Argentina crisis and recovery

Readers Question: With talk of a Greek exit from the Euro, the situation is almost always compared to Argentina in the 1980s and 90s. Can you explain what happened there and how it was resolved. In the 1980s, Argentina built up substantial debt and also suffered from periods of very high inflation. To stabilise inflation, …

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What next for the Pound to Euro?

In 2012, the Pound has strengthened against the Euro – reaching a level not seen since 2008. However, the value of the Euro to Pound is still  less than the peak of late 2007, when £1 reached €1.4. In June 14th, 2012 £1 = €1.24 Euros. An increase since the start of the year when …

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To what extent has the internet increased contestability?

Readers Question: Assess the impact on market contestability of increased use of the internet? Definition of Market Contestability – Contestability means that a market has freedom of entry and exit. In other words, new firms can enter and leave easily; this creates a permanent threat of competition. Contestability requires low sunk costs (costs that are …

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What Happens if Greece Leaves the Euro?

The BBC have this infographic about what happens if Greece leaves the Euro. Source: BBC But, when I look at this. Everything has already happened. Greece is already in recession. It has been in recession for past 5 years. Greece already has bank runs. Multinationals are not keeping money in Greek banks Due to unemployment …

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Economic Questions on Greek Exit

Readers Question: Should Greece pull out of the euro ? They are in the fifth year of recession despite EU bailouts – it seems like pouring money down a black hole. Yes. I believe they should leave the Euro. I put some arguments for and against here – Should Greece leave the Euro. Leaving the …

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Is the UK tax system fair?

Readers Question: Assess the effectiveness of the UK’s taxation structure in terms of reducing inequalities, negative externalities and unemployment. Some of the UK’s tax system is progressive. A progressive tax takes a bigger % of income from higher earners. The UK’s income tax system is progressive. In 2012-13, the tax threshold will be over £8,100 …

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Richest People in World 2012

We may be in a longer recession than the 1930s Great Depression (see: link) but it hasn’t prevented the richest people in Britain increase their net wealth. The richest 1000 men and women have a combined wealth of £414bn, up 4.7% on the previous year.   Richest People in the World 2012 1. The Walton …

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World Without Oil Scenario

Is this the future of a world without oil? Readers Question: What would a world without oil look like? Oil is currently the most important commodity. It is vital to transport (air, sea, road and rail) and also the production of goods like tar and plastic. Without oil, society and the economy would look quite …

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