Impact of Monetary and Fiscal Policies
Updated: 3/24/2020
Impact of Monetary and Fiscal Policies

Storyboard Description

Explanation concerning the current economic conditions and their impact on the Texas economy to a friend.

Storyboard Text

  • so this guy is supposed to tell us our country's future, whether it's good or bad?
  • according to the Troll at the bridge, yes. But, we have to be precise or he may not answer just as we need.
  • This project is brought to you by Alyssa Stanley and Kathryn Trout
  • Monetary Policy is where the Fed changes Real interest rate and the amount of money in circulation to influence the economy
  • I think he's already into a prophecy...could he have known we were coming?
  • Fiscal Policy is where the Government spends more and changes tax rates to influence the economy.
  • In Texas' economy, there’s too many people (increased housing need) who aren’t buying enough (decreasing retail sales) and they aren’t skilled enough (difficulty finding qualified workers) to get hired but want to be paid more (wage pressures). Outlooks generally improved, though the coronavirus introduced new uncertainty into the business environment.
  • Should we interrupt him?
  • Umm I don't know if we can...what is he even talking about? What's Texas?
  • What's coronavirus? Hope it's not as bad as The Plague...
  • Due to strong consumer spending it is plausible that the fed increases interest rates while the government decreases tax rates
  • the U.S. economy has a solid labor market, real GDP increased steadily, consumer spending is strong, but housing market declined (with rising mortgage interest rates and higher material/labor costs)
  • Lord Econ! Sir! Can you hear us? We don't want to know about the "U.S." and this "Texas!"
  • Yeah, that ain't gonna work, doll
  • When inflation returned, the FOMC returned the originally set 2% objective federal funds rate to sustain the economy.
  • The federal Funds rate is the interest rate banks charge one another . If the interest rates are high, the banks can't borrow as much money which also means they can't lend out as much money either. 
  • This is no use to us...I'm gonna go give that troll a word of my own!
  • You gotta admit, he did just give us some wicked cool information!
  • Texas' economy is affected by the actions of the federal funds rate because of its direction connection to banks.
  • For what it's worth, at least this "Texas" and "U.S." will have a decent economy around "February and March of 2020"
  • well, that was a waste of time!
  • I guess we shouldn't have trusted that troll! Ha!
  • yeah that's true, and we also know that the actions of the Fed and government of those places don't contradict one another because they are striving towards the same goal: expanding the economy!