Before I proceed with the remainder of the Economics for Beginners sequence, I suppose it’s necessary that I take a while to elucidate what Economics really is, since there seems to be a great deal of confusion both here on HubPages, and on the Internet typically. Our conclusion is that, in a financially-challenged economic system like the Eurozone, with policy rates near the ELB, and with extreme leverage in both the private and non-private sectors, balance sheet enlargement by the central bank alone might not be ample to boost mixture demand by enough to achieve the inflation goal in a sustained method.
There have been spectacular achievements since the attainment of freedom in 1994: in constructing homes, crèches, colleges, roads and infrastructure; the supply of water and electrical energy to tens of millions; free education and healthcare; increases in pensions and social grants; monetary and banking stability; and gradual but steady financial progress (until the 2008 disaster at any charge).
This prompted market analysts to determine five of the worst hit economies as the delicate five,” attributing their vulnerability to economic fundamentals, significantly to current account deficits.” Which is ok – present account is a fairly essential sign of the general external balance in the financial system, however… the but bit is that present account alone means little.
All this issues are seemingly coming to a head in 2015, and it remains to be seen as to whether the GOP Majority will will cooperate with Obama, who has been aggressively pushing for government reform and functioning, after a two week vacation in Hawaai, Jobs, immigration, education as Obama will probably be traversing the US, in his bid to rally his democratic voters for the following coming 2016 elections.
Instead of being reinvested in plant and tools, company income were spirited abroad or sought returns in the Johannesburg Stock Exchange (which rose 50% during the first half of the 2000s) and speculative real property, because the property growth raised house costs by 200% from 1997-2004, compared to simply 60% within the US just prior to its bursting housing bubble.