19 Dec Economy Works
How the Economy works?
1) Economy is like a car engine.
2) Fuel is like the money
3) Fuel in the tank is like money in the house
4) The car will work only when the fuel reaches the engine through the network of pipes controlled by valves of the carburettor
5) During winters cars don’t start because cold weather slows the flow of the fuel.
6) During pessimistic times like the lockdown, the economy slows down when people stop spending and not let money to reach the markets
7 ) Therefore one has to adjust the valves allowing more fuel to flow into the engine and kickstart the engine
8) Interest rates are like valves which we need to adjust ( lower the rates ) during slowdown helping more money to reach the different markets from the homes and thereby kickstarting the economy.