Hello everyone!

In development of the English week, I invite you to look at the link and answer the following
questions.

http://www.elblogsalmon.com/economia/como-funciona-la-economia-en-30-minutos-segun-ray-
dalio

1. What drives transactions in the economy?

these transactions are driven more than anything by human nature and create three main forces
that move the economy

2. What are the three forces that move the economy?

The productivity growth, short term debt cycle, and long term debt cycle

3. What is the total expense composed of?

the total expense consists of the money spent plus the credit spent, where the amount spent is
divided by the amount sold and the price is obtained

4. What does the central bank do?

controls the amount of money and credit in the economy, does so by influencing interest rates and
printing new money. in such a way the central bank is important for the flow of credit

5. What makes an economy make more or less credits?

if there are more credits it is because people want to acquire houses or things unnecessary for
their tastes as long as there will be an interest to be taken into account for that credit the
borrowers are obliged to return the agreed money plus an interest rate such that the the
borrower repays the debt everyone will earn the profit of the seizure and give me

6. In addition to borrowers pledging to repay loans, what other condition must be given for
credit to be created?

That person has the ability to repay the agreed money with an interest rate that was mentioned to
him and until he finishes his credit but the interest will settle the debt and so other people will
have the benefit of applying for credits

7. What things make a borrower worthy of credit?

Ability to repay the loan and a guarantee

8. How would it be done in a non-credit economy to increase revenues?

In the economy without credit would only increase spending to have income must be more
productive and work more
9. How is inflation produced?

Inflation is defined as a widespread and sustained increase in the prices of goods and services in a
country over a sustained period of time.

10. What causes the credit cycle to reverse?

It is difficult to take a step back and see short-term debt versus long-term debt and productivity.
so it will make us more productive but not access credit to circulate the money and so another
person will benefit from this money rotation,

11. What should an economy do in a situation of deleveraging?

One form of deleveraging is through debt restructuring. Basically, the banks prefer to have
something that everything from nothing. We know this as austerity. The government can also
redistribute wealth, hoping that it will help the economy grow when people spend more.

12. What is called beautiful deleveraging?

It is the right balance between deflationary measures (austerity, debt restructuring, income
redistribution) and inflation measures (printing money, the central bank buying bonds). You want
revenues to increase at a faster rate than debts, banks to lend and you can borrow

13. How can you apply the three practical rules proposed by Ray Dalio in your life?

As for these three lines in conjunction it can show where we have been, where we are and where
we are going. If debts grow faster than income, the debt burden will crush us. In the long run,
productivity is the most important thing. Credit comes and goes, but how productivity stays on a
constant rise.