Creation of Modern Banking Activity

Flash through Recollections of Pine Gulch

Part One: Click Here

Part Two: Click Here

When finished, please get a worksheet for a quiz on the readings.

Video: Are You Really Unemployed?

UNEMPLOYMENT: THE MOVIE

Click on the movie to play. It looks like a spreading plague or something.

HT: Carpe Diem

Detroit's Abandoned Buildings Providing Opportunity For Pranksters.

Read more here about this and other pranks from the Wall Street Journal.

The Berlin Wall: Before and After Photos

Here is a great NY Times photo of the Berlin Wall, before and after. It sure looks from the photos that East Germany has become relatively prosperous, at least compared to their living standards during communism.

Economists on Jeopardy

Don't Worry, Your Never McFar...

...from a McDonalds restaruant, if you are in the US. The fartest distance between McDonalds in the continental 48 states is 145 miles.

"between the tiny Dakotan hamlets of Meadow and Glad Valley lies the McFarthest Spot: 107 miles distant from the nearest McDonald’s, as the crow flies, and 145 miles by car!"

Not Very Stimulating: 49 of 50 States Have Lost Jobs Since The $787,000,000,000.00 Stimulus Package Passed

From the House Ways and Means Committee:

"The table below compares the White House's February 2009 projection of the number of jobs that would be created by the 2009 stimulus law (through the end of 2010) with the actual change in state payroll employment through September 2009 (the latest figures available). According to the data, 49 States and the District of Columbia have lost jobs since stimulus was enacted. Only North Dakota has seen net job creation following the February 2009 stimulus. While President Obama claimed the result of his stimulus bill would be the creation of 3.5 million jobs, the Nation has already lost a total of 2.7 million – a difference of 6.2 million jobs. To see how stimulus has failed your state, see the table below."

Neat Interactive Map of US Housing Foreclosures

Check out how the worst of the foreclosure market seems to be concentrated in just a few states. Play with the map here, or click on the map.

The Invisible Hand At Work. Wal-Mart and Amazon.com Have A Price War

Competition.

"Wal-Mart triggered the online skirmish Thursday when it began selling its 10 most anticipated hardcovers for $10 apiece when pre-ordered on its Web site. Amazon matched the offer hours later and Wal-Mart then chopped its price to $9. Friday morning Amazon had matched the price."

Read more here.

DOW 10,000

While the Dow Jones just hit 10,000, reaction was much more muted than the first time 10 years ago. Here, the journal writes about the caution many traders have about the economy going forward, especially about the national debt, soon to reach $12,000,000,000,000.

"Reaction this time was more muted than the first time the Dow closed above the 10000 mark, on March 29, 1999, when traders popped Champagne and passed around "Dow 10000" baseball caps. "People don't believe it, they don't trust it, they are nervous, they are anxious," said Andy Brooks, head of stock trading at money-management group T. Rowe Price. "Most of us can't believe the year we have just been through, where you made and lost so much money."

"But in the longer run, many of the problems that worry investors will need to be resolved, such as the high levels of bad loans and securities on bank balance sheets, the weakness of the real-estate market and the nation's heavy consumer and government debt. "We don't see a catalyst that would immediately drive the economy lower, but there certainly is some risk that the market could retrace its gains" since they have come so rapidly, says Bruce McCain, who helps oversee $20 billion as chief investment strategist at Cleveland's Key Private Bank."

Another Debt Chart, This One Even More Depressing

Current debt projections, unless changes in spending and taxes are made. Read more here from economist John Taylor.

United States Debt to GDP Ratio

Ships That Don't Move: The Global Recession Takes its Toll

The current recession has seen the biggest decline in global trade since the great depression, and can be exemplified by the ghost fleet of ships seen off the coast of Singapore, below.

As the Daily Mail writes: "The biggest and most secretive gathering of ships in maritime history lies at anchor east of Singapore. Never before photographed, it is bigger than the U.S. and British navies combined but has no crew, no cargo and no destination - and is why your Christmas stocking may be on the light side this year."

US National Income vs. The World

Here is an very interesting interactive chart comparing Gross Domestic Product around the world. Click on the image below to compare a nation's income based on region, religion, population, language, and much more.

Need Some (Facebook) Friends... Here's a price

Want some new facebook friends? You can have them easily... for a price. 7.6 cents per friend, precicesly.

As PC World Writes: "For a piddling 7.6 cents per friend, Usocial will deliver 5000 new buddies to your Facebook account. That's $654.30 worth of lovin' from people you'll never meet..."

Back in Business

Redonomics is back after a long and restful summer. Please check back for many updates this fall. Thanks for stopping by Redonomics.

Photos from Japan Trip

Great Advice on Budgeting From SNL

Global Economic Pain

Read more here from the Journal, for an excellent perspective on the global recession, and the stats show it is a bad one.

A Tough Market For College Grads

An excellent story in the Minneapolis-StarTribune today highlights the difficult job market facing college grads today:

"Just 19.7 percent of 2009 grads who applied for a job have one so far, down from 51 percent at the same point in 2007, according to a new survey by the National Association of Colleges and Employers.

