Tag Archives: economy

Economic History Part VI: Oil Prices and the Economy, OPEC and Stagflation

Source A

There’s no denying that gas prices are on the rise and many are attributing it to the unrest in the Middle East and North Africa in countries such as Libya and Iran. These high prices are certainly disconcerting for most all as 90% of Americans say they usually drive to get to their destinations (Source B).

But are there broader implications for this phenomenon? What effect do oil prices and supply have on the U.S. economy?

In the early 1970s, OPEC—the Organization of Petroleum Exporting Countries—coordinated to reduce the supply of oil which effectively doubled the world price. The subsequent increase in oil prices caused stagflation in most industrial countries, including the United States (Source D).

OPEC Member Countries

Source C

Here are the effects of the change in oil prices on the inflation and unemployment rates in the United States:

Source D

The trends are readily apparent upon a scan of the above data. The 68% increase in oil prices in 1974 resulted in significantly higher inflation and unemployment. After these initial supply shocks, after the economy had stabilized itself, 1979-1981 saw further spikes in the price of oil which again led to double-digit inflation and unemployment.

It was thanks only to the weakening state of OPEC, due to political turmoil among the member countries, that oil supplies were freed up and stagflation was reversed (Source D). Oil prices dropped by 44.5% in 1986 and the United States experienced one of its lowest inflation rates ever as well as a decreased unemployment rate.

Nowadays, however, OPEC itself has less of an effect on economic fluctuations within the United States due to how we’ve shifted to a more service-based economy over the manufacturing basis of our past. This means that we’re going to have to experience greater increases in oil prices for there to be macroeconomic repercussions, but it definitely does seem as if we’re heading in that direction.

Click here for a purely monetary explanation of the stagflation of the 1970s (it’s a link to a NBER-hoted PDF file).


  1. Source A:
  2. Source B:
  3. Source C:
  4. Source D: Mankiw, Gregory. Macroeconomics.
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Posted by on April 8, 2011 in Economic History


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Bilateral Trade Balances: The China-U.S. Trade Deficit

In recent months, criticizing U.S. production capabilities and the Chinese government’s manipulation of its currency has become all the rage. Not to mention that there seems to be some merit to the growing concern over our seeming ineffectiveness to compete with China in manufacturing and other industries.

Here’s a quick graph of the U.S.-China monthly trade balance I put together on excel using government-supplied data:

Source of data.

This is an example of a bilateral trade balance. The U.S. bilateral trade balance with China equals our total exports to China minus Chinese imports that we bring in from the U.S.A. But bilateral trade balance doesn’t necessarily determine a nation’s saving and investment. What I mean by this is that while we might have a terrible trade deficit with China, it is the country’s overall trade balance which matters most.

Most economists believe that bilateral trade deficits receive more attention than they deserve from both a macro and micro perspective.

As Robert Solow of the Solow Model once said, “I have a chronic deficit with my barber, who doesn’t buy a darned thing from me.”

But for those who are interested in this particular bilateral trade balance, one of the ways in which China manages their competitive pricing which you may not have considered is the overall lower standard of living in China which then allows firms to pay their workers lower wages.

And then there’s the value of the dollar. China is now officially America’s biggest lender, which gives them some leverage. Hypothetically speaking, if China were to dump all of its holdings, we could expect our interest rate to shoot up. Once again, though this is entirely hypothetical, the Federal Reserve could intervene. Anything could happen. On the other side of the coin, however, if it came down to economic warfare, our sanctioning of their exports would prove detrimental for them as well.

But really, I was just having a little bit of fun with the last paragraph. I don’t envision this actually taking place, at least not any time soon.

