Economics @ ITT

The Capitalist Network that Runs the World

Posted in economics, macroeconomics, Policy Issues by ittecon on October 21, 2011

The work, to be published in PloS One, revealed a core of 1318 companies with interlocking ownerships (see image). Each of the 1318 had ties to two or more other companies, and on average they were connected to 20. What’s more, although they represented 20 per cent of global operating revenues, the 1318 appeared to collectively own through their shares the majority of the world’s large blue chip and manufacturing firms – the “real” economy – representing a further 60 per cent of global revenues.

Revealed – the capitalist network that runs the world – physics-math – 19 October 2011 – New Scientist.

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Eliminating Minimum Wages as a Jobs Plan?

Posted in economics, Policy Issues by ittecon on October 21, 2011

Fox News said Cain’s opportunity zone plan risks angering unions because it would enact policies they consider bad policy, such as the elimination of the U.S. minimum wage.

Eliminating unemployment is a necessary yet not sufficient solution. We need living wages.  At issue here is not whether eliminating minimum wages would diminish joblessness (increase employment); rather it is to question living standards. Implementing a policy as this would create a larger poverty class. Even currently employed workers in affected areas would suffer as they would now be competing in a race to the bottom.

via Cain to scrap minimum wage in poor areas? – politics – Decision 2012 – msnbc.com.

Skip the Lottery and Save for Retirement?

Posted in economics, microeconomics by ittecon on October 20, 2011

 One study in Texas found that a person without a college degree spent an average of $250 per year purchasing lottery tickets. If that same person were to start an IRA or other retirement vehicle that earned a conservative average 4 percent annual return and they contributed $250 per year for 30 years, they would have $15,392 once they reached retirement age. If they did the same thing for 40 years, that number would jump to more than $25,000. If it were possible to know the rate of future inflation, the number would be much higher.

Is the lottery ever worth your money? – Money – TODAY.com.

Supply and Demand?

Posted in economics, employment, Humour by ittecon on October 14, 2011

A humourous commentary on supply and demand economics…

The conversation goes like this:
    • Customer: $15 bucks a glass?
    • Calvin: That’s right! Want some?
    • Customer: How do you justify charging 15 dollars?
    • Calvin: Supply and demand.
    • Customer: Where’s the demand?! I don’t see any demand!
    • Calvin: There’s lots of demand!
    • Customer: Yeah?
    • Calvin: Sure! As the sole stockholder in this enterprise, I demand monstrous profit on my investment!
    • Calvin: And as president and CEO of the company, I demand an exorbitant annual salary!
    • Calvin: And as my own employee, I demand a high hourly wage and all sorts of company benefits! And then there’s overhead and actual production costs!
    • Customer: But it looks like you just threw a lemon in some sludge water!
    • Calvin: Well, I have to cut expenses somewhere if I want to stay competitive.
    • Customer: What if I got sick from that?
    • Calvin: “Caveat emptor” is the motto we stand behind. I’d have to charge more if we followed health and environmental regulations.
    • Customer: You’re out of your mind. I’m going home to drink something else.
    • Calvin: Sure! Put me out of a job! It’s you anti-business types who ruin the economy!
    • Calvin: I need to be subsidized.

Peanut butter prices are going up

Posted in economics, microeconomics by ittecon on October 11, 2011

The price of peanut butter, that American lunch bag staple, is going up, The Wall Street Journal reported Tuesday. The reason: peanut prices have skyrocketed after a hot, dry summer decimated the crop.

via Life Inc. – Holy Peter Pan! Peanut butter prices are going up.

Keynes and Hayek, the Great Debate (Part 3)

Posted in economics, Keynesian Economics, macroeconomics by ittecon on October 10, 2011

By the early 1940s, the Keynesian Revolution in America was in full swing. Fast-moving events in Germany obliged Franklin D. Roosevelt to spend on the vast scale that John Maynard Keynes prescribed. Despite the president’s assurances during the 1940 presidential campaign — “I have said this before, but I shall say it again and again and again: Your boys are not going to be sent into foreign wars” — he ordered a gargantuan rearmament program. In 1940, the annual defense expenditure was $2.2 billion; the following year it reached a sizzling $13.7 billion.

via Keynes and Hayek, the Great Debate (Part 3): Nicholas Wapshott – Bloomberg.

Keynes and Hayek, the Great Debate (Part 2)

Posted in economics, Keynesian Economics, macroeconomics by ittecon on October 10, 2011

Part two of a multi-part discussion of Keynes and Hayek. It is telling  to me when people place Keynes and an also-ran like Hayek on the same plane.

Friedrich Hayek arrived in London in January 1931 to take up an invitation to participate in the most telling duel in the history of economics. His aim, in four lectures at the London School of Economics: Overturn the theories of John Maynard Keynes, and prove that recessions were not caused by a lack of desire from customers to buy goods.

via Keynes and Hayek, the Great Debate (Part 2): Nicholas Wapshott – Bloomberg.

Keynes and Hayek, the Great Debate Part 1

Posted in economics, Keynesian Economics, macroeconomics by ittecon on October 10, 2011

The first of a multi-part series about Keynes and Hayek.

Keynes and Hayek, the Great Debate Part 1: Nicholas Wapshott – Bloomberg.

Occupy Wall Street protests and “The Decline of the West”

Posted in economics by ittecon on October 10, 2011

Corporations are creatures of statute. There is no Common Law of corporations, they are instruments licensed by the state originally in aid of certain public objectives. But few of these objectives are left. With the passage of time, corporate charters have lost any power to keep corporations in check. What is left? Only the pursuit of wealth. As Baron Thurlow reportedly said, “Corporations have no soul to save and no body to incarcerate.” Their charter is in the gift of the public. They have no inherent right to exist.

via Occupy Wall Street protests and ‘The Decline of the West’ – The Washington Post.

Recession officially over, but US incomes kept falling

Posted in economics by ittecon on October 10, 2011

In a grim sign of the enduring nature of the economic slump, household income declined more in the two years after the recession ended than it did during the recession itself, new research has found.

via NYT: Recession officially over, but US incomes kept falling – Business – US business – The New York Times – msnbc.com.