Those employers say they plan to hire 22 percent fewer graduates than last year. Another survey by the group shows the average starting salary dropped 2.2 percent from the same time last year."

Let's hope these students do graduate with high-interest credit card debt in addition to their student loans. For the current unemployment rate, the worst in 25 years, check out my previous post here.Above photo: St. Olaf College, Northfield, MN

AP TEST REVIEW ON FACEBOOK

You are invited to attend an AP Economics review event on Facebook, hosted by David Mayer, a friend of mine and a Teacher at Churchill High School in San Antonio, Texas.

Here is the link:

MACRO: http://www.facebook.com/event.php?eid=90215276873

If you have any questions, post it at this site and a highly qualified teacher will answer your question.

15,000 Views, Check it Out!

15,000 views, of video I took from these students performing Georgian music and dancing from my Study Tour to the beautiful Republic of Georgia with the Council for Economic Education. Read about it here, page three, and check out the video.

8.9%, - 5,700,000 Jobs Now Lost Since Recession Began

1st Quarter GDP Down 6.1%

Read more here, from the Wall Street Journal.

The Trillion Dollar Campaign

The Zimbabwean Newspaper, from Zimbabwe, is drawing attention to the dire situation in Zimbabwe with a Trillion dollar campaign.

From the Zimbabwean: "In Zimbabwe, the money is so worthless, that banknotes are cheap alternative to paper - meaning its cheaper to use the notes themselves for printing onto than buying the paper with the currency.. The Zimbabwean newspaper calls upon South Africans to “Fight The Regime That Crippled a Country”. The call to arms is written on worthless Zimbabwe bank notes… using billboards, wall posters and via direct mail to South Africa’s top corporate executives. The creative and eye-catching campaign has caused a stir on the streets of Johannesburg and has been reported by media around the world. One of the most eloquent symbols of Zimbabwe’s collapse is the Z$100 trillion dollar note, a symptom of its world record inflation. This note cannot buy anything, not even a loaf of bread and certainly not any advertising, but it can become the advertising - a powerful reminder about Zimbabwe’s plight and the need to hold someone accountable. The Mugabe regime has destroyed Zimbabwe. It has presided over the brutal oppression of the opposition, a cholera crisis, massive food shortages and the total collapse of the economy. Furthermore anyone brave enough to report this has been bullied, beaten and driven into exile. One such group is ‘The Zimbabwean newspaper.'"

I Know Some Call Economics The Dismal Science, But Seriously Mr. Summers...

Here is the President's Top Economics Advisor, Dr. Larry Summers, falling asleep today while the president speaks on the economy. Read more here.

Four Bears

State Job Losses Since The Recession Began

This is an interesting chart showing what states have lost the most jobs since the recession began. You can click on the map to go the the Wall Street Journal interactive activity.

A Quick Quiz of Past AP Econ Test Questions... From The N.Y. Times

Click here to take the quiz.

North Korea at Night

So as North Korea spends most of their resources on the military, there is obviously little left for everything else, like economic development and feeding their population.

Charting The Stock Market: Ups and Downs, Mostly Down

So is the market heading for a huge dip? Click on the picture to enlarge.

More Worthless Zimbabwe Paper

To Protest the massive hyperinflation, the the Zimbabwean Newspaper created an ad campaign featuring huge posters, wall murals, flyers, and even billboards all made out of trillions of Zimbabwean dollars. Check out the photos from the newspaper’s Flickr Photo Stream.

"The Mugabe regime has destroyed Zimbabwe. It has presided over the brutal oppression of the opposition, a cholera crises, massive food shortages and the total collapse of their economy. Furthermore anyone brave enough to report this has been bullied, beaten and driven into exile. One such group is ‘the Zimbabwean Newspaper’. However, not content with having hounded these journalists out, the regime has slapped an import ‘luxury’ duty of over 55% on them which makes the paper unaffordable for the average Zimbabwean. In order to subsidize the paper they need to sell it in England and South Africa, to raise the foreign currency. A unique campaign was devised to promote the paper to raise awareness and increase readership. One of the most eloquent symbols of Zimbabwe’s collapse is the Z$100 trillion dollar note, a symptom of their world record inflation. This note cannot buy anything, not even a loaf of bread and certainly not any advertising, but it can become the advertising, it can be a powerful reminder about Zimbabwe’s plight and the need to hold someone accountable. Link.

Every Breath You Take - The Fed

GDP By Country: G-20 Players

Click on the above picture for a neat interactive graphic of GDP, Debt, Inflation, and more for the G20 Countries.

There Is No Such Thing As 11,000 Free Pizzas.

That is, until some clever people found a "bailout code" and spread it on the internet, and it spread until 11,000 people bought them. Read here.

Deficit Projections: An Unsustainable Path

We've Come A Long Way... Cool Video.

World Poverty

Tyler Cowen of George Mason University and economics blog marginal revolution (below, on the right) has some excellent insight on world poverty. Check it out!

