Quarterly Bulletin May 1995
... bond-specific effects; but if there are some premia applying to a class of bonds (for example, long bonds generally exhibit greater price volatility), this may cause the fitted curves to deviate from the true expectations. The second is the result of Jensen’s inequality (also called convexity). This ...
... bond-specific effects; but if there are some premia applying to a class of bonds (for example, long bonds generally exhibit greater price volatility), this may cause the fitted curves to deviate from the true expectations. The second is the result of Jensen’s inequality (also called convexity). This ...
Inflation: Islamic and Conventional Economic Systems: Evidence
... supply, inflation rate should be zero. Similar to the conventional economic system, there is a higher inflation rate in an Islamic economic system if there is deterioration in the domestic currency. It has been shown that debt financing and economic waste plus other known factors can cause inflation ...
... supply, inflation rate should be zero. Similar to the conventional economic system, there is a higher inflation rate in an Islamic economic system if there is deterioration in the domestic currency. It has been shown that debt financing and economic waste plus other known factors can cause inflation ...
Real Interest Rate
... (59%) 8. Econ can produce either 2 tons of cocoa or 4 cars with 10 units of labor. Nomics can produce either 5 tons of cocoa or 25 cars with 10 units of labor. Based on this information, which of the following is true. a. Econ has an absolute advantage in the production of cocoa, while Nomics has a ...
... (59%) 8. Econ can produce either 2 tons of cocoa or 4 cars with 10 units of labor. Nomics can produce either 5 tons of cocoa or 25 cars with 10 units of labor. Based on this information, which of the following is true. a. Econ has an absolute advantage in the production of cocoa, while Nomics has a ...
Market Discipline of Banks - Federal Reserve Bank of New York
... The points above are standard in this literature. Billet et al. (1998) recently make a novel argument: they suggest that deposit insurance may weaken discipline through a cost of funds effect. If bondholders try to raise spreads in response to increased risk, banks can soften the blow by substituti ...
... The points above are standard in this literature. Billet et al. (1998) recently make a novel argument: they suggest that deposit insurance may weaken discipline through a cost of funds effect. If bondholders try to raise spreads in response to increased risk, banks can soften the blow by substituti ...
Fedspeak: Does It Matter How Central Bankers Explain Themselves?
... which a person defines her identity. This is surely relevant to the possibility of public policy decisions being made on the basis of principles; if a central banker is to make policy decisions consistently in conformity with some set of principles, this is likely to be psychologically possible only ...
... which a person defines her identity. This is surely relevant to the possibility of public policy decisions being made on the basis of principles; if a central banker is to make policy decisions consistently in conformity with some set of principles, this is likely to be psychologically possible only ...
Modern Macroeconomics and Monetary Policy (15th ed.)
... • If a change in monetary policy is timed poorly, it can be a source of instability. • It can cause either recession or inflation. • Proper timing of monetary policy: • If expansionary effects occur during a recession and restrictive effects during an inflationary boom, the impact would be stabilizi ...
... • If a change in monetary policy is timed poorly, it can be a source of instability. • It can cause either recession or inflation. • Proper timing of monetary policy: • If expansionary effects occur during a recession and restrictive effects during an inflationary boom, the impact would be stabilizi ...
Lending Booms, Reserves and the Sustainability of Short
... One of the earliest formalizations of this notion, by Kletzer (1984), emphasized asymmetric information about the level of the debtor’s external obligations. Kletzer pointed out that it can be important for creditors to know the aggregate amount loaned to a debtor (since that debtor may otherwise bo ...
... One of the earliest formalizations of this notion, by Kletzer (1984), emphasized asymmetric information about the level of the debtor’s external obligations. Kletzer pointed out that it can be important for creditors to know the aggregate amount loaned to a debtor (since that debtor may otherwise bo ...
The effect of monetary and fiscal policy on interest
... shocks, initially driven by sharp declines in house and stock prices and by a tightening of credit and financial conditions. The collapse in output and the increase in unemployment produced a loss of confidence that considerably intensified the recessionary pressures. Policy institutions responded w ...
