E-Books

The advantage of starting a new book from anywhere is something any bookstore wouldn’t be able to keep up without embracing the digital format. E-books has created big changes in the bookstore market. Now that E-books are very popular and easy to use, more and more bookstores are going out of business. Privately owned stores are being the most effected because they have to keep up with the growing demand of on-line books. What makes Barns & Nobles the number one on-line book store is that they sell over one Million digital books. Barns & Nobles one million digital book’s makes it hard for competitors to reach a point to where they can really compete with Barns & Nobles therefore making them the dominating bookstore chain. But even Barns & Nobles is losing money. They are suffering a net loss of about $63 million for the third quarter of 2010.

Resenting The Rich

"This is not class warfare; it's math," is what Obama said about his plan on raising taxes for the rich to make $1.5 trillion dollars in ten years for the US. Would imposing a higher tax rate for the wealthy in America really in the long run of things, help us out. Taking money away from the rich would have a negative effect on the economy because the wealthy would cut down on their spending. With America’s economy in a recovery this is not the time to be taking money out of the flow of money cycle of the US. Much like the problem in Greece is that their government is spending more than they are making. Does this sound familiar? American need to cut back on spending through unneeded agencies and scaling back on new spending. We need to fix the problem and not try to cover it up by increasing taxes to the rich.

Hello Greece.

Greece was about to go into default if it wasn't for a 130 billion euro bailout. The 17 countries that make up Europe came together and talked for 12 hours and came upon the agreement that would financially reinstate Greece back into the country. The news of the GDP of Greece's debt projected to come down by %120.5 by 2020 lead to an increase in the value of the euro. If it were not for this deal, Greece was going to face a very bad situation and possible relocation from the eurozone. But why would Europe want to kick out Greece? This is because Greece is not only hurting from its economic downturn, but it is also hurting the rest of the eurozone since they all use the same currency. It is not a surprise that Greece's private investors were asked to take a hit on their high interest rates dropping the face value of return by %53.5. The high interest rates on loans that Greece took out for expenditures were very burdensome and took a toll on the country's economy.

Gas Prices, Mr. Kern... Gas Prices

Referring back to one of my earlier blogs, I said that the U.S. economy could only be stimulated and successful if the American people have money to spend. So, with a huge rise in gas prices expected, that's taking more and more money out of people's pockets. Now a days, there is so much commuting and jobs where people have to drive, that it's almost impossible to go even a day without a car. Since gas is so expensive, people are going to be cutting off on other kinds of spending because they have to save money for gas. This can lead to a huge decline in the U.S.'s economic growth. High crude oil prices and the threat of Iran to cut off oil exports can cause some refineries to close down during the spring, which sends gas prices even higher! Because it is almost impossible for people not to drive, the high prices are just going to throw people's income into gas instead of other markets. Therefore, it will make the economy decline.

Citizens United vs Federal Election Commission and the 2012 Election

Republican primary season is wrapping up, if it hasn't already. Hopefully many of you know about the supreme court ruling in the Citizens United case, and if you do, I'm going to tell you anyway.

On January 21, 2010, the Supreme Court ruled that corporations and unions cannot have restrictions put on their expenditures towards presidential campaigns, essentially giving them the same right as human beings. To agree or disagree with the ruling that corporations are people is strictly a political matter, and the opinion is all yours. However, what I would like to examine is the change in the rules of the game--how big money now has the ability to control the elections.

Money has always been influential in elections. The most seizable donations made to a campaign, however, would typically come from wealthy individuals or families. Now, corporations and unions can donate obscene amounts of money to the runner's super pac, so long as they don't in any way, shape, or form, "coordinate" with the candidate. But there are so many loopholes that this clause is easily circumvented.

Do you think this is fair?

