Original subtitles

sense. Just keep it in the back of your mind as we go through

expensive over time so that speed the speed of that

understand everything in relation so the driver is a

be careful of it because too much speed is dangerous too

obviously it's always set at 2% that's what central banks want

do they control interest rates to calm down the economic train

everything in in the content to come and yeah everything will

but when this inflation increases too much what do they

know go quite deep into every single component but these are

nation, you want a productive economy to keep the economy

inflation. What the central bank does, who is the driver of

at when looking at an economy. Of course we're going to you

actually makes it move. Of course you want a productive

they put on the breaks And then the productivity is what

stimulated and moving. But anyways guys I hope this makes

everything. So for example, you've got the Fed in the US.

breaks right so in any car or in any train you need breaks to

person who pushes everything forward he controls it speed is

the four main parts that build it up and you need to

You've got Bank of England in an in obviously the UK and

so that consumers have to pay more over time and the reason

England. So these are the four essential points that we look

the interest rates slow down an economy or they can speed it up

the train, we can say. They're the guys who who control

control the speed and what that is is the interest rates now

and you know around that time in Germany where you'd see so

much inflation is very dangerous and that's what we

they'd have to get a whole stack of cash just to buy that

so to control this inflation what do you need you need

something that of course we want we do want inflation

inflation and the amount that it rises you really do need to

so what that means is everything gets more and more

economy forward. There's nothing to propel it in that

certain direction. You know why would the economy be moving if

many times where just to buy one loaf of bread they could

see in cases of hyperinflation for example after World War one

so like how we see inflation, interest rates leads to that

called. Um What it is is products they increase in price

pace that you can look at essentially is inflation. Now

that is is because there's more there's more money inside the

economy and as there is more economy there's more inflation

the past 20 years or whatever a lot of people like to compare

the the idea of a a Fredo bar or a Freddie bar whatever it's

it's going to be moving at you know quite a pace. And this

what inflation is in simple terms is have you realised over

economy produces inside it. So think about it like this.

progressing and in a way like a train as well. Train tracks are

the economy is always moving forward. It's always

everything is stand still if nobody's producing any

to trade. Uh the second part of of the economy is the speed. Um

business. No one's producing any anything to sell, anything

now obviously as we know when the economy is moving forward

way I like to teach the economy as is imagine it like a train.

Without the economy there's nothing that actually moves the

Yes guys, welcome to the second video of the first part of the

There's certain components that obviously make up the train and

that I like to look at in terms of the economy. So the first

one is the productivity. And you can visualise that as the

things like gross domestic product which is what the

there. It never really stops. So there's four main components

coal of of the train. Makes it move. Productivity links to

what drives it forward but you've got to understand that

explain to you in conceptual terms what I see the economy as

and a simple way for you to break it down as well. So the

so rather than you know going straight into it. I want to

everything just by explaining the economy in simple terms. Um

fundamental course. Um so we're going to be beginning

make sense soon. Alright take care.