Colbert On The Gas Tax Proposal

The Grass Is Not Greener...On The Other Side Of The Atlantic

Here is some historical gas price info from the EIA. In March of 1999, gas was $1.10 a gallon!

Good Sales Pitch... But Is There Really A Recession?

Here is Gray's Papaya Hot Dog's in New York City. However, a recession is generally defined as two consecutive economic quarters (6 months) of negative GDP stats. GDP was up .6% in Q1 2008 and has not had a negative reading since 2001

Believe it or Not. Cubans Are Now Allowed to Have Computers!

Cuba's Communist leaders finally figured out there are normal people in the world with computers. The decided to let their people legally buy a computer. Here, from Wired Magazinge "Cubans are getting wired. The island's communist government put desktop computers on sale to the public for the first time Friday, ending a ban on PC sales as another despised restriction on daily life fell away under new President Raul Castro.A tower-style QTECH PC and monitor costs nearly US$780 (505 euros). While few Cubans can afford that, dozens still gawked outside a tiny Havana electronics store, crowding every inch of its large glass windows and leaving finger and nose prints behind (see picture above)."

The World's Most Worthless Currencies

Think you'd be rich with a few of these in your pocket? Actually the 10 million Zimbabwe bill is worth about $4 US dollars.

• Want to buy a roll of toilet paper in Zimbabwe? That would be $145,000 dollars, about 69 US cents.

• The smallest bill in circulation in Zimbabwe is $500. Read more here.
  

2008 Starting Salaries for College Grads

So the job market for 2008 grads is not that bad after all. The average salary is up 4% and the number of job offers is up 8%. Read more here from CNN.

That Was Only 22 Years Ago?

Here are some stats from last week's USA Today. In 1985, 8% of people considered and AM/FM Radio or CD Player "essential" and that number is 95.8% in 2007. Wants, it seems, do turn into perceived "necessities" over time. Sure, you could really survive without that AC in your car, that luxury that only 15% considered a necessity in 1985.

Also, the former Communists in Russia have different tastes in cars than us, it seems. Prof. Mark Perry writes here in his Carpe Diem blog about some interesting car preferences of the Russians:

"On Tuesday in Togliatti, Russia, I toured the production facility of the Chevy Niva (pictured above), a joint venture between GM and Russia's AutoVAZ. The vehicles are one of the best-selling SUVs in Russia right now, and there is a 3-month waiting list to get the vehicles. This situation is somewhat unique to the Niva, most other vehicles in Russia are available immediately. The Nivas sell for about $16,000 and there are only two models and one option: with A/C, or without A/C. Also, there are NO radios available in either model, although the Nivas come radio-ready, with wiring and everything except the audio equipment. It seems that in the Russian market, consumers prefer to purchase their own radio/stereo equipment as an after-market option. It might also be the case that some customers prefer radio only, others prefer audio cassette tapes, and some others prefer CD players.

When in Moscow today, I asked the President of GM Russia why GM/AutoVAZ didn't raise the price of Nivas to reduce the 3-month waiting list, and she said that Russian Niva consumers would easily tolerate a 3-month wait, but many would NOT tolerate a price increase. Go figure."

And please note, I was, amazingly, able to mention Russia without taking shots at Czar Putin's incessant meddling with the wonderful people of Georgia.

Why the "Rich" Are Getting Richer...according to Professor Greg Mankiw

Harvard Economics Professor Greg Mankiw writes in The New York Times today about the wealth gap in America Today. Mankiw says...

the superrich have been getting an increasing slice of the economic pie. In 1980, the top 0.01 percent of the population had 0.87 percent of total income. By 2006, their share had more than quadrupled to 3.89 percent, a level not seen since 1916.

Part of the explanation for the growing wealth gap, according to Mankiw, is education, or lack there of. Mankiw states that while technology continues to progress rapidly, America's educational achievement has not...

According to Professors Goldin and Katz, for the past century technological progress has been a steady force not only increasing average living standards, but also increasing the demand for skilled workers relative to unskilled workers. Skilled workers are needed to apply and manage new technologies, while less skilled workers are more likely to become obsolete.

For much of the 20th century, however, skill-biased technological change was outpaced by advances in educational attainment. In other words, while technological progress increased the demand for skilled workers, our educational system increased the supply of them even faster. As a result, skilled workers did not benefit disproportionately from economic growth.

But recently things have changed. Over the last several decades, technology has kept up its pace, while educational advancement has slowed down. The numbers are striking. The cohort of workers born in 1950 had an average of 4.67 more years of schooling than the cohort born in 1900, representing an increase of 0.93 year in each decade. By contrast, the cohort born in 1975 had only 0.74 more years of schooling than that born in 1950, an increase of only 0.30 year a decade.

A Global Boom in Commodities Has Negative Side-Effects - In MPLS

MINNEAPOLIS--As copper prices surge above $4 per pound (see chart above), thieves in Minneapolis are ransacking house after house in search of copper they can sell to scrap dealers for as much as $20,000 a month.Thieves most often hit foreclosed homes, but not always. They broke into Keili Mac's Minneapolis home while she was out of the country and took copper gas pipes. They left the gas on, the house exploded and the city demolished it. The victim returned to find her house gone.

