Bus 101 assnignment 2

Bus 101 assnignment 2 - Nicholas Connolly Bus 101- Dr. Barr...

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Bus 101- Dr. Barr 1/15/2009 BUS 101 - Dr. Barr Assignments for Thursday, January 15 1. Go to this website and read the articles posted there: http://history.howstuffworks.com/european-history/capitalism.htm After you have read about capitalism on this website, answer the following questions (in writing): Does the US economy operate under pure capitalism? Support your answer with some specific examples either from the reading or your own knowledge. No, the US economy does not operate under pure capitalism, if anything it is very close to planned economy market. The bankers knew that the trades were bad, but everyone went along with the get rich quick idea. They bought real estate that they knew was worth nothing, sold it for 3 times the actual amount and make a very nice sum of money. The problem was and still is that the people they sold these million dollar houses to was that they were only make $60,000 a year. In no way would they be able to afford such a house. After people started to realize this, the market started to collapse and something needed to be done. The Federal Reserve stated to print money, $700 billion to be exact. Now, the US is said to be in a recession, and the government is in serious debt, but they have the money to print $700 billion, that doesn’t make much sense. How could they print money that they don’t even have? This market is not free market economy in any sense and if Ben Bernanke and Barack Obama stay in charge I think we will never be back under a pure capitalistic economy. Should the US operate under a system of pure capitalism? Why or why not? What are the advantages and disadvantages of this system? Yes, the US should operate under a system of pure capitalism because that is the way the market works. When people start to control the market, things start to unravel and fall apart. A perfect example of that is the Dow Jones Industrial because with the Fed and the news of President elect Barack Obama pumping in money, the market takes huge swings. Before the War in Iraq started, the US operated under a system of pure capitalism, which had many advantages. The markets were very stable and there were not huge unpredictable shifts in the market like there are today. People would not lose their life savings over one day, like some have in the last few months. The unemployment rate has never been this high, and people who used to make millions on Wall Street now don’t have a job anymore. Another example of why markets should be operated under a system of pure capitalism and not a Marxist economy is because every market has hit new highs and a new lows in the last year which has never been seen before. There are no disadvantages to this system because if the economy were operated
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Bus 101 assnignment 2 - Nicholas Connolly Bus 101- Dr. Barr...

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