Friday, February 28, 2014

Economic Impact of 9/11

Economic Impact of 9/11

By Jake Paget
The morning of 9/11 started just like every other day, but today four planes were hijacked by several terrorists. Three of these four planes were successful in hitting their targets of the Twin Towers and The Pentagon. The last plane was designated to hit the White House, but crashed into the fields of Pennsylvania because brave civilians forced the terrorists to lose control of the plane. Final death toll for the event surpassed Pearl Harbor with a total count of 2,975 fatalities. According to an article on About.com entitled “How the 9/11 Attack Still Affects the Economy Today” written by Kimberly Amadeo, “Their goal was to cripple the U.S. economy by destroying its centers of power: Wall Street, the Pentagon and the White House.” The attack of 9/11 caused both immediate and long-term impacts on the economy. Some quick impacts were that it enhance the 2001 recession, and drop the Dow, an indicator of stock market prices, over 600 points. The events taking place on 9/11 then caused for one of the largest government spending programs in the history of the United States. The War on Terror.
            At that time America was going through what was known as the 2001 recession. The recession started in March of 2001, but was initially caused by the Y2K scare. The Y2k scare lead up to a boom in internet business. The attacks of 9/11 just aggravated the 2001 recession more than it already was. This was the first time since The Great Depression that the stock market closed for an extended time, four trading days. This opportunity cost was having some large stocks dropping hundreds of points.
            On the 20th of September, President Bush gave a speech and said, “Americans should not expect one battle but a lengthy campaign, unlike any other we have ever seen.” Bush called for the War on Terror and put it into action. The war launched in Afghanistan was initially for the cause of finding Al-Quada leader, Osama bin Laden. This cost the United States $33 billion, including homeland security. But not long after, troops were sent into Iraq and the CIA was said to have found weapons of mass destruction. Saddam Hussein, Iraq’s leader, was assisting the operations of Al-Quada. The war in Iraq after its first year cost $50 billion, but by the time Bush was done in office the War on Terror amounted to $864.82 billion. These costs included the choice to increase in Homeland Security and Defense Department funding.

            The largest impact that 9/11 had on the economy was the raise in defense spending leading to United States debt crisis. If the War on Terror never occurred, the country’s debt could be less than $15.5 trillion and manageable. Also caused by the War on Terror was the scarcity of funds available for putting towards stimulus programs to shoot the United States out of the 2008 financial crisis. Kimberly states, “Fewer jobs were created, which meant less tax revenue, further boosting the debt.” Were these mass amounts of funding toward the War on Terror Necessary?

(Additional information in the video below.)

Thursday, February 27, 2014

Healthy v. Unhealthy Food

Healthy vs. Unhealthy Food

Liz Leist

Maintaining a healthy lifestyle is a way of life in which people can choose to participate. It is a lifestyle where staying healthy and putting good nutrients into your body is important in their daily lives. To others, it is about the dollar menu at McDonalds or the next big thing at Taco Bell. Many people think that eating healthy costs more than eating unhealthy. The truth is that it all depends on what you are actually buying. It could be a healthy selection from your local grocery store, for example Aldi, or an organic product from a higher end supermarket, like World Market. A recent study done by the Harvard School of Public Health students proves that on average it costs around $1.50 more a day eating healthy, than unhealthy eating, which yearly adds up to $550. This is an opportunity cost situation. If you spend money on healthy food, yes you may have less money for other things that you want, but this is a choice where money is well spent. Healthy eating is a good investment, even if it costs more money. In the end for the unhealthy food choice eaters, it has a chance of backfiring on them and could potentially cause health complications due to their unhealthy eating habits, and those medical bills can add up. When you look at it this way there should be no excuse to eating healthy, because you are doing yourself a favor by staying in good shape and not having the potential for a diet related chronic disease.

There are many different products that can be alternatives to junk food being such foods as peanut butter, fish, fresh vegetables, fruit, beans and rice. They can all be found at your local grocery store for reasonable prices, making them accessible to people. In other cases though, there are more than two million Americans that live 10 miles or more from a grocery store, because they live in such rural areas and households who have an accessible form of transportation live a little over half a mile from a supermarket. This causes scarcity in some parts of the world in low-income areas, causing them to not have a choice in what they choose to eat. These types of situations can be understandable, because fresh produce for example can only last a few days, and when the distance is long this can be a problem for those residents. For others though it does not take much to cook a simple healthy meal in less than 15 minutes.

