Why The U.S. Economy Is So Bad

With everyone losing their jobs lately, ten million, more or less, myself included, it seems that every article I've read so far has blamed oil prices. Are we to say that thousands of people are losing their jobs, food prices are going up, stock markets are crashing, and people are going flat out broke, because of oil? This is absolutely ridiculous. George W. Bush isn't helping by putting out 100 billion dollars out to spend, the problem with the economy isn't people spending, it's companies raising prices and raping people of their money. I don't understand how a simple thing such as oil, could possibly be the cause for so many problems. I also don't understand why the U.S. doesn't invest in solar energy. If we were to build a power plant of solar panels, that covered one hundred miles, by one hundred miles in a U.S. desert, we would no longer need nuclear energy, and we would no longer need power plants, or steam engines powering our houses. Just pure solar energy. Even then, we could sell our energy to other countries, which would put the U.S. trade deficit so far up, we could create our own business. I personally think that we should make the middle eastern countries pay five times the price of our solar energy than other countries, because they are the same idiots raping us with the oil prices. A denial of selling energy to them would suffice too. At least Barrack Obama wants the U.S. to be 25% solar powered by 2025, as far as I've read. Which is a pretty good amount, however still not good enough. Oil is bull, solar and wind power are where it's at. One more thing if I could add. If every American home, were to have solar panels on their roof, they could sell energy to the local energy companies, and eventually put them out of business. I just don't understand why nobody is thinking about clean energy, and it's benefits, we have plenty of resources around us that won't rape our planet, and will help our global economy stabilize.

Buying a Car

I will be buying a car, rather than leasing it, because eventually, it's worth should go up. From reading the book Rich Dad, Poor Dad, it explains that the rich get their income from assets. So if I were to buy a car, and it's worth were to go up over time, I would be making more money than I would be paying for, which would be good. Now, because of our situation with gasoline, I will be buying a car that does not rely on fossil fuels. I will probably end up buying either an electric car, or a hydrogen fueled car, in order to help the environment. I will be purchasing Tesla's new fully electric car, which only costs $4 in order to get a full charge, for it to go 220 miles. Fuel efficiency at it's best. Unfortunately, the car is at a pretty high price, at $98,000. However, my feeling is that I'll be saving more money by purchasing this car, rather than spending $20,000 on a regular car, that get's 35 mpg. Depending on how much the car can carry in the tank, I'll probably be paying around $50 for a full tank of gas. If I needed to do that once a week, for the rest of the year, I'd be paying about $2500 in gasoline a year, not to mention the fact that gasoline prices will go up, and we will be facing more deflation. I will be saving more money by purchasing this car. In order to purchase it, I will get a loan, searching for a low interest rate. And pay it off in the amount of money that I would usually pay for gasoline. Having said that, I think that over time, I'll be able to sell this car at an even higher price than that of which it was purchased. Even though it is used, it's value will go up in the coming years as people will want to purchase electric and hydrogen powered cars. In time, this vehicle should pay for itself.

Fed helps market go up

Apparently, the Federal Reserve is capable of altering the stock market, we can see this when DOW increased 400 points on Friday due to the Central Bank lowering it's federal funds rate. At least the Federal Reserve is noticing that were going into a recession. Our economy is doing very poorly, and even if the DOW went up 400 points, I'm absolutely sure that in the oncoming weeks, it will rather than double the 400, simply go down 800 points to show how bad our situation is. If the stock market is going up, then nobody in our stock market game should be in the negatives. It's a bad time to be investing in stocks, especially now when our country is in the middle of a war, in national debt, and our economy is falling apart. I don't think that anything the feds can do could possibly help us.

Compound Interest and the Rule of 72

Compound Interest

Compound Interest is basically a way to invest your money in the bank in order for the money that you placed to increase over a long period of time. Compound interest starts out with a first deposit, and then takes a percentage of that, and adds it. The next time the percentage rolls around, the bank takes the percentage of the total of the previous percentage that it added. So basically you're money is slowly increasing.

The Rule of 72

In investing, is a way of calculating an investments doubling time, or halving time. They are more commonly used for compound interest rather than simple interest. Since simple interest doesn't add too much to your account.

US Trade Deficit

I'm not sure how this blog is useful, or should be graded on, seeing as you basically told everyone the answer today in class, Mr. Moloney...However, I will continue explaining what was asked.

A trade deficit is the amount where a country's imports, are more expensive than it's exports. The U.S. trade deficit went down in 2007 because our mighty dollar became extremely less valuable. When the cost of our dollar goes down, other countries see it as an opportunity to buy a lot of our exports for cheap. A large trade deficit is bad for the country, because a country should be making more money than it is spending. If a country spends more money on buying goods from other countries, than it does selling it's goods to other countries, then it adds to our national debt, at least the way I see it. It's bad to import more goods than to export because it means were not making as much money. If we ever make it out of this economic turmoil, we should definitely see our country's trade deficit dropping faster than google's stocks.

Opportunity Costs

An opportunity cost is when you lose something that you could have gotten, when another alternative is chosen. I guess in lamer terms, this must mean that for instance; Say I were to go to the food court at Queens Center Mall. There are many choices of food to eat. Let's also say that I have high blood pressure and I'm terribly overweight. If I choose something loaded with calories, like...McDonalds, over something more healthy, like Sushi, or perhaps Subway, I could possibly get a heart attack, or die. While the sushi or the Subway sandwich would have probably not killed me.

This is probably related to stocks in the way that people choose between two stocks, the one they choose from, takes a dramatic drop, and they lose money. I had a problem with google. Where it dropped 40 points in only 2 days. I mean, it dropped like crazy. It may as well have crashed for me. I bought it at 512. At the moment of making this entry. It is at about 460. When it was at it's peak, it was around 530. So I lost about 1000 in the stock game. My personal experience with opportunity costs has taught me never to invest in google again.

My Investment Strategy

The reason that I chose the companies were for some basic reasons. I think everyone in the class invested in apple simply for the heck of investing in Apple. However, I know for a fact that Apple will have a new press conference at the end of the month. Either they'll be releasing the new Software Developers Kit for the iPhone, or they'll be releasing the new fourth generation MacBook Pro's, seeing as they've been detected over networks as "MacBook Pro 4.0". The reason that I've invested in Yahoo was the fact that of recently, they were offered lots and lots of money from Microsoft, and they turned them down. Yahoo also is a very stable stock, and hopefully will rise soon. As for Google, when Microsoft was prepared to buy Yahoo, they tried to interfere, and I guess they succeeded because Yahoo turned them down. I also heard rumors that Yahoo and Google may merge in order to probe internet searches. Now I have a very interesting reason for investing in Intel. I feel that they'll be going up pretty soon, hopefully. You see Intel is researching new processors. Some new technology called "Phase Change Memory". Something where instead of using electrons to transfer data, it uses atoms. My strategy relies on how popular, or upcoming events for the company.