Oh, Canada

I read the article "Bank of Canada Official Says Economy Facing Multiple Pressures" from wsj.com (published October 6th 2016.) Some say that Canadian economy is in trouble. Even though there are many fears that of a recession is due, because of the state of the United States economy, it is safe to say at this time we are secure but we have a rocky road ahead.

             Jean Chretien, the former prime minister of Canada states that he is not worried at all about a recession, with consumer confidence running high, our economy is running smooth. Chretien says that “we are in a surplus position, we are paying down the debt, taxes will be reduced, and the country is being prepared for the year 2001.” We are standing in a good position, as long as we can keep consumer spending up, taxes down and a comfortable surplus, we will continue to be safe from recession.

             Canada’s economy shows the best results in five months in October. Economic growth has soared since 1998, and has continued to rise. Though analysts caution a slowdown is ahead, because of the United States consumer sales drop, because of our high consumer spending and positive economic growth, we will continue to sit secure through the recession scare.

             Ontario’s Finance Minister Ernie Eves has found $1.4 billion, using one billion towards Ontario’s debt, taking it down to $112 billion. With Ontario’s flourishing economy, which has grown 5.5%. The Finance Minister received an extra $2 billion in revenue, and this is expected to grow 3.7% in 2001.

             The jobless rate dropped 6.8% in December, meaning that consumer spending will rise, and government spending will drop (welfare numbers will fall), which means for now we are secure, the only worry is the fall of the United States economy. As the economy drops, growth slows down thus ensuring a drop in jobless rate and consumer spending. The clouds towards a recession are accumulating.

Shark Tank Economics

ABC's Shark Tank is full of the basics of economics. Basically, it's a competition where aspiring entrepreneurs make presentations to persuade potential investors to invest in their business. There is one episode in season 5 episode 9 where a woman tells the sharks how she and her husband saved a lot of money so they could launch their new product, Slawsa, a new condiment that is a cross between coleslaw and salsa. Mark Cuban, one of the sharks, praises her on this and says how nice it is to see someone giving up a little now have more in the future. This is a classic production possibilities frontier example of future vs. current consumption. The entrepreneur who made Slawsa also speaks of how she is not taking any salary from her business at this time because she wants to focus her time, energy, and resources into her business. This is an example of opportunity costs, which are  classified as costs in business production decisions. 

Economics Current Event #1

I found my article on economictimes.com by Business Insider and it was published on September 27th, 2016. This article was entitled "Warning signs are flashing for China" In summary, this article was about how the debt levels in China are extremely low currently. The GDP (gross domestic product) gap has risen 30% which means that the debt accumulation levels may be unsustainable. The danger level China is at concerning for the rest of the world due to how important they are.

It's been seven years since the global finical crisis which was in 2007-2008 and it was considered the worst finical crisis since the Great Depression. China's economy was in trouble even before the financial crisis erupted, and the crisis only worsened these concerns. China's leading stock indices declined rapidly beginning in late 2007, lasting well over half their value by the end of 2008. China's debt is scarily high. Over the past decade, total debt grew 465 percent. The debt rose to 247 percent of gross domestic product in 2015 when it was at 160 percent in 2005. The growth in the economy is slowing down and it needs restructuring.  The credit cap is widening and has been widening for the past several years. While there are other nations are at this danger level China is in, the pace of credit growth stands considerably above the rest. China is the biggest worry for the rest of the world seeing that it has been the engine of global growth and is extremely important. Given the state of development and its place in the global economy, development is not in the near future.