The "Freakonomics" of Inner-City Gangs

Steven Levitt, famous author of Freakonomics, talks about the economics of the Gangster Disciples A researcher from the University of Chicago, (now Harvard), sociologist Sudhir A. Venkatesh, lived with the Gangster Disciples, and found out most intimate details of the gang (and now has a new book detailing his experiences). Over a four-year period in the late 1980s and early 1990s, a former gang member kept careful records of his gang's profits, passing the information to Venkatesh on looseleaf sheets copied from the gang ledger. Levitt then created an economic model based on the gang's general expenses and its revenue from drug dealing and membership dues. For safety reasons, Levitt and Venkatesh chose to keep confidential their sources and the now-defunct gang's whereabouts and members. What you will find is the Gangster Disciples were run much like a corporation, most of the profits went to those at the top of the organization.

FOOD COSTS RISING AT THE FASTEST RATE IN 17 YEARS

There as various reasons for the rapid rise in food costs, and it boils down to supply and demand, as usual. Experts are worried about social upheaval in many developing countries. This picture, from the Wall Street Journal, shows riots in Haiti over food prices, which led to the resignation of Haiti's prime minister. Many people are blaming trade barriers and tariffs, as well as biofuels, as written about in a previous post. Here's this from the WSJ.

"During informal conversations and interviews, ministers mainly agreed that the U.S. policies on biofuels were especially harmful. U.S. ethanol is made from corn, which, ministers said, could be exported to feed the hungry, and benefited from tariffs that block Brazilian ethanol, which is produced much more efficiently from sugar cane." You can read more here.

INFLATION ----- HE'S BACK!!!!

The global economy, despite recording impressive economic growth in this decade, is facing its' highest inflation numbers in over a decade. This effect has been magnified in developing economies, especially with necessities such as food and energy. As usual, the cause is supply and demand. One of the reasons, among many others, is the use of crops for alternative fuels. As more food is used for fuel, less is available for food, which of course drives up the price ...and this is especially hard on developing economies and has the potential to create political instability (note the picture of riots in Egypt over food prices). Read more in today's Wall Street Journal here.

STAY IN SCHOOL! UNEMPLOYMENT RATE BY EDUCATION LEVEL

...and almost the entire .50% rise in the unemployment rate in the past 9 months occurred to people who never graduated from high school. Read more at Carpe Diem blog here.

News Story on Georgia Trip

STOCK RESEARCH ON THE WEB

Here are some websites you can use in researching stocks for the stock market game:

1. MSN: Moneycentral: good stock screener and more.
2. The Street: Get advice from Mad Money's Jim Cramer.
3. Google Finance
4. Yahoo Finance
5. Minyanville
6. CNBC: the web site of the stock channel.

Good Advice

... from the duty free shop at Amsterdam International Airport. Click on picture to enlarge

TRADITIONAL GEORGIAN MUSIC AND DANCE

Send-Off Celebration

For our closing dinner, the amazing people of Batumi threw quite a celebration for us. Many dignitaries showed up. The local kids also put on quite a traditional Georgian dancing show. The Georgian people are the kindest and warmest people I have ever met. Before this trip many people told me that the Georgian people are the most hospitable people in the world, and now I know first hand how true this is.

More Pictures From Beautiful Georgia

Falcon Fanatics Everywhere

Here is a great teacher from Batumi, Gerogia, with her Falcon Fanatic t-shirt and hat. Another teacher from New York City gave students the Yankees hats. We watched her teach a class on Economics. The students had many questions for the US teachers about the US. The Georgian students told us they like their cell phones, Eminem, 50 Cent, and Brittany Spears, until she became a "druggie". They were very curious about US students, and many said it would be a dream for them to go to school in the US. The students gave all the US teachers several gifts, and the teachers served us a very nice lunch. Well now I am off to the beach...

Georgian Public School #165

Our visit to School #165 was an eye-opening experience. Our visit was a REALLY big deal. The head of the Georgian Education Ministry was there, and the students were very excited to talk with us. Students preformed a Traditional Dance and gave a fascinating drumming performance, which I videotaped. The students like American culture, cell phones, etc. And I even stopped by the gym class to play some ball. The other picture is from the luncheon which the school had for us, again, delicious food, and I am sitting with teachers from the school, who are very eager for me to e-mail them pictures.

Tonight we will board a sleeper train, and we will wake up in Batumi, on the Black Sea coast. You can read about Batumi on a previous post. See you next post...

Meeting With Gerogian Parliament Member, Kahka Shengelia, PhD

Today we had the pleasure of meeting with Kahka Shengelia, a member of the Georgian Parliament, like our US Congress, a fascinating man who went to college in the US, and speaks 7 languages. Mr. Shengelia talked candidly about the tensions between Russia and Georgia, which were much worse than I knew. He told us, during the Communits years, you could only speak Russian, by law, in all public buildings. But now as an independent country, Georgians have their freedoms back.

