor costs throughout the world especially in the textile industry. The southeastern U.S. was at one point the epicenter of cheap clothing and towels. Following WWII, many of those jobs migrated to the lower cost labor pool in a recovering Japan. In more recent years, the opportunities have been more profitable in China. Now pressure in Chinese labor markets has created an opening for workers in Bangladesh who are willing to part with their labor for less. History will chase those jobs away eventually, but Chinese textile workers are now beginning to understand the feelings their brothers in the Carolinas felt not too long ago.

The War On Drugs

2010-07-17T08:07:00.001-04:00

Via: Medical Coding Certification

Energy Subsidies Black, Not Green

2010-07-17T07:53:00.002-04:00

Click on the title above and you'll access confirmation of something you probably already knew. Government subsidies over the last decade have inordinately favored the oil and carbon emitting industries and under supported the greener alternatives. Not only does that not bode well for the environment but might it also be ignoring a potential source for jobs in this transitional time?

In Plain English

2010-07-16T12:28:00.003-04:00

Click on the link above and you'll access a video production from the Fed that effectively illustrates the functions of the central bank. This used to only be available in hard copy DVD, but this is a much more convenient way to offer the content.

Markets Interact

2010-07-16T08:05:00.003-04:00

One of the most difficult concepts for students to grasp is the chain reaction that occurs throughout an economy when the interdependence becomes evident. This article is a terrific example of the impact the Gulf disaster is having on markets thousands of miles from its shores. People who never had a clue there was a connection are discovering the extensive reach of this calamity. According to the journalist, it all starts with the simple oyster. The impact on the cullers, captains, and shuckers is obvious but what of the fate of workers in the burlap bag factories in Mississippi? In Minnesota, oyster shells are ground to produce an ingredient in chicken feed. The restaurants in New York, Los Angeles, and Las Vegas are having to strike the delicacies from their menus.

Tech Behemoths

2010-07-14T05:21:00.002-04:00

Here is an interesting comparison of the big three tech giants Microsoft, Google, and Apple. There are interactive graphics that allow exploration of the different levels of competition they wage.

Plagarism? Keep Your Shirt On!!!

2010-07-13T06:07:00.003-04:00

The viral nature of plagarism at the collegiate and high school levels has relegated the educator to performing detective work. More frequently than ever, students will construct assignments from existing passages cutting and pasting their way to what many perceive as a legitimate outcome. Education has become training where you get from point A to B as efficiently as possible, with little regard for development of the mind. Studies have proven the detrimental effects of cheating as a strategy and it doesn't bode well for the quality of our future leaders.

There's No Such Thing As Free

2010-07-11T11:27:00.003-04:00

You can save money by cancelling your cable and DVR subscriptions because you've heard that many of your favorite programs are "free" on hulu.com or clicker.com. But are they truly "free" when you consider the time spent searching for those episodes? An economist would say you always pay one way or another.

The Economics Of Obesity

2010-07-08T19:37:00.002-04:00

Should the government give away free Krispy Kreme doughnuts and cigarettes as a cost saving measure? If people don't reach retirement missing out on Social Security and Medicare, does that leave more for the rest of us? This article contains a fascinating interview evaluating the costs of our modern lifestyle. Though obesity is expanding rapidly, the average American has lower blood pressure and cholesterol levels than our more physically taxed ancestors. The market has contributed to our unhealthy existence and is profiting by developing responses. Brilliant.

Economist In The Closet

2010-07-08T14:46:00.001-04:00

The Daily Show With Jon Stewart

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The Fleeting American Dream

2010-07-07T10:05:00.004-04:00

Click on the title above to access a sobering article on the prospects for today's millenials. 18-29 year olds find themselves moving back in with their parents with alarming frequency and the optimism of America has faded for them. This article is interesting because it incorporates multi-generational views of the father and grandfather as they struggle with their memories of this country in it's age of decline.

Pew Center Survey

2010-07-06T16:43:00.001-04:00

Two Ways To Measure GDP Give Us Two Okun Results

2010-07-06T16:09:00.003-04:00

As the last two posts suggest, Okun's famous law appears to be broken. Depending on the definition you trust, Okun's Law claims that every 1% increase above the natural unemployment rate is the result of a reduction in the GDP of 2-4%. The recent independence attributed to the unemployment rate despite growth in the GDP has led some to speculate that the law is obselete. But the fact that the GDP can be measured as spending or income raises the question over which is more accurate. The graphs in the article suggest the income approach to be more accurate and Okun's Law to still be relevant.

