Three Articles

Obama lifts Bush ban on stem cell research
This article talks about how Obama decided to let the government finance the stem cell research. This article is good for an Econ Commentary, because it discusses a merit good which has to be financed by the government since a private company won't make any short run profit. Furthermore, you can talk about a market failure, when Bush was president because he banned the research of stem cells. One can also talk about public vs. private goods and under allocation.

China minister rejects U.S. pollution duty idea
This article talks about how China rejected the ideas of the U.S to reduce pollution. This article is good for a commentary because you can talk about negative externality. Therefore, you can draw graphs about externality. Since the ideas of the US weren’t accepted, one can talk about other solutions. This is good because I could talk about pollution permits and draw graphs about that. I really like this article because there are lots of ideas to analyze and a lot of opportunities for graphs.

Mobile phones most searched online, Apple iPhone leads the pack]
This article is about how cell phones are the most researched items on the internet. It also talks about the fact that Apple is the most researched phone and after that is Nokia. I could talk about how these two companies dominate the market. I could also talk about, advertisement and why one firm is more likely to get more profit then the other one, even though they have the same product. Therefore, I can talk about the characteristics of oligopoly and the graphs of Nokia and apple.

Can't anyone afford my home?

Can't anyone afford my home? by Gandel and Amanda Gengler (September 22, 2008)

The National Association of Homebuilders stated that houses were more affordable than in the previous years. Lower prices can help clients sell their houses but then again the price has to be payable for the buyer. In 2001 there was the pre-boom where prices dropped 39% from today and hot spots like Miami are still twice as much as in 2001. The problem with buying a house in America is that the banks cannot borrow credit anymore, unless there is a guarantee that the money will be paid back. Furthermore buyers face higher interest rates which conclude that they borrow less credit from the banks. Although the prices for houses have gone down no one is buying them, but on the other hand the price for renting places has also decreased. The nationwide organization estimated that in 2009 the price will drop 20% for houses in the US, which makes people buy more houses because they still believe that homes is the best long-term investment.

This article states that the demand for houses has decreased due to the fact that the price has changed and that the banks are not giving out credit anymore (loaning money). Demand means that the quantity of a good or service depends on the consumers will and if they are able to purchase it, at a give price in a given time period. In Figure 1, it is shown that the demand for houses has decreased causing a shift of the demand curve. Due to the fact that prices have decreased, banks and real estate companies are hoping that consumers will buy more houses, but this is not true. This is due to various factors that affect the demand of houses. For example the population is growing, but the wages are not increasing drastically, meaning people cannot afford to buy houses or apartments. Another factor is government policy changes; this means that the government or law has changed the economic structure of buying houses. In this example it is the banks that have decided that they are not able to give out credits to everyone, because there is too high of a risk that the households or firms don't pay back the monthly pay. If the households or firms don't pay back, the banks are forced to step in and confiscate the house from its owner. The problem with this is that the banks are now stuck with the house but have no money, so now it is their job to re-sell the house, to make a profit. In figure 2, the graph shows that the supply and demand could meet at equilibrium, which is a state of rest and Allocative efficiency. To do so, supply and demand have to cross without causing a surplus (too much of a product) or a shortage (not enough of a good). In this case the demand decreases causing a shift of the demand curve (from D1 to D2), this causes the price to fall and the supply to decrease as well, because the demand proves that there is a surplus of the product. Looking at the long term possibilities, it is easier and less complicated to rent a house or apartment then buying it, because the owner has fewer problems concerning credits and can maybe buy the house or apartment in the future, because real estate’s are still a great investigation.