Hey,
SUPPLY AND DEMAND is another part of Economics.
Economics definition: soft science based on supposition (assuming), rhetoric (lots of debate), speculation (wishing), some HARD FACTS and mathematical or financial theories. Economics studies the production, distribution and consumption of goods and services.
First and foremost, all mathematical theories have one thing in common. The perpetrators (forever now known as the "Perps"!!!!) have a strong mathematical foundation and know what few of us do-- that there's a lot of mathematical persuasion that cannot be proved but there's enough that can be proved to make it look like a REALLY HARD (not difficult but real) science. .
Three more definitions we need here: What is meant by SUPPLY and DEMAND (S&D) being a fundamental concept of economics. Simply put it's the relationship between (S&D )that determines the price of a commodity (gas is a commodity).
SUPPLY is the quantity available. DEMAND is the quantity demanded or desired. When the two amounts are skewed (not in good relationship)- disaster hovers. The S&D relationship is reflected in price as the result of the interaction. Price in turn can affect supply and skew demand. A teeter-totter on which all financial ventures play.
Sounds like many human relationships where demand often exceeds supply or vice-versa. However, in Economics there should be a good balance--no permanent break-ups here. When one or the other side is over emphasized, financial imbalance occurs.
INFLATION is an over-SUPPLY of money often creating euphoria and DEFLATION means money supply diminishes, prices go down, demand lessens, jobs disappear and finances Suck.
Let's visit our Corporation "Up-yours" again and talk to the CFO (CHIEF FINANCIAL OFFICER) about how suppository sales are progressing.
Skipping the usual "yahtata,", we ask if DEMAND for his product has increased. He tells us that DEMAND (particularly in Washington, D.C.) so exceeded expectations (SUPPLY) that PRICES rose (REFLECTION OF INTERACTION) for "Up-yours" suppositories that the Corporation increased the SUPPLY to meet the DEMAND. Fortunately or unfortunately, as often happens this also increased competition and a new company "Stick it" is currently driving the price down by flooding the suppository market. Although the market share is holding steady, we asked him what "Up-yours" plans to do.
"Well," the CFO smiled and whispered conspiratorially, "We know that government regulations will assist us and we are currently talking to "friends" about making "Stick-it" face penalties for unfair trade practices because they do not follow all government guidelines. We'll borrow big time and with the current low interest rates, we can hold our own at lower prices. We'll also use some modern techniques in marketing and advertising. You know people are more open to our product these days." I guess you could say he's "bullish" (Stock market term for up market) on his market future.
An over abundance of articles on Economic theories exist. Economics proliferates with schedules,graphs, function/equations, demand curves, shifts vs. movements, individual vs. market and so on. Modern Economics is an economics "hay day" (or "hey-hey" day). There are so many theories that Economists have to explain them to each other. We can't take them all aboard but we'll take a look at four reasonably familiar efforts by Perpetrators (henceforth known as "perps".
Remember that the word THEORY means SUPPOSITION or ASSUMPTION. You remember the definition of Assume.
KEYNESIAN ECONOMICS IS A THEORY declaring that intervention is necessary to ensure an active and vibrant economy by stimulating DEMAND to encourage economic growth. (DEMAND drives Economic growth.) An intervention is recommended (by any source) to keep the overall demand high. By a "perp" named (You guessed it) Maynard Keynes, who argued for Government intervention.
Neoclassical Economics has various versions or schools of thought such as the Chicago School and Austrian School of Economics. It is an amalgamation (combination) of several THEORIES and currently provides the foundation for the global economy. It is a more quantitative (mathematical-statistical) approach to research that now appeals to modern economists. It is criticized as a Utopian philosophy focusing on a RATIONAL INDIVIDUAL in ECONOMICS who is mathematically predictable for a general methodological principle for economics.
That means in essence--it's about a "Joe" who can be relied on to make the same clear cut judgements over and over again so that he can be reliably graphed to form a program for all of us to follow to create Economic perfection.(Oh, Yeah, pul..leeselet's have more of this current purr..fection in the country's and the world's financial picture!!!????)
Often referred to these days as "mainstream economics", it is far removed from SUPPLY AND DEMAND realities and more into the philosophy of global trade. The followers have developed a range of theories: game theory; linear programming, and econometrics. As a movement it gets further and further away from the REAL world of 2+2 make 4 and into PHILOSOPHY. The "Perps" who came up with the theory are multiple.
SUPPLY-SIDE ECONOMICS is a THEORY (a name coined by "Perp" Herbert Stein in 1976) that says reducing tax rates for business and wealthy individuals stimulates (SUPPLY) by savings and investments that benefits everyone. Not as highly valued as in Ronald Reagan's time as President when it was used to create a high flying American economy that now is not fashionable in the global economy.
MONETARISM is an economic theory which focuses on the supply of money and central banking's role and was formulated by "perp" Milton Friedman, who believed in a Target of "quantity of money" rather than "value of money" which included Supply Side Economics as well as some Austrian theory-another amalgamation.