By changing the way that you each, and with price not being that big of a difference, it can lower the risk of diet related chronic illnesses and health conditions. Would you rather pay $1.50 more a day for healthy, nutritious foods, or have to pay for future medical bills because of the consequences from unhealthy eating? Either way it is obvious that eating healthy is worth the $550 more a year, because it is the best thing that you can do for your body and health, even if you are on a budget. It will without a doubt increase your energy levels and overall emotional well being.











Bittman, Mark. "Is Junk Food Really Cheaper." The New York Times. The New York Times, 24 Sept. 2011. Web. 24 Feb. 2014. <http://www.nytimes.com/2011/09/25/opinion/sunday/is-junk-food-really-cheaper.html?pagewanted=all&_r=0>.

"Distributist Party." : Healthy Food vs Fast Food. N.p., n.d. Web. 24 Feb. 2014. <http://distributistparty.blogspot.com/2012/01/healthy-food-vs-fast-food.html>.

"Healthy Eating." Healthy Eating. N.p., n.d. Web. 24 Feb. 2014. <http://healthyeating.sfgate.com/benefits-eating-healthy-vs-unhealthy-7680.html>.



Polis, Carey. "Eating Healthy vs. Unhealthy Will Cost You $550 More Per Year, Study Reveals." The Huffington Post. TheHuffingtonPost.com, 5 Dec. 2013. Web. 23 Feb. 2014. <http://www.huffingtonpost.com/2013/12/05/eating-healthy-vs-unhealthy_n_4383633.html>.






Economics Affect the NBA

Trevor Raasch
Mr. Reuter
Economics
24 February 2014

Economics affect the NBA

Although some may not recognize it, economics plays a huge role in all professional
sports, especially the NBA. The National Basketball Association is a lot different from most
American sports, the National Football League, Major League Baseball, and the National Hockey
League.

Competitiveness is what drives all sports; everyone wants to win. In professional sports the best
way to win is have to the best players, obviously. In order to acquire these all­stars, the owners
of the team must first look at the opportunity cost of each player and then, if willing, pay the price;
the best players typically go to the team that will pay them the most. The buying, selling, and
trading of players affects the NBA more than any other sport. Good team owners recognize the
economic boost that a certain player or players  can bring to a city. Take Lebron James for
example. He is one of the greatest to ever play, and he recently made the decision to sign with
the Miami Heat. The impact that one player had on an entire city’s economy is insurmountable.
Micky Arison, the owner of the Heat, made a very smart move to not only sign Lebron James but
another superstar, Chris Bosh. Miami Herald of Today’s reported that, “with the signing of
LeBron James, who is a "walking, talking, free­throw­shooting stimulus plan," the Heat will earn
more than $10 million or more in playoff revenue alone” (Herald). That is an unreal boost to an
economy, and that’s only the playoffs and only one player.

These economic times have been tough and they have deeply affected roster sizes. General
managers have had to cut or release players simply because they do not have the money. In the
NBA you are allowed 12 active players and three inactive or hurt players. In recent years nearly
every team has been able to fill up all 15 slots, however with the tough economic times, GM’s are
realizing that it might be more beneficial to leave a couple open slots. Mark Warkentien, the
Denver Nugget’s vice president of basketball operations, voiced his opinion about the decreased
roster size, “There’s an obvious economic benefit, I’m not going to deny it. The compelling
reason is the flexibility” (Warkentien). The economic benefit that Warkentien was talking about is
the fact that with open spots in the roster allows for more money to be spent. More money for a
team gives them a greater chance of signing a superstar to bring in all sorts of economic
benefits. The flexibility is also huge because 15 is the maximum amount of players allowed  on a
team; if spots are open, these high caliber players can find a place to fit in. All the greatest
general managers weigh the marginal benefit versus the marginal cost before signing a player.
Micky Arison knew that the benefit of signing Lebron James and Chris Bosh would easilyoutweigh the cost and look at Miami’s economy now.

Economics can affect all aspects of life, especially businesses. The NBA just like the NFL, the
MLB, and the NHL are all businesses and economics creates a great impact.

Tuesday, February 25, 2014

The Wizarding World and its Influence on Muggle Culture

Lian Arzbecker

The Harry Potter films and books have been a huge success for over a decade and a half, ever since the first novel was published 1997. Just two short years later, Warner Bros. bought the filmmaking rights and three of the total eight movies became the top grossing—most profitable—film of their year of release: Harry Potter and the Philosopher’s Stone, 2001; Harry Potter and the Goblet of Fire, 2005; Harry Potter and the Deathly Hallows—Part 2, 2011 (Box). Additionally, the books have amounted to an estimated 450 million dollars in sales worldwide. A big factor towards Harry Potter’s success is due to the fact that while it is a public good with shared consumption, it also exercises exclusion. Thus, a virtually unlimited amount of consumers can purchase the product, given they are willing to pay the money.  

