Quinny
Active member
Don't worry. You didn't make a stupid response, so I won't rip into you. My post was not necessarily optimistic, it just pointing out the obvious. Maintaining a good GDP is by no means the only concern that needs to be considered. The economy is a highly complex puzzle to solve. In truth, the government can only do so much to try and take control of it, especially in a capitalist system.
Something however does need to be done. If the current trends continue to hold over the next 5 years, we will likely be met with inflation (its already starting). The government will either increase its amount of currency to meet the rising prices or it will hold the current number. Increasing supply of currency will depreciate the dollar value (which hints to what is happening now). If you hold the current currency supply, it will not depreciate, however, it will drop ultimate drop demand and result in unemployment. Historically government have always opted to increase money supply.
The key to counter inflation, however, is to have a interest rate that outweighs the inflation rate. This is where money borrowing comes in. This is why GDP and Debt are important. Macro-economics are a "positive vs. negative" situation. Deficits (and such) are inescapable, but they can be counteracted. The key to a healthy economy is being able to have the positive outsize the negatives.
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Smaller Sig = Claustrophobia
Larger Sig = Endless Void
Something however does need to be done. If the current trends continue to hold over the next 5 years, we will likely be met with inflation (its already starting). The government will either increase its amount of currency to meet the rising prices or it will hold the current number. Increasing supply of currency will depreciate the dollar value (which hints to what is happening now). If you hold the current currency supply, it will not depreciate, however, it will drop ultimate drop demand and result in unemployment. Historically government have always opted to increase money supply.
The key to counter inflation, however, is to have a interest rate that outweighs the inflation rate. This is where money borrowing comes in. This is why GDP and Debt are important. Macro-economics are a "positive vs. negative" situation. Deficits (and such) are inescapable, but they can be counteracted. The key to a healthy economy is being able to have the positive outsize the negatives.
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Smaller Sig = Claustrophobia
Larger Sig = Endless Void
