10/19/11

• Confidence is a pivotal asset in everyday trade and work.
• you don't undergo a trade-off with other people if you don't have at the very least some semblance of confidence that the trade-off will go well
• Feedback Loop
• competition serves as an incentive to corporations to keep up the good work or another business will take its place
• doesn't work if people become apathetic
• Trade and Exchange
• basic economic questions derived from scarcity
• what gets produced
• how does it get produced
• allocation of said thing produced
• inputs-----black box---------"stuff"
• process of creating more economic resources
• two pre-requirements
• self-sufficiency
• specialization and exchange
• Factors of Production (inputs)
• land
• any preexisting physical object
• labor
• number of bodies
• capital
• what must be first produced to produce something else
• two kinds
• physical
• human-anything done to augment natural abilities
• Economic Activity
• depends on PSST- Pattern of Sustaining Specialization and Trade
• order of sequence
• specialization
• exchange
• discovery
• less GDP is gathered when people do things for themselves
• an economic slump can be caused by rapid emergence of new technology 
• trade is "good"
• biggest economic consensus
• some disagree thinking
• nothing new is created
• some get exploited
• wealth is whatever people value
• real economic growth happens with increased production of wealth
• voluntary exchange only happens when the values differ
• people trade to get more of what they value