Tuesday, August 10, 2010

Renewable Energy: One of the Main Keys to Global Sustainability “The Sustainability Revolution.”

The August 28, 2009, New York Times article entitled, Illuminating the Future of Energy, states that within the next fifty years we will reach the peak of oil and gas production, and coal production will begin to dry up by the end of this century. Since we have used renewable energy sources such as windmills and watermills only a few centuries ago some scientists believe that reverting back to these energy sources could be very beneficial. Most scientists also concur that eliminating our dominant use of fossil fuels could substantially decrease the growing global concern of climate change and global sustainability.


The discussion of whether or not to convert to renewable energy resources such as windmills and solar energy tends to have sides on both extremes of the argument with virtually no grey area. One side believes and advocates that the possibilities and benefits from solar energy are endless. Their main point being that the earth receives more energy from the sun in just one hour than our entire global population consumes in one year. Although, their stance on acquiring energy from windmills is not as strong as their solar argument, these advocates feel that this option could also very well be feasible to supply energy on a global scale. The discord amongst the naysayers is that they feel that renewable energy would be much too expensive and completely inefficient.

Figure 1. Estimated Worldwide Renewable Energy Jobs: 2006
The October 20, 2009, New York Times article entitled, New Agency to Lead Global Energy Push, introduces the International Renewable Energy Agency or IRENA, which was established this year “to lead a global crusade for renewable energy development and sharing of technology between the developed and developing worlds.” This agency has experienced much growth in just a minute amount of time and now its operation incorporates 137 nations in its battle to push the world toward a new paradigm shift in energy. The shift in which they are incessantly pursuing to achieve is essentially a global transition from fossil fuels to renewable energy.

Today, the United States of America and the entire world is facing times of economic turmoil and it is paramount that the world tries to come together and fight back against global climate and sustainability issues that threaten the future way of life as we know it. Conservation is especially important now because the idea of conserving resources was lost back in the industrial revolution. As Thomas Jefferson once said “Every generation needs a revolution,” and there are many groups of people out their becoming intensively involved in the idea of “the Sustainability Revolution.” This global initiative was introduced to the world on March 20, 1987 by the Brudtland Commission who defined this initiative by saying that “sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.” Continuing on with the path of the industrial revolution ideals would be horrific for the economy and also catastrophic to the overall health of our environment. Therefore a global commitment to transitioning to renewable energy would be a major boost to the sustainability revolution and global sustainability.



Video Source: http://www.youtube.com/watch?v=N-fXG4gdlDQ

Article Source: http://www.nytimes.com/2009/08/29/business/energy-environment/29iht-sustain.html

Article Source: http://www.nytimes.com/2009/10/21/business/global/21renirena.html

Graph Source: http://www.greencollarblog.org/images/renewable-energy-jobs-global-2006-lg.gif

Brundtland Commission Source: http://webcache.googleusercontent.com/search?q=cache:mjkGlK_j-FkJ:www.scu.edu/ethics/practicing/focusareas/environmental_ethics

Friday, August 6, 2010

International Beer Company Acquisition: Producers of Stella Artois and Budweiser Join Forces

International Beer Company Acquisition: Stella Artois and Budweiser Join Forces
The Belgium-based company Inbev bought out the well-known United States beer company Anheuser-Busch (BUD) with a $52 billion dollar takeover of the company, with each share amassing a figure of over 70 dollars per share. On November 18, 2008, this international transaction enabled the now called Anheuser-Busch Inbev to acquire over 22% of the world market share in the beer industry, with SABMiller in second with a distant 13% share of the market (Figure 1). This company has almost 300 different brands with the major ones being Budweiser, Stella Artois, and Becks, which were the significant driving forces behind $36.76 billion dollars in revenue with a $4.613 billion dollars in profit in 2009. Anheuser-Busch Inbev’s geographic wingspan stretches over 30 countries with a total of approximately 116,000 employees. This NYSE publically traded company holds its headquarters in Leuven, Belgium with its executive offices in New York City, New York.

