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Unformatted text preview: M IDTERM 2 STUDY GUIDE American Politics 11/3/2010 ECONOMY TODAY Largest and most powerful economy in the world (but china is catching up)- A shift from industrial to post-industrial o A bi-furcated economy with the demise of many manufacturing jobs o Achieving the “American dream” may be more difficult o We may be missing a piece in the middle o Immigrants have probably stepped up When we think of the American economy we have to look at it in different ways Stock Market : ways that we view the economy, a measure- Just play money cause it is just how we much we value corporations with the investments that we place to each Dow Johns : a collection of American largest companies- “ The big thirty”- However the 1990’s was great for some- BUT what comes up must come down Nasdaq : represents more of the new companies and new technology- Rose even higher in the 90’s but fell even harder- 2001 the whole in both the world in NY and in the stock market wall street 1990’s: huge turn for the better. Stocks way up!! - Did most gain from the stock market of the 1990’s- NO 2001: the crash 2003: the recovery…. Well not so fast 2004: economic growth literally crashed again when John Cary lost and bush went to war again. 2006: political question came up, was the situation still bad for the democratic? - Yes cause of BUSH 2007: All time high for both R and D 2008: market drops 50% 2009: TUMBLE! 2010: a partial recovery - Still suffering - Homes are still down- Employeement down Stock Market is not the entire Economy- One is Jobs - One is Inflation Both Jobs and Inflations are Political issues - Dem talk about creating Jobs- Rep promise to fight Inflation- Success and failure have political consequences Obama: not just the man but his position - They will just really never win- Blame for the Low population of Jobs and high Inflation in the Economy - Dem think that he inherited a bad economy and too hard to bring it up- Voters are very unforgiving.- Where is the recovery and we need to see more of it?- Well, the American people have always been unemployed o 4% unemployment is actually a good thing cause it is low o 9% is almost one out of every 10 people I nflation : a rise in the general level of prices of goods and services in an economy over a period of time. When the price level rises, each unit of currency buys fewer goods and services; consequently, inflation is also an erosion in the purchasing power of money – a loss of real value in the internal medium of exchange and unit of account in the economy. - About 25 years ago, inflation was high. Now it is pretty low- Deflation tends to be because of depression- Inflation tends to be because of war- In other times consumers would be ecstatic. Home loans are the lowest in modern history that means you can borrow money cheaper- The worry on the minds of many today is DEFLATION: Deflation : is a decrease in the general price level of goods and services. Deflation occurs when the annual inflation rate falls below 0% (a negative inflation rate). It amounts to an when the annual inflation rate falls below 0% (a negative inflation rate)....
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This note was uploaded on 09/07/2011 for the course ENVD 3114 taught by Professor Pyatt during the Spring '10 term at University of Colorado Denver.

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