With that said, let me close by saying that our bilateral trade deficit with China in particular doesn’t represent an unsuccessful relationship. Here is some evidence of why provided by the Trade Resource Center:

  • In a healthy and growing economy such as that of the United States, consumers simply have more money to buy more goods and services, including more imports. The trade deficit grows when our economy grows and shrinks when our economy shrinks.
  • At its most basic level, the bilateral trade deficit reflects a difference in U.S. consumer and Chinese consumer purchasing behavior and purchasing power. For example:
    • Most imports from China are inexpensive consumer products that no longer are manufactured in significant quantities in the United States, such as low-cost apparel, footwear, radios, televisions, toys, sporting equipment and consumer electronics. These are goods that U.S. consumers desire and purchase in large quantities.
    • Most Chinese imports from the United States are expensive, high-technology goods, such as semiconductors, computer software, aircraft and transport equipment, pharmaceuticals, and medical devices and services, but China is a developing country that cannot use or afford many of the products we export. The United States does sell large quantities of these products to other countries — accounting for our bilateral surplus with many countries — and exports of these products to China are growing.
  • In the first half of 2004, China had a global trade deficit. Despite its bilateral trade surplus with the United States, China is importing more than it is exporting overall.
  • In the 1980s, global assembly of low-cost consumer items shifted to China from other Asian economies such as South Korea, Hong Kong and Taiwan. Growing imports from China do not displace U.S. goods; they displace imports from other Asian economies.
  • U.S. consumers benefit from lower-priced imports. Increased tariffs on imports from China would result in higher costs for clothing, footwear and toys in the United States, which would weigh most heavily on working families.

What we need now is an increase in savings and investments within our country. In the short run, we’d be dealing with unemployment rates and in the long run, we’ll be closer to approaching the Golden Rule, which I’ll go into in one of my next few posts.

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Posted by on February 17, 2011 in Business/Technology


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The Financial Crisis of 2007-8

The following is a very crude and general overview of the Financial Crisis of 2007-8, which spurred on the recession the United States, and the rest of the world, is grappling with today. The idea behind this “report” is to break it down into terms such that anyone could understand it. Perhaps later I’ll go into the actual economics of it.

In order to grasp a firm understanding of the phenomenon that has been termed as the “Financial Crisis of 2007-08,” by some, one must look into the events precluding the recession which had begun in January of 2008 (Modjtahedi, p.3). Many of our current problems can be tied back to the splicing and dicing of risk which then extended to consumer lending in the form of asset-backed securities (Cecchetti, p.2). It is generally agreed upon that this trend began in 2000 with the rapid rise in home prices. In fact, these increases were higher than justified by fundamental values or replacement costs (Cecchetti, p.2). This post will discuss the economics of mortgage loans, the different banking models in the time of the crisis, the slicing and dicing of credit and asset securitization, the effects of the crisis itself, and finally, the macroeconomics of the crisis along with the policy options of the United States—and other international—governments.

To begin, mortgage loans are loans that people take out from financial institutions—lenders, such as banks—towards the purchase of a house. If the borrower defaults on the loan, any of the following may occur:

  1. The loan may become immediately due and payable.
  2. The loan may be turned over to a collection agency
  3. The borrower’s credit rating can be negatively affected.

It is important to note that if the borrower does not respond appropriately, the house may become forfeit and the property of the lender to do with as they please, the term for this being “foreclosure.”

As a result of the aforementioned housing boom, real estate rose and mortgage borrowing increased exponentially. At this time, the government had low restrictions on banks with regards to lending. It is important to note that mortgage brokers earn commission, so they have greater incentive to close a larger volume of deals. Lack of sufficient oversight and the financial prosperity of the time resulted in irresponsible loans. The banks would receive bonds from these loans after determining a term, generally 30 or 40 years, over which time the loan would be amortized (Modjtahedi, p.7).

In the wake of the Dotcom bust and the terrorist acts of September 11th, the Federal Reserve lowered interest rates down to a mere 1% to encourage investment spending and account for potential increases in aggregate demand. This encouraged borrowing money, as there arose an abundance in credit (Jarvis). Banks then used this credit to borrow money and amplify the outcomes of their deals, or “leverage” (Jarvis). With leverage, higher volumes of transactions were made possible. The process by which this occurred and the role these transactions had on the crisis is outlined in the following steps (Jarvis):

