Category / Economics

by Hoosier Econ

Unused Gift Card Economy

During the holidays billions of dollars in gift cards are received. Amazingly these cards start slipping through the cracks to never be used. How much is still lingering around:

“People are letting cash slip away that they could be using,” says John Kiernan, a senior analyst with CardHub. Kiernan, citing CardHub numbers, estimates that some $44 billion in unredeemed gift-card value has been accumulating since 2008.

Unused gift cards aren’t just free money for retailers either:

For retailers, however, gift-card sales don’t count as revenue until cards are used, meaning that retailers are holding $44 billion in liabilities against these unused cards.

NYPost also provides more information on how consumers can cash in the cards as well.

Really fascinating piece of the economy that is bigger than what one thinks.

by Hoosier Econ

Inflation Alert: Food Prices

My niche in my blog posts is inflation tracking. I do it because of how I position my investments and watching the unethical approach by MSM in not tracking it. Inflation hurts a lot of people and sucks money out of the economy that can be used for savings or other purchases. This update of increases comes from the Wall Street Journal:

Food prices rose 0.3% in December and 3.4% from a year earlier, the largest 12-month increase since February 2012, the Labor Department said Friday.

You can read the rest here.

by Hoosier Econ

Realtors Dream: $100 Million Condo Sale

Per NY Daily News:

A palatial apartment on 57th St.’s so-called ‘Billionaires’ Row’ has broken the record for the most expensive apartment ever sold in Manhattan.

A buyer dropped a staggering $100.47 million on the apartment, which occupies the entire 89th and 90th floors of One57, the high-end apartment tower overlooking Central Park at 157 W. 57th St., according to city records.

The property is the first single-family home to sell for an excess of $100 million in the city’s history.

by Hoosier Econ

Inflation Alert: Girl Scout Cookies

girl scouts
Inflation is more often associated with the price of a product going up. But inflation is also measured by a product being produced in a smaller size but staying the same on price. Girl Scout cookies fall into both of those categories.

First, lets look at the price of buying Girl Scout cookies. The 2015 price per box according to the Girl Scout website is now $5. In 2009 the price of a box was $3.50 and faced the other side of inflation, downsizing the product. The website popsugar.com noted the downsize:

According to the organization, the cost of flour rose by 30 percent, assorted cooking oils by 40 percent, and cocoa by at least 20 percent. The company felt this was the best method of dealing with increasing raw material prices. Alternatively, Girl Scouts could have used cheaper ingredients, or raised cookie prices from their current price of $3.50 per box.

Second downsizing of the product happened in 2011 as noted by OCWEEKLY blogs:

The Girl Scouts announced earlier this week that both the size and quantity of some remaining flavors will also dwindle slightly–as of now, only the Lemon Chalet Cremes are reducing in size, while the downsized quantities include Thin Mints, Peanut Butter Sandwiches, Shortbread Cookies, DoSiDos and Trefoils (up to four fewer cookies per box).

The reasons behind these changes? A rise in both transportation and baking costs. As a result, the agreed-upon course of action was to “lower the net weight of our cookie boxes slightly rather than ask our customers to pay a higher per-package price during these difficult times,” Girl Scouts spokesperson Michelle Tompkins told CNN.

Girl Scout cookies are shrinking in product serving and have spiked in price by almost 45%.

by Hoosier Econ

Final TV Ratings for College Football Bowl Games

Sports Media Watch released the final TV ratings for college football. Click here to read their more complete breakdown. But here is a snapshot of the games and how many watched.
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by Hoosier Econ

Food Stamps Usage Increasing

Food stamp usage is on the rise again in America. Rough estimate of what the federal government spends is around $77 Billion a year. What makes this news worthy is it conflicts with the notion that the economy is in great shape. Another problem is the program is very lax on rules and has become a new “social justice” program.

Here is more from CNSNews.com

The number of beneficiaries on the Supplemental Nutrition Assistance Program (SNAP)—AKA food stamps–has topped 46,000,000 for 38th straight months, according to data released by the Department of Agriculture (USDA).

In October 2014, the latest month reported, there were 46,674,364 Americans on food stamps. Food stamp recipients have exceeded 46 million since September 2011.

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If you don’t believe this program isn’t somewhat over used, let this stat sink in:

In 1969, the average participation in the SNAP program stood at 2,878,000. In 2014, average participation grew to 46,536,000 showing an increase of 1516.96 percent.

by Hoosier Econ

Tax Season: Deductions, Credits & More

Tax filing season is underway so here is some basic information for deductions and tax credits. Read more at Forbes as they have a big list for all types of taxpayers.

Standard Deductions. The standard deduction rises to $6,200 for single taxpayers and married taxpayers filing separately. The standard deduction is $12,400 for married couples filing jointly and $9,100 for heads of household.

Earned Income Tax Credit (EITC). For 2014, the maximum EITC amount available is $3,304 for taxpayers filing jointly with one child; $5,460 for two children; $6,143 for three or more children and $496 for no children.

Child Tax Credit. For taxable years beginning in 2014, the value used to determine the amount of credit that may be refundable is $3,000 (the credit amount has not changed).

Kiddie Tax. For 2014, the threshold for the kiddie tax – meaning the amount a child can take home without paying any federal income tax – remains at $1,000.

by Hoosier Econ

Indiana Governor Pence Submits 2016 – 2017 Budget

Indiana Governor Mike Pence submitted his budget proposal to the House and Senate for approval. The two bodies will debate the bill and then vote on a final budget at a later date.

I went over to the PDF file the state put out on overall spending areas of the budget. The one big glaring issue is the amount of federal funding the state receives for whatever programs are tied with that. Many people will argue that it captures the money Hoosiers pay in federal taxes and brings it back in the state. In that case, the money shouldn’t leave peoples paychecks at and just have it working economically in the first place.

Here are some budget numbers I found in the proposal. The proposal is for fiscal years 2016/2017:

Both years will cost Hoosier’s around $62 Billion

Education will eat up about 33% of the budget with spending projected at $22.5 Billion

Welfare (Food Stamps, Welfare, Medicaid, etc.) is projected at $28 Billion. $19 Billion of that is sent to Indiana by the Federal government. Start grasping we spend more on welfare then education.

Public Safety spending for the budget cycle is $3 Billion. I know Indiana prisons got more money but expect that to go up throughout the years. Criminals now have to serve 75% of the sentences.

The Governor’s office projected federal funds contributing to the budget for a total of $24.9 Billion.