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Finance Glossary

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Above Full Employment Equilibrium

Definition:

Short fancy men and women in fancy suits called "economists" believe in fancy. Lines of supply and demand meet. And the notion of "equilibrium" is like a religiously shared ideal. In theory, there is a natural balance of the employed and the unemployed and at that rate we have economic Satori. That is, there should always be some percentage of unemployed people out there. If we have fewer than that unemployed number (or, said another way), there are "too many people gainfully employed and working", then we likely have inflation as the economy is "too hot".

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