Walmart: Importance of Their Interest Rates

The issue discussed through-out the CNBC article, "Wal-Mart: One More Reason The Fed Should Not Hike Rates," was the decline in Walmart profits according to a recent report, most likely due to competition between other bussineses. The significance of this report was aimed towards the fact that the Federal Reserve Bank should not be raising interest rates, as it hasn't in over nine years.  

The report symbolizes a lack of economic growth in the nation but specifically the middle class as well as a lack of growth with other nations. Since this report was released, the economy has not reached a better state, especially not the portion associated with foreign trade. This thus pushes for more attention to consumer sales and wages because of the lack of rise of sales.

Although the profits in Walmart are a result of a variety of reasons such as retailer competition, minimal inflation, and increase in worker training, the most imposing reason is the unsatisfactory rate of unemployment. The Gross Domestic Product has not been altered as far as records have shown, even though Walmart is the biggest retailer in sales.

In conclusion, The Federal Reserve Bank has been considering raising interest rates, but a recent record of sales from Walmart has alluded to there being no need for this. Although Walmart has many factors reducing their income like employee training costs and retailer competition, economic analyzers see the most significant one being the lack in increase in wages for the middle class. The economic profit margin has mostly been directed towards stock, which is mostly the upper class. Therefore, the nation needs to take steps to increase middle class wages. Walmart itself, as well as other world-wide retailers, should consider maintaining their sales within the borders since the only positive report from Walmart came from the US sales, and would thus make the economy in the United States stronger due to the increase in jobs as well as sales.

http://www.cnbc.com/2015/08/19/wal-mart-one-more-reason-the-fed-should-not-hike-rates.html

Record Jobless Claim Drop, Too Good To Be True

In the article, "What You Need to Know About Jobless Claims Drop" by Jeff Cox from CNBC, the topic revolves around the issue of the unusually low record of the jobless percentage of the population. Since the release of records showed that those who filed claims of having no jobs fell to a low 255,000, the economy seemed to be going into a more positive direction. However, the notion was simply distorted by other factors, therefore revealing that the economy has not significantly picked up. 

The drop in unemployment is not as significant due to the seasonal company opportunities as well as the narrowing of the considered population. This unemployment record will not affect the economy due to the Federal Reserve Bank being aware of the conditions, and thus not changing rates as well as a lack of change in the stock market.

The article attacks the jobless claims and the factors distorting the unemployment rate. Unemployment should not be considered to be solved, and it should defiantly not be assumed that there are ‘too many jobs’. Inflation has not become a prominent result yet due to the short term impact of the unemployment record, as shown by the similar drop in Nixon’s era. Gross Domestic Product has also not significantly increased this year, and this record will not alter it by much due to the lack of truth to it. Therefore, there is no need for claims of deficit. Although for some, personal debts may be solved, specifically the recently employed, the national debt has not actually been altered, and it should not be expected to. The world debts should be taken as the main priority since China and Greece are where attention should be. 

In summary, for the month of July, there was an unexpected drop in the record of unemployment claims. Although some take this as a sign for the rise of the general state of the economy, their perception has been distorted due to the multiple factors that should have been considered before making this claim which include the following: company seasonal jobs, narrowed work force, and past records of similar peaks. The population should not concentrate on this sudden peak but on the world-wide events like the collapse of Greece.

http://www.cnbc.com/2015/07/23/what-you-need-to-know-about-jobless-claims-drop.html

America Continues To Recover

In the article, "That Old-Time Economics," published by the New York Times, the issue discussed is that America has yet to make a full recovery from the 2008 financial crisis, yet Europe still has an adjusted gross domestic product per capita that's lower than it was back in 2007.

The argument lies within the fact that Europe has done away with the basic textbook models of economics in favor of "alternative approaches that were innovative, exciting, and completely wrong."

The supporting evidence includes the divergence in economic ideals in Europe and America, the actions of European policy makers, and the European Central Bank. In America, the White House and the Federal Reserve mainly stayed faithful to standard Keynesian economics. In Europe, by contrast, policy makers were ready and eager to throw textbook economics out the window in favor of new approaches. The European Commission, headquartered here in Brussels, eagerly seized upon supposed evidence for "expansionary austerity", rejecting the conventional case for deficit spending in favor of the claim that slashing spending in a depressed economy actually creates jobs, because it boosts confidence.

The claims of how the issue affects the economy are that the European Central Bank took inflation warnings to heart and raised interest rates in 2011 even though unemployment was still very high, and European policy makers listening to economists that supported them and their policy ideals.
Raising Interest rates when unemployment is already high is contrary to the standards upheld by the Phillips curve. Because of this, Europe remains in a state of depression.

We put faith in macroeconomic models, so it is quite ridiculous to think that the European Central Bank will follow such alternative methods that economics doesn't support. According to the business cycle, America's real gross domestic product should fluctuate over time. Therefore, I believe it is still natural for America to be attempting to enter an expansionary period.



http://www.nytimes.com/2015/04/17/opinion/paul-krugman-that-old-time-economics.html?ref=topics&_r=0