Article Summary and Response

Paper Summary:

This paper summarizes and responds to three articles taken from The Wall Street Journal. Each article discusses one of the following economic topics: the impact of interest rates on new home sales; the connection between inflation and economic growth in China; and the use of salary bidding in the U.S. Navy. Article titles are: "New Home Sales Shoot Up"; "China's Rapid Growth Spurs Inflation Concerns"; and "How Much to Go to Yokuska, Japan."

From the Paper:

"The economy's strong recovery through new job creation has combined with low interest rates to increase new home sales. In March of 2004, sales increased by 8.9%. Some areas experienced a growth as high as 19.3%. Economists link the increase to an attempt to beat forecasted interest rate hikes. The Federal Reserve Bank could raise interest rates in an attempt to slow inflation caused by economic recovery. This news caused mortgage rates to increase to their highest average since December 2003. Despite this, most economists think the new home buying trend will continue as long as interest rates remain low. Home buying trends are excellent economic indicators, as they show people's buying power in addition to their perception of economy stability. "

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