Raising the Minimum Wage: New Evidence

In the article Raising the Minimum Wage: New Evidence by Laura D'Andrea Tyson on December 13th, 2013.  As of right now the minimum wage is $7.25 an hour which is 23% lower than it was in 1968, if it had kept up with inflation and with the growth of labor activity, minimum wage for be up to $25 an hour.  Congressional Democrats have put in an input of raising the minimum wage to $10.10 an hour and index it to inflation.  The people against increasing minimum wage seem to think that an increase will lead to higher unemployment among low skilled low wage workers.  From 1996 to 2000 the United States had an unexpected boom in employment and prosperity.  According to estimates, an increase of 10% in minimum wage would have a statically negligible effect on the unemployment in industries and occupations employing minimum wage workers.  An increase in minimum wage would increase the cost of the business that employ a large number of minimum wage workers.  This would be an offset portion of these costs and the businesses would have to possible increase the prices for their consumers.  But they say that it should not effect the business costs significantly, they would increase less than 3%.  According to an estimate McDonald's could cover about half of its higher labor costs by raising the price of a Big Mac by about 1.25 percent, or only 5 cents.  A transitory increase in the inflation rate from a minimum wage hike would lower the real interest rate, increasing demand and growth.  30 million workers would benefit from the increase, 88% of those workers would be at least 20 with an average age of 35; 55% of them would be working full time; 56% of them would be female, and more than 28% of them would be parents.  For a full time minimum wage worker, the whole year they would make about $15,080, 19% below the poverty line for a family of three.  More than half of the families working at fast food places are assisted by at least one public assistance program, $7 billion a year.  Raising the minimum wage would by great to start fixing the poverty line, with a 10% increase cutting the poverty line by 2%.  Studies show that increasing the minimum wage into the $10 range would lift spending, GDP, and job creation.  A recent poll shows that large majorities of Democrat, independent, and Republican voters support an increase in the minimum wage.
http://economix.blogs.nytimes.com/2013/12/13/raising-the-minimum-wage-old-shibboleths-new-evidence/?_r=0

The Wedding Markup

"The Wedding Markup" written by Catherine Rampell on December 4th, 2013.  Many people of the wedding industry get the feeling that they are being ripped off.  When people call to hire people to work for their wedding. and they here it is a wedding and not something like a birthday party, they jack up their prices tremendously.   They explain it as being driven by higher costs.  Brides are very high maintenance when it comes to their wedding and they seem to be less flexible when it comes to the prices of their wedding.  They say "You can't substitute beans with broccoli if the price of beans go up."  If the bride wants beans then you have to have beans."  When it comes to dresses, they have noticed that the dresses are tremendously less expensive in other colors than in white.  Along with other dresses that look exactly a like but are a lot more than the other.  They say that they can get away with these kinds of things spouses-to-be probably have stronger preferences for their “special day” than consumers shopping for other kinds of events do. That means they’re less price-sensitive.  Charging a higher prices for a certain category of events than others is called third-degree price discrimination.  
  http://economix.blogs.nytimes.com/2013/12/04/the-wedding-markup/?ref=economics&_r=0

Puerto Rico

On November 20th, 2013 the United States decided to go to Puerto Rico to help them in their economic crisis.  They are bracing for their 8th year of recession.  They will be sending people from the departments of education, health, human services, housing, urban development, and the environmental protection agency.  In December they will travel their to find a way to maximize their federal funds.  Bill Clinton created the force in 2000 but Barack Obama expanded the scope to make recommendations on areas that needed specific help.  The force includes people form every cabinet.  The formation follows that Washington might begin to help the Caribbean territory, right now they struggle under a $69 billion debt and a 13.9 percent unemployment rate.  And their obligation bonds have been hovering over near junk status.  Puerto Rico's banks said they would cut bond sales after investors pushed a yield on the bonds above 10 percent.  The US will work with them to get joint economic goals.

Economy Perked up this Summer

In the article "Economy Perked up this Summer" written by Annalyn Kurtz on November 7th, 2013 obviously talks about the economy doing better.  The economic activity rose 2.8% in the third quarter., the strongest growth in a year.  Business built up their inventories while the consumers spending increased along with the real estate.  The federal budget held back the growth for fourth quarter.  State and local governments ramped up their spending enough to compensate for federal cuts.  They say it does not reflect the government shut down from what they have seen.  The economy is trying to run more fast paced but things keep coming up.  The 2.8% is still not enough to bring down the unemployment number enough.  They hope for about a 3% rate each year to somewhat bring down the unemployment rate.  At the end of September 11.3 million people said they could not find work, a 7.2% unemployment rate.

http://money.cnn.com/2013/11/07/news/economy/gdp-summer/index.html?iid=SF_E_Lead

This past week we have taken a lot of notes and learned a lot about supply but we have taken no test on it just a few quizzes.  We have also had to draw I do not even know how many graphs.  An update in Weserville is we had a holiday on Wednesday, the day we took our PSATs and the others either went on a field trip or a retreat.  But the day after there was a huge flood in Weserville that had a  huge affect on the supply in the town.