  1. A family saves money for a down payment.
  2. Mortgage broker connects family to a lender who gives them a mortgage, broker makes a commission.
  3. Family becomes homeowners. Have positive prospects because house values have been on the rise.
  4. Investment bankers buy these mortgages from the mortgage lenders, doing this in vast quantities.
  5. Homeowners’ payments then go to these investment bankers.
  6. Investment bankers then create collateralized debt obligations (CDO).
    1. CDO’s are divided up into three troughs based on level of risk.
  7. These slices were then sold and the investment bankers repaid their loans.
  8. With time, most of the potential homeowners who actually qualified for loans already had one, and so spawned some of the unsafe lending practices mentioned before; irresponsible people—or those unable to pay off their loans—were lent money.
  9. Foreclosures occurred, loans were not repaid, debts were not cleared, and the financial system collapsed.

Initially, before people caught on to the realities of the situation, it seemed that no one had actually carefully considered the following flaw in this system: where would the money come from? No one was worried because as soon as one party sold off the mortgage to another, it was no longer their concern. The monthly payments which were meant to go to the investment bankers disappeared, with houses serving as the collateral. These houses were then put on the market to be sold. As this process continued, the housing supply substantially increased and demand shrunk. All of this resulted in the plummeting of housing prices. Once housing prices dropped, people stopped paying because their mortgages cost more than their homes were worth, more people walked away from their houses, prices continued to plummet, and the trend continued.

Keeping this process in mind, let us return to the different kinds of mortgages. There are fixed rate mortgages where the rate taken out stays constant despite market fluctuation. The borrower will repay the debt in equal monthly payments over a period of time, and during the first years of the loan, the money paid goes toward paying off the interest on the loan. The advantages to such a mortgage are the security and consistent payments that accompany it. If overall rates decrease, however, you will still be paying the same amount. Adjustable rate mortgages are such that the interest rate can change based on the market. The rate can increase or decrease depending on the rate agrees d upon. With adjustable rates, some of the risk is transferred to the borrower because the rate could suddenly go up. It is essential that borrowers think critically about the pros and cons to each mortgage type before they take out loans.

Another important concept to consider is the loan-to-value, or LTV, ratio. This is the ratio of the total outstanding loan to the value of the house. There is actually a percentage calculated by dividing the amount borrowed by the price or appraised value of the home to be purchased; the higher the LTV, the less cash a borrower is required to pay as a down payment. Lenders obviously prefer lower LTV ratios and higher equity ratios due to the consideration of moral-hazard (Modjtahedi).

Equity is equal to the market value of house minus the outstanding loan.  It is essentially the amount the home owner actually owns of the house.  For example if your house is worth $100,000, and you owe $70,000, then you have $30,000 in equity.  A borrower can have positive, zero, or negative equity.  Negative equity is when the price of the house falls below the outstanding loan.  Now the borrower would have to pay more on the loan then what the house is worth.

For a person with positive equity, it is not favorable for them to default on their house.  It is in fact advantageous for the borrower to make a profit by keeping the house, paying off the mortgage, and selling it for a higher price then they originally bought it for.

Negative equity, however, is a “necessary but not sufficient” reason to default on loan.  If the borrower decides to default on the mortgage and walk out on the house, the borrower could save money because they owe more than the house is worth in mortgage payments.  The borrower at this time would not want to sell house at negative equity because no profit would be made and they still owe the bank money for the remaining mortgage payments.  Therefore, foreclosures increase when house prices fall because negative equity increases.

There are many reasons not to default and continue paying mortgage as well.  First of all, and perhaps most importantly in the long run, defaulting on a house would result in the borrower gaining bad credit.  Having bad credit would make it harder to borrow money in the future because banks see you as a higher risk.  Secondly, there is no penalty in waiting to see if the market will improve, and if it doesn’t, the owner can always default later.  Thirdly, the homeowner would still require a place to live.  If they default on their house they are going to have to pay additional money to rent an apartment or even try and find cheaper house.  Moving is an expense that should be avoided when possible.  Finally, for many people there houses have a lot of sentimental value you to them.  It might be worth it to some home owner to continue to paying the mortgage in order to keep the house they consider to be their “home.”

