Macroeconomics Overview

Modern Macroeconomics

Follow the Money
Government Macroeconomic Policy
Keynesian vs. Monetarists

Macroeconomic Theory Primer
Analyzing Macro Equilibrium
When Will Policy Affect Income Equality/Growth? 
Rise of U.S. Monopoly Power video of recent
micro/macro financial markets developments.

Macroeconomic History
From Feudalism to Mercantilism to Capitalism
Building a Dem. Fed. Cap. Republic

U.S. Economic History
1900 to Present

Return to Free Economics Notes
Economic Reviews    

Updated 08/17/1



Follow the Money



Government Macroeconomic Policy



Keynesian vs. Monetarists


Macroeconomic Theory Primer

Rules Examples Result Skin in the Game Application
Increasing demand
raises price
and profits
President G. W. Bush (R) signed the Medicare Prescription Drug, Improvement, and Modernization Act created Medicare Part D. This increased demand for drugs and their price. The law also banned prescription drugs from Canada and the Use of government purchasing power when federal awarding drug contracts. These limited supply also pushed up price. Higher prices increased insurance premiums and exacerbating the recent increases in deductibles and copayments. Also many uninsured did without prescription drugs. Drug companies had lots of skin in the game and used politics to made sure their profits went up. Increasing the demand for homes caused higher prices and profits and eventually a housing bubble which ended with the Great Recession.
Decreasing demand lowers price



Decreased demand for U.S. produced goods followed NAFTA. It allowed cheap Mexican and Canadian manufacturing and agricultural goods to enter and replace US domestically produced goods. Foreign demand for US  goods increase a little but intellectually property which generate large profits but little employment got most of the new increased demand. US balance of payments increased and demand for U.S. workers decreased causing a drop in wages. Workers have skin in the game but guns and God and contempt for government hinder a united effort to increase wages. Intellectual Property owners use politics to enhance their profits creating economic rent. Helping workers relocate and training misses too many displaced workers. Increasing the safety need lacks political support. "Let them Eat Cake."
Decreasing supply increase price. Oil embargos of the 1970's pushed up price and oil's inelastic demand led to only small decrease in quaintly sold. Profits skyrocketed as did energy prices causing the World to Changed and Good Jobs to Disappeared The world's supply of  loanable funds increased. They were quickly loaned to Latin America and Third World nations. Most eventually defaulted. Oil producer's had no skin as their deposits were guarantied by commercial banks who had limited skin because they were too big to fail. Privatizing SS would have the same effect as the large increase in investment funds would outstrip the supply of worthy investments.
Increasing supply lowers price Federal support for agriculture beginning with Land Grant Universities increased production lowering price. Alabama, and other LGU  became football powers. Inexpensive food has almost become an obesity causing free good. Agriculture has skin (no pun intended) in the game making
it big business.
Increasing the supply of college educated workers using a non merit college system has lowered the Economic Return of College Degrees.


Analyzing Macro Equilibrium




When Will Macro Policy Affect Income Equality and Growth?

Return to Free Economic Notes Chapter 18_Economic_Growth.htm


From Feudalism through Mercantilism to Capitalism




Guttenberg Press1

Carrack Sailing Ships

Advanced Communication


Controlling Oligarchs


+ Politicians + Interest Groups + Billionaires
+ Social Media

Eternity in Hell or Heaven 
Physical punishment

  + Economic Rewards   + Political Rewards   + Self Interest
Economic System Feudalism Mercantilism
based on Gold.


with managed currency and credit


Energy Source

Water and Wind

+ Steam 

+ Electricity

+ Oil

+ Atom      + Nature

Major Sources of Government Income

Surfs + Borrowing + Inflation

 + Tariffs
  + Corporate + Income Taxes
+ Payroll Tax
Conflicted Participants

Church and Monarchs

    +Countries  + Business
+ Cultural Philosophy
Who Pays Most to Government

Surfs + Savers

+ Farmers
+ Bankers + Business
 + Corporations
+ Individuals
 Who Has
 Most Wealth

Monarchs + Church + Bankers

 + Business
+ Corporations
+ Finance
 + Innovators + Workers

Government Waste



+ Excess Military Spending 
+ Misdirected Education Spending

 Successful Government Contribution


   + Infrastructure

+ Sanitation + Health
+ R&D + Universal Education

Appropriate  Education
+ Security

Unintended Consequences of Government



Individual Dissatisfaction

What Wealthy Fear



Social Networks




Latest Leading Indictors

Source The Business Cycle: Predicting Recessions


U.S. Doing Something Correct