Q: Hello my two favorite economical experts, I have two questions for you: 1- Why did you censored me around June 2008 or so ? 2- Why you did not give US a hint about the 2008 financial debacle, let alone predicting it ? Norberto

Submitted by Norberto from Sydney

A: Nobody on this site censored you, not sure if you are referring to threads on stories, if that's the case, Tony and I have nothing to do with that.

Answered 07/29/11 16:41:40 by Kevin Hall and Tony Pugh

Q: My dear Kevin and Pugh, long time no see guys ! My favorite economical experts I missed you both, someone was practicing USSR media techniques (if we close our eyes we can't see him) within McClatchy with me. I have one question, but is not an easy one, namely WHEN is going to be that next global financial meltdown ? Some people say by the 1 October this year (end of US fiscal year), what do you think about ? Norberto

Submitted by Norberto from sydney

A: Since you are so wildly smarter than us, why don't you share with us when the next crisis will come?

Answered 07/29/11 16:40:48 by Kevin Hall and Tony Pugh

Q: Why doesn't anyone expose ALEC--the American Legislative Exchange Council--which sits with Congresspeople and often writes the actual laws? Is it because media is among the corporations at the table?

Submitted by paula winters from Dania, FL

A: Hmmmm, if that's so nobody's offered me a seat.

Answered 07/29/11 16:40:02 by Kevin Hall and Tony Pugh

Q: Kevin Hall - disagree with your article today on debt. WHY raise debt - taxpayers children grandchildren on hook? WHY should USA have to borrow money? WHY can't congress live w/i means? WHY cant congress CUT the billions in discretionary debt on books? WHY cant congress CUT pensions of pervert congressmen? WHY cant congress bring back all 100K of troops & cover our own borders? WHY cant congress stop paying millions to ACORN? WHY can't congress stop funding undocumented/illegals in our schools BEFORE our own children? WHY can't congress send illegals COSTS to president calderon - they are his citizens? WHY would Kevin Hall want congress to raise our debt [that we cannot pay now] to a higher amount rather than cut billions from debt & balance the budget? thank you for reading. GS of FL

Submitted by Grace GSNP from ft lauderdale FL

A: GS of FL, where to start. Sorry we disagree, but for clarification this isnt a debate about new debt, it's about paying for debt already accumulated. There is no immediate crisis, much of the problem can be dealt with but we need to avoid a near-term hit to a weak economy and we need serious entitlement reform, a mix of cuts and revenue increases. every credible economist says as much. as to why should USA have to borrow, all nations borrow at some point or other. Why do you borrow to buy a home instead of buy it outright with cash? Debt isnt a problem as long as it is reasonable. Huge tax cuts, at a time when we are fighting two wars without paying for them (first time we have not taxed during war)... generous prescription drug benefits for the elderly.. these all have costs and this is what is the long-term threat, not short-term stimulus spending that will go away in a few year. When the economy resumes growth, revenue will be higher, the debt will be more manageable. The world is not coming to an end, Washington loves to manufacture crisis.

Answered 07/29/11 16:39:40 by Kevin Hall and Tony Pugh

Q: TONS of Q&A here & Thank you for Answers. Q: will you send answer to my email address? LOW mortgage interest you said for last several years but no one will re-fi my high int for lo mortgage balance [same payment + higher w/hurricane insurance & escrow added - they add fees that are still equal to total old amount and higher - why no relief for retired people to reduce hi interest & high mtg payment? i'm sinking fast.

Submitted by grace GSNP from ft lauderdale FL

A: There is not an email address to send to here, your problem is a common one, mortgage rates are at record lows and yet few can get them because banks are using tough ratios of income to debt for borrowers and more importantly because they are uncertain whether homes will continue to lose value, sorry about your predicament, I am personally working with some borrowers trying to help and its a tough climb, banks are making a lot of people spin their wheels, appearing to offer help and instead jerking them around.

Answered 07/29/11 16:35:34 by Kevin Hall and Tony Pugh

Q: Why has this information about the structure of government policy been published in all of the American media? Social Security Checks August 3rd Just heard Mark Levine on WGST talk radio. He is a Constitutional lawyer. He quoted from a U.S. House committee investigative session where it was discovered that the U. S. Treasury will have sufficient funds to pay Social Security and Veterans benefits for the month of August 2011. So the head of the Social Security Administration was questioned as to how these benefits would not be paid (Obama had threatened to stop Social Security payments on August 3rd.). The committee found that Social Security does not have the authority to issue checks. The Social Security checks are issued by the Treasury Department headed by Timothy Geithner. Even Geithner DOES NOT have the authority to not issue Social Security unless he is directed by President Obama to not issue the checks. President Obama ALONE will be responsible if Social Security checks are not issued starting on August 3rd, 2011.

Submitted by Angel Youngblood-Chi from Abilene Texas home of Dyess AFB

A: It is not a secret that Treasury cuts 80 million checks a month, including Social Security payments among them. If the Aug. 2 deadline is breeched, there may still be enough incoming revenue to push off decisions for a few more days (some research groups think revenue may be a bit stronger than forecast).... but at some point winners and losers would have to be selected. I dont think Obama ever threatened to not pay, he said it could jeopardize payment, and it could if Treasury decided it was too difficult to separate winners and losers and applied an equal cut across all programs.

