Philippines vs. Drugs - Jose Lorenzo Otarra

These are some of the commonly abused drugs in the Philippines. Recently, the drug problem is quite alarming.The increasing number of arrested drug traffickers, seizures of big volumes of dangerous drugs, controlled precursors and essential chemicals and dismantling of clandestine laboratories since the conception of the Philippine Drug Enforcement Agency show the extent and impact of the drug abuse and drug trade problem in the Philippines.

While drug abuse is alarming in the country, the government is strong fisted in the fight of eradicating the supply and demand of illegal drugs.Thus, drug lords, big time drug pushers and transnational syndicates are laughing their way to their banks using the "dirty money" which is the proceeds of illegal drugs and invest the money to legitimate businesses. They are having a field day destroying lives and future of the people courtesy of inutile and corrupt government agencies.

The law enforcers cannot do it alone.The prosecutors and judges cannot move on without harmonious relationship. The problem rest upon us. It starts within ourselves.

Schools, churches, civic organizations, non-government organizations and private groups and individuals must all do their share and contribute to the battle against illegal drugs.

This country cannot afford to waste its future to drug addiction. If the war on illegal drugs is lost, the future of the country will follow the wrong direction. Despite and in spite of the government, Filipinos must remain resolute in their resolve to win the war against illegal drugs.

Tracking Economic Recession and Recovery in America’s 100 Largest Metropolitan Areas

Nearly all the metropolitan areas whose economies suffered the least since the start of the Great Recession had increases in government employment, while most of those that suffered the most lost government jobs. Seventeen of the 20 metropolitan areas that have had the strongest overall economic performance since the start of the recession (all except Augusta, Buffalo, and Columbus) gained government jobs since their periods of peak total employment. Fourteen of the 20 that had the weakest overall performance (all except Bakersfield, Boise, Cape Coral, Jacksonville, Lakeland, and Tampa) lost government jobs since hitting their total employment peaks.

In addition, nearly all the strongest-performing metropolitan areas rely substantially on government (e.g., Washington, several state capitals, and metropolitan areas with large military bases), education (e.g., Austin), or oil and gas (Dallas). Meanwhile, nearly all the metropolitan areas that suffered the most since the beginning of the recession either experienced a large house price boom and bust or depend heavily on auto and auto parts manufacturing.

Auto-producing metropolitan areas in the Great Lakes and South are recovering strongly. Great Lakes metropolitan areas that specialize in the production of autos, auto parts, and related durable goods are recovering strongly from the recession. Akron, Columbus, Detroit, Grand Rapids, Indianapolis, Milwaukee, Toledo, and Youngstown are among the 20 metropolitan areas that have had the strongest economic recoveries, and other auto-producing centers of the Great Lakes and upper South are also recovering relatively rapidly. The recession hit many of these metropolitan areas very hard. Many remain far below their pre-recession levels of economic performance, as evidenced by their relatively low rankings on our overall (recession and recovery) index. Yet their economies have begun to turn around. Detroit, one of the bottom 20 metropolitan areas for overall performance since the start of the recession but one of the top 20 for strength of recovery, is the clearest example.

The other major group of strongly recovering metropolitan areas is in Texas and nearby states. These areas, including Dallas, Houston, and Oklahoma City, suffered far less from the recession than did auto-producing areas. Their specializations in oil and gas are contributing to their strong recoveries.

Seventy-three of the 100 largest metropolitan areas had job growth in the first quarter of 2011, up from 67 in the fourth quarter of 2010 and 35 in the third quarter of 2010. However, the number of large metropolitan areas with job growth fell short of its recent high of 94, achieved in the second quarter of 2010. Moreover, the rate of job growth in the first quarter, 0.3 percent for the 100 largest metropolitan areas combined, was very low, equivalent to only a 1.2 percent job annual job growth rate, which is too low to keep the unemployment rate from rising.

Twenty large metropolitan areas gained jobs in all of the last four quarters. Austin, Charleston, Cleveland, Columbus, Dallas, Grand Rapids, Greenville, Hartford, Houston, Milwaukee, New Haven, Oklahoma City, Orlando, Pittsburgh, Provo, Raleigh, Salt Lake City, Toledo, Washington, and Youngstown gained jobs in every quarter from the second quarter of 2010 through the first quarter of 2011. Thirty-two more metropolitan areas gained jobs in both the last quarter of 2010 and the first quarter of 2011.

Seventy-seven of the 100 largest metropolitan areas lost a greater share of jobs 13 quarters after the start of the Great Recession (the fourth quarter of 2007) than they did during the first 13 quarters after the start of any of the previous three national recessions. Thirteen quarters after the start of the national recession, the 100 largest metropolitan areas combined had lost 5.3 percent of the jobs they had at the start of the Great Recession that began in 2007, compared to 1.1 percent for the 2001 recession. However, in the 1981–1982 recession, employment in the 100 largest metropolitan areas had grown by 6.3 percent in the first 13 quarters after the start of the national recession and in the 1990–1991 recession it had grown by 0.5 percent.

