Analysis of Economic Articles - Essay Example

Replies to 12 Summary Questions Torello, Alessandro. “Cheap U.S. Gas Is Europe’s Loss.” Wall Street Journal, 24 October 2012, Web. 29 November 2012. 1. One strongly believes that EU should definitely explore its shale gas potential in such a way that its recovery and sale would be competitive in terms of prices in the world market. As noted, the prices of shale gas in the United States and in other Asian countries are more competitive and cheaper than those sources from EU countries. Therefore, by thinking of strategies that would inevitably lessen recovery, processing and marketing costs, shale gas prices would considerably lessen. The repercussion of more efficient utilization of resources towards the production and marketing of shale gas would benefit the economy in terms of revenues from exporting it to other countries that look for cheaper sources of energy. 2. If chemical companies set their plants in the U.S., the more that production and marketing costs could be minimized, especially if the target market is within the U.S. or nearby countries. In so doing, there is a possibility that trade relationships between the U.S. and EU with regards to shale gas or other alternative energy sources would be minimized. Looking at this perspective, it would be more beneficial to the U.S. since shale prices would be significantly minimized; while this would be detrimental to the EU for diminishing trade and export to US markets. 3. The boom of production of natural gas in the US is seen to negatively impact EU, especially those countries identified to previous export shale gas to the US market. With more chemical companies opting to explore the potentials in the US, the EU economy could be foreseen to worsen due to the negative impact of lesser exports and potential reliance or dependence on the Russians as supplier of natural gas (Torello). Washington, R.A. "Slower and slower." 9 October 2012. The Economist. 29 November 2012 1. The current status of the U.S. economy significantly affects global trade in terms of contributing to increases in exports or imports, as continually affected by external forces. As such, it was evident in the article that the U.S. economy is not the contributory steering force that shapes the global economy, but rather, economic developments in both China and South Korea could be the dominant influencing factor. 2. The role of the Federal Bank in the U.S. in enhancing economic growth and allowing country developments remains paramount through the provision of financial support that is instrumental for global trade. As noted, governments and financial institutions play a significant role through providing credit, appropriate investment rates, and other financial support for industries, private and public organizations that aim to expand offering their products to the global market. Effective fiscal policies and monitoring mechanisms to check and balance sources and uses of funds would assist in determining the extent of which funding could be provided to various organizations. 3. Some of the corrective measures to boost the global economy include avoiding protectionism, encouraging global trade, create more jobs, and being more vigilant in fiscal and economic policies that would support potentials for growth (Aigner-Treworgy and Lothian). Likewise, the authors noted that as suggested by President Obama, there is a need to support and collaborate through enjoining other world leaders to think of innovative ways to bail out troubled economies. As each developed nation has evidently proven that the economic condition in the domestic market significantly affects other international markets, then, boosting the global economy necessitates participative and collaborative efforts of leaders towards economic recovery and growth. Takada, Aya, and Yuriy Humber. "Japan Wants Free Trade. Its Farmers Dont." Businesweek Bloomberg, 2 August 2012. Web. 29 November 2012. 1. If Japan wants to be involved in the Trans-Pacific Partnership (TPP) trade deal, the overall economy is supposed to benefit from free trade. However, as contended by agricultural farmers, free trade would negatively impact on their sector as free trade would allow a barrage of agricultural products from neighboring countries which could be relatively cheaper than what their country currently produces. 2. A reduction in tariff and the lowering of entry barriers would make competition in the domestic market tougher due to the availability of products from the international markets which could be relatively cheaper. When there is increased competition, the countries that could offer cheaper products due to economies of scale would benefit more; and governments could also benefit from taxes imposed for products being sold in the markets. But more than these, it is the consumers who could benefit more with the availability and access to more choices of products where the consumers could select those that are relatively cheaper than the products offered in the domestic market. 3. From an economic standpoint, Japan could actually open up its shores for trade with caution and identification on which sectors could be remain protected for the long-term good of the economy. However, using the experiences of countries that opened its doors to global trade, it was apparently evident that greater potentials for economic growth are accorded with this move. Likewise, Japan must design strategies that would make their products more marketable in the global sphere as a means to generate more revenues and spur further economic growth. Tracy, R. “U.S. to Hit China With Solar-Panel Tariffs.” The Wall Street Journal. 8 November 2012. Web. 29 November 2012. 1. According to the news article written by James Areddy, it was revealed that the US panel solar energy captures three (3) percent market share in 2011 (Areddy). The tariifs would generate an inelastic response; meaning, if prices are perceived to increase due to the tariffs, then, consumers would look for other solar panels which are more competitive and could deliver the same benefits. 2. In theory, one could interpret that the mere fact that tariffs are imposed means that oversupply of the solar panels in the American market at relatively cheaper prices are detrimental to the American worker. By damping excessive supply of solar panels from China (where they could afford to offer these low prices due to lower labor prices) would mean that solar panels produced by American workers would not be marketable due to the significantly higher prices. As such, this situation could endanger the employment status of current solar panel workers in the USA since higher prices could mean lesser buyers and could evidently result to job losses or closure of the manufacturing plants for solar panels in the US. 3. If violations of the trade agreements between China and the US continue to persist, then, most likely, the World Trade Organization would assist in mediating and resolving conflicts that could not be resolved by both parties alone. As such, it seems that there could be potential retaliations from China, if not directly from the solar panel industry, in other products being marketed to the US and vice versa. In this case, all the more that the World Trade Organization should evaluate the pros and cons of the arguments and stipulate a middle ground that would benefit both parties, the manufacturers of solar panels in the United States, as well as the end consumers who could be significantly affected by the impending conflict. Works Cited Aigner-Treworgy, Adam and Dan Lothian. "G-20 nations must do whats necessary to boost world economy, Obama says." 19 June 2012. CNN. 29 November 2012 Areddy, James. "Booming US solar panel industry captures 3% market share ." 25 May 2012. The Hockey Schtick. 29 November 2012 Takada, Aya, and Yuriy Humber. "Japan Wants Free Trade. Its Farmers Dont." Businesweek Bloomberg, 2 August 2012. Web. 29 November 2012. Tracy, R. “U.S. to Hit China With Solar-Panel Tariffs.” The Wall Street Journal. 8 November 2012. Web. 29 November 2012. Torello, Alessandro. "Cheap U.S. Gas Is Europes Loss." 24 October 2012. The Wall Street Journal. 29 November 2012 Washington, R.A. "Slower and slower." 9 October 2012. The Economist. 29 November 2012 Read More