Monday, December 15, 2008

╠ AniBlog - The Global Economic Crisis for Dummies╣

So here I am with another one of these things. This time trying to share my knowledge of economics towards the global economic crisis.

As far as quality goes with this AniBlog I tried something different here with trying to explain something with both sound and image at the same time which I think didn't work because at around the 30sec mark you either aren't paying attention to whats on the screen or have completely lost what I'm saying.

However this time at least I was able to keep it below 2 minutes so the bursts are getting shorter and shorter. As usual any recommendations or comments are welcome



The Script: (Not kept to 100%)

So stock markets are crashing, banks are being stingy, dollars are plummeting and America as usual is to blame. Now most of you probably know the housing loan issue that caused all of this but very has been said about the economic factors that contribute to a recession.

Now the main part of importance is inflation. An economies inflation is the percentage increase on what a country spends each year. In a perfect world this stays still at a low rate. However this usually isn't possible because when people negotiate things such as wage and price increases they usually increase by inflation and then because they're greedy and wish to grow tap some on top of it therefore inadvertantly increasing inflation.

Left to its own will this usually continues to rise, however the Reserve Bank of Australia tries to keep this at around two to three percent. They do this by changing interest rates. Raising interest rates means people are more inclined to save reducing inflation, lowering them obviously does the opposite.

What makes a recession is when inflation drops over an extended period. This means people aren't spending at the increasing rate that they were expected to, this unfortunately leads to unemployment increasing which means that those people aren't spending their wages which negatively affects inflation causing the horrible cycle that is a recession

So basically thanks to how interconnected the world is when a huge economy like America gets the sniffles, the rest of the world catches a cold.

The solution to this problem is relatively simple, if a country spending less overall puts them into recession, the solution is simply to spend more. So if you're listening to this here's my recommendation. Save the world, Embrace Christmas! If you run out of people to buy gifts for I'm sure you could find it in your heart to think of a Uni Student blogger who is deserving

1 comment:

Lili said...

...I tried something different here with trying to explain something with both sound and image at the same time which I think didn't work because at around the 30sec mark you either aren't paying attention to whats on the screen or have completely lost what I'm saying...

Thank God I'm not the only one. xD I had to watch this like 3 times to get it... =/