Employment rebounded from its low point in 88 of the 100 largest metropolitan areas by the first quarter of 2011, but only 12 gained back more than half the jobs they lost between their employment peak and their post-recession employment low point, and only two made a complete jobs recovery. Only Austin, Dallas, El Paso, Hartford, Houston, Madison, McAllen, New Orleans, Pittsburgh, San Antonio, Springfield, and Washington regained more than half of the jobs they had lost between their pre-recession high and their post-recession low, while only 18 additional large metropolitan areas regained as much as a quarter of the jobs they lost in the recession. Only McAllen and El Paso made a complete jobs recovery by the first quarter.

Local government employment fell in 60 of the 100 largest metropolitan areas since total employment hit its low point, while state government employment fell in 43 of those metropolitan areas, federal government employment fell in 50, and overall government employment fell in 50. In the 100 largest metropolitan areas combined, even as total employment rebounded by 0.8 percent after hitting its low point, local government employment fell by 1.2 percent and state government employment fell by 0.2 percent, reflecting the impact of reduced local and state revenues. During the same time period, federal government employment also fell, by 0.4 percent and total government employment fell by 0.9 percent. State capitals were less likely than other large metropolitan areas to experience state government job cuts; among metropolitan areas containing state capitals, state government employment rose in 17 (Austin, Baltimore, Baton Rouge, Boston, Columbus, Denver, Des Moines, Hartford, Honolulu, Madison, Minneapolis, Oklahoma City, Phoenix, Providence, Raleigh, Richmond, and Salt Lake City), fell in six (Boise, Columbia, Harrisburg, Indianapolis, Little Rock, and Nashville), and remained unchanged in four (Albany, Albuquerque, Atlanta, and Sacramento).

Between the first quarter of 2010 and the first quarter of 2011, manufacturing employment grew in 47 of the 100 largest metropolitan areas, including most of the manufacturing-based Great Lakes metropolitan areas. Youngstown, Modesto, Fresno, and Detroit had manufacturing job growth of 5 percent or more during the year. The only Great Lakes metropolitan areas that lost manufacturing jobs since the beginning of 2010 were Cincinnati, Columbus, Indianapolis, Rochester, St. Louis, and Syracuse. The strong rebound of manufacturing, especially in autos, auto parts, and related durable goods, is responsible for the strong economic recoveries of many Great Lakes metropolitan areas. It propelled Detroit and Youngstown, among others, into the ranks of the 20 best-performing metropolitan economies during the recovery.

In March 2011, the unemployment rate was lower than it was a year ago in 92 of the 100 largest metropolitan areas but remained above 6 percent in all but five large metropolitan areas. Honolulu’s unemployment rate in March 2010, 5.0 percent, was the lowest among the 100 largest metropolitan areas, while Madison, Oklahoma City, Omaha, and Washington had unemployment rates between 5 and 6 percent. Bakersfield, Fresno, Modesto, and Stockton had unemployment rates in excess of 15 percent and 27 other metropolitan areas had unemployment rates between 10 percent and 15 percent. All of the 100 largest metropolitan areas had higher unemployment rates in March 2011 than in March 2008.

Fifty-seven of the 100 largest metropolitan areas had made a complete output recovery by the first quarter of 2011. Output grew in all but seven large metropolitan areas (Cleveland, Los Angeles, New Orleans, Pittsburgh, Sacramento, San Francisco, and Scranton) in the first quarter. However, the rate of output growth slowed between the last quarter of 2010 and the first quarter of 2011 in the 100 largest metropolitan areas combined and in 85 of those metropolitan areas. Output growth slowed by 1 percentage point or more in four California metropolitan areas: Los Angeles, Sacramento, San Diego, and San Francisco. The 15 metropolitan areas in which the rate of output growth accelerated (Baltimore, Dallas, El Paso, Houston, Jacksonville, Louisville, McAllen, Miami, Orlando, Palm Bay, Portland (OR), San Antonio, Seattle, Tampa, and Wichita) were mainly in Texas or Florida. Output growth accelerated by one-half percentage point or more only in Houston.

In the first quarter of 2011, house prices hit new lows in all of the 100 largest metropolitan areas. In all 100 metropolitan areas, house prices in the first quarter of 2011 were lower than at any time since their previous peak. Prices were less than 10 percent below peak levels in Baton Rouge, Buffalo, Harrisburg, Houston, Little Rock, Oklahoma City, Pittsburgh, Rochester, San Antonio, Syracuse, Tulsa, and Wichita. However, they were more than 50 percent below peak levels in Bakersfield, Cape Coral, Fresno, Las Vegas, Modesto, North Port, Palm Bay, Phoenix, Riverside, Sacramento, and Stockton.