Answered 07/29/11 16:33:01 by Kevin Hall and Tony Pugh

Q: The branch of Micro Economics that studies the decisions of individual households and firms is called? 1.Microeconomics 2.Positive Economics 3.Macro Economics 4.Normative Economics

Submitted by rocky from Dhaka

A: 5. Reporters won't do your homework.

Answered 07/26/11 18:50:32 by Kevin Hall and Tony Pugh

Q: I saw a movie called Inside Job where the most frightening thing I learned (I hadn't even thought of this before) was that Economics Professors are voice pieces for the financial industry. Some of the Economists mentioned in the film included such luminaries as Glenn Hubbard, W. Dudley, Larry Summers, and Fredric Mishkin. They work for universities but write papers for pay for financial institutions as though they were working for an advocacy think tank like American Heritage. Do you consider the role played by these university professors a reason for the meltdown? We can't trust think tanks as they are ideological. Can we trust papers that deal with deregulation etc. released by university professors who take an active part in policy?

Submitted by Parun from Tallahassee

A: Yes, most of us know there is some baggage that comes with high profile folks, they cash in on their name. In a perfect world it wouldnt happen but it doesn, not unlike how prominent liberal economists write books that cash in on their good name too. I think its important to start with a healthy dose of skepticism when approaching studies and papers, and I can't speak for other news organizations but we tend to start with some questioning of the material presented. You have to assume that everyone is pushing an angle, whether it is ideology or money they are after. I wouldn't pin the meltdown on professors. It was pure and simple Wall Street greed, aided by the lawmakers Wall Street money was able to influence.

Answered 07/26/11 18:50:08 by Kevin Hall and Tony Pugh

Q: What are your thoughts about companies lowering their employees' wages and decreasing their benefits in order to lower the cost of the production of their goods?

Submitted by steph from sc

A: Well, not naive enough to say it doesn't happen. In some cases it is to remain competitive, and the reality is US products often compete with cheap labor, and in the case of China with products that often are money losers but it is absorbed in the big state bureaucracy and subsidies. Benefits have been lowered significantly for many workers, in a massive cost shift to employees. At the top level, benefits are a perk that is one of the carrots or incentives offered during hiring, but for most workers benefits have decreased over time or the cost of these benefits has been increasingly passed along to employees, much like the pension gave way to the 401 k retirement plan, from a payment to a tax-deferred contribution made by the employee.

Answered 07/26/11 18:47:01 by Kevin Hall and Tony Pugh

Q: Is it true that the failure to raise the debt ceiling will prevent the Treasury from paying last year's bills? If so, how can Congress refuse to do that? Finally, whose responsibility is it to see that past obligations are met, the President or the Congress?

Submitted by Fred Como from Burnt Hills, NY

A: Yes, credit card reference frequently cited is a bit off target. Our debt is money already borrowed to pay for things like the wars and other needs in the past. Refusing to honor that now would like like refusing to pay your bills, not the frequently mentioned cut up the credit card reference. A ratings downgrade would be like the credit card company raising your interest rate! As to your last question, Congress has power of the purse.

Answered 07/26/11 18:44:11 by Kevin Hall and Tony Pugh

Q: While it is a waste of breath to get many to believe that Barack Obama IS an American citizen; what you can help explain is this. All the time we hear on the news that the U.S. gave billions of dollars to this country or that country; and I assume it is for economical need. Where does this money come from and is it a part of the budget deficit? In the same vein, I can say, instead of sending this money to help a foreign country, why not help us Americans that are getting poorer by the day. Im all for charity and give what I can, but I too am a Senior, help my brother, who is disabled and lives on less than $700 a month. So, I know there is not an easy answer to this question on why we send so much money to other countries to help them in a crisis, I never never hear of another country sending money or help like when we had Katrina. We barely got our own government to help. Why is this? I commend both of you for trying to answer questions here....if more Americans understood the economy we might not fuss so much and be grateful for what we have. Thank you for your time.

Submitted by Brenda Robinson from Chambersburg, PA

A: Most foreign aid is proposed by the executive branch, usually the State Department, and is authorized and appropriated by Congress. That got a little muddied during the Bush era by the war spending that was done as emergency spending and all kinds of things tacked on, ostensibly in support of our diplomatic priorities and strategies. As the richest nation and strongest economy, it would be unlikely post Katrina to take aid. Venezuela offered it to score political points, Mexico actually sent military personnel to help with search and rescue and clean up, and we accepted.

Answered 07/26/11 18:42:27 by Kevin Hall and Tony Pugh

Q: When a factory with employees closes, is there a percentage loss of other businesses in the area, such as food sellers and suppliers. If $10 million business with ten employees closes, what is the collateral damage?

