Thesis: Fiscal Policy Macroeconomics Questions: Uncertainty

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Fiscal Policy

Macroeconomics Questions:

Uncertainty is the greatest watchword of the current economy. As American staggers into the 18th month of its recession, the dramatic 'bailout' spending of the Obama Administration and the freewheeling money-printing of the federal reserve have simultaneously slowed the pace of economic decline and opened up a hornet's next of questions over the threat of inflation in the immediate future. An article from July of 2009 by L. Mutikani and published in Forbes Magazine offers some insights into the nature of this uncertainty.

Identifying the correlation between inflation in the value of the dollar and the trends concerning commodity trade, Mutikani indicates that a recent rise in an oil price eroded in the last year by reduced consumer and commercial spending has staved off the present probability of inflation. Additionally, the article reports that a rise in May in the Consumer Price Index (CPI) though more modest than projected, at least constituted a month-to-month rise. Other positive indicators in the economic outlook concern the budgetary deficit, which actually went down for the first quarter since 2001.

Some economic forecasters have taken the present indicators as a positive sign that inflation may actually be avoided as we attempt to turn a corner in the recession. According to the article, "there is no sign that there has been widespread inflation because of the Fed's quantitative easing regime. In fact, long-term inflation expectations haven't budged and the Fed is still ahead of curve on inflation,' said John Canally, an economist and investment strategist at LPL Financial in Boston." (Mutikani, 1))

This is an optimism which is not shared by everybody. With only modest gains in stocks and negative projections by such key economic predicators as FedEx Corp, many see a recession with sustained power and have limited confidence that consumers are prepared to float a return sufficient enough to prevent the devaluing of a freely printed dollar.

2.

The question of self-employment vs. regular involvement with an organization carries numerous questions that concern personal priority and long-term expectations. The immediate and most obvious drawback to the self-employment that our subject is considering is the personal stake which it constitutes. In the first year projected, the $30,000 revenue reported here would just barely eclipse the expenses cited for necessary office purchases and utilities. The remaining sum allowed for general living expenses is observably paltry and would demand a rather ascetic lifestyle orientation. That said, she would be availed the independence to begin drawing profit from the business as time progresses. The expenses here noted are likely to account for such items as might be sustained, replenished or reused without added cost. The fact of her ownership of the business would denote that moneys spent could largely be projected to account for future expenses as well.

This contrasts the opportunity to be kept under somebody else's employ, where a $3,000 sum nearly offsets the $3,500 margin left after expenses in self-employment. In this case though, the fact that the woman owns her own property denotes that not only will she not carry the expense of rent or mortgage, but that she has the capacity to make money off of the property itself. This latter prospect denotes that employment for somebody else is likely to carry with it a prospect of greater money earned in the immediate future. With respect to self-employment, there is an unspoken prospect that longer time spent in the position can lead to greater personal profitability. Though the case indicates that there are no employees at present for the self-employed woman, there are prospects for personal advancement which are more malleable and open in this capacity.

Therefore, in spite of the immediate gains likely in terms of living practicalities from employment, self-employment carries a far… [END OF PREVIEW]

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Fiscal Policy Macroeconomics Questions: Uncertainty.  (2009, July 18).  Retrieved September 17, 2019, from https://www.essaytown.com/subjects/paper/fiscal-policy-macroeconomics-questions/16554

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"Fiscal Policy Macroeconomics Questions: Uncertainty."  Essaytown.com.  July 18, 2009.  Accessed September 17, 2019.
https://www.essaytown.com/subjects/paper/fiscal-policy-macroeconomics-questions/16554.