Top 5 for 9/2/2012-9/8/2012

Drought’s Grip is Wide, Deep, by Neil Shah and Conor Dougherty, The Wall Street Journal, September 5, 2012, Section 1, Page 3, www.wsj.com. Heavy rains from Hurricane Isaac helped to dispel some of the nation’s worst drought, but not before negatively affecting everything from hay prices to barge operators. Consequences of the drought were most prominent on farms. This led to an increase in food prices, especially corn, which is a main ingredient used in feeds for chickens, hogs, and cattle. This domino affect will also lead to the increase of chicken, pork, and beef. All of these combined could potentially slow economic growth if consumers aren’t willing to pay for the increase in food.

Dow Drops on Fresh Fears, by Chris Dieterich, The Wall Street Journal, September 5, 2012, Section 3, Page 4, www.wsj.com. The Dow Jones Industrial Average sank 0.4% as over the Labor Day weekend showing that the economy is continuing to deteriorate. If the economy does not improve, it could lead to a stall in our economy. When investors loose money in the stock market, they become more conservative in their spending, which causes business to make pay cuts, which then makes unemployment rise. The Dow is especially sensitive because it encompasses materials, industrial and energy stocks, that are most tightly connected with global stimulation.

Blue Chips Grind Out a Gain, by Jonathan Cheng, The Wall Street Journal, September 6, 2012, Section 3, Page 4, www.wsj.com. The Dow Jones Industrial Average gained 11.54 points due to a slowdown in European manufacturing. This indicates that not as many consumers are purchases goods manufactured in Europe. The gain was also occurred because FedEx lowered its first-quarter earning prediction. Since FedEx plays such a large roll in transporting goods for businesses, it is a good indicator of the activity in our economy nationally and internationally. 

Wheat Falls as Buyers Eschew U.S. Experts, by Owen Fletcher, The Wall Street Journal, September 6, 2012, Section 3, Page 4, www.wsj.com. Wheat in the United States dropped 2.3%, a three-week low for the industry, due to less of an export demand and lower corn prices. Eqypt, one of the world's largest wheat importers, recently turned their sights towards Russia. Other countries are also passing over the United States as an importer of wheat due to the recent hike in prices. This will hurt our economy because there is product, but not as great of a demand for the product. Companies that sell wheat will be forced to slash prices in order to sell their goods, which may also lead to cutting their payrolls to cover the costs. Thus, increasing our unemployment rate.

Stocks Close at Multiyear High, by Matt Jarzemsky, The Wall Street Journal, September 8, 2012, Section 2, Page 4, www.wsj.com. Stocks closed this week at a multi-year high with the Dow Jones Industrial average closing at 14.64 points, its highest finish since December 2007. This increase shows that the economy might be looking at an upswing. Not only were United States stocks up, but so were Europe's and China's. An improvement in the economy will add a more positive outlook for consumers and may encourage them to invest more or spend more money.