Analyzing Articles in Journal in Economics - Essay Example

Article Source: http www.guardian.co.uk/world/2009/oct/01/imf-useconomicgrowth Oct, 2009 Word Count: 473 Article summary The International Monetary Fund has predicted a slow but sure economic recovery as developing countries are trying their best to end the steepest recession the world has witnessed since the world war. The world economic outlook has predicted a positive growth starting from 2010, with strong economic growth forecasted for China and India and a moderate growth in countries like Europe, America and Japan. Article analysis The IMF has projected a sure but slow economic recovery and revised its growth estimates for the remaining half of this year and for 2010. In its report during the World economic Outlook (WEO), the IMF, however, noted that the growth would be quite sluggish and it would not be able do much to prevent further unemployment across the globe. It also added a word of caution about credit crunches and lesser demands during the recovery period. A much better growth is forecast primarily for 2010 with an expansion of about 3.1%. The IMF forecast for Britain is a weaker growth in the remaining of 2009 and a 0.9% rate for 2010, three times more than the previously expected rate of 0.2%. Europe, North America and Japan are expected to show a moderate growth of 1.3% next year, while the largest growth rate has been predicted for China and India at 9% and 6.4% respectively. Thus Asia is been predicted to lead the economical growth from the front during 2010. However, unemployment is expected to remain on a high in most developing countries even next year especially in the US, Germany, France and Italy. The WEO has attributed this resurgence to strong public policies that have been initiated by many world economies together with the large cuts in interest rates by Central Banks. The IMF also warned against complacency as it would not do any good to improve the situation further. The current recovery has been attributed mainly to increased public spending and inventory adjustments and the IMF adds that a sustained recovery will require careful balancing of private and public demands and also between countries with large current accounts and those showing current account deficits. Opinion The article stresses that there will be a sure recovery and there will not any global economic meltdown as previously forecasted and adds that this road to recovery will have its own share of hurdles and only a proper balancing act between surplus and deficit economic countries will help to achieve complete recovery. There is also no forecast of an immediate improvement in unemployment rates due to the sluggish growth to recovery. A complacent attitude by governments due to the positive signs predicted for the next fiscal year will only take the economy to a backslide and hence governments should continue to introduce growth oriented public policies that would increase pubic spending which would aid in a more speedy recovery. Article 2 Source: http://money.cnn.com/2009/10/19/pf/college_costs/index.htm?postversion=2009102013 Date: 20 Oct, 2009 Word Count: 401 Article summary Education costs have become dearer in both public and private schools, making higher education quite inaccessible for those in the lower income group. Decrease in endowments for private schools and financial aids from the state for public schools have resulted in tuition fee hike. Educationists suggest that schools must increase the grant given to students from lower income groups to enable them continue their education. Analysis The current year has witnessed a 4.4% hike in tuition and fees at private schools and a 6% increase at public schools. The lesser endowments and state funding for private and public schools respectively has forced schools to hike the fees thus making higher education less affordable for those belonging to the lower income group. On the part of the household, the looming unemployment and pay cuts is making it harder for families to meet the rising costs of education. Schools have been offering grants for about two-thirds of their students, according to reports, but this still leaves a large number of students who are left to fund the entire cost of their education by themselves. And educationists further add that even those who get grants for their tuition fees might find it hard to meet their living costs. All this has resulted in a rise of student loans which has seen a 5% increase for the years 2007-2008 and 2008-2009. Educationists suggest the best way would be to cut costs and find means to get financial aid and more grants should be offered only to those students in the lower income group as according to a survey carried out during 2007-2008, in public schools grants are being given to students irrespective of their financial status. Thus increasing financial aid and proper utilization and channeling of funds for the needy students alone would help students to gain education. Opinion Rising education costs is a matter of great concern which needs to be resolved immediately as it could have an adverse affect on the educational future of children. Given the present economic crisis, higher educational costs would only result in students opting out of further studies, thus depriving themselves of the education that they might deserve. It is in the hands of educationists and government policy makers to make suitable provisions that would provide aid for the institutions and thereby enable more number of students, especially those belonging to the lower income group, continue their education. Article 3 Source: http://www.nytimes.com/2009/10/20/business/economy/20fed.html Date: 19 Oct, 2009 Word Count: 422 Article summary The chairman of the Federal Reserve, Bernanke, B.S, expressed his view that Asian countries were leading the road to global economic recovery and pulling the world back from the recession period. Asian countries especially China, had exhibited growth rates of more than 10% compared to US and other countries and added that US needs to regulate its finances and improve its national savings rate to help the country come out of recession. Analysis According to Bernanke, the chairman of the Federal Bank, Asia seems to be pulling the world out of the global economic recession as countries such as China are showing impressive growth rates which are contributing to expansion globally. Countries like the US on the other hand had not regulated its finances well enough and the trade imbalances both within the US and between other countries had played a key role for the start of the recession. He further added that by improving the national savings rate by gradually reducing federal deficits would help strengthen the economy. Also the US global trade and financial policies also need to be constantly monitored and regulated. On the other hand increasing asset prices in Asia together with stimulus policies, especially those of China are worrying investors owing to the potential dangers which these bubbles may introduce. And while the dollar has seen a sharp drop against the yen and euro, it has not been able to do so against the Chinese RMB. Thus more suitable policies and regulations need to be adopted in order to enable the world countries come out of the global recession. Opinion The Federal Reserve chairman has vehemently expressed his views on the situation in the Asian counties and that of the US when the recession is slowly receding. The US will have to strictly regulate its global trade policies so that such a slump in economy does not crop up again. Additionally it will also have to increase its national savings and make every effort to reduce its soaring federal deficits, which had crossed the trillion mark and soared to 1.4 trillion during the current fiscal year. The value of the US dollar has also not been able move against the Chinese RMB for more than a year now and this will also have to be monitored in order to improve American exports. Thus the situation does need a lot of good trade and financial regulatory policies to put the world countries which have been greatly hit by the recession back on the global economy track. Read More