I can recall one thing, and one thing only, I learned from my economics courses at Tulane University--never, ever forget the opportunity costs. This mantra is based on the principle that money spent on X is unavailable for Y. What we spend on education can't be used for health care, etc. There's always a trade off, so you must know your values.
Economics is hard for a lot of us to understand, so I am appreciative when someone simplifies the matter for easier understanding. As I was perusing the Wall Street Journal online today, I came across this article on why the stimulus package won't work. I can't vouch for the accuracy of the analysis, but the article certainly is clarifying. Check it out here.
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4 comments:
I just saw today that Pelosi is promising a bailout to automakers now. I was coming around to the idea that something needed to be done, but does anyone plan to draw the line? Its painful to watch.
I am afraid that we are in for a long ride. And by the way, what ever happened the the constitution and the limitation for Federal Powers.
If capitalism is to survive and work, they (the big 3) unfortunately need to fall victim to what the market dictates, and it is obvious that bankruptcy is the way. Toyota, Honda, Nissan; why have they survived when the big can not? There are several different reasons; a lot of their problems are based on their infrastructure, union contracts, etc. The result of them going under would be terrible, the slippery slop of government intervention has already been playing it's self out which could be just as terrible. We all might start driving around in victory cars… (1984 reference).
Here is a recent article regarding the GM.
http://blogs.moneycentral.msn.com/topstocks/archive/2008/10/28/a-government-bailout-won-t-save-gm.aspx
Thanks, Mezo!
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