Caree+D.


 * THE MONEY MARKET**



As we learned in class, there is a direct relationship between the interest rates in America and the quantity of money that is circulating in the market. We also learned that the only way to shift the supply of the money is for the supply to be directly affected by the Federal Reserve. For example, if the Federal Reserve makes more money and starts to circulate it in the money market. As you can see in the graph, if the demand for M1 shifts out, meaning there is an increased demand for money that is counted by cash and the money in accounts, the interest rates within the market increase as well. These are the ways the graph of the money market is affected. True, how would the Demand for M shift out? 9/10


 * THE PARADOX OF THRIFT**

While in class, StanWeins mentioned a concept called the Paradox of Thrift. As he went on to explain what it was, I became more interested in why it happened and if there was a specific reason or circumstance for it to occur. Paradox of Thrift is when a person thinks the economy will go down, they save their money. As more people do this, GDP actually does end up decreasing because people consume less. So by taking precautionary measures to lower the impact of a lower GDP, GDP subsequently lowers because of it. However, this is only a theory applied to a Keynsian economic model where an increase in savings decreases production and unemployment, therefore it does not exist in the long run. A current example of Paradox of Thrift is during the Bush administration when he mailed people checks and practically begged to them to go spend it the money to boost consumption which would help increase GDP. However, the economy was at such a low state, most people just saved the money for a rainy day, resulting in almost no beneficial outcome for America. Good application Caree, an important idea. 8/10

Here is a cartoon to help explain:




 * THE PHILLIPS CURVE**




 * THE NAIRU RAP**

I'm downward sloping if you please, I got inflation and unemployment on my axes. I represent non-acceleration, showing the situation of the entire nation. A shift to the right is when GDP is down, a shift to the left is the other way around. When full unemployment is at equilibrium, it means that the rates are at a minimum. Inflation and unemployment don't go together except in the long run when inflation can do whatever. Now if this doesn't make your socks go up and down, I don't know what will, All I know is this NAIRU rap and econ are both pretty chill.

This rap explains the curve that is also known as the Phillips Curve. If NAIRU, or non-accelerating inflation rate of unemployment, is at equilibrium, this means that employers are no longer benefiting from hiring people because wages become extremely high, while workers are at a point in being able to say they expect extremely high wages because jobs are no longer in demand. At this point, unemployment is shown as a vertical line at equilibrium, which is also called long run Phillips Curve. The rap also explains how shifts in the curve can occur. Changes in GDP, either positive or negative, will affect the graph by shifting it left or right (as seen above). Thus, we have the Phillips Curve. 10/10 Nice job Caree! Really fun with this. I appreciate your enthusiasm for the class.


 * UNEMPLOYMENT IN AMERICA**



I think this is a very interesting cartoon because it raises a question about who is receiving unemployment checks and under what circumstances. It made me begin to wonder if people receive money from the government due to the fact that they truly don't have a job, or if some people may try to cheat the system. It is no news that unemployment, although improving, is still not at a level that most think is acceptable. I feel that people can try and get through loopholes when receiving unemployment because, even though there are guidelines and restrictions, the definitions of those can be loosely defined. In this cartoon, a very interesting point is brought up. The man Bob says that he has not found a job because employers are not paying wages that are greater than what he can get from unemployment. However, this man can keep earning this money provided by the government because he is "actively looking for a job." I think it is important to see both sides of the spectrum when talking about unemployment. It is also interesting to think that some people could be in the same position as Bob while there are still many people who need these benefits and cannot receive them because they do not qualify for other reasons. 10/10 Isn't this also about opportunity cost? We may have to get folks off the benefits before they commit to finding a job.


 * HEALTH CARE IN THE U.S.**



In the U.S, heath care is a very controversial issue in which people argue, and have argued about, for centuries. Many people believe that health care is a commodity that should be given to all, while others think that it should be given to those who can provide it for themselves. On the other hand, some people think that requiring health care to everyone is costly and inefficient, especially since not everyone wants it. Many people obtain health care through their employers but the problem with that of course it the unemployment rates here in America. Those who do not hold a steady job face a double standard when it comes to applying for insurance. Due to the fact that they don't work as much as someone with a steady job, they cannot receive it through their employer and insurance companies reject them for other reasons. It seems as though people can't catch a break when it comes to health care. But have no fear, that's what Obama's health care plan is here to fix... Right?

As seen in the comical cartoon above, the artist is portraying a situation in which someone has apparently gotten into a car crash. The Federal-State's "quick fix" for this is a bottle of aspirin thrown at the man in hat seems to be a drive by. This cartoon really made me laugh because some people who don't want health care to be given to everyone think of a similar situation, although most likely not as drastic. It's a great Q: should someone who refuses to have healthcare, be forced to have it? Is it a public good or a private good? What are the spillover effects of people who don't have it? Good Q's. 9/10 -SW




 * TO BE.. OR NOT TO BE.. AN ECONOMIC THINKER.**

When one thinks about life in general, most of the decisions we make can be traced to a Macroeconomic term or concept. For example, say you walk up to the vending machine to grab a snack during break. By simply considering the price and overall appeal of the snack, marginal cost and revenue come into play. The marginal cost in this situation can either be the dollar amount you spend on the tasty treat, or even the nutritional value of it. Marginal revenue could be considered as being the satisfaction of hunger you receive by eating this snack, or saving a little extra cash by choosing a cheaper option. Perhaps you are deeply conflicted because you would like to purchase the "healthy" Sun Chips that have less calories (marginal revenue), but don't want to spend $1.50 on a snack (marginal cost). You glance over your other options and see that Gardetto's are only $.75. Bam! Decision made. So you think.. By thinking like an economist, you can deduct that the calorie and fat content of the cheaper treat are in fact not worth your money because it is the more unhealthy choice of the two and you will probably get hungry in another hour. But, you want to have money left over for other snacks throughout the week so you end up choosing the cheaper one anyways. Even minute decisions like these can be viewed in a way that is directly correlated to Macroeconomics. By simply weighing out your options, and seeing things as an economist would, there are endless possibilities in the vending machine of life. I believe you mean marginal benefit and marginal cost here. Marginal revenue is something a bit different. Still, you show economic thinking in comparing them. I've always thought a smart vending machine would scan a person's psyche to determine their total mb and then establish the price at that. 9/10

Stay hungry my friends.