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BONUS Week Thirteen Diary of New York Café: Getting Coronavirus Relief is Tough

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BONUS Week Thirteen Diary of New York Café: Getting Coronavirus Relief is Tough

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Link: https://www.nytimes.com/2020/04/22/business/economy/coronavirus-nyc-restaurants-sba-loans.html

Summary: The coronavirus has caused for many small businesses to close, leaving their owners out of work and in financial trouble. The owner of this café kept a diary discussing the many troubles she’s encountered during the pandemic. When restaurants were forced to do takeout or delivery only, the owner realized that it was costing more to be open than to bring in sales. She went through the experiences of missing rent, applying for loan programs, and scrambling for cash. Many programs for relief were running out of cash, so now it’s just a waiting game.

Reaction: I wish I could say that I’m surprised. There are so many small businesses experiencing these events similar to OatMeals Café. It is terrible that many restaurants are forced to close because they can’t stay afloat or make enough sales when open. The experiences of missing rent and applying for loans that keep getting denied is terrifying. It can make an individual not know how they are going to make it and can be really discouraging.

Relation to Class: This relates to many aspects such as unemployment and supply and demand. Once the café closed, the employees had to file for unemployment. This can lead for the rate to go up. The demand for the café items went down, and the supply had to be cut down and then closed.

Citation: Smialek, Jeanna. “Diary of a New York Cafe: Getting Coronavirus Relief Is Tough.” The New York Times. The New York Times, April 22, 2020. https://www.nytimes.com/2020/04/22/business/economy/coronavirus-nyc-restaurants-sba-loans.html.

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Week Twelve      Don’t Mention the Virus! And Other Marketing Tips

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Week Twelve      Don’t Mention the Virus! And Other Marketing Tips

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Link: https://www.nytimes.com/2020/04/19/business/coronavirus-influencers.html?auth=login-email&login=email

Summary: Social media influencers are struggling to promote products and keep themselves from becoming unemployed. However, as the pandemic continues and more are becoming unemployed, so many are spending more time on social media. This has driven many influencers drive to post more about certain products. Many companies that influencers work for suggest that by posting more relatable content about staying in with the addition of new products, can intrigue buyers. Buyers are on high alert so the wording of these posts have become carefully created, to ensure a calm approach.

Reaction: I have to say, the longer I have stayed in, the more I want to purchase more items. Perhaps it’s out of boredom, but I can understand how carefully worded suggestions could persuade me to buy something new. It is often forgot how influencers make their money and that’s how they live. But like many others, they need to make a living. The relatability of someone on social media, creates a bond between the viewer and the content. That is just the type of world we live in now, it is important for some to keep up with the trends, even in the times of a pandemic.

Relation to Class: This relates of many macroeconomic factors. The unemployment rate could raise if these influencers aren’t producing enough sales through their accounts. It effects the demand aspect of products. If no sales are occurring, the demand is down. Meaning the supply and demand scale may become unbalanced.

Citation:
Maheshwari, Sapna. “Don't Mention the Virus! And Other Marketing Tips.” The New York Times. The New York Times, April 19, 2020. https://www.nytimes.com/2020/04/19/business/coronavirus-influencers.html?auth=login-email&login=email.

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Week Eleven        How the Virus Transformed the way Americans Spend Their Money 

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Week Eleven        How the Virus Transformed the way Americans Spend Their Money 

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Link: https://www.nytimes.com/interactive/2020/04/11/business/economy/coronavirus-us-economy-spending.html

Summary: There have been radical changes to how individuals are spending their money. It has been the sharpest decline on consumer spending in a while. There are spikes in purchases one groceries and online purchases, but there is a significant decline on regular shopping, travel, and entertainment. There was a surge of demand for grocery products during the first few weeks of the pandemic. It is creating threats for brick-and-mortar stores.

Reaction: I wish I could say I was surprised but I expected this to happen. It is more sensible for individuals to be saving their money for the necessities and not spending it just to spend. The spikes in purchases on groceries makes sense for how the stores have been looking. Many people have been non-stop stocking up on products from grocery stores or have been doing online grocery shopping to avoid continuously going back to the store.

