The End to Recession Depression Inflation and Unemployment! PDF Print E-mail
Written by Tan   
Sunday, 22 February 2009
 The End to Recession Depression Inflation and Unemployment!       


 
Four economic concepts that do not exist in the Business Model of the 21st Century Economy.

1.    Recession
2.    Depression
3.    Inflation
4.    Unemployment

A recession
Occurs when a nation’s living standards drop and prices increase.  This downturn in economic activity is widely defined as a decline in a country’s gross domestic product for at least 2 quarters.

Depression
An economic condition caused by a massive decrease in business activity, falling prices, reduced purchasing power, excess of supply over demand, rising unemployment, and other negative economic factors.

Inflation
The rate at which the general level of prices for goods and services is rising

Unemployment rate
The percentage of the people classified as unemployed as compared to the total labor force

-    Bloomberg financial definitions

Too much focus is on the isolated economic details rather than the whole elephant.

Working and consuming are the only two functions for economic humans to consider in the business model of the 21st Century economy.  Therefore the goal is to eliminate any impediment with the ability of labor units to consume.

The solution is to frame the problem into three dimensions instead of the usual two-dimensional thinking.

There are exactly two macro components of the globe’s economics for the 21st century, summed up in what is called the Gross World Product.  Therefore the three dimensions are as follows:

A.    Gross World Product
B.    Labor units
C.    Stock Markets

There are only two components of consumer economics - the labor units producing the value and the stock markets capturing the excess value from the labor units.  The words “recession,” “depression,” “inflation” and “unemployment” need to be eliminated from the lexicon of economists.  When supply is balanced with demand and unemployment is eliminated by a “New Consumption Function” in the 21st century, those four words – recession, depression, inflation and unemployment – will be exposed as the paper tigers they really are.
 
The real question is, “how do we accomplish this seemingly impossible feat in one chess move?”  By the engineering of the standard accounting principles using a “New Consumption Function.”  The “price” - arbitrator of supply and demand - of products and services are CHEAPER than the appreciating EQUITY of the publicly traded companies thus causing the GWP to increase and sustain itself through innovations.

When one hundred percent of the need-based products and services of consumers - the primary drivers of the economy - are integrated into the majority ownership of equity in public traded companies;

The New Consumption Function is called Product Equity Value© (PEV©). Governments do not have to legislate PEV©.  The market place will find this equilibrium on its own.

Paul T. D. Katchings
Business Engineer

Last Updated ( Saturday, 27 June 2009 )
 
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