Thursday, May 26, 2011

World Economies Ranking

The world economies ranking are done as a way of showing how the economy in different countries are doing. There are several variables that are looked at for this to be determined. The comparisons are done by looking at all the underlying parameters that are then converted into dollar amounts. In many cases, this is done to help in things like the currency conversions.

There are countries that are ranked by looking at their gross domestic product and these are the value of the goods and services that are produced within the country. This is within a certain year and the information is very useful when making generalized differences. These are things liking the living standards of the citizens of that country. The use of the purchasing power parity (PPP) is one of the most common methods for doing this. It takes in account things like the inflation rate and the living standards. This is different from other methods that use only the exchange rates which may not be able to show the differences that are there in the income of the people.

An economy can be able to self adjust itself with time because there may be so many things going on at a time. There are many surveys that are taken at international level to show these comparisons and the results are among the things that are used in the PPP calculations. They are used in an attempt to estimate different things. On many occasions, the countries appear as a result of the GDP comparisons and they can be ranked based on all the economic indicators that are there. There are several organizations that use common indicators to determine this. They measure the results over time before they can rank the economy of a particular place. Every year, there are different countries that come up because the economy in many places is randomly changing.

As per now, some of the countries that have been ranked to be at the top are countries like the united states, china, Japan, India, Germany and France. All the estimates that are found are divided by the total population of the country and the list from different organizations that do this may differ by a negligible margin which is expected. The opportunities that are available that allow business to take place in a country can also be used to carry out the ranking. There are some countries that have really improved in their rankings with time and some of the things that boost this chances is where there are so many different opportunities to do business in the country. Several years in future, this countries can do so well.

World economies ranking can also be seen in terms of the foreign currency that is available within the central bank of that particular country. These can be in terms of several strong currencies. These reserves can determine the charts when the countries are being ranked. Other indicators that are also used are things like corruption, foreign investments, balance of trade and inflation.

The Canadian Economy

What makes the Canadian economy to be unique? While there are so many different countries that have been struggling a long time, the Canadian economy has been well prepared for so many things. Their financial systems along with the health care were able to withstand the recession. Even with other places still recovering, there is so much that this country has to offer this cannot be said about other economies. It has been the subject of so many different organizations and they do not look at the face value. They have to look at all the things that enabled it to work even after all the other places things were failing. They also have to look at the planning and the strategies that were there they allowed it to work. The sectors that also allowed it to survive and were the strongest are also checked.

The GDP has grown by about two percent. This is because of the development of different industries that were able to inject some stimulus. Some experts have seen that the growth will continue if such trends continue then within the next five years there is a lot of difference that will be seen. Such trends are the ones that make the markets to remain strong even when things are shaken up a little. There is the chance for double dipping where the private equity investors have been postponing their plans because they believe that the market is very flexible. It means that many people are planning just in case things get worse they have some back up plan so to speak.

There are several ways that the country can continue to increase the progress that they are making. From the year two thousand and eight, there have been buy out investments that are worth about nine billion. This is a great increase from what was there before which was about two billion dollars. The economists have analyzed that things have continued to be very positive and they will continue to be so for the time to come. There is still going to be a period where things are still going to continue growing and there are boundless capacities where these can happen. In a long term outlook, there are so many benefits that this could bring.

The governments together with the private sector have had to put several stimulus packages and this has seen all the plans falling into place. Opinions that have been taken have shown that the consumer still continues to remain confident that things will become even better as the days go by. Even as the counties population continues to grow at the rate of one percent per annum.

Other things that make the Canadian economy to be different is that even the per capita has grown. There are more people that are coming into that country to invest. The living standards of people has started going up to even better ways. These with the continued optimisms of the citizens and those people that have made the market to be better have really helped a lot.

Wednesday, May 25, 2011

Stages Of Economic Growth

Understanding the stages of economic growth begins by examining them thoroughly. The stages are made from the natural growth that free markets realize by systematically allocating their resources to their most optimal economic purpose. Shifts in public policy are the reasons that stages materialize in the first place. The incentives that new policies bring make it possible for investors to make more money than the economy usually dictates. The stages we are referring to are the bubble, peak, bust, decline, trough, and then finally, recovery. Every one of these six stages play a vital role in the economy and warrants a detailed examination.

The Bubble
A Bubble is a phenomenon that dictates the price homes or stocks will rise a lot higher than justified by the underlying fundamentals of the product. Bubbles in the stock market frequently are driven by companies that buy on speculations which have not made a profit yet, but are anticipated to grow quickly in the very near future. With real estate, the bubbles are usually driven by changes in financial policies that make it simpler for people to get financing, which results in a lot more buyers, thus higher prices.

The Peak

Bubbles can only get so big, and when they max out that means the market has reached its peak. These peaks really are difficult to predict and become apparent only when looked upon in hindsight. The way in which they usually come about is when part time investors catch wind about all the superb profits that are realized by others and decide to finally buy their way into a particular market.