Relation to Class: This relates because of the demand of the products. There was a surge of demand for products and the supply wasn’t prepared for it. This made for products to not be restocked within stores for weeks. It shows how important for supply and demand to stay balanced. It also can relate to the unemployment as individuals who aren’t working cannot spend on certain products and it restricts the sales.

Citation:       Leatherby, Lauren, and David Gelles. “How the Virus Transformed the Way Americans Spend Their Money.” The New York Times. The New York Times, April 11, 2020. https://www.nytimes.com/interactive/2020/04/11/business/economy/coronavirus-us-economy-spending.html.

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Week Ten         Young Adults, Burdened With  Debt, Are Now Facing an Economic Crisis 

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Week Ten         Young Adults, Burdened With  Debt, Are Now Facing an Economic Crisis 

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Link:
https://www.nytimes.com/2020/04/06/business/millennials-economic-crisis-virus.html

Summary:  Millennials are facing a big hit with the pandemic. As the past few years was good for the economy, it hasn’t helped the millennials set up a solid foundation financially. Many have part-time jobs, which have been cut or forced to shut down. This makes them more vulnerable to the financial downfall. Many millennials are faced with student debt on top of now not being able to afford bills or even provide for families. Individuals are now selling personal items to just get by.

Reaction: The coronavirus pandemic has brought the reality of bills and how to define the necessities. I can relate to this because I am currently faced with the same questions of paying bills and student debt. It is a scary time to be living through at the moment. But I know I’m not the only one that’s going through it and having these thoughts. The debt that will accumulate post pandemic will be interest to see.

Relation to Class:
This brings up the topic of debt and unemployment. By these millennials losing jobs, it is increasing the unemployment rate. It’s been on the constant rise throughout this pandemic. As individuals are unable to pay from working, they probably will have to charge it. Individuals will not be able to afford certain goods, meaning the supply and demand will be affected.

Citation:
Popper, Nathaniel. “Young Adults, Burdened With Debt, Are Now Facing an Economic Crisis.” The New York Times. The New York Times, April 6, 2020. https://www.nytimes.com/2020/04/06/business/millennials-economic-crisis-virus.html.

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Week Nine   'It's a Wreck': 3.3 Million File Unemployment Claims as Economy Comes Apart

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Week Nine   'It's a Wreck': 3.3 Million File Unemployment Claims as Economy Comes Apart

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Link: https://www.nytimes.com/2020/03/26/business/economy/coronavirus-unemployment-claims.html?auth=login-email&login=email

Summary:  As thousands
of businesses close due to the coronavirus pandemic, it’s leaving many
employees to file for unemployment. There is expected many more to lose jobs,
and unfortunately experience foreclosures, evictions, and bankruptcy. With more
cases arising, the senators have agreed to provide a $2trillion aid package for
cash payments to many Americans in efforts to help those who have become
jobless and own businesses. However, it’s been determined that many workers
don’t even qualify for the unemployment benefits and if they do, they are
unable to file claims due to jammed phone lines.

Reaction: As this pandemic is
currently still evolving, it is crazy to think of so many individuals who have
been out of a job and can't make their payments. Even as people try to file for
unemployment, it is not even guaranteed they can qualify. For example, my jobs
have either told me to resign till the fall or are making bare minimum payments
for a few weeks. This means I can't even apply for unemployment.

Relation to Class: This relates to the
unemployment rate since it is being altered. As more people file and are
declared unemployed, this was cause a spike in the rate. This also will cause a
fluctuation in the supply and demand for products that are being sold in
businesses that are forced to shut down.

Citation:  Casselman, Ben,
Patricia Cohen, and Tiffany Hsu. “'It's a Wreck': 3.3 Million File Unemployment
Claims as Economy Comes Apart.” The New York Times. The New York Times, March
26, 2020. https://www.nytimes.com/2020/03/26/business/economy/coronavirus-unemployment-claims.html?auth=login-email&login=email.

