probably not Professor Phil Powell 19 September 2014 The Alliance

UNEMPLOYMENT 4.5% 5.5% INFLATION 2.0% 4.0% SUPPLY SHOCK Less Oil Output Product Shortages Job Furloughs Reverse Bottlenecks UNDEREMPLOYED Expenditures Down Reduced Confidence Market Fear Stimulus Policies OVEREMPLOYED Expenditures Up Irrational Exuberance Labor Shortages Retrenchment Policies EXPANDING CAPACITY Plentiful Inputs Productivity Growth Expanding Labor Force Run Surpluses NORMAL ECONOMIC ACTIVITY

Year Now GDP Growth Rate Unemployment Rate Inflation Rate Interest Rate Public Spending Growth Rate Labor Productivity Growth Corporate Profit / GDP S&P 500 Annual Return Corporate Profit Stock Market Economic Activity Job Market Leading Indicator Lagging Indicator FUTURE EXPECTATIONS Corporate Cash Business Investment EXUBERANCE CYCLE Personal Income

Expected Inflation Rate Market Interest Rate Real Interest Rate Deficit Spending Private Savings $ $ Business Investment (+) Cash Supply (-) Money Supply Banks lend cash (0) if trust (+) if no trust

The Haves The Have Nots ACCESS TO Opportunity Education Technology Falling Wages Global Irrelevance Democratic Majority Rising Wages Excess Global Demand Democratic Minority Institutional Stability Economic Innovation