Sound Economics – Page 51 – Everyday economics from the University of Puget Sound

The State of the Venezuelan Economy

Posted on September 15, 2016 by Alex Shaw — No Comments ↓

For those of you who may not know, Venezuela is in the midst of a massive economic crisis that is leaving people without basic necessities. Inflation is expected to reach 720%, up from 275% at the end of 2015. GDP has been contracting since 2014. Drought has left the government to rationing out water, and because Venezuela relies on hydroelectric dams to produce much of its energy, the drought has caused power shortages. The government has been running huge budget deficits on social programs that they can no longer afford, as high as 29% of its GDP in 2014. Unemployment is at Continue reading The State of the Venezuelan Economy→

Where are America’s Jobs Going?

Posted on September 13, 2016 by Tesha Shalon — No Comments ↓

Big companies and corporations are notorious for cutting corners and looking for innovative and creative ways to save money and maximize profits. Today we are seeing these types of job cuts in industries in which the task can be automated to some degree. For example amazon factories already have over 30,000 robots fulfilling orders 24/7. This tradeoff between convenience to a company and employing real humans is one that is widely debated. The banking industry is undergoing its own shift, with 30% of its jobs threatened in the last year. This type of automation differs from what we imagine as Continue reading Where are America’s Jobs Going?→

What Increasing the Federal Funds Rate Means for the Stock Market

Posted on September 12, 2016 by Geremia Lizier-Zmudzinski — No Comments ↓

Since the Great Recession rocked the U.S. and world economy in 2007, the federal funds rate in the U.S. has been at or near zero, falling from its pre-recession level of 5.25%. The hallmark of post-recession years has been the Fed’s strict adherence to low interest rates for fear that raising them could send the United States back into a recession. But now, this period may finally be coming to an end. For the first time in nine years interest rates may be set to climb as Janet Yellen announced at the Fed’s annual Jackson Hole meeting two weeks ago Continue reading What Increasing the Federal Funds Rate Means for the Stock Market→

The Game Behind North Korea’s Fifth and Largest Nuclear Test

Posted on September 12, 2016 by Megan Waldo — No Comments ↓

On September 9th, North Korea completed their fifth and largest nuclear test, just fifty miles from the Chinese border. The test was the second this year and a clear example of the increased pace in nuclear trials that Kim Jong Un has been pushing since he inherited power in 2011. The US has attempted to slow this rapidly increasing progression of tests by imposing sanctions and as of July 2016 deploying an advanced missile defense system in South Korea, however, the tests have continued to ensue and now the US is considering placing an embargo on North Korea. According to Continue reading The Game Behind North Korea’s Fifth and Largest Nuclear Test→

2008 Financial Crisis Under the Magnifying Glass

Posted on September 11, 2016 by Cole Driscoll — 2 Comments ↓

It may be almost a decade after the 2008 financial crisis shook the US economy, but economists and financial managers are still trying to snuff out the causes of this pandemic. The idea of a “housing bubble” has been used to describe the confusion and ignorance around the risks of the housing market leading up to the collapse. This concept connects many different pieces within the US housing market, from borrowers to lenders to big players on Wall Street. But it is difficult for economists to pinpoint one key cause of this crisis. So the magnifying glass has been placed Continue reading 2008 Financial Crisis Under the Magnifying Glass→

Impacts of Wells Fargo Scandal

Posted on September 9, 2016 by Lukie Crowley — No Comments ↓

Yesterday, news came out that Wells Fargo Bank would have to pay $185 million in fines in addition to the $5 million they had to pay to their customers for accounts that were set up without their approval. Essentially, customers were being charged fees for accounts they had not set up on their own. Patrick Rucker and Dan Freed from the Huffington Post note that, “In a complaint filed in May 2015, California prosecutors alleged that Wells Fargo pushed customers into costly financial products that they did not need or even request.” $100 million of the fines went to the Consumer Continue reading Impacts of Wells Fargo Scandal→

The Why Axis: How to get People to Give More

Posted on May 11, 2016 by Alex Shaw — 1 Comment ↓

In Chapter Nine of the The Why Axis, Uri Gneezy and John List examined some of the conventional wisdoms about the techniques used in charity fund raising to try to determine if they really work at all, as well as which work better than others. What are the motivations for people to give to charity? How might these motivations be exploited to get people to donate more? The authors noted that in their travels, that most charities rely on the assumptions and conventional wisdoms of the previous decision makers, “rather than verifiable data.” One of the conventional wisdoms John came Continue reading The Why Axis: How to get People to Give More→

The Why Axis: Innovation is Key

Posted on May 5, 2016 by Cole Driscoll — No Comments ↓

Chapter 10 of the Why Axis discusses the reason behind many people’s willingness to give to nonprofits and how this changes the way these nonprofits run their companies. The chapter starts off by telling of a child who was the star of a 2008 Academy Award winning documentary entitled “Smile Pinki.” This child from India, Pinki Sonkar was born with a cleft lip and faced many hardships early in her life because the way people treated her. But one day she was introduced to a doctor employed by a nonprofit who agreed to preform surgery to rid of this problem. Continue reading The Why Axis: Innovation is Key→

Robo-Econimus

Posted on May 4, 2016 by Matthew Moreno — No Comments ↓

There’s been a lot of interesting talk about “homo-economicus” on the blog this semester, so I figured it would be fun to close things out with a post on “robo-economicus.” That is, robots using strategies modeled on economics to cooperate. Let me explain… A few months ago, I was applying for REU positions in mathematics and computer science. One of the programs I considered was Oregon State University’s Robotics in the Real World. In doing my due diligence in preparing an application, I stumbled upon this paper, “Learning to trick cost-based planners into cooperative behaviour.” In the paper, the authors essentially Continue reading Robo-Econimus→