The Minnesota Timberwolves "Recession" Season Ticket Package

It looks like the Timberwolves have a very interesting marketing gimmick to sell some tickets. If you buy season tickets for the 2009-10 season and lose your job, you can get a full refund on all unused tickets. But then, as Rick Reilly says, you still have to watch the Timberwolves. The T-Wolves also cut prices on 95% of their seats. Of course the T-wolves would see an increase in the quantity demanded of tickets as they lower the price of tickets; however the demand curve could also shift to the left, decreasing demand, and reducing the advantages of this sale to the T-Wolves due to their continued futility.

... but then again, if Latrell Sprewell were still playing, how would he feed his family with this decline in revenues.

It's Getting Better All The Time

Here is what the average teenager could have bought, after a summer of work in 1949, at the minimum wage of 40 cents per hour in 1949, assuming a 12 weeks of 40 hours of work per week. This work would have generated $192 in total summer earnings (ignoring taxes). Using a Sears catalog for retail prices, $192 would have only purchased the following 4 items in 1949:
At the mimumum wage of $7.25 today, full-time summer job will generate about $3,500 this year, which would be enough to purchase the following list of 28 items (click to enlarge):
Economics professor Mark Perry says the following: "Teenagers today can afford things like cell phones with cameras, digital cameras, GPS systems, CD players, DVD players, laptop computers, and iPods that even a billionaire couldn't have purchased 20 years ago. As much as we might complain, just by being alive in the 21st century America, even if you're earning the minimum wage, you've "won first prize in the lottery of life."

Inside the Fed: Hope Those Robots Don't Spend All That $

Watch CBS Videos Online

Big Ben Bernanke: The 60 Minutes Interview - Parts 1 and 2

The first interview with a Fed chair in 20 years...

Watch CBS Videos Online

Watch CBS Videos Online

First Wall Street...Now Sesame Street

It appears no one is immune from the current recession. According to the San Fransisco Chronicle...

"The crisis on Wall Street is plaguing Sesame Street.

Sesame Workshop, the nonprofit producer of "Sesame Street" and other kids' programs, is cutting about one-fifth of its work force because of the economic downturn.

The New York-based company said Wednesday that it's eliminating 67 of 355 staff positions.

Declaring it is "not immune to the unprecedented challenges of today's economic environment," the company pronounced a need "to operate with fewer resources in order to achieve our strategic priorities."

JR: It looks like a possibility to introduce economics to my 3 little kids at home.

Economics Battle Royale: Mankiw vs. Krugman

Mankiw's best selling textbook. Krugman's text.
Two authors of best selling textbooks, Greg Mankiw of Harvard and Paul Krugman of Princeton have been arguing, via their columns and blogs, about the very rosy economic forecast over the President's budget. Mankiw challenged Krugman to a bet, some of his Nobel Prize million, that GDP growth will not be as large as the President's budget predicts. Krugman called Mankiw "evil" and yet has not responded to the wager. My money is on my facebook friend Mankiw.

Here's the Washington Times today: "Harvard economics Professor Greg Mankiw thinks that Mr. Obama's growth forecasts are overly optimistic and that the federal deficit will be a lot larger than Mr. Obama thinks. He was chastised by Princeton's Paul Krugman, a Nobel Prize winner in economics, who on his New York Times blog claims that Mankiw can only make the predictions that he does because of "more than a bit of deliberate obtuseness." He titled his post on Mankiw, "Roots of Evil."

Last Wednesday, Mankiw responded to Krugman's attacks by suggesting: "Well, Paul, if you are so confident in this forecast, would you like to place a wager on it and take advantage of my wickedness?" Krugman has still not responded. It seems even a Nobel Prize winner isn't willing to lay money on Mr. Obama's rosy projections."

Another $1 house in Landlord Nation.... Detroit

DETROIT – Welcome to Landlord Nation, where foreclosure notices are plentiful and for-sale signs offer at least 1,800 homes for under $10,000 that once were worth at least 10 times more. In extreme cases, homes are on sale for $1 or less (home pictured above is listed for $1 here), which has enticed investors to Detroit from as far away as the United Kingdom and Australia.

"In the past few months, I've picked up 10 new clients from out of state that are buying in bulk," said Mike Shannon, a suburban Detroit real estate agent. His office specializes in foreclosures in a city that's among the national leaders.

"They're coming to us, saying `Look, I want to buy 50, 100, 1,000.' They want to own every decent and cheap house they can find."

Despite a stagnant retail housing market, real estate sales of foreclosed homes are booming. Shannon regularly fields calls from eager prospects, and recently sold 30 homes in one day to one buyer. A trio of U.K. investors has bought a half-dozen and plans many more.

HT: Carpe Diem

SNL on Treasuary Secretary Geithner and The Banking Crisis

Unemployment Rate Now 8.1%, Worst in 25 Years

The Unemployment Rate now has reached it's highest point in 25 years, 8.1%. Anyone want to guess how bad the news will be when the March unemployment numbers come out on April 3rd? Well... maybe the video will help out.

One Economic Bright Spot - Used Car Repair Shops

Used car repair services would be considered an inferior good or service, where as incomes fall, demand increases. So, this actually is not a positive sign for the economy, or GM and Ford. But business is good for repair shops, as people fix up their old cars, rather than buy new. Read more here.