Negative equity is not just bad for the homeowner, but for the lender and community as well.  When a person defaults on their house the bank—the lender—will collect the house as collateral.  When they end up with too many foreclosed houses and have to sell the house at reduced price.  This in turn lowers housing prices in the neighborhoods, forcing more home owners in to negative equity and causing even more foreclosures.  When this happens it is referred to as a deflation spiral.

The originate-and-hold banking system is the original banking system.  This system was very simple and straightforward and also included less people.  In this banking system there are the depositors, the bank, and mortgage borrowers.  Depositors are people who put money into banks.  These deposits are usually relatively small, short term deposits.  People put their money into banks in order to save and receive interest on their deposits.  The banks, in return, take the depositor’s money and lend it out to the mortgage borrowers as loans.  The mortgage borrows in return give the bank a bond.  A bond is basically an “I owe you.” It is a contract by which the borrower agrees to pay back the loan, and with it a set interest.  The contract usually also states that if the mortgage is not fully amortized, or paid off, by the given period, the bank will take over their property. The borrower pays back the principal, the amount borrowed, and interest on the principal payment.

Adverse Selection is a problem with this banking system that occurs before transactions.  The banks are at a disadvantage because borrowers could have poor credit and be a high risk but they won’t tell the banks that, therefore the banks are at risk of the borrower defaulting.  In order to help prevent this, banks will to do background checks on the home owners to see if they have poor credit. Another way to help prevent the home owner from defaulting if to have the owner put down a down payment on the house.  This prevents the home owner from being a “moral hazard.”  The home owner has money invested in the house and is less likely to walk out on the house and is more likely to keep it up.

Maturity mismatch is another problem with the originate and hold banking system Because depositors are usually short term deposits while loans, especially mortgage loans can last up to 40 years.  If a lot of depositors decided that they wanted to take money out of the bank, then the bank would not have their money because it is tied up in long term loans that have not yet been paid back.  And reversely, if many people want to get a loan, the bank may not have enough money from deposits to fund the loans.  They are also unable to raise interest on loans because of regulation from the government. This is referred to as an “inelastic source of funds.”

Originate and distribute, the current banking system used today, is much more complex than the originate and hold system.  This second banking system still involves depositors, a bank, and mortgage borrowers the way that the originate and hold model does. However, the system also involves, as the name suggests, originators.  These institutes give home owners a loan and in return receive a mortgage bond from the borrower.  The originator then sells that same bond to a bank and receives a profit on the sale in addition to the origination fees they earn from the borrower. The reason the bank will pay more for the bond is that the bond is likely to increase in value over the years and also the bank will receive interest on the loan.  Now that the bank is in control of the bond, the mortgage borrower will pay back the principal and interest to the bank, not the originator.  In this way the originator has effectively taken themselves out of the loop. Because of this, the originators do not have as much incentive to do background checks and check the borrower’s credit.  This causes a major problem because the banks could be purchasing bonds from originators in which the borrower of that bond is a moral hazard.

One of the big problems that occurred with this type of banking system was that originators encouraged low income, high risk homebuyers to take out mortgages.  Then when these borrowers defaulted it was not a problem to the originator because they did not hold the bond. Instead, the banks lost money because they were the holders of the borrowers bonds.

Recall the decline in the value of homes as the supply of houses increased and demand subsequently fell. One amplification mechanism that operated during this liquidity crises works through asset prices and balance sheets (Krishnamurthy, p.2). Balance sheets are deteriorated when prices are lowered which comes about as a result of negative shocks of asset-holders (Krishnamurthy, p.2). To counter this, the Federal Reserve actively purchased mortgage-backed securities, essentially taking the “bad” loans and mortgages out of others’ hands to help alleviate the strains on the market (Krishnamurthy, p.13). Another strategy they have utilized is their offerings to finance the asset holdings of commercial and investment banks at margin requirements far lower than is offered in private-sector transactions (Krishnamurthy, p.13).