Friedman's argument stated that excessive expansion of money (SUPPLY) IS INFLATIONARY. AN EQUILIBRIUM should be maintained between the S&D OF MONEY (Wellll..yeah!!??). He attributed deflation to a central bank's failure to support the money supply.(provide more or less)
Alan Greenspan, our former GOVERNMENT FINANCIAL GURU was a leading monetarist. Ben Bernanke (our present GURU) appears to be following in his footsteps. Critics have said that a devaluation effect follows printing more money while the economy is not stimulated and the dollar is weakened.
The Austrian School blames Greenspan's actions in 2004-6 for creating false signals for investors with excessive liquidity (which refers to how quickly and cheaply an asset can be converted into cash. Cash money is the most liquid asset. And that Greenspan caused lending standards to deteriorate thereby creating the HOUSING BUBBLE of 2004-6 that ended in the bubble bursting in 2007-8 and the depression.
All these theories deal with the PHILOSOPHY of SUPPLY and DEMAND but they seem to exist far outside the real world balancing act of SUPPLY and DEMAND by focusing primarily on theories. I am not assured that this is good financial planning for a country let alone a world.
No theory has a perfect record so an immense amount of paper work ensues and I don't intend to add to it here.
Suffice it to say, we are being ruled by supposition (or assumption) And the new theories based on Global disasters being speculated on by world congresses rest on the same kind of supposition.
And you thought ECONOMICS was just a harmless hobby for MATHEMATICIANS and not of interest or concern to you!
MUCH has been written lately about deficits and impending INFLATION (what the USA owes everyone but mostly China). MUCH was written during the Reagan years about deficits to overcome "STAGFLATION" caused by years of Keynesian policies. MUCH continues to be written about who and what caused the current depression. Wall Street blames the Government. The Government blames Wall Street. In the depression overseas blame is placed on our Wall St. however the European Union ( many countries in Europe joined together under one Economic policy)must share blame. That Union was put together on suppositional theory as a Socialist Global Economy.
I add to the hyperbole (yata taa yata ta) that maybe all our problems stem from SUPPOSITION!!!!???? (ya think?). And worse, an unwillingness to admit that PHILOSOPHICAL ASSUMPTION is okay for the debating team but not okay for building a firm foundation for fiscal (financial) reality and security. But what do I know? beyond 2+2=4 and that's way too simple to stand the test of time. Or is it??????!!!
Economists can spout theories forever but let's leave the theories for study and debate as a true social science, not put those theories into practice without a firm not esoteric basis of fact. Supply and demand equal profit. LET BUSINESS BE BUSINESS and THEORY BE THEORY!
CHEERS, CONNIE
SUPPLY AND DEMAND is another part of Economics.
Economics definition: soft science based on supposition (assuming), rhetoric (lots of debate), speculation (wishing), some HARD FACTS and mathematical or financial theories. Economics studies the production, distribution and consumption of goods and services.
First and foremost, all mathematical theories have one thing in common. The perpetrators (forever now known as the "Perps"!!!!) have a strong mathematical foundation and know what few of us do-- that there's a lot of mathematical persuasion that cannot be proved but there's enough that can be proved to make it look like a REALLY HARD (not difficult but real) science. .
Three more definitions we need here: What is meant by SUPPLY and DEMAND (S&D) being a fundamental concept of economics. Simply put it's the relationship between (S&D )that determines the price of a commodity (gas is a commodity).
SUPPLY is the quantity available. DEMAND is the quantity demanded or desired. When the two amounts are skewed (not in good relationship)- disaster hovers. The S&D relationship is reflected in price as the result of the interaction. Price in turn can affect supply and skew demand. A teeter-totter on which all financial ventures play.
Sounds like many human relationships where demand often exceeds supply or vice-versa. However, in Economics there should be a good balance--no permanent break-ups here. When one or the other side is over emphasized, financial imbalance occurs.
INFLATION is an over-SUPPLY of money often creating euphoria and DEFLATION means money supply diminishes, prices go down, demand lessens, jobs disappear and finances Suck.
Let's visit our Corporation "Up-yours" again and talk to the CFO (CHIEF FINANCIAL OFFICER) about how suppository sales are progressing.
Skipping the usual "yahtata,", we ask if DEMAND for his product has increased. He tells us that DEMAND (particularly in Washington, D.C.) so exceeded expectations (SUPPLY) that PRICES rose (REFLECTION OF INTERACTION) for "Up-yours" suppositories that the Corporation increased the SUPPLY to meet the DEMAND. Fortunately or unfortunately, as often happens this also increased competition and a new company "Stick it" is currently driving the price down by flooding the suppository market. Although the market share is holding steady, we asked him what "Up-yours" plans to do.
"Well," the CFO smiled and whispered conspiratorially, "We know that government regulations will assist us and we are currently talking to "friends" about making "Stick-it" face penalties for unfair trade practices because they do not follow all government guidelines. We'll borrow big time and with the current low interest rates, we can hold our own at lower prices. We'll also use some modern techniques in marketing and advertising. You know people are more open to our product these days." I guess you could say he's "bullish" (Stock market term for up market) on his market future.
