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Economics for Canadians. Croecko Publishing. A cardboard bicycle. An Israeli engineer heard about a cardboard canoe, and thought about the possibility of building a cardboard bike He asked experts, who all told him it would never work
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Economics for Canadians Croecko Publishing
A cardboard bicycle An Israeli engineer heard about a cardboard canoe, and thought about the possibility of building a cardboard bike He asked experts, who all told him it would never work He was depressed until his wife told him to do it, as he was driving her crazy He now has a working prototype and hopes to market the bike for $20
The theme of “Economics for Canadians” Free, fair and functioning markets offer great benefits to individuals and societies Free, fair and functioning markets are only possible where people’s rights and where the rule of law are respected Rigged and broken markets do, however, exist. They benefit special interests at the expense of everyone else
The backstory “Economic Education” by Brian Maddock “Workbook for the New I.B. Economics” Awareness of the need for a clear, concise and affordable high school (and community college) Canadian economics textbook “Occupy Wall Street” protests in the fall of 2011 add emphasis to the need for economic education
The Book Itself 85 lessons with exercises Questions for review and extension every 6-8 lessons Four lessons on the current and ongoing global financial crisis Index of economic terms
A Guide for Teachers How to use “Economics for Canadians” with students Lesson guides – suggested additional resources, teaching tips, and the solutions to the exercises Student writing support materials Sample test and quiz papers
www.croecko.com Additional exercises Additional test and quiz papers Resource links (and supporting question sheets) Writing support materials and exemplars
The Flipped Classroom Students read and prepare for lessons at home, but work on questions and engage in active learning activities in class where they can seek help from their classmates and teachers
The Flipped Classroom (2) • When using “Economics for Canadians” • Assign homework – read next lesson and do vocabulary questions • The next day, check the questions have been completed and orally check for comprehension of the lesson’s main ideas. Spend a short amount of time instructing students on trickier bits. • Students work on the more challenging questions in class. Group activities and documentaries can also be done in class.
The book and current events “Occupy Wall Street” and the threat of ignorant ‘anti-capitalism’ The very important distinction between a free market economy and a crony capitalist economy and the problems that arise when people confuse the two Matt Taibbi – “I think I am doing more crime reporting than financial reporting”
Free Markets A functioning free market economy is the product of countless social norms and laws that give people the confidence to take risks Free and uncorrupted markets generate accurate price information Accurate price information allows us to make good decisions and allocate scarce resources most effectively which in turn increases overall welfare
Rigged Markets Rigged markets exist to serve and enrich insiders. Laws are changed or ignored if they are not convenient. Competition is suppressed as government and certain businesses cultivate close relationships. Price information becomes corrupt as insiders, in rigging markets, also rig prices. Poor price information leads to resources being poorly allocated throughout the economy.
The Financial Crisis Best understood as the capture of government by financial and banking interests Years of falling interest rates led banks to employ ever-greater leverage in the pursuit of profit People began to emulate banks as they too employed ever-greater leverage when buying property
The Financial Crisis (2) Since 2008 (or perhaps even 2001), it has been apparent that there is too much debt and that much of it will not be repaid In order to maintain the illusion that they were solvent financial institutions have pushed for very low interest rates However, making the ‘price’ of money artificially low has consequences
The Financial Crisis (3) • Real negative interest rates: • Discourage saving • Encourage speculation • Prop up ‘zombie’ institutions and individuals that are in fact insolvent, thus delaying indefinitely the creative destruction that would, through bankruptcy, see debts forgiven, assets reduced in price and redeployed, and the economy once again set on the path of recovery.
The Financial Crisis (4) Fundamentally, this mispricing of risk and of capital results in resources being mis-allocated Capital is not going where it is needed and where it could be most productive. Instead it goes towards speculation, and the result is widespread inflation and unemployment Recovery will be elusive until interest rates rise, bankruptcies occur, and the system is allowed to reset
Thank you I hope you will find the book and the website useful. If you could please sign the participants list that is going around before you leave, I would appreciate it. Thank-you very much for your interest and attention. Feel free to get in touch if you have any questions.
