How have these policies affected the employment rates for your chosen industry?
Initially the decreases in taxes from fiscal policy and the increased disposable income and money it created, helped along by the Fed’s decreased interest rate monetary policy, helped the technology industry. It allowed many to easily afford computers and to invest in computer companies. This increased demand for services lead to hiring demands for all types of computer and technology workers. In the long run, however, when the mini-booms led to massive failures, people lost their disposable income meaning their demand for technology decreased. Also, to obtain technology services at lower costs, many turned to outsourcing. Technology company failures and expense cutting measures then led to massive layoffs and unemployment.
How have these policies affected the growth of the industry?
As discussed above these policies first lead to great expansion and growth in the industry and then caused a great contraction in the industry.
How have these policies affected the prices of the product the industry produces?
When money was over abundant and credit was cheap, technology prices tended to hold steady or rise slightly as demand peaked during certain holidays and seasons. As the massive layoffs in the industry and the declines in disposable income occurred, demand decreased and many had to lower the price of technology goods and services.
Appendix B
Article One
Article or Web site reference in APA format:
Auerbach, A.J. (2008). Facing the Music: The Fiscal Outlook at the End of the Bush Administration. The Brookings Institution, May 8, 2008. Retrieved August 10, 2008, from http://www.brookings.edu/papers/2008/0508_tax_gale.aspx
Summary of Article or Web site:
The fiscal policy during the Bush Administration over the past eight years has consisted of decreasing income for the government and increasing government spending. In other words, the government has cut back on its main source of income, taxes, while its spending on government retirement programs, wars, and other things have risen. The government has financed this spending by increasing its debt levels. Depending on the calculation method used, government debt will range from 2.5% of GDP to 6.8% of GDP by the end of 2008. The government can either continue with this deficit spending to its ruin or it can take action, raise taxes, reduce its spending, and fix the problem in the years to come.
Article Two
Article or Web site reference in APA format:
Paul, R. (2008). Rising Energy Prices and the Falling Dollar. Ron Paul Newsletter, June 9, 2008. Retrieved August 10, 2008, from http://www.ronpaullibrary.org/document.php?id=1086
Summary of Article or Web site:
The Federal Reserve’s policies over the past years have caused there to be too much American currency available to Americans and foreign investors. The result has been that these persons have needed to use those U.S. Dollars to buy commodities and assets to be able to secure value for that cash. In the rush to buy those commodities and assets these people drove prices up in certain small economic segments, like dot com companies, real estate, and now oil and gold. When these segments face such high, unnaturally created demand, the eventual result is that they finally come crashing down, as dot coms and real estate did.