terça-feira, 23 de setembro de 2014


Question: what is workshop?
Answer: men work, women shop.

The husband says to his wife? “If I don’t work, you will have no money to shop”.

The wife replies: “If women don’t shop, the shops will be closed, the factories will be closed, you will be out of work and millions of people lose their jobs. All economic activities come to a complete stop. The country – and the world – moves form mild recession to great depression.

This scenario actually happened om USA in early 1930’s. Hoover, the republican candidate. Advocated low interest loans to Ford to re-open the factory (production creates consumption). Roosevelt , the democratic candidate, did the contrary. His “New Deal” was based on keynesian theory that consumption creates production.

Roosevelt and his keynesian economists undertook the following measures to stimulate consumption:

Mininum wages – increase workers capacity to spend and consume. If every worker buys a shirt, the shirt factory will re-open and employ more workers – a virtuous circle of consumption creating production.

Installments – banks finance purchase of automobils om 24 months with low interest rate, purchase or construction of houses with mortgage of 20 to 30 years for payment. “A house on every piece of land, two cars in every garage”.

Low rate of interest – stimulus for automobil sales and house constructions. Also banks return to profit and employ more people, again a virtuous circle.

There was even suggestions from Roosevelt’s keynesian economists that the american bank note should have a date of validity (data de vencimento) to accelerate spending and consumption. However, this crazy suggestion from crazy economists was not adopted.

In conclusion, we shall be thankful to our wifes, for their role in the society. If they don’t shop, we will be all be without work.

I have a joint account with my wife in a local bank. “Joint” means I deposit and she withdraws. I work, she shops. I am glad that she contributes more than I do to the well being of our society.

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