The lack of knowledge and uncertainty during the recent crisis served as a significant amplification mechanism (Krishnamurthy, p.17). As was mentioned before, mortgage brokers, financial intermediaries, and essentially everyone involved in the system practiced unsafe lending practices, classifying certain, and relatively risky credit structures as AAA (Krishnamurthy, p.17). When these tranches suffered losses and people defaulted on their loans, people did not know how to react, for these were supposed to be the safest of investments. All of this created an atmosphere of uncertainty, paralyzing many into inaction, devastating the private sector.

While the roots of the crisis may be firmly planted in United States soil, the repercussions already have impacted the economy on a global scale because of all of the foreign investment. It is important to remember that people and institutions from around the world purchased these mortgages and CMO’s. Paul Volcker, former Chairman of the Federal Reserve and the current chairman of the Economic Recovery Advisory Board said that the crisis that began in the U.S. housing market has become a global problem that requires a global solution (Policy Options, p.5). In response, many countries have provided public capital to financial institutions with guarantees on their liabilities (Shirakawa, p.5). The United States, along with Germany and several other countries, have instigated economic stimulus packages designed to stave off some of the destruction, though these actions are not always enough to counteract the downturns as Germany’s output is still projected to fall by 2.5% in 2009 (Andersen).

The Federal Reserve itself “has responded aggressively to the financial crisis since its emergence in the summer of 2007” (Federal Reserve).  The Reserve has instigated a cut in the discount rate as early as September of 2007, prodding an increase in investment rather than savings, increasing aggregate demand and GDP (Federal Reserve). As the crisis continued and matters intensified, the Committee “responded by cutting the target for the federal funds rate” (Federal Reserve). It has also provided liquidity to the private sector in order to support the functioning of credit markets and reduce financial strains (Federal Reserve). It has become the responsibility of all nations to combat the repercussions of the crisis and promote global economic recovery. International cooperation is essential to achieving sustained recovery.

This video is an absolute must if this topic is of any interest to you:

By Edris and Louise Marquino

Works Cited

Modjtahedi, Bagher. Sept. 2009. “Financial Crisis of 2007-09: Causes, Consequences, and Policy Options.” Dec. 2009.

Cecchetti, Stephen G. April 2008. “Monetary Policy and the Financial Crisis of 2007-2008.” Centre for Economic Policy Research.    Dec. 2009.


Jarvis, Jonathan. The Crisis of Credit Visualized: The Short and Simple Story of the Credit Crisis. Video. March 2009.  <;.

Krishnamurthy, Arvind. “Amplification Mechanisms in Liquidity Crises.” June 2009. National Bureau of Economic Research. Dec. 2009. <;.

“Policy Options for Global Financial Crisis.” Jan. 2009. Lee Kuan Yew School of Public Policy. Dec.          2009. <;.

Shirakawa, Masaaki. “International Policy Response to Financial Crises.” Aug. 2009. Bank of Japan. Dec. 2009.             <;.

Andersen, Camilla. “Germany Faces Extended Downturn Despite Stimulus.” Jan. 2009. International Monetary Fund. Dec. 2009.  <;.

“The Federal Reserve’s response to the crisis.” Nov. 2009. Board of Governors of the Federal Reserve System. Dec. 2009. <

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Posted by on January 7, 2011 in Business/Technology


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Fifa World Cup Decisions & Significance

Almost exactly two weeks ago, live from Zurich, FIFA announced the host countries for the 2018 and 2022 World Cups. These announcements came after impressive presentations made by each of the bidding teams:

Russia 2018’s Ready to Inspire campaign’s central selling point was that they, of all the different parties, had the most to offer the world: “I have given a lot of presentations recently, but never one as important as this. Important to so many people and for all the right reasons,” opened Alexey Sorokin, CEO of Russia’s 2018 Bid Committee, “We can show you what you cannot find in our bid books, we can show you what‘s in our hearts…This morning we have just 30 minutes to share with you the collective passion and pride of 145 million Russians who would like nothing more than to welcome the Fifa World Cup to our home for the first time in history. History, and the making of it, is a powerful theme in our bid…Our bid and our vision is about opportunity for Russia and opportunity for Fifa—for Russia, these opportunities are clear. For Fifa, these opportunities include new markets, new stadiums, new players and fans, and an assurance of an impeccably hosted tournament…”

It was clear from early on in their presentation that Russia was bringing some of their biggest guns to bear in this bid as some of their most culturally relevant stars were present, including a vital Andrey Arshavin—their national team captain—Yelena Isinbayeva, a two-time Olympic gold medalist pole vaulter, opera stars, etc.  Isinbayeva’s delivery in her speech, in my opinion, was very weak, but her message of how much Fifa has positively empowered female athletes, and how the organization can continue to make a difference here, must have rang true to the decision makers.