... shocks, initially driven by sharp declines in house and stock prices and by a tightening of credit and financial conditions. The collapse in output and the increase in unemployment produced a loss of confidence that considerably intensified the recessionary pressures. Policy institutions responded w ...
Answers to End-of-Chapter Problems
... The orchard owner will not trade with the chocolatier because he doesn’t like chocolate. Hence, in a barter economy, trade among these three people may well not take place, because in no case is there a double coincidence of wants. However, if money is introduced into the economy, the orchard owner ...
... The orchard owner will not trade with the chocolatier because he doesn’t like chocolate. Hence, in a barter economy, trade among these three people may well not take place, because in no case is there a double coincidence of wants. However, if money is introduced into the economy, the orchard owner ...
Document
... b. It is more important to reduce world inflation than to reduce U.S. unemployment. c. Workers are not affected; only business suffer. d. The long-run gains to consumers & some producers exceed the losses to other producers. e. Government can protect U.S. industries while encouraging free trade. ...
... b. It is more important to reduce world inflation than to reduce U.S. unemployment. c. Workers are not affected; only business suffer. d. The long-run gains to consumers & some producers exceed the losses to other producers. e. Government can protect U.S. industries while encouraging free trade. ...
Monetary Policy Statement Contents
... commitment and approach to inflation targeting are transparent and well understood. It should also be stressed that although the MCI is useful between projections, it does not obviate the need for projections. The appropriate level of monetary conditions depends on the prospective extent of inflatio ...
... commitment and approach to inflation targeting are transparent and well understood. It should also be stressed that although the MCI is useful between projections, it does not obviate the need for projections. The appropriate level of monetary conditions depends on the prospective extent of inflatio ...
The Zero Lower Bound, ECB Interest Rate Policy and the
... the entry and exit from crisis regime. In particular, while central banks can be expected to cut interest rates rapidly if they become concerned about the ZLB, once the economy starts to recover they may wish to maintain low interest rates for a while in order to prevent long-term interest rates fro ...
... the entry and exit from crisis regime. In particular, while central banks can be expected to cut interest rates rapidly if they become concerned about the ZLB, once the economy starts to recover they may wish to maintain low interest rates for a while in order to prevent long-term interest rates fro ...
Chapter 4 DEPOSITS IN BANKS
... Basic economic principles of supply and demand for goods and services push money through banks. The economy at large plays a far greater role in determining how money is moving than does the government. Slide 20 ...
... Basic economic principles of supply and demand for goods and services push money through banks. The economy at large plays a far greater role in determining how money is moving than does the government. Slide 20 ...
Finance , Saving, And Investment,
... An increases in disposable income or a decreases in the wealth, expected future income, or default risk increases the supply of loan-able funds and shifts the curve rightwards from SLF0 to SLF1. A decrease in disposable income or an increase in the wealth, expected future income, or default risk ...
... An increases in disposable income or a decreases in the wealth, expected future income, or default risk increases the supply of loan-able funds and shifts the curve rightwards from SLF0 to SLF1. A decrease in disposable income or an increase in the wealth, expected future income, or default risk ...
Sense and Nonsense About Deflation
... expenditures on social programs to combat, for example, a rising unemployment rate. The zero lower bound issue conjures up an old idea that permeates the literature dealing with monetary policy when inflation is very low and becomes negative, namely the possibility of a socalled “liquidity trap.” On ...
... expenditures on social programs to combat, for example, a rising unemployment rate. The zero lower bound issue conjures up an old idea that permeates the literature dealing with monetary policy when inflation is very low and becomes negative, namely the possibility of a socalled “liquidity trap.” On ...
Treasury Bill Rates in the 1970s and 1980s
... Wilcox (1983). The tax rate used for the October observation is an average of the rate for the Current year and the subsequent year. We use full-employment government purchases and net taxes as our fiscal policy proxies for two reasons. First, separate variables for purchases and for taxes-net-of-tr ...