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Week Eight      Racing to Head Off Evictions and Foreclosures

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Week Eight      Racing to Head Off Evictions and Foreclosures

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Link: https://www.nytimes.com/2020/03/18/business/economy/coronavirus-evictions.html?auth=login-email&login=email
Summary: The coronavirus pandemic is threatening housing security for many individuals. Many finance firms that back mortgages are suspending foreclosures and other related evictions. This suspension is estimated at 2 months. The same goes for renters as they are finding it hard to make payments after being sent home during the pandemic. Many companies are anticipating a wave of late payments. Some are preparing by having a waiver for the late payments and halting evictions.

Reaction: This is important that companies are understanding the situation that many individuals are being forced into. By allowing late payments and suspending evictions for the time being it allows for a sense of relief for individuals as they are experiencing chaos during this pandemic.

Relation to Class: This relates to unemployment rate as it is now becoming affected with individuals being told to go home and their jobs being on pause. As more individuals file for unemployment it will be harder for the government to supply money for individuals.

Citation:
Dougherty, Conor, Matthew Goldstein, and Emily Flitter. “Racing to Head Off Evictions and Foreclosures.” The New York Times. The New York Times, March 18, 2020. https://www.nytimes.com/2020/03/18/business/economy/coronavirus-evictions.html?auth=login-email&login=email.

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Week Seven         Cash is King In The Time Of Coronavirus

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Week Seven         Cash is King In The Time Of Coronavirus

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Link: https://www.forbes.com/sites/nathanvardi/2020/03/16/cash-is-king-in-the-time-of-coronavirus/#5acd7d4c3e44
Summary: Two months ago it was said that cash was compared to trash. But now stocks are plummeting, the value of gold is falling but cash is where the investors should be going. Many companies are making sure they have enough cash on hand. This rush of cash has included a shortage of physical cash for some companies.

Reaction: It isn't surprising that this pandemic has triggered individuals to want to have a physical copy of cash. Just in case something were to happen, debit or credit cards might not be optional to use. With physical cash, people could trade if need be. But it's kind of terrifying that the world might get to that point.

Relation to Class: This relates to Chapter 16 as a whole. It was mentioned that the commodity money, like gold, was losing its value. The ultimate price for cash, I believe will go up especially if there is a shortage of bills.

Citation:
Vardi, Nathan. “Cash Is King In The Time Of Coronavirus.” Forbes. Forbes Magazine, March 16, 2020. https://www.forbes.com/sites/nathanvardi/2020/03/16/cash-is-king-in-the-time-of-coronavirus/#5acd7d4c3e44.

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Week Six  Unemployment Lowest Since 1960’s as Employers Add 136K Jobs 

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Week Six  Unemployment Lowest Since 1960’s as Employers Add 136K Jobs 

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Link: https://www.usnews.com/news/economy/articles/2019-10-04/unemployment-lowest-since-1960s-as-employers-add-136k-jobs

Summary: In September of 2019, the unemployment rate fell to 3.5%. This rate was continuous for three months and was the lowest it’s ever been since 1969. The job report for September was shown to be a positive thing for workers, investors and most Americans. However, with the unemployment rate so low, it didn’t give much room for growth in hourly earnings and it slowed the hiring pace.

Reaction: The article had said that when the unemployment rate rises it could lead to a recession, which in September they didn’t have to worry about as much since the rate was so low. But it was estimated for a recession to occur eventually into the late 2020’s. This is interesting to compare to the more recent times of 2020. With the coronavirus spreading, it has most likely made this rate of unemployment grow.

Relation to Class: The topic of individuals being dropped out of the labor market was mentioned within the article. There were 275,000 individuals that were considered unemployed, yet 89,000 were those that dropped out of the labor market. According to Chapter 15, these individuals were no longer labeled as unemployed.

Citation: “Unemployment Lowest Since 1960s as Employers Add 136K Jobs.” U.S. News & World Report. U.S. News & World Report. Accessed March 10, 2020. https://www.usnews.com/news/economy/articles/2019-10-04/unemployment-lowest-since-1960s-as-employers-add-136k-jobs.