Debt of the United States

On October 10th, 2013 QUOCTRUNG BUI wrote about the debt of the United STates.  They say that if they do not raise the debt ceiling soon then the US will not be ale to pay the debt at all.  There is a chart of who the US owes money too.  The US owes money to other countries ($2.6 trillion), individuals and COOPERATIONs ($1 trillion), federal reserve ($2.1 trillion), SOCIAL SECURITY ($2.6 trillion), federal retirement and disabilty ($1 trillion), and China ($1.3 trillion).  These are just to name a few there are quite more that are not named.  But to pay this off will take so long and who knows if we will even be able to do it because as we are trying to pay the debt we put ourselves in more debt.  For example the shutting down of the government will put us billions more in debt.  Like in the shutdown in 1996, that lasted 26 days it costed the government $1.4 billion and roughly $2.1 billion in today's money.  As time goes on the US will continue going in debt even as when we try to get out of it, it seems like a CONTINUOUS cycle.

http://www.npr.org/blogs/money/2013/10/10/230944425/everyone-the-u-s-government-owes-money-to-in-one-graph

This week in class we have been learning about demand and being making a lot of demand graphs.  Earlier this week as we all know our government has shut down so we have had a lot of talk about that.  Yesterday we watched Shark Tank and that was my first time ever seeing it and I actually thought it was pretty interesting.  While we were watching it Mrs. Weser brought it one of the products the people proposed which was a mango jelly that you can put in others things to make other foods. She put it in cream cheese and we had it with crackers. Then Patrick brought in cheese dip and chips and was nice enough to share.  The food made it great because we all like to eat especially in class.  It was a pretty relaxed week and hopefully will be followed by another.

This was a very busy week for the school, especially Mrs. Weser, the juniors, and seniors.  This whole week we were preparing for Junior/ Senior Showdown.  Along with our case study being due on Wednesday added to the stress but we all pushed through and got everything done.  We took a few notes this week and watched the debt chart website.  I thought that was the coolest thing we did this week in class, it showed us how much debt each category was in an it was increasing every second.  We also watched quite a few videos and played a game in which I did not achieve my badges, but I was close.  Overall, I think this was the most fun week we have had in school, outside of Econ class and inside of Econ.

The past week we have done a lot and learned a lot.  Well first off we took quite a lot of notes this week, which I personally do not mind.  We had a stock game going on one day in class after we decided what we were going to open in Weserville, there were many different ideas such as an ice cream shop, restaurant, apartments and many more.  Then for homework one night we started a stock market game, and we all seem to be enjoying it.  We will be doing this for a whole month and whoever  is top ranked will get a prize.  Then at the end of the class we found out we have to write a 3-5 page essay on the laws about healthcare that is going to be passed on January 1st, which should not be fun.

October 10th, Housing Market Indicates Trouble.  The housing industry seems to be going for a bigger decline and foreclosures hit a record high in August.  Housing is one of the largest factors in the US economy and almost 40% of consumes are spent on housing situations.  When home values fall, Americans seem to spend less, banks lose money, and oversupply of houses.  To fix this problem they are thinking for the lenders to cut the amount of money the borrowers owe to match the value of the house, while the owners give up half of any gains if the house is in value.  Another solution may be to let people refinance so they most likely will not default.  I think that it may be a good idea to use one of these options because I think it will benefit us and the economy in the long run.  It will leave us with more money not using all of our money for the house you are buying, all the foreclosures can hurt the economy because they make the prices drop so it hurts the housing markets.

http://hmcurrentevents.com/housing-market-indicates-trouble/

A huge current event right now is "Is the cost of college crippling?" written by Frankel Laurie.  What is going on is they are saying that the cost of college is rising dramatically.  Statistics show that nothing in life has risen in price as fast as college has, since 1985 it has risen over 500%.  Some believe universities are the biggest scam going on.  Most people say it is related to economics and that you have to go to college to get ahead and at the same time they are not opening new colleges and as they said "they have a fixed amount of supply and when demand is going up and supply is not, the prices rise" therefore the prices of college must rise.  When the prices rise most people need loans and grants which leads to debt after you get out of college.  They stats said that grants and loans only cover about 30% of your tuition meaning you are still in debt because for tuition that is not that much being covered.  These debts will affect their lives after they get out of college also.  We all know that the cost of colleges is rising and I believe they will keep rising because of their fixed supply and with more and more people wanting and attending college the price will continue rising.  After college people are in a huge debt which I believe can be life affecting, it affects how you live after college and if you are still paying it off when you have a family it will be hard to support while paying off the huge debt you have from college.  Paying off debt will be even harder if the person cannot get a qualified job for their field and may end up working somewhere that does not even need people that attended college.

 http://money.cnn.com/video/news/2013/09/03/n-cost-of-college-rising-education-middle-class-jobs.cnnmoney/index.html?iid=SF_E_LN

                                                          

                                                         Reflection on Weserville

This past week in Econ class, the first week of school we did many things such as read the syllabus, discover the classroom, complete thought questions, figured out the new Google drive,  talked about Weserville, and began doing things with it.  I thought that the activities with Weserville were the most interesting and fun.  First we learned about Weserville, the people, the land, the stores, etc.  Then we made up the person we were going to be in this town and what our occupations would be.  Then we were told we were getting ten million dollars to do whatever we wanted with part of the land.  Each group decided on what they think this land should be used for and we agreed on two, now in the process of discussing the two decisions.  I thought this was the most interesting and fun of the week because it allowed us to use our imagination and put in our own ideas.  This project of Weserville could easily relate to other things we are going to talk about in class because it deals with money, products, decisions, what is best for something, and limitations.