Their first video featured a young soccer player dreaming of playing in the World Cup while the audio boomed an inspiring, “Russia Never Sleeps!” frequently throughout the duration of the promo.

Their technical video, The Jewels of Russia, was hosted and narrated by a stunning woman whose identity, despite some Googling, leaves her nameless for now.

“It is true that if awarded the 2018 World Cup, Russia has much to do, but the reality is that most of the infrastructure development is already planned and budgeted for and the World Cup will just accelerate this development,” said Alexey as he went on to outline the four cluster plan they have for their stadiums, centrally planned around the Russian capital of Moscow. Their plans for accommodating the inevitably huge surge in fans are impressive and those with match tickets were guaranteed free inter-country transportation between the 13 hosting cities.


Russia's Four Cluster Plan

Why should Russia be chosen to host the 2018 World Cup? (according to their Deputy Prime Minister).

  1. Would bridge the east and the west.
  2. Russia represents a huge region of the world which has never hosted the World Cup, whereas Western Europe has hosted numerous times.
  3. An opportunity to overcome the negative stereotpyes Russia faces.
  4. Inspire the youth of Russia and promote gender equality.
  5. Promote social and economic development on a global scale.
  6. Will open the nation to the entire world.
  7. Politically a very stable country.
  8. Have the financial resources to follow through on all their guarantees.
  9. Will be a better partner than Fifa has ever had in hosting the World Cup.
  10. “Let us make history together!”

Welcome to Russia, fellow futbol fans! Let’s make the best of it.

Needless to say, there remains much anger and dissent amongst those in support of England’s failing bid as they have not hosted the World Cup in 44 years despite how it is where soccer, as we know it today, was “invented.”

But as our wise friend, Jay-Z once said, “On to the next one.”

2022 World Cup Host: Qatar

Well it looks like for once the United States was, in the end, defeated by the Middle East despite the best efforts of Bill Clinton, Morgan Freeman, Landon Donovan, and Attorney General Eric Holder (not to mention a video appearance by Obama).

The US was thought to be the favorites and performed well with a strong bid, but perhaps it was one of their main selling points which backfired on them? Yes, we are the most diverse country in the world, there’s nothing negative to be said about that. We also would not have required any significant changes to our infrastructure to host the cup, but perhaps this was not looked upon favorably? Wherever the World Cup goes, it is believed that progress, construction, and an economic surge will follow. Could this have been one of the factors leading into the committees’ selection of Qatar? Probably not, but it’s a thought.


Unsurprisingly, Qatar was listed among the “12 More Countries You’ve Never Heard of And The People That Live There,” post on The website’s rich and informative description of the country tells us all we need to know about Qatar:

“Qatar is owned by one really rich Arab dude that likes to stage bicycle races every day for his personal amusement.”

Well that about sums the country up, but just for you nerds who aren’t satisfied with that flash of brilliance, here’s a little more insight into the State of Qatar. According to several different web sources, Qatar is a Constitutional Monarchy where the Emir (Chief of State) Amir Hamad bin Khalifa Al-Thani holds the power to name prime ministers and such though the title/rank of emir is hereditary. There’s a messy but interesting history here where they used to be a British protectorate state and how they battled Saudi Arabia and played a role in the 1991 Persian Gulf War, but I won’t go into all of that, but promise me you’ll get around to it before 2022.

