Important Important Lessons from Lessons from

MacroeconomicsMacroeconomics

Lesson 1: Markets Raise Living Lesson 1: Markets Raise Living StandardsStandards

Exchange based on low cost pushes Exchange based on low cost pushes out Production-Consumption out Production-Consumption PossibilitiesPossibilities For all incomes, political divisions, For all incomes, political divisions,

ethnicities, ethnicities, … …

Lesson 2: Markets Promote Lesson 2: Markets Promote Individual Individual

Choice & ValuesChoice & Values How do you prefer to spend your How do you prefer to spend your

money? money? Food: Bananas, carrots, berries, Food: Bananas, carrots, berries,

hamburgers, …hamburgers, … Music: Pop, metal, classical, jazz, Music: Pop, metal, classical, jazz,

alternative, …alternative, … Leisure: Books, music, movies, theater, Leisure: Books, music, movies, theater,

DisneyDisney, …, …

Lesson 3: Markets Gain Lesson 3: Markets Gain Through Changes – “Creative Through Changes – “Creative

DestructionDestruction””

Lesson 4: Markets Promote the Lesson 4: Markets Promote the Unlimited Resource -- Human Unlimited Resource -- Human

CreativityCreativity

Lesson 5: Prices Are Critical to Lesson 5: Prices Are Critical to MarketsMarkets

Signals to Consumers/ProducersSignals to Consumers/Producers Incentives to Consumers/ProducersIncentives to Consumers/Producers Cash or Vouchers better way to help Cash or Vouchers better way to help

low incomelow income

Lesson 6: Markets Are Not Lesson 6: Markets Are Not PerfectPerfect

Panics, Bubbles, Fraud, Greed, Job Panics, Bubbles, Fraud, Greed, Job Losses…Losses…

Other “systems” share these Other “systems” share these problemsproblems