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Week Five           How We Know California’s New Rent Control Law Will Make Its Housing Shortage Worse

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Week Five           How We Know California’s New Rent Control Law Will Make Its Housing Shortage Worse

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Link: https://fee.org/articles/how-we-know-california-new-rent-control-law-will-make-its-housing-shortage-worse/

Summary: California places a policy that limits annual rent to increase up to 5% after the inflation. This bill also offers new barriers of eviction, that will provide some housing security. Housing demand in California is very high and the supply for it doesn’t match up. These rental controls places are opposing minimum wage laws. The price of housing is responsive to the price changes that are occurring.

Reaction: It seems to be very common for housing to be in high demand. Many people today are finding it harder to secure a place to live from lease to lease. It was interesting that the rental controls in California are opposing the minimum wage laws. But after a second it made since that the costs of housing is so high that ordinary people need maybe two or three minimum wage jobs in order to afford living. Since California is a popular place it doesn’t surprise me that housing is experiencing a shortage.

Relation to Class: This relates to the reference of supply and demand. This is mentioned in the chapter as well as previous chapters we’ve discussed. By the California being a well-known and very desired place to live, the demand is high. But the space and buildings are able to supply for the demand. This article also mentioned the increase of 5% due to inflation. Inflation is a factor that influences the price of rent and its effect on minimum wage.

Citation:

Phelan, John. “How We Know California's New Rent Control Law Will Make Its Housing Shortage Worse: John Phelan.” FEE Freeman Article. Foundation for Economic Education, September 16, 2019. https://fee.org/articles/how-we-know-california-new-rent-control-law-will-make-its-housing-shortage-worse/.

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Week Four          US Economy Heads Into 2020 With Steady Growth

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Week Four          US Economy Heads Into 2020 With Steady Growth

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Link: https://www.wsj.com/articles/fourth-quarter-economic-growth-11580386835

Summary: As 2020 began, the US economy was going steady at a 2% pace. GDP had grown 2.3% within 2019. This was the slowest pace of growth since 2016. Economists believe that the economy will continue to grow at the same pace for this year. This is planned to influence lower interest rates and for American consumers to be more upbeat. Although the US stocks are edging a slowdown within global growth. It was identified as an inverted yield curve, and it has occurred several times in 2019, but the Federal Reserve cut short-term interest rates. The US is reaping the benefits of low unemployment and the rising incomes. This is what is increasing the consumer upbeat confidence in spending.

Reaction: I thought it was interesting that growth has been steady. I knew that unemployment rates were low, but I had no idea that the US had the benefits of rising income. Although working two jobs, I noticed that there was a rise in minimum wage. I could see how this could increase consumer confidence with spending.

Relation to Class: This is related to macroeconomics because of the topic with growth. In Chapter 12, it discussed the many factors that effect or improve growth within an economy. The productivity and improvement given to the consumer is important and it is a result from these terms of low unemployment and rising incomes.

Citation:

Torry, Harriet. “U.S. Economy Heads Into 2020 With Steady Growth.” The Wall Street Journal. Dow Jones & Company, January 30, 2020. https://www.wsj.com/articles/fourth-quarter-economic-growth-11580386835

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Week Three   US CPI rate unchanged in December, as expected 

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Week Three   US CPI rate unchanged in December, as expected 

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Link:
https://www.sharecast.com/news/international-economic/us-cpi-rate-unchanged-in-december-as-expected--7231972.html

Summary: The cost of living rose in the US. Although this was expected, there was also the increase in medical care. The month of December consumer prices were unchanged, at 2.3%. This was expected, but economists are a bit unsettled due to the inflation between the cost of living and medical care increase. As of now the inflation is under control but the direction is not looking as hopeful. The core CPI rate did rise, but only by 0.11%. It was forecasted to increase by 0.2%. Many factors of shelter prices, cost of used transportation or transportation services were involved. This core CPI had risen 2.3% from the previous month.

Reaction: I think it was interesting the factors of transportation services and used car costs are involved in the CPI. I also find it interesting that the core CPI only rose 0.11%. Perhaps the lack in sales in some areas caused this be lower than expected.