But to be clear, Qatar is a much more progressive country than many would think. Many would wrongly assume that because of how the country’s legal system is based on a combination of Islamic and civil law codes, that the country would be rife with inequality between genders and that there would be severe government censorship, when this is not the case. Yes, the television and radio broadcast media are state controlled, but around 1999, the emir lifted press censorship, took steps towards instituting democratic elections, and pushed for woman’s suffrage. It’s 2005 constitution guarantees freedom of expression, assembly, and religion with 30 of the seats within their 45-seat parliament will be decided upon democratically.

This is not to say, however, that Qatar is not without its problems. In fact, I expect that many organizations will rise to oppose this decision—if they haven’t already—due to reports of trafficking and sexual abuse. The country is said to have taken significant steps to tackle this issue, and hopefully the looming date of the cup will speed up the process.

One interesting aspect of all of this is how the expected numbers of fans expected to flood the country’s gates in 2022 will far exceed the entirety of the state’s population of less than 850,000 people. This will surely be interesting to see.

Did you know that Qatar’s team has never even qualified for the World Cup? Well, don’t worry, because the hosting country is guaranteed a slot. Perhaps they will join forces with South Africa to become the second hosting nation to never make it past the first round of the tournament? But I hope this isn’t the case. In my opinion, the World Cup is always a more pleasant experience for everyone when the hosting team fares decently in the grand scheme of things. I remember how watching South Africa get knocked out of the most recent cup was kind of a buzzkill for most people.

What excites me most is the new technology Qatar unveiled in their bid. The stadiums to be built for the cup will mostly be powered by sunlight! Not to mention the climate-control systems they will use to keep the stadiums at decent temperatures despite the blistering heat that is sure to pester the unfortunates not within the structures. But those without the stadium won’t be without their benefits either. To see what I’m talking about, go through the below pictures and then watch the video:

To my surprise, I found many reports online asserting that despite the billions of dollars of corporate sponsorship and additional monetary wealth expected to be brought to the region which is hosting the event, that they can overall be expected to lose billions. Despite these reports, I can’t wait to see what the future holds for Russia, Qatar, and the rest of the world in the years to come.

“You will be proud of us, you will be proud of the Middle East, and I promise you this,” said one of the delegates from Qatar.


Check out Qatar Foundation’s multimillion dollar deal with FC Barcelona.

Video of Russia & Qatar Winning their Bids.

Video of Entire Russian Bid.


2018 World Cup

2022 World Cup








South Korea


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Posted by on December 15, 2010 in Business/Technology, Recreational


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Let’s Laugh Through Our Misery

You know your audience consists primarily of college kids when your view count drops to single digits during finals week.

But check out these cartoons on your study break for a few laughs 🙂

If you’re a computer programmer, check out these jokes.

If you still haven’t heard about Ireland’s newest declaration of war, click here!

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Posted by on December 5, 2010 in Recreational


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Signs of a Failing Economy

Got this forwarded to me a long time ago. Just saw it again a couple minutes ago and thought I’d share 🙂

The Economy is so bad that:

-I got a pre-declined credit card in the mail.

-I ordered a burger at McDonald’s and the kid behind the counter asked, “Can you afford fries with that?”

-CEO’s are now playing miniature golf.

-If the bank returns your check marked Insufficient Funds,” you call them and ask if they meant you or them.

-Hot Wheels and Matchbox stocks are trading higher than GM.

-McDonald’s is selling the 1/4 ouncer.

-Parents in Beverly Hills fired their nannies and learned their children’s names.

-A truckload of Americans was caught sneaking into Mexico .

-Motel Six won’t leave the light on anymore.

The Mafia is laying off judges.

-Exxon-Mobil laid off 25 Congressmen.

-Congress says they are looking into this Bernard Madoff scandal. Oh Great!! The guy who made $50 Billion disappear is being investigated by the people who made $1.5 Trillion disappear!

-And, finally

I was so depressed last night thinking about the economy, wars, jobs, my savings, Social Security, retirement funds, etc., I called the Suicide Lifeline. I got a call center in Pakistan , and when I told them I was suicidal, they got all excited, and asked if I could drive a truck!


