America’s Economy

“High Gas Prices could Slow Recovery”. By Clifford Crauss: The New York Times. June 8, 2009.

Summary

Sources are indicating that there may be a problem in the refineries in the Midwest regions where most of the Oil products in the land of America is supplied from. This resulted to a sudden shoot in the prices accorded to the petroleum products. The refinery problem has resulted to a challenging situation since the manufacturers of gasoline have sharply resulted to reducing their production since the lack of the inputs inhibits their processes. It is argued though by economists that it may be a step towards the betterment of the consumers’ spending as the government is desperately fighting to see its citizens use the new vehicles in the market that only consume a limited supply of gas according to Ann Karen, a reporter from Chicago. Increasing the prices of gas will therefore force people into buying the vehicles that consume limited amount of fuel.

Opinion

The step is a well calculated economic strategy though it tightly closes doors to the effects that will be felt by the other sectors in the economy whose production are dependant to the production of gas. These producers will be forced to increase the prices of their products to cater for the increased levels of expenses. According to Dixit (75) this will consequently make the consumers of the products shy away from the consumption of these commodities. The long term effect will result to the producers of the commodities being heavily punished economically by the step. It is due to this well stated argument that I greatly differ with the article whose content has been summarized above.

“Jobless Rate Rises, but Pace of Losses Slows”. By Irwin, Neil: The Washington Post. Saturday, June 6, 2009.

Summary

The United States has been on the edge of receiving rapid increases in unemployment levels from for a long time now. By the end of May though, the levels of unemployment were recorded to be 16.4%. As per the analysis done by the bureau of labor statistics, the 16.4% of the unemployed population of the Americans was by the strongest terms possible the greatest per cent age drop in the levels of unemployment ]which was quantified to be a 9.4% decrease. This is cited to be the greatest per cent age decrease in the unemployment rates ever since the 8.9% which was last experienced in 1983. As a matter of fact, the unemployment rates though still high, are on the decrease as Heidi, Shierholz, an Economics Analyst indicates. In contrast though, the levels of unemployment in manufacturing industries is on the increase as they lay off another 156, 000 people last month. This is making it hard for even the Economists to forecast on the future job market trends.

Opinion

Though the scenario is causing high rates of confusion in the job market the government plans underway for the year are not taken in to consideration and we may even end up making baseless conclusions that may be impaired in one way or another just as Dixit (112). Basing on this point it may also be wrong to make a general assumption that the remarkable improvement experienced at the end of the last month was an unexplainable reason. Government policies are a great force in the determination of rates of joblessness in a country Dixit (100). US may therefore continue experiencing the good improvements. Am therefore in disagreement by the argument put forward by the summary above.

 “Why Home Prices May Keep Falling”. Shriller Robert: The New York Times. June 8, 2009.

Summary

A surprisingly new shift is being observed in the market trends that deal with the selling and buying of houses. The irony of the situation can not be put in a better way than this. “How comes the houses are being sold to the market when the prices are not favorable?” This question is coming from lots of the correspondents from the reader’s desk. The situation is in total conflict to the theory of supply which would imply a reverse in the current happenings in the US markets. The low prices should be making the suppliers of the houses shy away from providing their houses to the market for sale and wait till the prices shoot up. This though is necessitated by several factors which include the following: Some of the buyers of the houses are in no rush to buy the houses since they are in possession of other houses and are therefore in no hurry to buy them. They will therefore wait patiently for the prices to go down. Due to the saddening trend, some house owners are doing their best to sell their houses so as to avoid much heavier losses as the trend is likely to continue till 2010.

Opinion

In reference to the Economic principles Dixit (43) learnt in class the scenario presented by the case of the house prices is totally realistic and am therefore obliged to comfortably state that am in complete agreement with the article.

Work Cited

Dixit, Avinash. Thinking Strategically: Barry Nalebuff, Washington DC (2008).