Worth more dead than alive

​ After last Saturday death of super star Whitney Houston, her album sales went through the roof. The same happened with Michael Jackson in 2009. Since his death, Jackson has made 1 billion dallors and sold 9 million more albums. After these artists death iTunes as well as their record label increased the price of their albums. Just after a couple of hours after Houston's death the price of her cds went from $4.99 to $7.99 on iTunes. Because of their death, the demand for their CDs increase and people were willing to pay a higher amount because the artist has became more popular. Houston and Jackson once again topped the music charts after their deaths. After several people complained publicly about how the increase in price was being " greedy", the price went back to normal and people continued to purchase their albums.

Was Hercules Greek or Roman?

I just Googled it, turns out he was Greek, which is good, cause now I have something to write about. If the Disney version of the movie Hercules was a metaphor for the state of the Greek economic system right now, this would be the part of the movie where Hercules is swimming in the lake of souls in Hades. In the movie, Hercules almost died, and he became very skinny and weak, not like the Hercules we all know and love. Thats what Greece's economy is looking like right now. The once powerful nation that brought the world Democracy has fallen in to a "bottomless pit" that needs to be filled up at once.

Greece is one of the seventeen European countries that uses the Euro as it's currency. With it's failing economy, the strong representation the Euro once had is now dwindling every day that something is not done. The other sixteen are backing up Greece in their time of need, but according to German Finance Minister, Wolfgang Schaeuble, the pit needs to be closed before they can put something back in there. That's why today, Monday the 13th, Greece's Parliament passed a piece of legislation that contain $4 billion in budget cuts and 15,000 job reductions as well. This sent protestors to the streets, bring buildings to a rubble, setting cars on fire, and drawing out riot police to control the chaos. Without legislation like this, Greece will keep sinking deeper and deeper into an economic failure, worse than our Great Depression or our recession that we're in now. But once they stop sinking, the rest of the Euronations will offer a bailout which will then send Greece in to bigger debt troubles.

I think it's about time for the Greek government to climb Mount Olympus and ask some favors from Zeus. Maybe throw a lightning bolt or two at that debt and make it go away. As for the American debt problems, we can now see that it could easily be worse. In the words of Tony Horton from the P90 X Workout (talking about sit-ups) - "Imagine if you had to do a hundred of them! Twenty-five doesn't sound so bad..."

How China Manages Inflation

After China has experienced recent inflation in the past two months, they find themselves in an economically challenging situation. This Time article explains their conundrum.

A way to combat unwanted inflation in any economic system is by raising interest rates, something the Chinese government has been unwilling to do. This is for two big reasons: A) this would attract international money into the country, therefore strengthening the Chinese currency the Yuan. The government finds this undesirable, as demand for their exports is high while the global market is depressed, strengthening their currency would only make their exports less appealing. Or perhaps they resist strengthening the Yuan because of pride issues, something the Chinese undeniably suffer from. They conclude their currency is fine where it is, and inflation can be dealt with in other ways.

New government stimulus policies has lead to a growth in bank lending, which leads to reason B) why China can't hike up its interest rates. Increasing the interest rates would leave more debt in the hands of Chinese businesses and corporations, and all borrowers for that matter.

So the Chinese government is taking a different approach, most unconventional than usual methods of controlling inflation. The banks are to be given certain amounts of money they must store in the bank, hopefully limiting how much they can lend. But it gets more complicated. This method of withholding money from borrowers is due to fail. Therefore the Chinese are going all rogue-communist  on economic practices by controlling the price on staple Chinese foods. This, of course, calls for a delicate balance of supply and demand, or as Schuman calls it, "reserve ratio [increase] and price suppression". 

Selling Personal Information

​You may have heard of Facebook starting to sell your personal information to third party companies, but did you know that your cellphone services are already doing this? Mid October verizon wireless changed their private policies to allow them to sell your information like age, gender, and even your location to third party companies. For example if a business wanted to open a new pet store, they can buy a market report from Verizon about the designated area. The report would have information about which city block had the most foot or car traffic from people's who web history indicates that they own a pet. Although Verizon was the first to have this policy, they aren't the only ones. AT&T, Sprint, and T-Mobile are also making money of this. I think this policy is over stepping its rights, but however if I was trying to start a new business this kind of information would be very helpfully.