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Posted by on December 1, 2010 in Recreational


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Demystifying Black Friday

You wipe the sweat from your brow and take deep breaths to slow your heart rate—when suddenly—you spot what you’ve been looking for! You take a step forward to claim your prize but you notice a heavyset man galloping towards what’s rightly yours with his even larger son in tow. After some quick thinking, you decide that a new Sony Cyber-shot digital camera at a 10% discount might not be worth the trouble after all. Shamefacedly, you leave the store with your tail in between your legs and the stench of failure all around you. Black Friday is no joke. If you read this article thoroughly, maybe you’ll avoid being like this loser, so drop your food for a quick second and pay attention.

But first, what exactly is Black Friday? Black Friday is the day after Thanksgiving Day each year which marks the beginning of holiday shopping. Traditionally, retailers offer discounts and special deals sweet-sounding enough such that many stores open up the next morning to find anywhere from dozens to hundreds of people waiting anxiously outside. Different stores have different opening times, though in my experience, most open between 4-6am.

Make no mistake, this is not an event you take your great grandmother to unless you think she can handle herself in similar situations, like the San Francisco Quake of 1989. Yes, that’s definitely an exaggeration, but no joke, it gets serious. Just two years ago in 2008, a Wal-Mart worker was trampled to death in the opening moments of the event. And I might be misremembering here, but I’m pretty sure most people present didn’t really give a damn until their consciences pulled through in the aftermath.

But anyways, back to November 26th, 2010: for those of us brave enough to weather the…well…weather, I suppose…and the masses of likeminded crazies, listen up. Approach Black Friday like you would a war. Depending on your strategy/goal(s), each store (or each item IN the store) is an individual battle, and you would do well to come up with some plan of action beforehand so you’re not running into hostile territory blind.

But before you go texting your friends and googling for great deals, take the following into consideration:

  1. The retailers are not your friends. Never forget that they are ultimately a business which needs to maximize profits. It’s even in the name, Black Friday, where black represents the retailers going into the black (which means that they are turning profitable).
  2. The retailers will lure you into their stores by offering discounts on some of the goods, but they make their money from the other items which are, in fact, not discounted at all, but sometimes overpriced.
    1. The basic lesson here is that you should keep an eye out for the discounted items first and foremost. You can always come back for those $60 jeans later.
    2. If you pick out an advertised $600 television including tax, for example, and your total bill comes out to $850 for unknown reasons, make sure to insist on the advertised price. It’s a funny idea, but you can also always threaten to write a letter to the attorney general.
  3. Accessories are often not discounted. You might end up coming out of the store with way less money than you expected. Just be aware of what you’re actually purchasing.
    1. Example: iPod (discounted).
      1. Accessories: iPod clip, iTrip, iGriffin, Skullcandies, etc.
  4. Don’t buy things on credit unless there’s no real interest fee to worry about or if it somehow stacks up as better than your credit card.
  5. Keep an eye out for the reject/overstocked items they’re just trying to get rid of.
  6. Stay focused. Once again, this is battle and they are not your friends. Few battles are won without focus.
  7. If you wanna be really hardcore about it and you know what you want and other people know what they want, you should shop in teams! I kind of did this last Black Friday with one of my closest friends.
  8. Do your research.
    1. The retailers often leak their special deals early.
    2. Surf the web, you’ll find it everywhere.
    3. Check out the local newspaper the day of or the day before.
    4. Check out the Black Friday App from for an example of what the apps for this event are like.

Good, you already know more than the typical Black Friday enthusiast. Below are a few deals I found simply by looking up the major retailers:

A.      Target

B.      Wal-Mart

C.      OfficeMax

D.       Apple

E.       Macy’s

F.       Gamestop

What I found to be interesting were the new tactics made by some retailers to open their doors even earlier than in the past. Toys”R”Us, for example, will be opening in some locations at 10pm on Thanksgiving (Thursday night). I can’t wait to see whether this was a good bet on their part.

If you’ve made it this far, thanks for reading and have a great Thanksgiving Day (don’t try to fight the serotonin)! And don’t forget to get a good night’s rest.

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Posted by on November 25, 2010 in Business/Technology


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