Although there is no way to prove that each of the some 450 million copies were actually read—moreover, some people may have illegally possessed the text, or lent their book to a friend—it is safe to say that Harry Potter had, and continues to have, a massive influence on today’s culture. Therefore, it unavoidably leads to negative externalities—fanatical fans who believe it to be real, peer pressure to read the books and see the movies—yet the positive effects far outweigh the bad. For example, leisure reading has increased in children because 51% say they did not read for fun before discovering the series (Garlick). These millions of Harry Potter books—hardback, paperback, and translations—have been sold throughout planet Earth and are available in over 65 languages, being purchased in nearly 200 territories (Garlick). The universality of this fantasy world builds a sense of community among fellow followers of the series, which is another positive externality.


The most profitable of the films is the final installment, both during opening weekend and in total grosses. Interestingly, Harry Potter and the Half Blood Price is ranked seventh among its counterparts for its opening weekend; however, it lies in third places in terms of total grosses. These conflicting pieces of data show a general trend toward gaining popularity as time wore on.
Numerous students have decided that reading and watching Harry Potter is worth the opportunity cost of doing essentially anything else with their time. Many deprive themselves of valuable sleep to finish the novel, while others sacrifice studying time. Some even become social hermits until the last word has been read. Adding to the incredible popularity of the novels and films, games and attractions have additionally helped the Harry Potter franchise grow in value. It is estimated that the total sales of all seven books, eight movies, and toys are $24,751,000,000 (Total). However, there has been some argument over the appropriateness of calling Harry Potter a “franchise” because by definition, a franchise is the authorization to sell a certain group’s goods and use their ideas; despite the fact that all the merchandise associated with this series is extremely profitable, it has always been one grand story, rather than a business. Indeed, the Wizarding World of Harry Potter exists as one of the most influential stories in muggle culture.

Works Cited
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Economic Downturn in Olympic Host Cities

Nolan Fahey

It is the ultimate goal of every city to host the famous Olympics.  To get two weeks in the limelight of the entire world is seen as a chance to show off just how awesome your country is.  What’s not to love about hosting the Olympics?  You get a chance to massively increase your infrastructure, increase tourism and turn an economic benefit in the long run.  The trouble is, the only thing that happens is a massive increase in spending on infrastructure and an increase in jobs for a few years preceding the event.  The gains from the broadcasting of the events, and ticket revenue are nowhere near enough to compensate for the expenses of the more recent Olympics. 


As you can see in the graph, all of the Olympics since 2004 have cost more than sponsorship and ticket and broadcasting revenue combined.  Although the cities are able to convert some of the venues into multi-use facilities that see some use in the years after the Olympics, these venues and the exposure to the world are not enough to spark waves of new tourists.  In fact, before the Olympics, the cities see a decrease in tourism, and don’t always gain that back fully.  During the Olympics the cities experiences large dips in tourism outside of Olympic spectators and athletes, and these “tourists” hardly boost the local economy as much as regular tourists because of their interests in the Olympics prevent them from taking part in other activities that would stimulated the local businesses.  Yet as these cities continue to see economic losses, other cities clamber over each other to bid to host the next Olympics.  There are a few potential fixes to maximize economic benefits to host cities and countries.  As experienced with the last couple Olympics, the larger cities fail to increase tourism directly to the city as a result of the Olympics, however smaller cities with lesser known attractions are able to boost national and international knowledge in their places of interest.  A potential solution would be for smaller cities to host Olympics, not cities that are know of world wide, and already have large numbers of tourists visiting, because it is unlikely for them to boost already relatively high numbers. Smaller cities may be able to increase tourism in the later years, and spawn new suburbs to accommodate the increase traffic.  These cities may not have the finances to build adequate venues, however they may be able to take out loans from the government or from larger cities, as they will most likely be able to pay them off better than a larger city would.  Another way to make the Olympics host able for smaller cities is to construct less permanent structures.  Along with being cheaper to construct, they do not require expensive demolishing if it ends up derelict and in the way of future projects.  The U.S. Olympic Swimming Trials are sponsored by the Mutual of Omaha is hosted in a portable pool, which allows the trials to be held in a different city every four years, any city with a sizeable hockey or soccer arena is able to host the Trials.  


Unfortunately, cities will continue to waste millions of dollars hosting an event that will only put them in the hole financially. 




