It vice versa where’s it coming from when the economy is booming?
When the economy is bad, it feels like there’s not enough money to go around, but when it’s good there’s plenty.
In: Economics
Here’s a analogy that explains what you see. Think of money like cars. They can be parked in the garage or they can be driving around on the street. If you look at the street, with some traffic monitoring device and publish how much traffic there is, you’re not really measuring how many cars there are. If the government makes more cars and gives them away, then there are more cars, so you might expect to see more cars on the street. But even if the number of cars remains the same but when more opportunities to get some good stuff if you drive to get it arise you’ll also see more cars on the road.
This is how the economy works. The “opportunities to get some good stuff” are an example of a healthy economy rewarding people for doing work (or at least driving to work). Government stimulation, giving away cars, provides the measurement of a good economy, lots of cars on the road, without it meaning the same thing.
When politicians do stuff to make the stock market go up, not only are they lining their pockets (and their rich supporters pockets) they are also messing with the measurement you might use to understand if the economy was good or bad.
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