Running head: Wall Street Journal Project
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Drought Hits New Zealand’s Economic Growth
Rebecca Howard. 20th June 2013. Retrieved From
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Economic Growth
Rebecca Howard’s main purpose for writing this article was to address the effects of the
New Zealand drought on her economy. Rebecca says that this is the worst drought to have hit
New Zealand and that it negatively weighed on the growth of the economy in the first quarter.
The drought resulted in the reduction of milk production and milk production is the backbone of
New Zealand’s economy. The author mentions the unintended consequence focusing the
economy’s growth on manufacturing. The industries will lead to pollution of the environment if
not properly monitored. Therefore, even though the economy grow, the societal problems such as
rising levels of pollution will emerge as an issue.
Obama's Fiscal Priorities Are Right; Redirecting money from the expiring Bush tax cuts to
unemployment benefits would be a net job creator and give the economy a much-needed boost.
Alan S. Binder. 18th July 2010. Retrieved From
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Unemployment
The author’s purpose is to criticize President Obama’s fiscal priorities of redirecting money to
unemployment benefits from the expiring Bush tax cuts and the boost it would inflict upon the
economy. The Obama policies eschew the phrase physical stimulus. The policies are aimed at
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increasing unemployment benefits and engaging in activities which encourage spending and job
creation. The Republicans however hawk these policies and insist that the Bush tax cuts should
be made permanent instead of being redirected to the unemployment benefits. The increase in
unemployment benefits would cause a different impact on the economy-wide. The budgetary
buck would be offered a spending bang. This as a result would improve the economy. The
unintended consequence in this article is that even though the increased government expenditure
on unemployment benefits would help improve living standards of the unemployed, it would
consequently result in inflation if not properly checked.
The Long and Short of Fiscal Policy.
Alan S. Blinder. 22 May 2012, Retrieved From
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Fiscal Policy
The author purposes to focus on the federal budget deficit. He argues that there has been
a lot talking than thinking on this matter. The fiscal policies of the government greatly affect the
amount of budget deficit of a country thus affecting the economy as well. Should the government
spend more money than it can rise, it will lead to an increase in the budget deficit. More money
will need to be borrowed to fund the government programs and the country will be in huge debts.
The huge debts will reduce the lucrativeness of doing business with such a country or investing
in such a country hence affects the economy as well. Programs such as selling of government
bond won’t attract investors and so the government won’t gain from this venture. The
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government may increase its taxes to raise more funds resulting in unintended consequence of
high cost of living in the state.
The Fed Squeezes the Shadow-Banking System
Andy Kessler. 23 May 2013. Retrieved From
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Banking
The author’s purpose is to communicate the efforts of the banking sector, the Federal Reserve
included, in developing the economy. The money-markets funds, regardless of the fact that they
are traditional banks have been able to venture into credit extension to its customers. The credits
extended to the customers enable them to develop themselves by engaging in business ventures
that in essence help improve the economy through the generated income, she says. She has also
explained the simplicity of repos stating that it only involves a borrower putting up security as
the collateral and the receiving cash from the lender. The monetary base is termed in this article
as the commercial’s bank gold. Banks are in summary advised to uphold conservancy in their
underwriting standards. The unintended consequence of banks being conservative in their
underwriting standards leads to a solid financial position.
China and the Dollar
Anonymous. 26 March 2009. Retrieved From
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Exchange Rates
The author purposes to reflect on the problems faced by the dollar frequently referring to it as he
green buck. There are suggestions that the dollar should be replaced by an international monetary
system. The author says that the exchange rate has suffered since the Bretton Woods collapsed in
1971. The global economy has since tried to function with floating exchange rates whereby the
market has been setting the currency prices. With the currency exchange rates self-setting the
prices, adverse effects may lead to unmanageable prices of the foreign currencies and thus affect
the availability of such. The unintended consequence is that the self-pricing mechanism of the
money market affects the supply of money in the global economy. The supply of follow
determines the success of economic growth.