The good and bad sides of debt & borrowing

At least once a week I explain to you that you need wider context, and it was clear from your essays on inflation/deflation & central bank policy that this is still very limited, and is something you should be trying to overcome. All of you wrote good technical answers, with basic explanations of both causes and outcomes, and applied broad CB policy to this. However, not one of you differentiated between different groups in terms of policy impact, or applied the current situation in terms of the changing shape of our economy and demography in your explanation of why CBs should be focusing on deflation. This would be where you would lift your answer to a higher grade - from simple explanation to more complex development of a theme using the current context.

I understand that when we cover a topic in class you get the material to write technical essays - the "bones", if you will; it is up to you to read around a subject to put the meat on the bones. I spend a lot of my time reading across the spectrum of commentary on the current context; I post the best & easiest to grasp articles here. I can tell who is taking the time to read this and who isn't. If you believe that, having learned the material from class, and demonstrated the ability to regurgitate it in an essay, you will achieve your target grade, you are mistaken. Your target is set at the upper boundary of what you showed us you could achieve; you are unlikely to coast to that grade. If you take this point seriously, and start to read the material I post here - and other articles - you will get a much wider grasp of each topic. This will help you hit your target, and possibly lift you up a grade.

With regard to the issue of tackling deflation, the key point you all missed is not just debt-deflation issues; it is the nature of our economy (and all consumer-driven economies) as being demand-led, driven by debt. Debt is not a problem if it is used wisely - but it is a problem now; you can read about this in an interview with Russell Napier in the 28th Nov issue of MoneyWeek. As you know, there is a copy (usually unopened) in the library. I know some of you read it online, but many of you don't. We are more than half way through the course, and while all of you have shown improvements in your writing, many of you are not adding the depth through reading as we go along; you will NOT be able to add this during the last few weeks before the exam; "economics" is happening all the time - and every week something significant is happening. You ignore this at your peril.

You all need to be getting serious about your exams now; your Saturdays and Sundays need to contain both school work and extension reading. The Unit 4 exam probably needs more extension reading than anything else. In future I will be marking your essays for their context; if they are a rehash of class material alone do not expect better than a C.