Super Bowl Commercials

There's a different tone and attitude in Super Bowl commercials than the kind of commercials we watch every day. When watching prime time TV like local news, Jersey Shore, or Justified, the commercials that air can be very annoying. For example, that guy from Builders Surplus who smashes panes of glass and screams YEEHAWR! to get attention. No, the marketers who design commercials for the Super Bowl put much more time and thought into how to grab the consumer's attention, and make them salivate for their product.

This past Super Bowl was the most watched television event in American history, NBC says. Therefore it is highly important that whoever pays for a commercial slot during the game will have to make the best impression they can to get the most out of the millions they pour into their ads.

Creating a successful advertisement to air in the Super Bowl is no easy task- you have to appeal and win over an entire country of varying ages and demographics which all have varying interests and humors. So commercials like for the Toyota Camry, which are rather generic in their jokes, could make almost anyone laugh. These commercials are effective and can generate much needed publicity for a company, or just bring in millions of dollars in sales.

War Eagle!

Last week, I travelled to Auburn, Alabama to take a look and tour the campus of Auburn University. The campus was amazing and the academics were superb, with great programs for every major they offer. I pretty much fell in love as soon as I saw it. After the tour, I sat down with my parents and told them that I had a good idea that this was where I wanted to go. And then, all he[ck] broke lose. It hadn't really occurred to me that the cost of college was so immensely high. Out-of-state tuition for Auburn is $34,000 per year, and I needed to pay for some of it. My visit to Auburn was a huge reality check, and got me thinking about my future education and career. Why is college tuition so high? I think it has a lot to do with the economy and the value of the dollar. College is a service provided to you, like the internet or a maid. With a so-so economy like we have now, every other service inflates as well as college tuition. The value of the dollar has decreased so much in the past decade, that every company (including universities) is trying to compensate for the loss of value. So how do we make the price of college go down? According to this article, it's now starting to become more and more of a political issue. Obama, in a recent speech, has provided some sort of plan to make student loans more affordable for college-goers. With increasing interest rates, as well as tuition prices, student loans almost end up making college more expensive then it needs to be.

Putting a Price on Piracy

According to this blog post on the Washington Post website, The Motion Picture Association of America estimates that online piracy amounts to a net loss of $20.5 billion dollars a year. However, once you narrow in the window onto American pirates, it is figured that the industry only loses around $446 million dollars a year, subsequently less than what they claim.

There is a grey area in which the numerical figures are to be calculated. We cannot say that money is lost from the industry as it is uncertain if a person who illegally downloads a movie would have actually bought it in the first place. In this instance, the entertainment is at the expense of the entire film crew, but not even. On the other hand, there are cases in which thousands upon thousands of works are downloaded immediately after release, quite at the expense of the industry.

While there may be detrimental damage done to the music/film/television industries by online piraters, there is no harmful repercussion done unto our economy. Money not spent on a $20 movie winds up being spent elsewhere.

As SOPA, the Stop Online Piracy Act, has been pulled from Congress' agenda due to severe uproar amongst the citizens of America, the ball is in the entertainment industry's court. My guess is that Congress will create a new Anti-Piracy Act, but one slightly more lax and less threatening of American's first amendment rights.

​This year the weekend of black Friday had a total of 52.4 billion dollars. Between online sales and in store purchase, 35 percent were generated by online. The name black Friday comes from the fraze " movine into the black" when stores become profitable this day for the year. The Thursday after thanksgiving, black Friday, stores have the highest sales of the year. If the company had a strong black Friday they can generally keep their prices up and assume their holiday inventory will sell. A weak black Friday means that they have mark down their prices to keep money flowing through the Christmas season. Since the falling of the American economy, retailers have come up with the idea of moving back opening hours to midnight or earlier to try and attract more customers.