How are the 2014 Winter Olympics affecting Russia’s Economy?

Leslie Griger

We all know that the Olympics are a big deal; they always have been and always will be. Both the Summer and Winter Olympics are among the most widely televised, and most watched programs of the year. Due to all of this publicity and popularity, the ceremonies and even competitions are normally relatively extravagant. But unlike most other years, this year the Olympics were held in the “developing” country of Russia.


Though most do not think of Russia as a developing country, compared to other Olympic locations such as the United States, Canada, and Australia, Russia is pretty far down on the developed scale. In recent history, there has been an increase in the hosting of sporting events in developing countries, such as Mexico City, Moscow, and Sarajevo, and more often than not, the economies of those countries do not really improve at all, which is the opposite of what most would think. It is accurate that hosting the Olympics does create many new jobs for the people of Sochi, Russia, but the main concern is that the jobs will not last past the closing ceremonies.

There are quite a few jobs that end when the athletes leave Russia, but studies have shown that, “infrastructure and some jobs are created that last well after the games have moved on” according to Business Insider. So even after the closing ceremonies, the economy still has potential to rise.


Though there is a large sum of money coming into the country throughout the games and maybe for a bit after, there is an even larger amount of money going out to prepare the country and simply run the games. According to the International Business Times, the Sochi Opening Ceremony topped the list of most expensive openings “costing in excess of $50 billion and far exceeding the 2008 Beijing Summer Games, a record many said would never be beaten.”



But even though the cost is extremely large, there are many people that still believe the economy of Russia will improve from hosting the Olympics besides just the jobs that will be left over; after all the Olympics bring both people and money from every corner of the globe.

The popularity alone brought to Sochi could help the economy. Being a city that has hosted the Olympics heightens the appeal of the city in many perspectives. First of all, Russia is already a popular tourist destination for many reasons, but Sochi is normally not on the list of cities within the country. After the Olympics, Sochi might now have the attention and publicity it needs to attract the tourists coming into Russia.

Benefitting from a rise in tourists would be the businesses. If there are more tourists, maybe even more Russian citizens living in Sochi, more business owners will be tempted to open a business in the area because the demand for goods and services will be greater, boosting the economy. The tourists and businesses come full circle, ultimately leading again to the creation of more jobs for the people of Sochi, and the neighboring cities. In general, the people of Sochi have definitely considered their opportunity cost. Though the games are expensive, the only alternative would be to not have the Olympics games, and that would be a much worse choice. Sochi already has an economy that is not in very good shape, and without the Olympics, there is a very small hope of the economy improving in the near, or even relatively distant, future. Overall, even though the Olympics are expensive and a large amount of work, Sochi made the right decision for the country and the economy to host.


Work Cited

Harress, Christopher. "The Economic Impact Of The Winter Olympics: Not Great For Russia But Sochi Stands To Gain." International Business Times. 8 Feb. 2014. Web. 25 Feb. 2014. <http://www.ibtimes.com/economic-impact-winter-olympics-not-great-russia-sochi-stands-gain-1554153>.

Perlberg, Steven. "A Strong Economy Is The Secret To Winning Medals At The Winter Olympics." Business Insider. Business Insider, Inc, 9 Feb. 2014. Web. 24 Feb. 2014. <http://www.businessinsider.com/economics-sochi-olympics-2014-2>.

Reuters. "Moody's: Olympic Games Unlikely to Boost Russian Economy."VOA. 5 Feb. 2014. Web. 25 Feb. 2014. <http://www.voanews.com/content/reu-olympic-games-unlikely-to-boost-russian-economy/1844858.html>.

Thursday, February 20, 2014

Steroid Use in Sports

Riley Sheahan

Steroids are being used all over the world for personal benefits no matter what the consequences are. Professional athletes are continuously buying their muscles so they can play better on game day. It’s hard to believe how good of a player these athletes are when most of them are all taking growth hormones or steroids to perform better. Today’s day and age this is the new “popular” thing to do. And sadly these are athletes who are making millions a year to play a sport and yet they have to cheat and set a bad example to people who look up to them. In 2012 1.3% of seniors in high school reported they used steroids. While .8% of sophomores admitted and .6% of 8th graders said they used steroids. These percentages are only showing the amount of people who reported and admitted they used steroids. Think about how many people in the world use steroids and keep it to themselves just like the professional athletes try and do.

