Chilean Earthquake

Article:
http://www.economist.com/world/americas/displaystory.cfm?story_id=15591569&source=features_box_main

In the aftermath of the earthquake in Haiti a huge 8.8-magnitude earthquake hit Chile early on Saturday February 27, 2010. Michelle Bachelet, Chile's President, estimates that 1.5 million homes were damaged and 2 million people were affected by the quake. There are collapsed buildings and roads. There is also a prison wall that collapsed allowing 300 inmates to escape of which only 60 have been recaptured. This earthquake, though larger than Haiti's earthquake,has had a lesser impact on the country. Chile is a much more wealthy nation than Haiti and has a much better infrastructure. Unlike in Haiti the people in Chile will be able to receive medical care rather quickly.

Chilean earthquakes are not rare. Chile lies along the Pacific “ring of fire" which is one of the most seismically active zones. In the past 37 years Chile has experienced 13 earthquakes with a 7-magnitude or greater. This fat has made Chile a durable place for earthquakes. The building codes are very strict and Chile has the money to enforce these codes, unlike Haiti. How will this earthquake affect the economy? I think that this earthquake will make a dent in the Chile economy. Many businesses will be out of business for weeks. On the other hand. the many collapsed buildings and roads could call for an increase in jobs.

Vocabulary:

Michelle Bachelet- Chilean President

Pacific "ring of fire"- "is an arc stretching from New Zealand, along the eastern edge of Asia, north across the Aleutian Islands of Alaska, and south along the coast of North and South America. The Ring of Fire is composed over 75% of the world's active and dormant volcanoes."

 

http://atlas.nrcan.gc.ca/site/english/maps/environment/naturalhazards/volcanoes/fig_2_volcanoes_pac_ringfire.jpg/image_view

Infrastructure- the fundamental facilities and systems serving a country, city, or area, as transportation and communication systems, power plants, and schools

How the Weather Affects Jobs

Article: http://blogs.wsj.com/economics/2010/02/19/february-jobs-report-may-be-impacted-by-blizzards/?mod=rss_WSJBlog&mod=marketbeat

Everyone has heard about the intense blizzards in the Midwest and Northeast that have left people unable to go out of their homes. Has anyone thought how this could affect the February job report. The firm Macroeconomics Advisers forecasts a drop in the job report. Because of these blizzards workers have been unable to go to work and companies have lost some customers. It is expected that because of these blizzards companies have held off on hiring new workers until March when the weather is thought to clear.

In the past, job reports during extreme blizzards have shown low numbers. In January 1996 there were blizzards that showed a drop in jobs of about 60,000. This is being used as an estimate for this months job report. How does this affect the economy? Well, because this month's job report will be impacted by the weather then it could correlate to a lower amount of consumerism for this month. Less people are working this month so there could be less activity in the market. Hopefully March will show a bounce back and the market activity will increase slightly.

Terms:

-Macroeconomics Advisers: the most trusted source for U.S. macroeconomic analysis. MA is known for its
ability to combine a rigorous, model-based approach with keen judgment to produce award-winning forecasts and insightful commentaries.

-Job Report: A report released every month that describes the gain or losses in jobs for that specific month.

-Firm: Any business, such as a sole proprietorship, partnership or corporation.

Lights, Parks, Police Oh My!

Article:
http://www.npr.org/templates/story/story.php?storyId=123691065

Do you walk in the streets at night wondering if the street lights are going to turn off, leaving you in the dark to find your way? Do you walk through the parks in your city picking up trash at every step you take having no place to go to the restroom? Do you walk in the city seeing less and less policemen and firemen everyday? Well, most of us would say no but for the residents of Colorado Springs, Colorado these things are a reality. The city has turned off street lights, stopped much maintenance in parks, and cut the number of policemen and firemen in the city.

These are just some of the ways that Colorado Springs is attempting to fill the $28 million budget gap for the city in 2010. Why is the city government making these cuts? Some say that this is a typical tactic of the government to make public cuts to make people feel some kind of suffering. Is this tactic a good tactic? Does it work? I would say not. I believe that this tactic gives the people of the city and country a lack of pride in their government. If the city can not provide a clean park or lit street for children to walk home on then how can the government provide the people with solid healthcare and schools? I believe that if more cities make these kinds of cuts then the American confidence in the government will drop and our infrastructure may begin to crumble.

Terms:
National League of Cities-"the oldest and largest national organization representing municipal governments throughout the United States"

Revenue: the entire amount of income before any deductions are made.

Budget Gap: The amount of money by which a government exceeds the set budget.

America and Canada, eh?

Article:

http://online.wsj.com/article/SB10001424052748703894304575047282403176858.html?mod=WSJ_economy_LeftTopHighlights#articleTabs%3Darticle

Definitions:

• Procurement: Acquisition of goods (materials, parts, supplies, equipment) required to carry on an enterprise.
• World Trade Organization: the only global international organization dealing with the rules of trade between nations. For more information go to-http://www.wto.org/english/thewto_e/whatis_e/whatis_e.htm
•  Municipalities:  A political unit, such as a city, town, or village, incorporated for local self-government

 The United States and Canada are attempting to reach a deal on the "Buy American" provision in the U.S. Stimulus package. This deal could potentially allow for both the U.S. and Canada access to procurement contracts at local and state levels. The Stimulus package requires U.S. manufactured products to be the only products used in stimulus funded projects. The U.S. and Canada have agreed, in this deal, to give permanent reciprocal access to 37 U.S. states and Canadian provinces and territories. These are areas covered by the World Trade Organization's procurement agreement. These two countries would also have temporary access to other projects across the borders. The agreement is hoped to be signed on February 16, 2010 and the countries have plans of discussing in a year about making temporary procurement agreements permanent.

What is this "Buy American" provision in the stimulus package? They basically state that any project that is funded by the stimulus package must get all of its manufactured products from American manufacturers. They also gives the heads of federal departments the ability to waive this provision for multiple reasons. These reasons include whether the provision would not coincide with public interest or whether the manufactured goods made by American companies used in a project would increase the cost by more the 25%  or whether the goods manufactured in America were not sufficiently and reasonably produced. To read more about the provision go to http://www.forbes.com/2009/02/23/buy-american-stimulus-opinions-columnists_wto_trade.html. This provision has frustrated not only Canadian companies but also American companies. This deal will hopefully help the trade relationship between these two countries. Between 2008 and 2009 trade between Canada and the U.S. has dropped dramatically.


Will this deal help? Many say that this deal will help but that there will still be much to fix. A U.S. trade representative spokeswoman said that this deal would give companies in Canada access to 7 programs that have an estimated value of $18 billion which is minuscule in comparison to the $787 billion in the stimulus package spending. Personally, I think that this deal will most likely not help the U.S./Canada trade numbers. America's reaction to Canada is a clear example of how America is likely to act with other countries. This could be detrimental to President Obama's plan to double American exports within five years. How can we increase our exports without a good name in the trade game?