The perfect storm is here!

I did not have any idea what a “perfect storm” was (actually I thought it was just a movie). Thanks to today class, I learnt something about it.

To understand what America’s perfect storm is about, we watched an interesting video. As the information was presented, I tried to create an image on my mind to get the main idea. What I imagined is an entire country being absorbed by a black hole… What a terrible situation!

Nowadays, American companies not only face new challenges to satisfy people’s needs but also have to compete with companies from all over the World; and this is very difficult for them because the workforce is cheaper in those other countries. The situation gets worse if we consider the fact that there are less and less highly qualified professionals in the US. The reason of this seems to be that many people do not finish high schools nor do not do a degree course because they think they do not need it, they could be content with a badly-paid job. Finally, but not less important, it is the fact that American population will continue to grow and became older and diverse. In this context, the immigration would have an effect not only in the population’s growth but also in the workforce (according to a report of ETS, between 2000 and 2005, two-thirds of the nation’s civilian labor-force growth and 86 percent of its employment growth was generated by new immigrant arrivals.)

Based on all this information, I would say that the US future may be a real nightmare. Americans should take measures before it is too late.

Big corporation, big power

Big corporations are really important in the US Economy. They provide work to thousands of people, they satisfy people’s needs, and they are admired and envied by small companies. 

Nevertheless, some of them do not want to have any competition, so they create monopolies (unfair competition); as a result they can fix the prices they want. In addition some of these companies have influence upon political and/or economic issues of the country; and that is unacceptable. Let’s imagine that a huge laboratory develops a pill which cures a specific disease. Everything is ok. However, the pharmacists know this pill has terrible side effects so it is impossible to sell it. But it does not matter. They have “friends” in the highest levels of the State and they can persuade them (with money, of course) to admit their product. Finally, the magic pill is welcome to the market where thousands of people will buy it without knowing its bad consequences… This is just an example about how some big corporations take unfair advantage of their power. 

I would not say all big corporations are bad or good, but I am totally sure that they must be controlled for the good of all.

American crisis

Fourth class was about the Great Depression and the Subprime mortgage crisis. 

These crises seem to have similarities. For example, in the Great Depression there was an “Economic bubble” while in Subprime mortgage crisis there was a “Real estate bubble”. 

Another similarity is that Wall Street was involved in both crises. In the Great Depression, companies and people bought and sold shares. In the Subprime mortgage crisis, investors and banks bought and sold ‘toxic bonds’. 

The consequences are also similar: lots of companies and/or banks went bankrupt, thousands of people lost their jobs, unemployment rate increased, middle class people were affected, crises spread all over the World, etc. 

 

 At the Great Depression time, the President of the US was Hebert Hoover. He did not take the necessary measures to face the crisis so people got angry. When the Subprime mortgage crisis started, the President of the US was George W. Bush. He did take measures but these measures consisted of save banks and companies which were responsible for the crisis. Once again, people got angry. Both Presidents were from the Republican Party. Both Presidents were succeeded by Democratic Party’s candidates. 

Finally, despite the facts, I think the main reason of both crises was greed. People were not happy with what they had, they wanted more and more.