The Bust
Bubble markets in time will rise up to peak, and there is usually some kind of trigger event which will initiate a sell off. It may be an earnings report that disappoints, or news of political unrest which may disrupt energy or food prices.

The Decline
When this cycle of the market hits, many players come to see the assets that they bought are not worth the market prices at that time. It becomes clear that the new stock will not reach the profits that were expected, and that plays out with sell-offs among the investors who simply cannot afford carrying the asset forever without selling it.

The Trough
When the values reach a point low enough that investors will be willing to face the risks of any losses for the chance to get upside gains, a certain value bottom is reached. Sometimes this trough lasts a long time if the investors are unwilling to start buying with aggression based on fears that any future growth will materialize. Conversely, if banks hold a lot of properties that are foreclosed, they will of course need to sell said properties as fast as possible, given that they don't make market prices go down any further.

The Recovery
When over-priced capital is sold at lowered prices and those new owners start using that capital in ways that produce value, the recovery can start. Depending on many factors, this could take months, years, or decades.

Monday, May 23, 2011

Resource Based Economy

The concept of a resource based economy is an economy in which goods and services would be freely available to consumers without requiring any form of payment. It was proposed by Futurist and social engineer, Jacque Fresco. All the world's resources would become the property of everyone, not just certain classes or groups. This concept is based on the idea that the world has an overabundance of resources, and our current way of distributing those resources is not conducive to the livelihood and continuation of humans.

This theory also postulates that due to the technological advances that society has made, we now possess the means to be able to develop a system that distributes resources in such a way that everyone can be educated and live well. The supporters of this theory believe that if the government or large corporation were put in charge of an initiative like this they would make themselves the primary beneficiaries of the resources while making most of the population menial slaves or servants to them. The theory places a lot of emphasis on equality and elimination of socioeconomic classes which divide people and create feelings of jealousy and inadequacy.

The theory emphasizes that every person has both physical and psychological needs that need to be met. It is stated that every person living in a resource-based economy would be allowed to fill any occupation or undertake any trade at which they excelled. This would help people to focus on working for pleasure and to achieve a sense of personal fulfillment. When people feel fulfilled and accomplished, many of the feelings of greed and hatred will disappear. Resource based economies would help to eliminate crimes and thus eliminate the need for jails. It is thought that crimes such as robbery come about because of the greed, jealousy and inequity that exist between people who live well, and those who are socioeconomically disadvantaged. The problem of inequity comes about because of a lack of resources, and once society has engineered a solution to end poverty and scarcity, this inequity and the crimes associated with these two things will disappear. This type of economy is the solution which will help humans become more efficient and fair in terms of rationing resources, and ensuring that need are met.

This form of economy would make use of its existing technology and renewable resources to help to create and sustain the environment and the economy while simultaneously ensuring everyone has equal access to the things they need and the things they want. This new system would also have health care for all, a better transportation system. Also, the new system would emphasize conservation and protection of the Earth, since it is the source of our resources. Many believe that technology plays a major role in pollution and the destruction of our planet. According to this theory, however, the abuse of technology is what causes the destruction. Technology is a wonderful tool available to humans when used correctly and with discretion. Machines should be a help to humans, not an attempt to replace them. When technology is employed correctly, it translates into a more efficient, better run society where people can focus more on personal fulfillment as opposed to gaining power and wealth.

Achieving this society is only possible with everyone putting in effort. New technologies must be researched and created, and renewable energy must also be discovered. If all of society pitches in, the world would be more conducive to humans leading better, more fulfilled lives. They would not have to worry about paying bills and holding onto jobs. In this type of society, the focus would be on people as human-beings, and not as merely beings who live to work, and have no time to enjoy life.

What Is Economic Growth

A lot of people are wondering what is economic growth and how does it help. This situation can be explained as the expansion of the productive possibilities of the economy. With this kind of growth, this should help advance higher living standards as well as employment. There are many advantages here that everyone can benefit from. One benefit with this situation is higher living standards. This standard is measured by income per head of household. On an even better note, employment will be greatly effected. This kind of growth will certainly increase employment.

Other advantages here include the fiscal dividend and growth and business confidence. As far as the fiscal dividend is concerned, economic growth will have an excellent effect on the government's finances. With growth and business confidence, this is usually great news for the stock market as well as company profits. Just as they there are advantages with everything, there are also disadvantages. Although there are not too many disadvantages here, they still pose a risk or a threat. Even though it's good that the economy will be growing, there are two threats here that could cause serious problems. The threatening factors that come along with economic growth are inflation risk and environmental concerns.

When it comes to the inflation risk, this situation will occur when the economy is growing too fast. The danger comes when the demand rises significantly above the supply. If this situation comes to pass, producers will take advantage of this and will increase prices for consumers. On the other hand, there will also be environmental concerns. With the fast growth of consumption and production, it has the possibility to create negative factors.