Okun's Law And Unemployment

2010-07-06T15:55:00.001-04:00

A Falling Unemployment Rate Can Be Misleading

2010-07-06T15:50:00.001-04:00

The unemployment rate fell in June to 9.5% from 9.7%, reaching its lowest point since last July. But the decline wasn’t due to improvement in the labor market. Instead, jobless Americans dropped out of the labor force in droves.
June’s decline in the civilian labor force of 652,000 was the sharpest one-month decline in 15 years in the Labor Department’s survey of households. Some people could be frustrated with their job searches, choosing to take time off or pursue other options like school. Some could be experiencing the end of their unemployment benefits, which required them to maintain an active job search. Whatever the cause, over the past two months almost one million people simply stopped looking for work. And over those two months, the U.S. population grew by 361,000 — with more than half of that gain coming in June.
The drop of 125,000 jobs in the monthly payroll report, which is compiled from a separate survey of employers, should have led to an increase in June’s jobless rate. The economy generally needs to add at least 100,000 jobs a month — often more — just to keep up with growth in the labor market and keep the unemployment rate steady. In June, people giving up hope and leaving the job market offset that need for more jobs to keep the jobless rate even.
What happens when all those people return? The unemployment rate is a measure of the total number of unemployed people — defined as those out of work but looking for work — as a share of the overall labor force. Once the economy improves, many of those people will restart their job searches and expand the labor force again.
If employers aren’t producing enough jobs to satisfy all that available labor — they probably won’t be — then the overall unemployment rate will rise again. The recent drops in consumer confidence and the recent pace of hiring suggests many Americans won’t be rushing back into the job market soon. That will mean continuing downward pressure on wages — and little underlying inflation.

News Flash: Economists Agree

2010-07-02T15:25:00.000-04:00

The recent debate over the stimulus bill has lead some observers to think that economists are hopelessly divided on issues of public policy. That is true regarding business cycle theory and, specifically, the virtues or defects of Keynesian economics. But it is not true more broadly.

Here is the list, together with the percentage of economists who agree:

1. A ceiling on rents reduces the quantity and quality of housing available. (93%)

2. Tariffs and import quotas usually reduce general economic welfare. (93%)

3. Flexible and floating exchange rates offer an effective international monetary arrangement. (90%)

4. Fiscal policy (e.g., tax cut and/or government expenditure increase) has a significant stimulative impact on a less than fully employed economy. (90%)

5. The United States should not restrict employers from outsourcing work to foreign countries. (90%)

6. The United States should eliminate agricultural subsidies. (85%)

7. Local and state governments should eliminate subsidies to professional sports franchises. (85%)

8. If the federal budget is to be balanced, it should be done over the business cycle rather than yearly. (85%)

9. The gap between Social Security funds and expenditures will become unsustainably large within the next fifty years if current policies remain unchanged. (85%)

10. Cash payments increase the welfare of recipients to a greater degree than do transfers-in-kind of equal cash value. (84%)

11. A large federal budget deficit has an adverse effect on the economy. (83%)

12. A minimum wage increases unemployment among young and unskilled workers. (79%)

13. The government should restructure the welfare system along the lines of a “negative income tax.” (79%)

14. Effluent taxes and marketable pollution permits represent a better approach to pollution control than imposition of pollution ceilings. (78%)

If we could get the American public to endorse all these propositions, I am sure their leaders would quickly follow, and public policy would be much improved. That is why economics education is so important.

Note that the proposition about fiscal policy (#4) does not distinguish between taxes and spending as the best tool for purposes of macro stabilization. Maybe that question should be added in a future poll. I doubt, however, that the answer would make it onto this list of widely agreed upon propositions.

Too Early To Pull-back?

2010-07-02T08:41:00.002-04:00

Paul Krugman bemoans the movement toward austerity among the world's legislators before the global economy recovers.

Structural Unemployment In Manufacturing

2010-07-02T08:06:00.002-04:00

Click on the title to go to a great article depicting the mismatch that exists between the demands for labor and the supply of workers in manufacturing. Continued automation and the evolution of manufacturing means that employers are looking for workers with sophisticated skills but the pool is apparently shallow. This is frustrating recovery in that sector.

Latin America Surges As Most Of The World Flounders

2010-07-01T07:03:00.003-04:00

A combination of pragmatism and a blooming relationship with Asia has allowed many Latin American economies to buck the trend currently plaguing the developed world. The article points out lessons that the U.S. should have adopted in retrospect such as, when the going is good....save!!!

Who Will Drive The 21st Century Economy?

2010-06-30T17:46:00.003-04:00

Throughout world history, the global economy has been led for large segments of time by a dominant country or region. The diagram illustrates the periods of leadership dating back to the beginning of A.D. The article points out the likelihood of a leadership transfer as we emerge from the global financial crisis and forge a new century.

A New Social Networking Site At The St. Louis Fed

2010-06-30T08:08:00.001-04:00

A great friend of high school economics education, the St. Louis Federal Reserve Bank, now has a social networking site that is definitely worth checking out. The St. Louis Fed's web site serves up loads of top quality Econ Ed content and comes highly recommended as a great resource for classroom teachers and researchers.

Here's the announcement with the URL:

Economic Education at the Federal Reserve Bank of St. Louis has a social networking site for economic educators. The URL for the site is http://econednet.stlouisfed.org.

