1. Connecting Economics and Government

2. Paul Solman Video: Steering the Course

3. Re-explain the analogy between Homer's Odyssey and our economic goals
Scylla
(Inflation)
Charybdis
(Unemployment)

4. Achieving the Three Goals
The governments role is to prevent unemployment and prevent inflation at the same time.
If the government focuses too much on preventing inflation and slows down the economy we will have unemployment.
If the government focuses too much on limiting unemployment and overheats the economy we will have inflation
Unemployment
Inflation
GDP Growth
Good
6% or less
1%-4%
2.5%-5%
Worry
6.5%-8%
5%-8%
1%-2%
Bad
8.5 % or more
9% or more
.5% or less

5. Connect this cartoon to the article?

6. Connect this cartoon to the article?
Consumer Confidence

7. The Broken Window Fallacy
Stossel Video:
The Broken Window Fallacy 7