Taxes - How Does The Government Spend Money?

Every year United States government get money from tax collection and they spended in many things, like health plans, human services, parks, jail, education, costs of war, etc.

While the United States spends far more on a per capita basis than any other nation, there's a greater reliance on government or public health programs elsewhere.

Savings and Debt

My reaction to this article is that it reflects the type of situation that many families in America are going through. Also I think that everybody should try to stay out of debt because sometimes it take you in problem with credits. When you have credit cards dont use it for everything that you want to buy because sometimes the interest rates can increase or charge on the cards and it is hardest to get out of. People get in debt so easiy because they dont realize how much they are really spending on things they buy and they are not watching out for the charges that are hidden in these credit cards.

Critique of GDP Podcast

I'm going to critique Veronica and Lucy's GDP Podcast because I found interesting, it is the one that caught most of my attention than the others. The recording was loud and clear eventhough the pictures weren't that descriptive and relating to what they were saying. Also the information that was given was perfect, but they need more information about GDP. This podcast have mention a lot of things about GDP.

US Trade Deficit: getting better?

This article discusses about the trading around the world and the trade deficit. Trade Deficit really means a negative balance of trade in which a country imports more than it exports leaving it with a major debt. It occurs when we have more imports than exports. The US trade deficit is more likely to go down since in the future we will have less trade and we'll have more imports, and this can cause a drop on job opportunities. A weak dollar can help the US economy to go up because the more people spend the higher the economy will get up.

Taxes - How Does The Government Get Money?

Americans pay many different types of taxes to federal, state, and local governments. The American tax structure is progressive in nature, meaning that the more income someone earns, the higher his or her tax rate is. Taxes are like a "enforced contribution" to the government. This money is usually used by the government to fund many things that they need to be done, like protection of property, costs of war, fundations, etc.

Students Loans-Beware

Many students rely on federal government loans to finance their educations. These loans have low interest rates and do not require credit checks or collateral. Student loans also provide a variety of deferment options and extended repayment terms. I think that students in general take out large loans because they arent given the financial aid that they need to attend the college of their choice. Everyone wants to go to a good college and become successful. A good college is a very large expense, an expense that most people cant afford. In other words loans are taken out for what they cannot pay for or didn't receive in financial aid, so they would prefer to take loans and pay for them later. Also I think that student loans are essential when it comes for a college education.
In my way I'm going to take loans from my uncle because he is going to give the money without interest.

Critique of Federal Reserve Podcast

I was watching Ashely and Justin podcast, and this is the link: I think that they did a great job because this podcast is organized very well, the recording is very clear and understandable. The pictures that they put make sense and clearly express what is being said in their podcast. It is creative and strong. They act both act like if they didn't know what federal reserve was it. In conclusion I think it was a really nice job.

Compound Interest and the rule of 72

Compound interest is when you borrow money from a bank, you pay interest. Interest is really a fee charged for borrowing the money, it is a percentage charged on the principle amount for a period of a year usually. If you want to know how much interest you will earn on your investment or if you want to know how much you will pay above the cost of the principal amount on a loan or mortgage, you will need to understand how compound interest works. Compound interest is paid on the original principal and on the accumulated past interest.
The Rule of 72 is a simplified way to determine how long an investment will take to double, given a fixed annual rate of interest. By dividing 72 by the annual rate of return, investors can get a rough estimate of how many years it will take for the initial investment to duplicate itself.

Insider Trading Scandal - What Happened?

Insider trading occurs when someone makes an investment decision based on information that is not available to the general public. In some cases, the information allows them to profit, in others, avoid a loss.
On March 1, 2007 thirteen people facing assorted charges of fraud and insider trading in New York were not the titans of past scandals of similar scope to Ivan Boesky and David Levine, but they were none the less privileged professionals who used access to non-public information to satisfy an all too familiar temptation greed. According to investigators, the schemes first originated with two of those charged late on Thursday. One, Michael Guttenberg, was trading secret share data stolen from UBS bank where he worked; the other, Randi Collotta, dispensed inside information about pending merger deals from her bank, Morgan Stanley. Together they spawned a scandal spanning 2001 until last autumn, which prosecutors described as one of the most pervasive on Wall Street in more than a decade.

Dow down 416 pts! - Why?

Black Tuesday struck the U. S. stock market in chain after the market plummeted in China and Europe, along with distressing forecasts for economic development in the USA.
On February 27 the Dow Jones industrials index went down 416.02 points, or 3.5 percent to 12.215,24, following the New York Stock Exchange's trading. The index was losing nearly 550 points during the trading. The decline was the Dow's worst since Sept. 17, 2001, the first trading day after the terror attacks.
The Dow's percentage decline was modest in historical terms, not even ranking among the top 20 all-time percentage drops since 1950. The Dow declined by more than 4 percent on two dates in 2002.
Some economists and analysts said that the market was girding for a possible recession later in the year, while others said stocks were simply staging a reasonable and needed correction, a University of Colorado economist Richard Wobbekind said that a large stock declines can affect consumer attitudes, making consumers feel less wealthy and likely to cut back on spending, which can in turn affect the U.S. economy.

Opportunity Costs

Opportunity cost: is the cost we pay when we give up something to get something else. There can be many alternatives that we give up to get something else, but the opportunity cost of a decision is the most desirable alternative we give up to get what we want.
One example that I can use to describe opportunity costs is that I had to stop buying fashion clothes each sunday or stop spend money in things that I don't really need and start earn money for the college because it is more important for me.

Types of Economic Systems

1.Define these 4 major economic systems:
*Traditional Economies: are found in rural and non-developed countries. It is an economic system in which resources are inherited, and it is based on primitive methods and tools. Economic decisions depend on tradition and custom not market activity. Today it is found mainly in agricultural parts of South America, Asia, and Africa.
*Centrally Planned (Command) Economy: economies in which the state decides what goods are produced, the methods of production, and who gets the goods.
*Market Economy: is an economic system in which the production and distribution of goods and services takes place through the mechanism of free markets guided by a free price system rather than by the state in a planned economy. In a market economy businesses and consumers decide what they will produce and purchase, as opposed to a planned economy where the government decides what is to be produced and in what quantities.
*Mixed Economy: it is usually defined as an economy that contains both private-owned and state owned enterprises or that combines elements of capitalism and socialism, or a mix of market eaconomy and command economy.

2.What is the difference between communism and socialism?
The difference between communism and socialism is that communism is when the government operates and controls all of the nations productions. Communism is a system of government in which the state plans and controls the economy and a single, often authoritarian party holds power, claiming to make progress toward a higher social order in which all goods are equally shared by the people. And socialism is when the government owns everything from banks to airplane companies. And everyone contributes to the economy. If the government owns and operates many of the nation's major industries such as banks, airlines, railroads, and power plants-but allows individuals to own other businesses, including stores, farms, and factories, that nation's economic system is called socialism.

Stock Market Game -1- Initial Investment Strategy

I plan on buying stock in Wal Mart, Walgreen, Apple and Yahoo Inc stores because there are a lot of stocks coming out this year. I plan on investing in clothing, computers, food, etc because some of this companies have good stock and is all the things that we need in everyday life.