Outline
This paper reviews the article, “From Bear to Bull” published on Sep 19, 2009 in the online version of the Wall Street Journal. The article is about the current economic crisis and argues that contrary to expectations of a prolonged and deep recession with the recovery being jobless and fuelled by high inflation, the recovery can be better than most investors or economists care to acknowledge.
Idenitfy
Main Idea/ Introduction
The main idea presented in the article is about the recovery of the economy that according to the author would be speedier than expected. The author draws upon history to send the message: the deeper the slump, the zippier the recovery. This relates to the learnings from the class that posits a way out of this slump with an emphasis on speedy recovery.
New Concepts / Definitions
The new concepts that were brought forth in the article relate to the shrinking of the GDP in times of recession and the correlation between government spending and the GDP growth. This is monetary economics and if I were to define the terms, it would be that GDP or Gross Domestic Product is the value of all the goods and services that were produced in the country in a certain period of time.
Explain
Facts
The author of the article while maintaining a bullish stance on the economy recovering nonetheless makes the point that even the best investors do not hazard guesses on the way the economy would progress. This is one of the points that the author uses to support his claim that predicting how the economy would behave is simply not sustainable. The central idea of the article is about the speedier the recovery, the deeper the slump. Finally, the last point is about how the policies of President Obama and his areas removed from Roosevelt as they are from Reagan. The author supports this claim by stating that President Obama has not constituted a National Economic Recovery Administration like Roosevelt nor has he tended to follow Reagan in promoting big business.
Bias/ Faulty Reasoning
The bias that the author has can be discerned in the way in which he promotes the idea of a faster recovery. While every economist worth his econometric model has gone on record warning us against a double dip recession, the author remains somewhat of a bigger bull than he would care to admit about the prospects of the economy. Granted that the author has a point when he talks about the futility of forecasting, however, how can one forget the huge numbers of derivative contracts that are outstanding and very well herald the next stage of the economic crisis?
Illustrate
Application/Examples
As an entrepreneur, I would profit from the article because of its optimistic tone and the way in which it argues about the future with reference to the past and what lessons we can learn from previous economic recessions. This is certainly good news for any small business owner about to make investments or planning to put on hold investments in his or her business.
Retention/Conclusion
If I were to remember something about the article three to five years from now, that would be the “glass half full” optimism of the author. In times when everyone talks of gloom and doom, it would be worth remembering that there was someone who was optimistic without being starry eyed and realistic without being pessimistic.
Reference List
Grant, J. (2009). From Bear to Bull. Wall Street Journal Website. Fonterra.com.