Thursday, May 3, 2012

Gas Prices Headed Lower

A recent article I read from CNNMoney is predicting gas prices to fall in the coming weeks and coming months. This is a good thing for motorists and summer travelers. The article stated that we may have seen the highest gas prices of the year all ready peaking at around $4.11, so we shouldn't expect to see anything higher than that. The major reason that there gas prices are declining is because of a decrease in price of crude oils. The articles says that Brent Crude oil has fallen from a $125 price in April to around $100. The reason for this is that the tensions created by Irans nuclear program with the U.S. have decreased. As the article states, as long as we don't see a shortage of supply or refinery outages, gas prices should not rise throughout the summer months.

Monday, April 30, 2012

The Creative Monopoly

A recent article I read by David Brooks deals with the idea of a Creative Monopoly. His background story is pretty unique and he draws on that to suggest that people shouldn't focus on being more competetive but more monopolistic. The article states that Brooks is not referring to the idea of an illegal monopoly where you are focusing on eliminating your rivals but one where you create a new market that is unique and you are the only one who people can come to when they need that good. He stressed how our education system at the college level is creating competitive students who compete to get into schools and compete for jobs and then once they have a job compete against other companies and try to beat them in any way possible. He says that the problem with this competitiveness is that it is taking away from peoples abilities to be creative and find their own niche in the market which will ultimately result in a better outcome individually and to society. He values the idea of a "creative monopoly" over competitiveness because of the outcomes and he suggest that people should focus their goals on becoming better monopolists.

Demand for Apartments Drives Commercial Building Rebound

A recent article I read discusses how a demand for apartments is driving an increase in commercial buildings. The article states that an improving economy is driving the demand for new apartments and a benefit of that is more stores and warehouses are also being built. Construction of these buildings is increasing as people are more confident in the economy and more willing to take chances. The article refers to the Generation Y age group and how they are marrying later in life which means at this current time they are focused on their careers and more accepting of jobs in urban areas where they are moving out of their parents house and into a place of their own. This is driving the demand for apartments because buying a home is still a risky decision and some of Generation Y are not even able to buy homes. This trend is going to increase the demand for apartments and that demand for apartments is driving a a construction spree of commercial buildings.

Saturday, March 31, 2012

Consumer spending rises, income lags

This is an interesting article on how consumers were spending more even though inflation has caused income after taxes to not increase in a similar fashion. You would think that these two things would go hand in hand and that when income is increasing at a certain rate, spending would also increase but in this case income did not increase too much but spending did increase considerably, even though gas prices are high. I believe the reason for this is that people are more optimistic about the economy and as more and more jobs are added and unemployment rates are lowering people are more confident and happy with their situation. I think that this has caused an increase in consumer spending, and as the article states this trend might stop as gas prices are rising and people are going to be making cuts on their spending of other goods to afford these prices.

Gas Prices Are Out of Any President's control

This is an interesting article from the NY times about peoples perceptions on how presidents can control the price of gas. The article states that the price of gas is not set by people but by the price of oil and what suppliers do. Therefore presidents cannot set prices because the price of gasoline is dependent on supply and demand and unless you suspend the theory of supply and demand like the article states, presidents cannot set gas prices. The U.S. is more of a consumer than a producer of oil and even though oil production has increased the U.S. still does not hold enough of the market to have any effect on global prices. The article states that gas prices cannot be set but we can do things to help out oil prices such as using it more efficiently.

Wednesday, February 29, 2012

Gas prices spike in February

This article discusses a recent spike in gas prices for the month of February and what is contributing to this increase in gas prices. Motorists have had the pleasure of seeing an eight percent increase in gas prices and the trend doesn't seem to be stopping anytime soon. The cause of the recent gas price spike and the reason for near future spikes is contributed to two factors.

The first factor deals with an increasing price for oil and Iran's threat to shut down the use of the Strait of Hormuz. The second factor is that taxes are increasing the price of gas as well. However, there is some positive outlook on the situation in the fact that the economy is stronger right now so people can afford to spend more on gas. Gas was relatively lower during the recession so the fact that gas prices are rising in a stronger economy is not as alarming. This article is mainly dealing with the direct relationship with the price of gas and oil and how increasing oil prices are increasing gas prices. It also puts a focus on the fact that foreign threats are creating a scare where the availability of oil supply is uncertain and driving up the price of oil, consequently driving up gas prices.

California to Suffer Housing Shift

UCLA forecasters are predicting a shift in housing as more people are relocating around the coast where they can be closer to their jobs and not have to travel as much. The reason for this shift in demand for housing from more single person houses to multi-family houses on the coast is because of rising gas prices and a bad economy. As the article states the demographic of California is rather young and the younger generations see value in living closer to where they work. The article states that there is already evidence of this shift as a decline for single person housing permits is decreasing as the demand for multifamily housing permits is increasing.
The demand for new houses in general is shifting in as the economy is taking a toll on people and they can't afford to live in a single house by themselves, so they are moving in with family members to save money. This shift in demand is negatively affecting the economy as it requires less labor to build a mulitfamily house than a single person house and the fact that California will have to wait for a construction boom will keep unemployment rates high until 2013 where they will issue more building permits. This will create more jobs and lower unemployment. This article discusses two shifts in demand for housing in California if you focus on single person houses and multifamily houses as the demand curve is shifting out for mulitfamily houses and in for single person houses. The second shift in demand deals with new houses and the demand shifting inward as people who are unemployed can't afford it and need to move in with their family.