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Kern Economic Journal

The Kern Economic Journal is a quarterly publication (February, May, August, and November). Its purpose is to track and analyze economic trends that affect the well-being of Kern County. In doing so, the journal provides primary data on consumer confidence and business outlook as well as secondary data on a wide range of economic indicators. These data help the community make more informed decisions. Sources of funding for the journal include university contributions and sponsorship fees.

Economy at a Glance

The world’s largest economy of more than $16.5 trillion, the United States, grew by 1.5 percent, but at a much slower rate than the real Gross Domestic Product (GDP) growth rate from the second quarter of 2015, where real GDP grew by an incredibly large 3.9 percent. Real GDP increased largely because of increases in consumer spending, durable goods (mostly vehicles and parts), non-durable goods, and large increases in spending on healthcare, as the effects of the Patient Protection and Affordable Care Act (PPACA) continue to unfold. However, the growth rate was moderated by decreases in private inventory investment, as firms in wholesale trade and manufacturing continued to let inventories drop, perhaps as a hint to the state of the global and national economy.

Tracking Kern's Economy

With continued stagnation of oil prices and layoffs starting to affect regional oil companies, there was a minimal increase in personal income, increasing by 0.51%, on an annual basis, compared to the second quarter of 2015. This amounted to an increase, in total income, of only $41 million. This increase was largely driven by increases in property income from the third quarter of 2015, helping to offset stagnation in personal income and a decrease in profit income by firms.

Impact

California is entering the fourth year of what many consider a historic drought. According to the U.S. Department of Agriculture (USDA), in October of 2015, 46-percent of California is in an exceptional drought (though this has decreased from 58-percent of California a year ago). Currently, only 0.14-percent of California is not experiencing any drought conditions.

Featured Article: A Glance of Dual-Class Companies in the U.S.

Recently, the topic of dual-class companies has been popular with the media, academia, and professionals. A dual-class company is a type of company that issues two classes of common stocks. One is a publicly traded inferior stock with one voting right per share, and the other is a non-publicly traded superior stock with multiple voting rights per share. Therefore, in a dual-class firm, shareholders of superior stocks have more voting power than cash flow power. A dual-class company has a stock structure that allows shareholders of superior stocks to have disproportionally higher voting power than the financial risk. As a result, firm insiders such as board members and executives maintain the decision-making power in the company.



Publishers and Managing Editors

Thank you to Dr. Abbas Grammy, Founder of KEJ, for the contributions he has made to CSUB and the Kern County Community through KEJ. For more information on Dr. Grammy, please visit the link below.

KEJ Founder

__________________

Richard Gearhart

(661)654-3962
rgearhart1@csub.edu
BDC 257A

Nyakundi Michieka

(661)654-2465
nmichieka@csub.edu
BDC 259A

California State University, Bakersfield
9001 Stockdale Hwy
Bakersfield, Ca 93311