... Wilcox (1983). The tax rate used for the October observation is an average of the rate for the Current year and the subsequent year. We use full-employment government purchases and net taxes as our fiscal policy proxies for two reasons. First, separate variables for purchases and for taxes-net-of-tr ...
Monetary movements in the U.K. balance of payments
... bring about an equivalent change in the official reserves an inflow producing a rise, and an outflow a fall. However, because monetary items b and d also reflect in part the financing of transactions on current and long term capital account, it is impossible to determine to what extent they have le ...
... bring about an equivalent change in the official reserves an inflow producing a rise, and an outflow a fall. However, because monetary items b and d also reflect in part the financing of transactions on current and long term capital account, it is impossible to determine to what extent they have le ...
Interest Rates and Monetary Policy in the Short Run and the Long Run
... nominal rate of interest and the real rate of interest in the short run as the Fed continues to increase the money supply. Explain why. In the short run, both the nominal interest rate and the real interest rate will decline. Consumers and financial intermediaries will not have correctly anticipated ...
... nominal rate of interest and the real rate of interest in the short run as the Fed continues to increase the money supply. Explain why. In the short run, both the nominal interest rate and the real interest rate will decline. Consumers and financial intermediaries will not have correctly anticipated ...
Money And Credit
... The RBI is also responsible to maintain stability of foreign exchange and to hold the foreign exchange reserve. RBI with its monetary policy also protects domestic economy from external shocks. ...
... The RBI is also responsible to maintain stability of foreign exchange and to hold the foreign exchange reserve. RBI with its monetary policy also protects domestic economy from external shocks. ...
financialIntermediation_KiyotakiPaper
... where Et is the expectation operator conditional on date t information and > 0. The preference speci…cation allows for both habit formation and GHH preferences over hours: The latter, of course, eliminates wealth e¤ects from labor supply. As will become clear, these features improve the ability for ...
... where Et is the expectation operator conditional on date t information and > 0. The preference speci…cation allows for both habit formation and GHH preferences over hours: The latter, of course, eliminates wealth e¤ects from labor supply. As will become clear, these features improve the ability for ...
Important information regarding changes to the
... Deposits in the Merrill Lynch Bank Deposit Program moved from FIA to BANA, and when aggregated with other BANA deposits caused the excess over $250,000 to become uninsured. Deposits are now across two banks — BANA and BA-CA. Deposits of $300,000 are fully insured ($250,000 in BANA and $50,000 in BA- ...
... Deposits in the Merrill Lynch Bank Deposit Program moved from FIA to BANA, and when aggregated with other BANA deposits caused the excess over $250,000 to become uninsured. Deposits are now across two banks — BANA and BA-CA. Deposits of $300,000 are fully insured ($250,000 in BANA and $50,000 in BA- ...
Global Economy - New York University Stern School of Business
... • Sophisticated version (more than we need) – Demand for money depends on nominal interest rate i M/P = Y/V(i) [= Y L(i)] – At higher interest rate, velocity higher, we hold less money ...
... • Sophisticated version (more than we need) – Demand for money depends on nominal interest rate i M/P = Y/V(i) [= Y L(i)] – At higher interest rate, velocity higher, we hold less money ...
FRBSF E L CONOMIC ETTER
... 3. RW model-based measure. Instead of a VAR, one can forecast interest rates using a New Keynesian macroeconomic model. For example, the RW (Rudebusch and Wu 2003) model has some advantages over a VAR for forecasting long-term interest rates, such as allowing the market’s longrun expected rate of in ...
... 3. RW model-based measure. Instead of a VAR, one can forecast interest rates using a New Keynesian macroeconomic model. For example, the RW (Rudebusch and Wu 2003) model has some advantages over a VAR for forecasting long-term interest rates, such as allowing the market’s longrun expected rate of in ...
Flexibility and the limits to inflation targeting ARTICLES
... to use this flexibility, setting out our analysis and assumptions so that others may evaluate our performance. This is for two ...
... to use this flexibility, setting out our analysis and assumptions so that others may evaluate our performance. This is for two ...