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The Young GOP Show

Money In The Bank What Do Ya Think?

The Federal Reserve has recently put $600 billion back into circulation with its purchase of treasury bonds.  In so doing the Reserve hopes to artificially inflate the dollar which will not only have a large impact on the American economy, but the global economy as well. Hypothetically with the bonds purchased from the banks the Reserve hopes the money will do multiple things on the domestic front. First it will grow with interest, second create more jobs, third increase exports, and fourth lower loan interest rates. Through the use of inflation more money will be in circulation which subsequently devalues the dollar.  This is not necessarily a bad thing, because homeowners will find it easier to pay their “fixed loan rates”. The dollar may lose the purchasing power it had before the inflation; however the loan value stays at the rate is was before the inflation. Simply stated the homeowner has a larger amount of money in the bank, the money is less valuable than before the inflation but it still has the same purchasing power as before when it comes to their fixed rate home loans. By increasing the money supply the Federal Reserve also hopes to create more jobs. This theory is known as the demand pull inflation theory.  Simply put, this theory states that with more money in hand, American’s will be purchasing more. With this increase in purchasing, product demand will increase, and with the increase in product demand, labor demand will also increase so that the supply of products will match that of the demand for them. This counting on of course that American will spend more, and not decide to save it. Globally t he devalued dollar will make products manufactured in America cheaper, thus hypothetically will increase exports, because foreign companies can buy our good cheaper than theirs. This is similar to what China has been doing this year. Due to the fact that exports are still only a small percentage of Americas GDP, this may not have an overwhelmingly large effect on our economy. However it may have a large effect on countries like China or Germany, who’s GDP is largely made up of exports. Even though America does not export many good, the good we do export we do in large quantities. China and Germany may feel the effects of this because other countries will turn to the cheaper American exports, as oppose to theirs. This large change in monetary policy will undoubtedly have some effect on our economy, however only time will tell if it will be a positive effect. With the amount of spending the government is doing, coupled with our large debt, it is a tad disconcerting to have the dollar weaken. If this all fails however, the barter system did seem to work well for the Romans. :)

Global Warming, Say Whaaaat?

Our Crumbling Environment

Did you know that the ocean naturally leaks oil at a much larger and much more constant rate than the resent BP Oil spill? “Oil residue in seafloor sediments that comes from natural petroleum seeps off Santa Barbara, Calif., is equivalent to between 8 to 80 Exxon Valdez oil spills, according to a new study by researchers at Woods Hole Oceanographic Institution (WHOI) and the University of California, Santa Barbara (UCSB).” Should we also seal off the ocean floor along with having reusable grocery bags, driving hybrids, and turning the water off when we are brushing our teeth, or perhaps the media blows these so called “crises” out of proportion.  

Another issue all together, is the question of whether the earth’s temperature is actually rising. NASA has been reworking recent temperatures upwards and older temperatures downwards - which creates a greater slope and the appearance of warming. Furthermore, a paper published in scientific journal Nature this week has reignited the debate about Global Warming, by predicting that the earth won't be getting any warmer until 2015. If the current trends of manufacturing continue for the next five years then how could the temperature not rise, unless of course the reason for “Global Warming” is not due to humanity but rather a natural phenomenon? As far as the Government is concerned it seems hardly fair that American’s tax money should go to things that they don’t agree with. If individual wish to get into eco-friendly groups and push their ideas and help the environment I am all for it. That is the beauty of America where people can voice their opinions and be active in their pursuits. I agree Americans should watch how they impact the environment; however my concern goes as far as picking up trash and recycling.