The web site is a dual-threaded design, meaning each user can select both the topics of interest and the sites users with whom they wish to communicate. Unlike unfiltered Internet blogs, users will not have to sort through commentary of little interest to locate useful information.

We hope the site will help you find others with similar interests; exchange knowledge about economics and personal finance content, materials and research; solve problems and develop new ideas.

EconEd Net allows each user to write his or her own blog. Each user’s blog is available to all other users who sign up to receive that user's commentary. Users are able to read blogs from selected users while excluding ones they do not care to read.

The Ultimatum Game

2010-06-28T16:45:00.003-04:00

Click on the link and you'll access a full lesson using the Ultimatum Game. This is a great activity when you begin teaching Economics on why people make the choices they do and how each person has a unique perspective on the line between greed and self-interest.

RSA Animate – Crisis of Capitalism

2010-06-28T16:30:00.001-04:00

RSA Animate – Crisis of Capitalism
Clicking on the link takes you to an animation video and lecture by a radical socialist economist. He conveys his unique take on the recent financial crisis and how it is endemic of a germane flaw of Capitalism. The video and lecture are very thought provoking and should stir a great deal of discussion in your classroom.

RSA Animate – Superfreakonomics

2010-06-28T16:08:00.001-04:00

RSA Animate – Superfreakonomics
Clicking on this link will take you to a short video animation on the classic Ultimatum Game. This is an entertaining look at the motives that drive people to make the choices they do. The video and actually playing the game with your students will clarify in their minds the difference between greed and self-interest, and whether there actually is altruism in the world.

Leno And Incentives

2010-06-28T08:38:00.002-04:00

1. Comedian Jay Leno takes his show to Michigan to help "not just the autoworkers -- anybody out of work in Detroit."

2. He gives away tickets for free.

3. Someone tries to sell his ticket on ebay.

4. Mr Leno objects.

So I wonder: If a person down on his luck prefers the cash to the opportunity to watch Leno live, why would Leno object? Is it altruism that is really motivating Leno here? Is he really sure that the unemployed person in Detroit would be better off with an evening of laughs than $800 in his pocket? Or does Leno want to play to a live audience of unemployed workers so he will seem altruistic to his television audience?

Absent externalities, markets improve the allocation of resources. Both the buyer and the seller of the ticket must be better off: otherwise they would not engage in the transaction. The only significant negative externality that I can see here falls on Mr Leno himself. In other words, Leno's objection to the ebay sale is an understandable and fundamentally self-interested act in that the sale impedes his abilty to appear selfless.

Did he play Detroit to lift the spirits of the unemployed or to elevate his own image?

Budget And Fiscal Policy

2010-06-28T08:32:00.001-04:00

This is an assignment in which your students access online resources to answer questions and further their understanding of debt, deficit, budget, and fiscal policy.

Parking In L.A.

2010-06-28T08:22:00.002-04:00

This is an article about the traffic problems in Los Angeles that the author believes are the result of a pricing issue. It's a good study in incentives and how a realignment could fix an inefficient market. There are follow-up questions at the end of the article for your students to answer.

Advertising and Brands Effect on Price

2010-06-28T08:16:00.003-04:00

Here is an in-store project that can be done with your regular Econ students. It's a non-scientific way of looking at non-price advantages that brand name products have over off-brand ones in a grocery store setting.

Love For Our Pets Is Recession Proof

2010-06-26T08:08:00.002-04:00

This article describes the unconditional "love" we shower upon our pets regardless of the state of the economy. The pet care and pampering business isn't deterred by a little global financial meltdown.

Top Tax Rate By President

2010-06-26T07:56:00.002-04:00

Federal Debt To GDP

2010-06-26T07:53:00.002-04:00

New Financial Regulations Sweeping But Not Game Changing

2010-06-26T07:34:00.002-04:00

The new financial regulations expected to be signed into law will create a revenue rollback for the major banking firms like JP Morgan Chase. But no one is mistaking this legislation for the dramatic changes spawned by the Great Depression. This article addresses the policy modifications and the new expectations Congress has for the industry. JP Morgan Chase will be one of the most affected firms because they have significant interests in all areas of banking.

The Origins Of The American Stock Market

2010-06-25T07:28:00.004-04:00

The NYSE is a technical wonder now days moving billions of dollars daily between capital interests. This essay points out the humble beginnings of the stock exchange in America and how it evolved.

A Glimmer Of Hope In The I.P.O. Market

2010-06-25T07:03:00.003-04:00

If you incorporate the stock market challenge into your curriculum, this article might interest you. It discusses the difficulties companies have faced in recent years taking their firms public. From the Internet bubble to frozen equity markets, it's been a tough decade for fledgling businesses seeking capital.

Disparity Of Wages Worldwide

2010-06-22T19:15:00.001-04:00

Click the image to enlarge

Source: FixR