Submitted by Brad Freeman from Arcata, CA

A: It is hard to pinpoint with certainty, but economists try to calculate multiplier effects ... so if a new plant brings x number of jobs into a community, the benefits would multiply and create y number of additional jobs. The inverse is true, and you can just imagine what would have happened through this chain if the Bush and Obama administrations didn't step in to rescue the automakers ... the multiplier effects would have been devastating

Answered 07/18/11 17:29:39 by Kevin Hall and Tony Pugh

Q: What's ging to happen to those who deoend on SS if a deal is not met. Who really cares anymore about others....Some of us never had a chance in the benefits offered today in education and we're just low class...Not fair to judge us and hurt our only source of income. I always thought that the rich we're to help those who could't help themselves. Senior....

Submitted by Sandra Colegrove from Olympia WA

A: Your concern is certainly one that is echoed in some quarters of Washington. Most here think this is a game of political chicken and political theatre, but if they can't get a deal one presumes they will take steps to protect the most vulnerable... but may be forced into a choice between creditors, soldiers and retirees.

Answered 07/18/11 17:05:27 by Kevin Hall and Tony Pugh

Q: How Might pressures felt by college-bound high school students to participate in academic related organizations and activities contribute to a lower teen labor force participation rate??? Why are people receiving disability benefits not counted as part of the labor force?

Submitted by Savannah Starmack from Los Angeles California

A: For the first question, assume it has some effect, if teens want to get into a better college, academics matter more than work experience. It is one reason you see so few teens working at fast food joints any more. As to why people who are receiving disability checks aren't counted as part of the labor force, I would think the answer is that they are disabled, certified as such and thus literally and technically not in the labor force. if they receive disability but work a second job while receiving that check one presumes they would be counted

Answered 07/18/11 17:04:01 by Kevin Hall and Tony Pugh

Q: The table below shows the hypothetical production of cloth and rice by Nigeria and Benin republic. Countries Unit of labour Tones of rice per period Bales of cloth per period Nigeria 100 25 20 Benin republic 100 10 15 (a) Determine the opportunity cost of producing cloth and rice in Nigeria and Benin republic. (b) Which of the two commodities does Nigeria and Benin republic have greater comparative advantage over reach other and why? (c) Which of the two countries have absolute advantage in the production of cloth and rice?

Submitted by AZIKE NOBERT from LAGOS, NIGERIA

A: and again... not the place for homework questions

Answered 07/18/11 17:01:26 by Kevin Hall and Tony Pugh

Q: In year X, 25 naira exchanged for a dollar and later in year Y, 75 naira exchanged for a dollar through the forces of demand and supply. (a) State the effect of the above on the value of the dollar. (b) How much, in naira, would be needed to purchase a 25,000 dollar worth of car from the united states of America in year X? (c) How much, in naira, would be needed for the same purpose in year Y? (d) (i) Calculate the percentage change in the value of the naira between year X and year Y. (ii) From your calculations, state the effect on the value of the naira.

Submitted by AZIKE NOBERT from LAGOS, NIGERIA

A: ditto, no dice here

Answered 07/18/11 17:01:10 by Kevin Hall and Tony Pugh

Q: The table below shows the trade position of country X and Y in year 2000 and 2003. Country Year export prices import prices in Naira X 2000 1496m 1698m Y 2003 1520m 1306m (a) use the table to calculate the terms of trade for country X and Y. (b) state the condition of terms of trade for the two countries. (c) Give a clear definition of terms of trade. (d) Mention three ways of improving terms of trade.

Submitted by AZIKE NOBERT from LAGOS, NIGERIA

A: Sorry, not going to do your homework

Answered 07/18/11 17:00:59 by Kevin Hall and Tony Pugh

Q: how is human resource different from other resources like land and capital?

Submitted by tenzin tseyang from india(dharamsala)

A: Wrong forum for what appears to be a test question

Answered 06/14/11 13:50:31 by Kevin Hall and Tony Pugh

Q: In the article "Speculators swamping oil, grain markets" no mention is made of the leverage that is being used to make the bets. Is it possible to get that information?

Submitted by Bob Seibel from State College, PA

A: Good question, don't have an answer. Once Dodd-Frank Act is completely limited, banks large and small with have margin requirements and some leverage limits. Don't think hedge funds will face the same requirement, so the issue of leveraging to the hilt and blowing up the system is still possible but methinks that risk is years out and that institutional memory still recalls the stench of meltdown.

Answered 06/14/11 13:49:58 by Kevin Hall and Tony Pugh

Q: How will reducing government payrolls help the economy and reduce unemployment?

Submitted by Ed Estes from Oakhurst, CA

A: Well I don't know how it will reduce unemployment, but some critics suggest that we are in an era of big government and can't afford all these government workers. Govt spending is up on wars in Afghanistan and Iraq, the Medicare Part D benefit for RX_ none of the three paid for by taxes_ and we've reduced taxes in 2001, 2003 and then extended this reduction in 2010 til the end of 2012. all of these things are structural reasons that have caused the debt to explode and the deficit to soar. On top of that we piled stimulus spending to prevent the worst recession since the Great Depression from becoming a repeat of that terrible era. Fewer government workers will reduce govt spending by a fraction, it isn't the cause of our economic woe.

Answered 06/06/11 15:03:19 by Kevin Hall and Tony Pugh