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Economy Watch – first edition
Economy Watch – first edition

Mauritius - COMESA Monetary Institute (CMI)
Mauritius - COMESA Monetary Institute (CMI)

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... independence was that the increased transparency of the inflation targeting regime enhanced political oversight. An important benefit of the transparency of an inflation-targeting regime, therefore, is that it makes it more palatable to have an independent central bank which focuses on long-run obje ...
Why the Federal Reserve Should Adopt Inflation Targeting
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... Critics of inflation targeting, most notably Don Kohn (forthcoming), who is member of the Board of Governors of the Federal Reserve, have also worried that inflation targeting may be too rigid because inflation-targeting central banks in advanced economies have often adopted a horizon for their infl ...
The Big Picture of Monetary–Fiscal Interactions
The Big Picture of Monetary–Fiscal Interactions

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... with estimated effects of the Fed’s asset purchases impact on longterm yields. Our study differs by using Japanese data which allows us to properly estimate the effects and uncertainty around the effects of the QE-shock. Chung et al. (2011) must either rely on a notoriously short sample period or el ...
The Thatcher Experiment: The First Two Years
The Thatcher Experiment: The First Two Years

The Costs of Inflation
The Costs of Inflation

... Step III: Calculate your deflator. You do this by dividing all of the CPIs by the CPI in the period you use as the “base period”. In this case it is August 2006. The deflator equals 1 in the base period. Step IV: Divide the average house price by the deflator. Result: There has been a real increase ...
introduction to macroeconomics e202
introduction to macroeconomics e202

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Does Central Bank Independence Frustrate the Optimal Fiscal
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Monetary Policy Statement September 2010 Contents

... The earthquake that struck Canterbury on 4 September has significantly disrupted economic activity and is likely to continue to do so for some time yet. Many homes and businesses have been damaged, as have significant parts of Canterbury’s public infrastructure. Eventual reconstruction and repairs w ...
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mmi14-vanveen 19106661 en

... structural changes in the euro area economy to suggest that the relative attractiveness of holding money as opposed to other financial instruments has been fundamentally altered in recent years”. Whatever the ultimate causes of high money growth, the result may signal excess liquidity in the economy ...
Monetary Policy Statement September 2015
Monetary Policy Statement September 2015

... to increase only slightly during the projection – less than previously expected – supported in large part by stimulatory monetary policy, and in some areas by fiscal policy. However, there remains significant uncertainty about the outlook – especially for China, which has important flow-on effects t ...
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More details

... America. The world biggest economy, America, for instance, conceded that they were sunk in economic depression. Economic depression was rooted from hypothecation credit crisis since end of 2007 that took away payment capacity of many banks, pushed banks into the brink of bankruptcy. Bear Stearns, fo ...
Macroeconomics II Lecture notes (2)
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... has been considered more satisfactory from a theoretical viewpoint and has been adopted by several macroeconomic models aimed at explaining the basic mechanisms originating cyclical fluctuations, and particularly the positive correlation between nominal variables (such as monetary aggregates) and re ...
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Snacks–The Monetary and Fiscal Policy Two Step

The Causes of Inflation and Deflation in Mainland China
The Causes of Inflation and Deflation in Mainland China

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... The Latin-American debt crisis of the 1980s, after a decade of Latin-American deficit financing by petro-dollars via the American banking system, serves as an early example that non-sustainable foreign debt positions can arise in practice. ...
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... Keynesian Theory of the Inflationary Gap Keynesians and believers in the quantity theory of money (implicitly or explicitly) are one in the belief that the immediate cause of inflation is excess demand, though they may disagree regarding the proximate and the ulti­ mate causes of excess demand itsel ...
NBER WORKING PAPER SERIES FISCAL PREREQUISITES FOR A VIABLE A NON-TECHNICAL
NBER WORKING PAPER SERIES FISCAL PREREQUISITES FOR A VIABLE A NON-TECHNICAL

... The paper first reviews the budget identities of the fiscal and monetary authorities and the solvency constraint or present value budget-constraint of the consolidated public sector, for closed and open economies. It then discusses the new conventional wisdom concerning the fiscal roots of inflation ...
Recovery in the Eurozone
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... their spending. This additional spending could, for example, be focused on ‘green’ infrastructure projects. In the second proposal, the newly created money could be distributed equally between every citizen of the Eurozone. This type of “citizen’s dividend” would put additional purchasing power dire ...
Introduction to Business
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... E-banking, or online banking, is becoming more popular worldwide, but the United States still relies heavily on paper checks. A recent survey revealed that of all the households that are on the Internet, only one in five also do their banking online. ...
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Money supply

In economics, the money supply or money stock, is the total amount of monetary assets available in an economy at a specific time. There are several ways to define ""money,"" but standard measures usually include currency in circulation and demand deposits (depositors' easily accessed assets on the books of financial institutions).Money supply data are recorded and published, usually by the government or the central bank of the country. Public and private sector analysts have long monitored changes in money supply because of its effects on the price level, inflation, the exchange rate and the business cycle.That relation between money and prices is historically associated with the quantity theory of money. There is strong empirical evidence of a direct relation between money-supply growth and long-term price inflation, at least for rapid increases in the amount of money in the economy. For example, a country such as Zimbabwe which saw extremely rapid increases in its money supply also saw extremely rapid increases in prices (hyperinflation). This is one reason for the reliance on monetary policy as a means of controlling inflation.The nature of this causal chain is the subject of contention. Some heterodox economists argue that the money supply is endogenous (determined by the workings of the economy, not by the central bank) and that the sources of inflation must be found in the distributional structure of the economy.In addition, those economists seeing the central bank's control over the money supply as feeble say that there are two weak links between the growth of the money supply and the inflation rate. First, in the aftermath of a recession, when many resources are underutilized, an increase in the money supply can cause a sustained increase in real production instead of inflation. Second, if the velocity of money (i.e., the ratio between nominal GDP and money supply) changes, an increase in the money supply could have either no effect, an exaggerated effect, or an unpredictable effect on the growth of nominal GDP.
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