Foreclosures fell in 79 of the 100 largest metropolitan areas in the first quarter of 2011. The largest declines in foreclosures (measured by the change in the number of real estate-owned properties per 1000 mortgageable properties between the third and fourth quarters) occurred in many of the metropolitan areas that had experienced a house price boom and bust (Cape Coral, Jacksonville, Lakeland, Miami, Modesto, North Port, Orlando, Palm Bay, Stockton, and Tampa). Foreclosures increased in only 21 large metropolitan areas (Birmingham, Chattanooga, Denver, Des Moines, Detroit, Fresno, Grand Rapids, Honolulu, Houston, Jackson, Knoxville, Las Vegas, Memphis, Milwaukee, Nashville, Ogden, Omaha, Provo, Salt Lake City, Seattle, and Tucson).

- With job growth slowing and housing markets showing continued weakness, the most recent national economic data suggest that the economic recovery is slowing down. Data for the nation’s 100 largest metropolitan areas, which are available through the first quarter of 2011 (ending in March), show widespread but slowing growth in economic output coupled with much slower improvement in the labor market. Job growth, though occurring in more metropolitan areas than in the past, was sluggish. Unemployment rates, although lower than at the beginning of 2010 in most large metropolitan areas, remained very high. House prices hit new lows in all large metropolitan areas even as the pace of foreclosures slowed. As always, metropolitan economic performance varied greatly among the 100 largest metropolitan areas.

The metropolitan data show that government is associated with economic performance since the beginning of the recession. Although we do not have data on government spending at the metropolitan level, data on government employment make the point. The metropolitan areas that suffered least since the beginning of the recession typically had increases in the number of government jobs (federal, state, and local combined). Those that suffered the most typically lost government jobs. Yet government job cuts have become widespread even as total employment has grown during the recovery. These cuts have contributed to the slow pace of the recovery.

Circular flow of income

In economics, the terms circular flow of income or circular flow refer to a simple economic model which describes the reciprocal circulation of income between producers and consumers. In the circular flow model, the inter-dependent entities of producer and consumer are referred to as "firms" and "households" respectively and provide each other with factors in order to facilitate the flow of income. Firms provide consumers with goods and services in exchange for consumer expenditure and "factors of production" from households. More complete and realistic circular flow models are more complex. They would explicitly include the roles of government and financial markets, along with imports and exports.

Assumptions

The basic circular flow of income model consists of seven assumptions:

The economy consists of two sectors: households and firms.
Households spend all of their income (Y) on goods and services or consumption (C). There is no saving (S).
All output (O) produced by firms is purchased by households through their expenditure (E).
There is no financial sector.
There is no government sector.
There is no overseas sector.
It is a closed economy with no exports or imports.

Two Sector Model

{{Unreferenced section|date=September In the simple two sector circular flow of income model the state of equilibrium is defined as a situation in which there is no tendency for the levels of income (Y), expenditure (E) and output (O) to change, that is:

Y = E = O

This means that the expenditure of buyers (households) becomes income for sellers (firms). The firms then spend this income on factors of production such as labour, capital and raw materials, "transferring" their income to the factor owners. The factor owners spend this income on goods which leads to a circular flow of income.

Five sector model

The five sector model of the circular flow of income is a more realistic representation of the economy. Unlike the two sector model where there are six assumptions the five sector circular flow relaxes all six assumptions. Since the first assumption is relaxed there are three more sectors introduced. The first is the Financial Sector that consists of banks and non-bank intermediaries who engage in the borrowing (savings from households) and lending of money. In terms of the circular flow of income model the leakage that financial institutions provide in the economy is the option for households to save their money. This is a leakage because the saved money can not be spent in the economy and thus is an idle asset that means not all output will be purchased. The injection that the financial sector provides into the economy is investment (I) into the business/firms sector. An example of a group in the finance sector includes banks such as Westpac or financial institutions such as Suncorp.

The next sector introduced into the circular flow of income is the Government Sector that consists of the economic activities of local, state and federal governments. The leakage that the Government sector provides is through the collection of revenue through Taxes (T) that is provided by households and firms to the government. For this reason they are a leakage because it is a leakage out of the current income thus reducing the expenditure on current goods and services. The injection provided by the government sector is Government spending (G) that provides collective services and welfare payments to the community. An example of a tax collected by the government as a leakage is income tax and an injection into the economy can be when the government redistributes this income in the form of welfare payments, that is a form of government spending back into the economy.