Relation to Class: The reason this was related to macroeconomics was due to the CPI. The article mentioned that CPI rate excluded food and energy. The article also mentioned the inflation between living and medical care. These factors could make a big difference in the economy as a whole.

Citation:

Bueso, Alexander. “US CPI Rate Unchanged in December, as Expected.” BOLSAMANIA. Sharecast, January 14, 2020. https://www.sharecast.com/news/international-economic/us-cpi-rate-unchanged-in-december-as-expected--7231972.html.

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Week Two       Economy Grew at 1.9% Rate in Quarter, Hit by Trade Flight and Global Weakness

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Week Two       Economy Grew at 1.9% Rate in Quarter, Hit by Trade Flight and Global Weakness

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Link: https://www.nytimes.com/2019/10/30/business/economy/us-gdp-growth.html

Summary:

The GDP has had only a growth of 1.9% for the third quarter. This pace of growth has declined since the spring of 2019 and then through July, August, and September. Businesses are showing a pull back on investments, such as buildings and equipment. The spending on factories and offices for businesses has dropped 15%. Although residential investments did rise 5.1% of an annual rate after months of the constant decline. The article mentions that the economic data will help shape the campaign narratives for the 2020 presidential election. Many business owners are terrified of the tariffs that are scheduled to be set in place.

Reaction:

This article was interesting because the GDP is growing at such a slow pace. The rift between consumers and businesses is causing this slow growth. By many businesses pulling back on investments, it is causing the rift. The pullback was mentioned at 3%. This pull back resulted in consumer spending growth to fall from 4.6% to 2.9%. The article mentioned that the Federal Reserve has lowered the interest rates in efforts to keep the slow in growth from turning into a huge downfall.

Relation to Class:

Mentioned in chapter 10, it was mentioned of the importance of the investment components for a good GDP. This article relates to that by the possible factor of businesses lack of investments which are leading to a drop in percentage of consumer spending. By the lack of investments occurring, there won’t be a more advanced or efficient way to produce new goods or services.

Citation:

Cohen, Patricia. “Economy Grew at 1.9% Rate in Quarter, Hit by Trade Fight and Global Weakness.” The New York Times. The New York Times, October 30, 2019. https://www.nytimes.com/2019/10/30/business/economy/us-gdp-growth.html.

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Week One          Yes, There Is a Trade-Off Between Inflation and Unemployment

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Week One          Yes, There Is a Trade-Off Between Inflation and Unemployment

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Link: https://www.nytimes.com/2019/08/09/business/trade-inflation-unemployment-phillips.html?auth=login-email&login=email

Summary: As of today, there are concerns that due to the unemployment rate becoming lower, there will be a spike of inflation. This concern was brought up by Representative Ocasio-Cortez, when she was questioning Mr. Powell, the Federal chair, about central banks being aware of the flaw of inflation and unemployment. In the article, the concept of the “Phillips curve” is introduced. Inflation and unemployment have an inverse relationship. When unemployment is high or low, employers will either raise wages or keep them at the steady rate. As the inflation with wages occurs, it will soon turn into an inflation of prices of goods and services. Central banks are believed to push inflation and unemployment in different directions, as they face trade-off.

Reaction: There were a few aspects of this article that I found interesting. The theory began in 1958 and has since developed into a formal concept. The “Phillips curve” has helped explain the trade-off that central bankers are facing. Economic activity revolves around those decisions. It’s interesting that with lowering unemployment, comes a steady wage but when the opposite occurs and wages are risen. It’s like the domino effect, the inflation of wages will carry out to production and goods.

Relation to Class: Mentioned in chapter one, the tenth principle of economics is that there is a trade-off between inflation and unemployment. This connects to the article as the connection between the two represent a trade-off based on the central banks.

Citation:

Mankiw, N. Gregory. “Yes, There Is a Trade-Off Between Inflation and Unemployment.” The New York Times. The New York Times, August 9, 2019. https://www.nytimes.com/2019/08/09/business/trade-inflation-unemployment-phillips.html?auth=login-email&login=email.