The Airports get XXX-Rays

            Lost bags, long lines, broken golf clubs, small seats, bad food, poor service, and layovers, some of the many reasons people dread airports. However all of this will be shortly forgotten as our favorite flying friends add new security measures. Airports will now begin to implement full body scanner, which of course can see through clothing. Not to worry however, passengers will only be subjected to these scanners if they set off the metal detectors and decline a much more hands on approach to the good ol’ fashion pat down. In the past TSA pat downs was with the back of the hands, now TSA will be using the front of their hands and be…..much more thorough. It seems to me that we now have the choice between the lesser of two evils; we either allow complete strangers to feel us up, or basically see us naked. Airports have gone downhill at a rapid rate. This started with the ridiculously high prices for tickets, shortly followed by mile long lines, and you never really can seem to count on flights being on time especially when it is most important. I cannot be too hard on airline companies however; after all when they lose my bags I do get a sweet toiletry kit which contains all the essentials, a white XXXL T-shirt, XS black socks, half of a toothbrush, none flavor toothpaste, a one blade razor, and the all important vanilla soap. If our national economy didn’t depend so heavily on this ability of transportation I would suggest a boycott, perhaps in this boycott we could all wear rather larger T-shirt with our preferred slogans on them, as opposed to holding signs. I do remember my first flight, and how excited I was to be so high in the air. I was going to my grandmother and could not wait to inform her of the peanuts I had on the plane. Ignorance is bliss I suppose, and unfortunately I grew up. The cherry on top of this Sunday for me though is that my family lives in Europe, and as the only way to see them is by air. I better decide if I want to be XXX-Rayed or groped whatever the decision I think I may have to hit the gym beforehand.

Trouble in Paradise?

 Fareed Zakaria US - China Relations

Fareed Zakaria’s editorial covering the U.S. - China economic relations was a very interesting and insightful read.  Zakaria appeared to have carefully thought out his questions, and made sure to hit the discussion from every angle. It is very easy for an onlooker to be frightened by this artificial deflation that China is doing with their currency. However Zakaria does a masterful job of putting things into perspective, “Remember the vast numbers of companies that are exporting from China that are American companies. The Chinese have opened up their economy to a huge number of American firms.” It is a breath of fresh air to have someone in the mainstream media to be seeing the positive in this circumstance. However Zakaria is also not ignorant to potential possibilities that could ruin the relations between our two countries. “There's a structural problem, which is that the U.S. is the established superpower in the world, China is the rising power. Those kinds of relationships have often ended up badly. Think about Japan as it rose in the 1930s, think about Germany as it rose in the 1890s and 1920s, think about the Soviet Union.” When discussing potential backlashes to China’s “artificial” currency in the long run, Zakaria gives solutions the hypothetical. He describes how when German was unable to compete with price, they competed with quality of product. As you can see know there are just as many German-made vehicles on the road as there are Hondas or Toyotas. When faced with a problem in business or in this case, national economies, innovation is the key. Zakaria shows a different side to this story and how it may not be as horrible as we may believe. When describing the possibility that Congress may be making such uproar over this situation simply due to the fact that mid-term election is weeks away. Mid-terms in a community college are not much different. Students making a mad dash to cram for grades as oppose to votes.  Zakaria’s use of thoughtful logic, and his possible solution to potential problems, goes very far in persuading any Negative Nancy’s to his point of view. I see his points and agree, his use of facts, as well as pulling from history help strengthen his point of view. 

The Tag Team VP's

Obama-Clinton ticket 'on the table,

 It would be an interesting notion to think of Joe Biden and Hillary Clinton swapping jobs in 2012, however much can happen in the next year. If the pace at which the President is going continues it may not be a terrible idea. I cannot believe I’m saying this but I think Hillary would make a good VP, well better than Biden. The Gallup has Clintons approval rating at 51% whereas Biden’s is at 42%. That being the case Obama’s camp may want a more likable character seated next to him when re-election is right around the corner. Another interesting thing to think about is that Obama has an average of a 44% approval rating, and seeing how Clinton ran opposite Obama in the 2008 election, it would be hard not to think she has her sights set on the White House for the next presidential election. With that thought in mind she may not want to get to close to the Oval Office just yet for fear of being judged by the company she kept. This discussion may just be for naught, I mean Biden may manage to keep his foot out of his mouth for the next year and produce more to this administration than just comical relief. This article was a very easy read, and had a lot of food for thought.  I had not ever thought of this large of a switch near the end of someone’s presidency.