Congratulations for completing the course, Understanding Economic Policy Making, which is the first one in the series for this specialization on globalization, economic growth and stability. Now that you've finished the course, we're going to move into the capstone project, but before we do, I'd just like to remind you what we were doing in understanding economic policy making. You will remember that the course attempts to give you the tools so that you can look at this swirling economic information around you, some of it true some of it false, some of it distorted some of it misleading, and you can have a toolkit to try to understand it, to divide what's appropriate from what's inappropriate, what's true from what's false in a very complex world, which is the macro-economy. So remember that what we did in the course. We started out looking at the basic indicators of the economy, understanding how they relate to each other, what's normal, what's not normal, that a picture in our mind of how they should look, that was GDP, that was inflation and that was unemployment. Then we moved on to diagnosing an economy saying, "Okay, I know that it's growing, alright, I know that inflation, unemployment look like this." Now, when I look at this data, is there anything I can tell about whether the economy's doing well or not? Whether it's growing too, fast too slow, or just right. And so we talked about gaps in the economy, and what was appropriate, what was not. We talked about stabilizing an economy, the idea being that we should try to stay at potential GDP. If we grow too fast, we're going to have problems in the future. If we grow too slowly, we're going to have problems in the future. So, once we determine that, where we should be, we turned to the policies, fiscal and monetary policy being the big ones. And we talked about how government spending and taxes can be used to bring the economy to its ideal point, and what happens to deficit automatically across the cycle, and what happens to debt, and when the debt is a problem and when it is not. And then we turn to monetary policy, to see what should be happening with interest rates, and sometimes the money supply, as the economy moves across the cycle. When should interest rates go up? When should they go down? When are they too high? When are they appropriate? From there, we turn to two other policy tools, which are structural policy and exchange rate policy, and we also thought about what happens when we mix fiscal and monetary policy, either in the same direction or in opposite directions at different moments of the cycle. What happens to the economy? Does it grow more? Does it grow less? Is there crowding in? Is they're crowding out? And so we discussed all of these. And finally, we turn to just a thought of how these policies are being used, and how these indicators look in some different economies in the world. For me, in this course, my hope was to give you, as I've said, a toolkit or a toolbox, so you can look at the economies that surround you and determine what's normal, what's not normal? What would be appropriate in policy terms? What would be inappropriate? And what the consequences of these appropriate or inappropriate policies would be, because we'll see as we move along in this specialization, that inappropriate policies lead us into risk situations. Having wrap this up, what we're gonna do now is move on to the first peer reviewed or peer graded exercise of the specialization, for Capstone one.