With this situation, there is also a trend rate. To get a better understanding of these trend rates, people use speed limits to get a better understanding of what's going on. In this situation, there is above trend and below trend growth. The above trend is considered the positive gap and the below trend is considered the negative gap. With the positive gap, the economy will grow a lot faster than the set trend. This situation can also lead to positive inflation. On the downside of things, the negative gap happens when the economy goes through a "slow down" or recession. This issue becomes a factor when the growth rate is substantially below the trend rate.

The economy is very important for everyone's well-being. In recent times, the economy has suffered quite a bit and is recovering slowly but surely. There are a few things that we can do to keep the economy up to date and functioning properly. Keeping an entire economy functioning is not at all easy, but it can be done. The economy hits a few rough patches every now and then, but it always manages to get back to where it needs to be. With changes in our habits and resources, we can keep the economy flowing the way it should. If it happens to get out of balance, everything falls out of place and has to be fixed.

Factors Of Economic Growth

Anyone can understand the factors of economic growth.It is not rocket science and the logic behind it is simple. You therefore can understand anything explained about the economy and other growth related issues. Keep in mind that trends do change in in different economies around the world.therefore, the all you need to know is that what may be a success in economy A may be a failure in economy B. The key thing in any development of any economy is the current account deficit. If a country imports more than it exports, chances are, there could be a fall in the graph showing the status of its economy. Therefore the country has to balance the import and export trend.

The job market in any country influences it s financial status directly.there has to be more jobs that a country creates so that the economy may be stable. The most common way to curb fewer jobs is the by exporting more manufactured good that will create higher paying jobs.This why, countries with fewer population always seek foreigners to to work for them. Note that without people, work is absent, which in turn means there is no money. Then the currency of a particular country has to be strong against the major currencies. This has been a major problem in developing economies worldwide. If a currency seems to stagnate, then the best thing to do is to phase it off and start a new currency all over again.

Keep in mind that the kind of growth we are talking about is the increase of per capital gross domestic product. This is the simplest way to look at this factors.certainly, the GDP influences the economy in one way or another. Therefore, if any economy is to succeed, they have to do something about their gross domestic product. There have been concerns lately that domestic productivity of nearly all the countries are affected by the global warming factor. This is true in some way, however, every country must keep an eye on their natural resources and utilize them well. If the natural resources can be well managed, then that may just be enough to boost any type of an economy

There is also the political situation of a country. If the situation i too bad, then the economy may be worsened. Political stability is essential n giving any country a success. When the political situation of a country is good, then even things such as infrastructure may as well be good.note that infrastructure is one thing that cannot be overlooked in the growth factor of any country.

Lastly, there are other factors such as the mortality rate. They may seem as minor factors but they still do matter. This is because it directly affect productivity. It directly affects the population of any state which is always necessary for any economy to success.there has to be population moderation.all these trends do change with time so one has to be on the look out for changes in major economies. This can always be done through researches on the internet.

Command Economy Countries

Command economy countries are those where production is public property and a quota system controlled from the top determines both production levels and the distribution of produced goods. This is as opposed to a market economy which depends on demand and supply. The current status quo is that market economies have decisively been shown to the better system. The best example for highlighting the pros and cons of command economy countries is the former Soviet Union. The USSR set up a system where all the land, property and production belonged to the state. Prices for goods and wages for workers were set by the state, and the state owned and ran all services. The state even got to decide who should pursue which career.

In return, the state took care of citizens' every need, insofar as it was possible. This included everything from food and medical care to vehicles. On paper, it seems like an ideal arrangement where a benevolent socialist state would make sure everyone gets taken care of and is assigned some work to do. But in reality, the system had quite a few holes that ultimately led to its downfall and the victory of the free-market economic model. For instance, a farmer would get only the state allotted quota of fertilizer, seeds, laborers and other necessities required for farming. This would in turn limit the farm's crop to a set amount, regardless of the weather and whether it was a good season or if there was a huge demand.

It doesn't allow for growth or cut-backs in the farm based on conditions on the ground. Instead, it has to depend on instructions from the central planners under a one size fits all system. Simply put, the same farm with the exact same climate/soil conditions would do a lot better in the long run in a free market economy than it would in command economy countries. It also doesn't properly channel individual talent, initiative and entrepreneurship. Someone who has a lot of talent for the arts may end up as a clerk, while those without any leadership qualities may get to lead a large workforce just by being a loyal servant of the state. Since production belongs to the state, there's little motivation for anyone to try and build up a profitable business.

But the system was still followed by the Soviet Union, its vassal states and many others who were attracted to it. It worked well in certain areas where discipline is more important than decision-making powers for individuals. It allowed these nations to build impressive state bureaucracies and a top-down structure for quickly and effectively implementing policies or responding to large-scale disasters or national emergencies.

While they had the resources, it ran like a smooth and well oiled machine. But as the free market capitalist nations began to progress faster, the disparity begun to grate on citizens in the command economy countries. They began to realize the benefits of a supply and demand based economy. With the end of the cold war, these nations have begun dismantling their old state-run controls on the private sector and have allowed a capitalist system to take its place.