He also told us about Georgia's fast growing economy, which has been stimulated by opening up the economy to foreign investment and lowering taxes. Georgia was the world's #1 economic reformer in 2007. His apartment which cost $70,000 three years ago in Tbilisi now is worth 1/2 a million dollars. Georgia received $10 billion dollars in foreign investment in 2007, and their GDP is growing 10% a year.

He also talked about how all of the schools in Georgia will have computers with access to the internet this year. Still keep in mind, Georgia has a much smaller economy than ours, and it is difficult to deal with scarcity. GDP per capita is $4000 in Georgia, where in the US it is about $46,000. Overall, he was a very generous to take time out of his busy life to tell stories about Georgia to us.

The Georgian Supra, or Feast

I am proud to say that I survived my much anticipated first Georgian Feast Sunday night. I saw more food (all of it outstanding) on one table than I have seen in my life. Basically, we started eating one of the national dishes, khachapuri (of course), many salads, vegetables, and the like. Then the Tamada, or toastmaster, begins making toasts. The only time you can drink whatever is in your glass is when the Tamada proposes a toast. And do not make the mistake of saying a toast without the Tamada's permission, like one woman did in our group. Then the waiters bring out many different meats, and khinkhali, which is a meat dumpling, pictured above. More toasts, more food, repeat, repeat, and after many hours it was a memorable time experiencing this integral part of Georgian culture.

One Monday, we met with many Georgian economists and economics educators, hearing about the promising economic reforms here. More on this in a later post.

TRADITIONAL GEORGIAN DANCE

Georgian Dancers at a Tbilisi restaurant.

GAMARJOBA (Translation: Hello)

Gamarjoba: We arrived in Tbilisi, Georgia about 7 PM, a day later than we left DC. Tbilisi has many ancient churches, and is set in a valley surrounded by mountains. Beautiful scenery! Today we are taking a tour of Tbilisi and the ancient capital of Mskheta, so I will have more to report later.

Food Notes: Our first Georgian Dinner last night. Katchapuri: the national food, is Bread stuffed with cheese: delicious. Basically a Dinner in Georgia is this: eat a lot of great food, and after you have eaten more than you ususally eat in a day: watch as the waitress keeps piling more food on the table

Send-Off Breakfast on Capitol Hill

This morning was our send-off breakfast on Capitol Hill. In this picture on the left is Svetlana, our tour guide for the entire trip. Svetlana is an economics professor who fluent in Russian and came to the US from Russia in 1991 after the fall of Communism. To her right are two diplomats from the Gerogian Embassy, who we also met with yesterday. They said many great things about Georgia, and, upon meeting them, it is easy to see why Georgia (as we were told) has some of the most hospitable and friendly people in the world.

The Honorable US Senator from Minnesota, Norm Coleman, and US Representative Jim Ramstad, who represents the Congressional District that includes Armstrong HS, both sent staff members to the breakfast. Pictured here is Heather, a legislative assistant from Rep. Ramstad's office. It was great to talk to them not only about the trip, but Minnesota. And of course they wished us the best.

Next up: We fly out of Dulles Airport in DC at 6 PM tonight, and 24 hours later, we arrive in Tbilisi, the capital of Georgia. We have a 8 hour flight to Amsterdam International Airport, and after a 4 hour layover, have a 5 hour flight to Tbilisi; add the time difference and it will be Saturday evening upon arrival.

Greetings From Washington DC

Hello from beautiful Washington DC. It was great to finally meet the entire group of people going to Georgia, and learn more about our trip. We have quite a fascinating group of very friendly people in our group. We are staying in the area of DC known as Embassy Row, which is full of foreign embassies, as well as numerous beautiful homes and delicious restaurants.

Yesterday we spent the afternoon time learning about the National Council on Economic Education (NCEE), the sponsor of this trip to Georgia, and all of its work on helping economic education around the world. Then we had a delicious dinner, the New York Strip Steak was great.

Friday morning, we will be having breakfast at the US Capital; I invited both Minnesota Senators and Rep. Jim Ramstad and their staff members to attend. I was happy to hear staff members from Senator Coleman's and Representative Ramstad's office will be attending, and I will be able to tell them all about the trip.

This morning some representatives from the Georgian Embassy met with our group; it was apparent they were very proud to be Georgian, and we found out we are one of the first groups of US Educators to visit Georgia since the fall of Communism in 1991. Quite an impressive fact.

Also, after our plane was delayed 1 ½ hours due to snow on Wed. morning, the 60 degree sunny weather felt like a tropical paradise after the MN winter. Also, the price of a gallon of gas in DC, $3.60.

News Clip on Georgia Trip

Check it out here. The clip starts about 5 minutes in.

OBAMANOMICS

The Economist Magazine writes here about the rise of economic populism, anti-trade rhetoric, and Obamanomics.