More Money, More Spending

Teenagers and the elderly are jumping for joy at the new advances made recently in the economy. Their annual wages were raised! People between sixteen and twenty-four saw a 5.5 percent raise in their paychecks while people aged fifty-five and older saw a 6.8 percent raise. People are now able to make more of a stable living in order to take care of their basic necessities without having to worry about always having to put aside a certain amount of money to meet their needs such as putting food in their mouths or pumping gas into their car so that they are able to have a way to get to their job every day.

With all of the paychecks rising, different departments of the economy saw a significant difference in their wages. One branch in particular puzzled economists: construction. Construction workers saw a 9.8 percent raise in their wages without even hiring more construction workers. My theory is that there were already a significant amount of construction workers, therefore eliminating the need to hire more. They work so hard and have on one of the hardest jobs with not enough money to show for all of the hard work that they do, so they fairly raised construction workers' wages. Because construction and other jobs similar to it have so many workers, the companies, most of the time, can not afford to pay them all a whole lot of money, so their paychecks never backed up how much time they spent working. Now, they have paychecks that prove how much and how hard they work on what they do.

Now that Americans have a few extra bucks left over after paying for food, gas, and all of the basic bills for their homes and such, they are able to do what they love most: splurge on themselves. Consumer rates are always high, so now that the customers actually have the money to buy more things that they want and not necessarily need, it will help the domestic economy grow. Businesses will continue to make more money so that they are able to keep growing.

Natural resources like oil are expensive. Because of the big drop in energy prices, Americans are able to spend their money on other things, which is similar to opportunity cost. Opportunity cost, in terms of resources, is the value of the best alternative sacrificed as compared to what actually takes place. Now that Americans do not have to spend so much money on energy and gas for their cars, they can buy clothes and other things they have always wanted. It's a real-life opportunity cost, in a way.

Minimum wage has not yet been raised, but yearly salaries have been, which is good for more of a long-term deal. A sixteen-year-old teenager working on their first job can get paid just as much as an older person, balancing the economy and making wages more fairly balanced. Now, when teenagers get ready to start working, they will have the promise of a higher wage to motivate them.

http://www.usnews.com/news/articles/2015/07/15/wages-rise-in-2nd-quarter-according-to-adp-workforce-vitality-index

Corporate Kings of America

Big monopolies are popping up everywhere due to a lack of government regulation on the companies. Merging companies has been an idea that is floating around now that may endanger the economy due to prices not being set in stone for customers. If the prices are too high, customers won't want to buy the products. If they are too low, the cost of transporting the items will be high, causing the company to lose money rather than gain profit, making it a lose-lose situation.

Big monopolies suck up so much money that they damage the economy and put customers at a disadvantage. Miller and Coors, two big beer companies, have merged. In the stores, their beer would be referred to as MillerCoors which would make it a monopoly. They could raise their prices and customers would not buy another brand because there would not be another brand. Before the merge, customers had two more types of beers to choose from, giving them more freedom to choose and they were able to walk out of the store satisfied with a six-pack of beers in hand. Now, since the two companies have merged and become one big company, if customers liked one beer over the other, they have no choice but to buy the MillerCoors beer because that is the only beer close to what they are used to buying, completely ruling out the other types of beer in the store.

I think monopolies can cause customers problems because, with the MillerCoors monopoly, they have nowhere else to buy beer and they are forced to spend crazy amounts of money for something they could have bought cheaper at another company or Miller and Coors separately. Customers are put in a position where they have to probably spend more money than they have on something that used to cost a lot less, but now that the company has transformed into a big powerful monopoly, their prices have to be higher so that they are able to afford to actually produce their product and put it in the stores for customers to have the chance to purchase.

Prices that are too high turn customers off, making them not want to buy the product at all. The customer is forced to think, "Do I want expensive beer that would have been cheaper somewhere else, or no beer at all?" if Miller or Coors happened to be their favorite beer separately. The customer would buy the beer because they probably taste the same, right, if they merged? 

Monopolies will be detrimental to the economy because they will run other smaller companies out of business, making customers buy their product, but the product will be outrageously expensive, turning customers off and hurting the company because they are not making the profit needed to pay for the cost of transportation and for the production of the product. Companies would be losing more money than what they are making and the economy will suffer because of it. 

http://www.economist.com/blogs/freeexchange/2015/08/trust-busting