The final sector in the circular flow of income model is the overseas sector which transforms the model from a closed economy to an open economy. The main leakage from this sector are imports (M), which represent spending by residents into the rest of the world. The main injection provided by this sector is the exports of goods and services which generate income for the exporters from overseas residents. An example of the use of the overseas sector is Australia exporting wool to China, China pays the exporter of the wool (the farmer) therefore more money enters the economy thus making it an injection. Another example is China processing the wool into items such as coats and Australia importing the product by paying the Chinese exporter; since the money paying for the coat leaves the economy it is a leakage.

In terms of the five sector circular flow of income model the state of equilibrium occurs when the total leakages are equal to the total injections that occur in the economy. This can be shown as:

Savings + Taxes + Imports = Investment + Government Spending + Exports

OR

S + T + M = I + G + X.

This can be further illustrated through the fictitious economy of Noka where:

S + T + M = I + G + X
$100 + $150 + $50 = $50 + $100 + $150
$300 = $300

Therefore since the leakages are equal to the injections the economy is in a stable state of equilibrium. This state can be contrasted to the state of disequilibrium where unlike that of equilibrium the sum of total leakages does not equal the sum of total injections. By giving values to the leakages and injections the circular flow of income can be used to show the state of disequilibrium. Disequilibrium can be shown as:

S + T + M ≠ I + G + X

Therefore it can be shown as one of the below equations where:

Total leakages > Total injections

$150 (S) + $250 (T) + $150 (M) > $75 (I) + $200 (G) + 150 (X)

Or

Total Leakages < Total injections

$50 (S) + $200 (T) + $125 (M) < $75 (I) + $200 (G) + 150 (X)

The effects of disequilibrium vary according to which of the above equations they belong to.

If S + T + M > I + G + X the levels of income, output, expenditure and employment will fall causing a recession or contraction in the overall economic activity. But if S + T + M < I + G + X the levels of income, output, expenditure and employment will rise causing a boom or expansion in economic activity.

To manage this problem, if disequilibrium were to occur in the five sector circular flow of income model, changes in expenditure and output will lead to equilibrium being regained. An example of this is if:

S + T + M > I + G + X the levels of income, expenditure and output will fall causing a contraction or recession in the overall economic activity. As the income falls (Figure 4) households will cut down on all leakages such as saving, they will also pay less in taxation and with a lower income they will spend less on imports. This will lead to a fall in the leakages until they equal the injections and a lower level of equilibrium will be the result.

The other equation of disequilibrium, if S + T + M < I + G + X in the five sector model the levels of income, expenditure and output will greatly rise causing a boom in economic activity. As the households income increases there will be a higher opportunity to save therefore saving in the financial sector will increase, taxation for the higher threshold will increase and they will be able to spend more on imports. In this case when the leakages increase they will continue to rise until they are equal to the level injections. The end result of this disequilibrium situation will be a higher level of equilibrium.

Assumptions of the Quantity Theory

The quantity theory of money implies that a number of interactions are not possible. First, the quantity theory assumes that changes in spending do not simply cause proportional changes in the money stock. It is changes in money stock that are the cause, not the effect. In the jargon of economists, money is an exogenous variable, one determined by forces outside the model.

Second, the quantity theory assumes that the value of velocity is not dependent on either the amount of money or on the price level.1 Changes in velocity are possible, however, due to factors such as changes in transportation, new financial institutions, or other exogenous factors.

Finally, the quantity theory assumes that T, or the number of transactions, is determined by the availability of labor, capital, natural resources, knowledge, and organization. The quantity theory assumes not only that markets clear in equilibrium, but that any adjustment problems are small enough to ignore. If there are unemployed resources, then the prices of those resources should be dropping, which means that the economy is not in equilibrium. Only when the price in each market has reached a point at which the quantity supplied equals quantity demanded will the economy be in equilibrium, and in this situation there will be no resources that cannot find employment. In other words, the quantity theory assumes that in the long run the economy tends to full employment.

Unlike labor or machines, money is not a resource that results in the production of output. Hence, additional money does not act as an input that increases output. However, the quotation from Thornton does not say that prices move in exact proportion to money. It is possible that the adjustment process can influence the amount of machinery available, and thus a change in money can have long-run influences on the amount of transactions. All quantity theorists, however, believed that any effects of this sort were small enough so that they could be ignored in making predictions about the long-run effects of changes in money stock.

Although the quantity theory makes the most sense when presented as a theory of explaining total transactions, today it is more commonly discussed as a theory of total spending for production, or of GDP. In part this is because data on GDP are available while those for total transactions are very sketchy, and in part because GDP is a more interesting item to explain than total transactions. There would be no difficulty in making this change if GDP transactions were a constant percentage of total transactions, but they do not seem to be. Not only does the percentage change gradually over long periods, but there are erratic changes over shorter periods. Most proponents of the quantity theory have believed this problem is small enough so that the quantity theory can be used to explain variations in GDP.

The quantity theory can be illustrated with an aggregate supply and demand graph.