It’s hard to believe that sports are coming down to cheating and taking the easy way out instead of putting in hard work and getting your strength yourself. For an example, Barry Bonds who was a professional baseball who played his first seven years with the Pittsburgh Pirates and then his last 15 years with San Francisco had a tremendous batting average. According to ESPN, “Barry Bonds has earned 172 million dollars in salary over his career.” Giving someone this much money a year in the first place is ridiculous and second of all, the opportunity cost of taking steroids is getting getting caught and or potentially getting killed. MLB watchers knew something was happening because his performance was incredible, but clearly he got so much attention and brought thousands of dollars money into San Francisco because everyone wanted to see him play and catch his home run balls. Barry Bonds 715th home run ball which got him 2nd on the home run home list was sold for 500,000 dollars on Ebay. According to Profit and Loss, “Revenues have increased from around $65 million in 1992 to about $171 million last season.” As you can see, Barry Bonds got millions of dollars to come into San Francisco because of his performance. This goes along with all the athletes who were on steroids, their performance brings money to the city because everyone wants to see this person perform on game day. And of course, their performance is fascinating which attracts people around the world. Not only is Barry Bonds the “bad guy” who used steroids along with bringing a lot of attraction into the city he plays for, but it’s the fact that citizens look up to these athletes and the opportunity cost is only resulting in something bad for the user of steroids.

http://www.youtube.com/watch?v=ljOC0L1Bq8E





































"sports." Washington Post. The Washington Post, 25 July 2006. Web. 18 Feb. 2014. <http://www.washingtonpost.com/wp-dyn/content/article/2006/07/24/AR2006072

How Netflix Changed the Game

How Netflix Changed the Game
By: Faiyaz Hasan

A few years ago everybody relied on the blockbuster down the lane for their move rentals. Everybody had a Blockbuster card in their wallet and a certain day of the week that they would dedicate to renting a movie. With over 7,000 stores and more than 6,000 public DVD vending machines it was simple to understand why Blockbuster was considered the center of the movie rental industry. They had a 500 million annual cash flow and the company was valued at over 8 billion dollars.
During the same time the postal service was being used by Netflix to distribute DVD’s. Netflix was founded in 1977 and its stock was considered “a worthless piece of crap.” by Wall Street analyst. So how did Netflix become the head of the movie rental entertainment business?
Down to the fundamental aspect of it, the company understood the trend of wanting things instantly, people don’t send letters the send emails, people don’t leave their houses to shop they would rather shop online with a few clicks of a button, the game was changing and people either had to adapt or sink. Netflix developed a strategy of online streaming and easy to use customer system. When news of faster broad brand and better video compression abilities around the corner they knew it was time to capitalize on this change.


Without the burden of retail outlets and operating online Netflix truly created a distribution company on the web. The company realized that streaming videos were the business was moving. Blockbuster was charging 5$ a movie with late fees, so Netflix decided t implement a monthly subscription with no late fees to focus on the customer instead of the money.
At this point Netflix had set a new standard for the market, this stunning success propelled Hastings, who was the mastermind behind Netflix’s business strategies straight to the top of Fortune’s “2010 Businessperson of the Year” award.
So how does this all relate to economics? This shows just how important it is to capitalize on new technology advances that are always emerging, and how much technology can transform a business or industry, Netflix new that it would be very possible to stream movies soon, but they also realized how important the timing of implementing this had to be. Making a change too early could be drastic for the company and could allow bigger companies to capitalize on their ideas.

Fun facts about Netflix:
  • Netflix is watched more than any TV network in the U.S.]
  • It is estimated that the average user watches around 87 minutes in a day
  • Blockbuster turned down many offers to buy Netflix even for as low as 50 million dollars. Netflix is now worth at around 20 billion dollars
  • Netflix’s “Instant Streaming” is the single largest contributor to internet traffic accounting for about 1/3 it
  • “Breaking Bad”  is the most watched show on Netflix (2014)

Sources:




http://www.trefis.com/stock/nflx/articles/146469/the-u-s-netflix-story-evolving-competition-threatens-growth/2012-10-16

http://www.google.com/url?sa=i&rct=j&q=netflix+vs+blockbuster&source=images&cd=&cad=rja&docid=vV9KXbIJjxHLGM&tbnid=BLuQYWsHEODuPM:&ved=0CAUQjRw&url=http%3A%2F%2Fwww.trefis.com%2Fstock%2Fnflx%2Farticles%2F146469%2Fthe-u-s-netflix-story-evolving-competition-threatens-growth%2F2012-10-16&ei=oqMDU_nhGeO0yAHCl4CQDg&bvm=bv.61535280,d.b2I&psig=AFQjCNHFZg8KnobXd1wIahE3wl9LvDsOgQ&ust=1392833820278653