Figure 1. World Market Share of Beer Producers by Volume
Inbev was originally founded in 2004 when Ambev and Interbrew merged and in doing so they created the largest brewing company in the world. Of course up until 2008 when they bought all 100% of the St. Louis, Missouri-based company Anheuser-Bush’s shares. This acquisition just reaffirmed many economists beliefs that the beer industry was undergoing rapid globalization in the United States and the world for that matter. The implications and the magnitude of this acquisition have caused an increase in movement in the United States of the beer industry to be heading in the direction of an oligopoly. Many economists believe that the Inbev merger should be categorized as a conglomerate merger, meaning that prior to their takeover agreement both of these firms had little to no economic involvement or dealing with one another simply due to a sizeable amount of distance decay.



http://www.wikinvest.com/image/Beer_Market_Share.png

http://www.marketwatch.com/story/anheuser-busch-accepts-52-billion


Thursday, August 5, 2010

Increasing Net Exports: A Key to U.S. Economic Stabilization

The subject of international trade is that of a multifaceted and complex nature. The international trade balance and the current account are considered to be similar concepts. The current account encapsulates a detailed record of a particular country’s overseas transactions. This account includes all goods and services that are both imported and exported, and all net unilateral transfer payments, as well as net income from abroad. The international trade balance is the same as a nation’s difference amongst imports and exports (NX). Also the international trade balance is one component’s of the “twin deficits,’ along with the government budget or balance of government savings. The so called “twin deficits,” is an equilibrium condition in economics meaning that the international trade balance (NX) is equal to the government budget (T-G) so long as domestic saving is equal to domestic investment. Another key determinant of international trade to be duly noted is that imports decrease a national total GDP and exports add to a nations total GDP.

Figu
re 1. U.S Unemployment Rate (2007-2010)



















Recently President Obama said in his recent state of the union address in the video clip below that he felt that increasing our exports will be a crucial component in our ongoing economic recovery and stabilization process. Unsure of how this would aid our ailing economy I decided to investigate this matter further. What I found was that by devoting more resources to increasing our exports first we could create a significant amount of domestic jobs. The substantial increase in jobs that this initiative offers could drastically diminish our unemployment rate which was last recorded at 9.5% in June of 2010 (Figure 1.U.S. Bureau of Labor Statistics). Decreasing our ever expanding international foreign trade deficit proves to be another benefit that would be created from Obama’s plan. Another major upside to Obama’s proposal is that as we learned earlier this would cause exports to go up significantly causing a similar rise in our country’s GDP level.

President Obama Talks About Trade in the 2010 State of the Union from U.S. Trade Representative on Vimeo.

Figure 1: http://www.economicpopulist.org/category/topic-meta-tags /unemployment-rate

U.S. Rise in Exportation of Ethanol

The Ethanol (denatured and undenatured for non-beverage use) industry in the United States exported a ghastly five-times the amount of ethanol in the first quarter of this year than it did the first quarter of last year in 2009 (Figure 1). This 2010 first quarter figure of 83.5 million gallons already exported in the first three months of this year is the major driving force behind the outstanding reality that these producers have already reached 71 percent of last year’s total exports of ethanol (Figure 1). If the U.S. ethanol industry could somehow maintain this astronomical pace they have the potential to export up to three or even four times more ethanol than last year. The reason for the industries recent fortune has a great deal to do with simple economics. Currently the United States has the lowest-cost of all of these ethanol producers. One of the first features of economics is the inverse relationship between a products price and demand, when price goes up, demand goes down, and vice versa. As a result of this law of demand because the price of U.S. ethanol went down, this caused the incredible increase in global demand for U.S. ethanol. The U.S. Census Bureau chart below shows just how dramatic this current U.S. ethanol surge is.











Tuesday, July 13, 2010

The Importance of GDP

The concept of Gross Domestic Product or GDP has always been a significant term in the field of economics but with today's struggling and lackluster economy, the term has become more prevalent to all on a global scale. The term GDP is a measure of the overall size and well being of an economy. Although GDP hardly has an effect on our daily lives, the behavior of GDP helps us to understand the behavior of other important economic concepts such as the unemployment rate and inflation rate. Not only has this figure become relevant to many citizens of the United States as shown by a speech by President Obama shown below, but this term has become noteworthy on an international level as well. Other countries too are amidst trying to pick up the pieces left behind by the collapse of the sub-prime mortgage industry in the U.S. in 2007 that had a domino effect on their markets as well. Thus, signifying just how globally interconnected the world is becoming.

The Video clip below is from the United states President Barrack Obama, on august 1, 2009. In this clip the president explains to the public what the term GDP is and why it is a significant indicator of the overall health and stability of the United States economy. The president then goes on to let the citizens of the United States of America know that the economy is experiencing progress and signs of recovery, on the basis that the U.S. GDP has been experiencing recent gains. And that he believes that this overall economic progress is due to his recent recovery act.