An over abundance of articles on Economic theories exist. Economics proliferates with schedules,graphs, function/equations, demand curves, shifts vs. movements, individual vs. market and so on. Modern Economics is an economics "hay day" (or "hey-hey" day). There are so many theories that Economists have to explain them to each other. We can't take them all aboard but we'll take a look at four reasonably familiar efforts by Perpetrators (henceforth known as "perps".
Remember that the word THEORY means SUPPOSITION or ASSUMPTION. You remember the definition of Assume.
KEYNESIAN ECONOMICS IS A THEORY declaring that intervention is necessary to ensure an active and vibrant economy by stimulating DEMAND to encourage economic growth. (DEMAND drives Economic growth.) An intervention is recommended (by any source) to keep the overall demand high. By a "perp" named (You guessed it) Maynard Keynes, who argued for Government intervention.
Neoclassical Economics has various versions or schools of thought such as the Chicago School and Austrian School of Economics. It is an amalgamation (combination) of several THEORIES and currently provides the foundation for the global economy. It is a more quantitative (mathematical-statistical) approach to research that now appeals to modern economists. It is criticized as a Utopian philosophy focusing on a RATIONAL INDIVIDUAL in ECONOMICS who is mathematically predictable for a general methodological principle for economics.
That means in essence--it's about a "Joe" who can be relied on to make the same clear cut judgements over and over again so that he can be reliably graphed to form a program for all of us to follow to create Economic perfection.(Oh, Yeah, pul..leeselet's have more of this current purr..fection in the country's and the world's financial picture!!!????)
Often referred to these days as "mainstream economics", it is far removed from SUPPLY AND DEMAND realities and more into the philosophy of global trade. The followers have developed a range of theories: game theory; linear programming, and econometrics. As a movement it gets further and further away from the REAL world of 2+2 make 4 and into PHILOSOPHY. The "Perps" who came up with the theory are multiple.
SUPPLY-SIDE ECONOMICS is a THEORY (a name coined by "Perp" Herbert Stein in 1976) that says reducing tax rates for business and wealthy individuals stimulates (SUPPLY) by savings and investments that benefits everyone. Not as highly valued as in Ronald Reagan's time as President when it was used to create a high flying American economy that now is not fashionable in the global economy.
MONETARISM is an economic theory which focuses on the supply of money and central banking's role and was formulated by "perp" Milton Friedman, who believed in a Target of "quantity of money" rather than "value of money" which included Supply Side Economics as well as some Austrian theory-another amalgamation.
Friedman's argument stated that excessive expansion of money (SUPPLY) IS INFLATIONARY. AN EQUILIBRIUM should be maintained between the S&D OF MONEY (Wellll..yeah!!??). He attributed deflation to a central bank's failure to support the money supply.(provide more or less)
Alan Greenspan, our former GOVERNMENT FINANCIAL GURU was a leading monetarist. Ben Bernanke (our present GURU) appears to be following in his footsteps. Critics have said that a devaluation effect follows printing more money while the economy is not stimulated and the dollar is weakened.
The Austrian School blames Greenspan's actions in 2004-6 for creating false signals for investors with excessive liquidity (which refers to how quickly and cheaply an asset can be converted into cash. Cash money is the most liquid asset. And that Greenspan caused lending standards to deteriorate thereby creating the HOUSING BUBBLE of 2004-6 that ended in the bubble bursting in 2007-8 and the depression.
All these theories deal with the PHILOSOPHY of SUPPLY and DEMAND but they seem to exist far outside the real world balancing act of SUPPLY and DEMAND by focusing primarily on theories. I am not assured that this is good financial planning for a country let alone a world.
No theory has a perfect record so an immense amount of paper work ensues and I don't intend to add to it here.
Suffice it to say, we are being ruled by supposition (or assumption) And the new theories based on Global disasters being speculated on by world congresses rest on the same kind of supposition.
And you thought ECONOMICS was just a harmless hobby for MATHEMATICIANS and not of interest or concern to you!
MUCH has been written lately about deficits and impending INFLATION (what the USA owes everyone but mostly China). MUCH was written during the Reagan years about deficits to overcome "STAGFLATION" caused by years of Keynesian policies. MUCH continues to be written about who and what caused the current depression. Wall Street blames the Government. The Government blames Wall Street. In the depression overseas blame is placed on our Wall St. however the European Union ( many countries in Europe joined together under one Economic policy)must share blame. That Union was put together on suppositional theory as a Socialist Global Economy.
I add to the hyperbole (yata taa yata ta) that maybe all our problems stem from SUPPOSITION!!!!???? (ya think?). And worse, an unwillingness to admit that PHILOSOPHICAL ASSUMPTION is okay for the debating team but not okay for building a firm foundation for fiscal (financial) reality and security. But what do I know? beyond 2+2=4 and that's way too simple to stand the test of time. Or is it??????!!!
Economists can spout theories forever but let's leave the theories for study and debate as a true social science, not put those theories into practice without a firm not esoteric basis of fact. Supply and demand equal profit. LET BUSINESS BE BUSINESS and THEORY BE THEORY!
CHEERS, CONNIE
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