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Finance - Department of Agricultural Economics
... What are the three major policy instruments the Federal Reserve System can use to modify the rate of growth in the nation’s money supply? Reserve requirements, discount rate and Federal Open Market Committee purchases and sales of government securities. ...
... What are the three major policy instruments the Federal Reserve System can use to modify the rate of growth in the nation’s money supply? Reserve requirements, discount rate and Federal Open Market Committee purchases and sales of government securities. ...
FRBSF L CONOMIC
... responses to the financial crisis with preventing another Great Depression. However, the global economy is still hampered by excessive leverage. The need for continued expansionary fiscal policy in the short term requires a commitment to long-term budgetary tightening to persuade the public that fis ...
... responses to the financial crisis with preventing another Great Depression. However, the global economy is still hampered by excessive leverage. The need for continued expansionary fiscal policy in the short term requires a commitment to long-term budgetary tightening to persuade the public that fis ...
Monetary-Policy
... • Conventional monetary policy was therefore ineffective – Interest rates could not easily be cut further – Lower interest rates were not stimulating extra demand - perhaps consumers and firms were not confident, and therefore did not spend more as interest rates were cut ...
... • Conventional monetary policy was therefore ineffective – Interest rates could not easily be cut further – Lower interest rates were not stimulating extra demand - perhaps consumers and firms were not confident, and therefore did not spend more as interest rates were cut ...
NBER WORKING PAPER SERIES BUBBLES, FINANCIAL CRISES, AND SYSTEMIC RISK Martin Oehmke
... The ideal breeding ground for the run-up phase is an environment of low volatility. Usually, during such times, financing is easy to come by. Speculators can lever up, lowering the return differential between risky and less risky securities. The resulting leverage and maturity mismatch may be excess ...
... The ideal breeding ground for the run-up phase is an environment of low volatility. Usually, during such times, financing is easy to come by. Speculators can lever up, lowering the return differential between risky and less risky securities. The resulting leverage and maturity mismatch may be excess ...
Stimulus and Regulation - Yale Economics
... Stimulus can also take the form of bailouts of systemically important financial institutions or of individuals whose economic situation in the financial crisis suggests an economic injustice that may harm our sense of civil society. Bailouts appear actually to have been the cheapest form of stimulu ...
... Stimulus can also take the form of bailouts of systemically important financial institutions or of individuals whose economic situation in the financial crisis suggests an economic injustice that may harm our sense of civil society. Bailouts appear actually to have been the cheapest form of stimulu ...
Chapter 13 (12 in 8 th edition) Balance of Payments Accounting
... financial account. Discuss implications for official international reserve flows. In 2006, US income receipts on foreign assets were $647.6 billion while payments on liabilities (foreign owned assets in the US) were $604.4 billion. Yet the US is a substantial net debtor to foreigners. How then is it ...
... financial account. Discuss implications for official international reserve flows. In 2006, US income receipts on foreign assets were $647.6 billion while payments on liabilities (foreign owned assets in the US) were $604.4 billion. Yet the US is a substantial net debtor to foreigners. How then is it ...
Bubbles, Financial Crises, and Systemic Risk
... The ideal breeding ground for the run-up phase is an environment of low volatility. Usually, during such times, financing is easy to come by. Speculators can lever up, lowering the return differential between risky and less risky securities. The resulting leverage and maturity mismatch may be excess ...
... The ideal breeding ground for the run-up phase is an environment of low volatility. Usually, during such times, financing is easy to come by. Speculators can lever up, lowering the return differential between risky and less risky securities. The resulting leverage and maturity mismatch may be excess ...
Download paper (PDF)
... The ideal breeding ground for the run-up phase is an environment of low volatility. Usually, during such times, financing is easy to come by. Speculators can lever up, lowering the return differential between risky and less risky securities. The resulting leverage and maturity mismatch may be excess ...
... The ideal breeding ground for the run-up phase is an environment of low volatility. Usually, during such times, financing is easy to come by. Speculators can lever up, lowering the return differential between risky and less risky securities. The resulting leverage and maturity mismatch may be excess ...
Toward Free-Market Money
... many still hold to the Keynesian notion that increasing spending is the fiscal antidote to slowing growth when, in fact, it will exacerbate poor economic conditions by displacing the market’s more efficient allocation of resources (see Alesina et al. 1999). Japan in the 1990s is the latest example o ...
... many still hold to the Keynesian notion that increasing spending is the fiscal antidote to slowing growth when, in fact, it will exacerbate poor economic conditions by displacing the market’s more efficient allocation of resources (see Alesina et al. 1999). Japan in the 1990s is the latest example o ...
NBER WORKING PAPER SERIES THE JAPANESE BUBBLE: A 'HETEROGENEOUS' APPROACH Robert B. Barsky
... of earnings implies higher profits in the future, and eventually higher dividends as well. Further, as Figure 3 makes clear, earnings yields are themselves low. The real reason for the low yields is that Japan did not have an “equity premium puzzle” as did the United ...
... of earnings implies higher profits in the future, and eventually higher dividends as well. Further, as Figure 3 makes clear, earnings yields are themselves low. The real reason for the low yields is that Japan did not have an “equity premium puzzle” as did the United ...
Financialization in the Extreme - Political Economy Research Institute
... Although Crockett appears to have rediscovered Minsky, he leaves aside some of the more salient characteristics Minsky and other Post-Keynesian economists have identified in financial markets, which make them prone to bubble dynamics. Fundamentally, the conundrum may be summarized as follows: prices ...
... Although Crockett appears to have rediscovered Minsky, he leaves aside some of the more salient characteristics Minsky and other Post-Keynesian economists have identified in financial markets, which make them prone to bubble dynamics. Fundamentally, the conundrum may be summarized as follows: prices ...
Supply and Demand Models of Financial Markets
... – Supply curve represents the behavior of savers & lenders – Demand curve represents the behavior of borrowers ...
... – Supply curve represents the behavior of savers & lenders – Demand curve represents the behavior of borrowers ...
Stability of General Equilibrium
... It cannot be individual agents, because there is one price for each good in the whole economy! Arrow et al. assumed that the price system was controlled by a mythical “auctioneer” (commisaire-priseur in French) acting outside the economy to update prices in the current period on the basis of the cur ...
... It cannot be individual agents, because there is one price for each good in the whole economy! Arrow et al. assumed that the price system was controlled by a mythical “auctioneer” (commisaire-priseur in French) acting outside the economy to update prices in the current period on the basis of the cur ...
Working Paper No. 51 - Levy Economics Institute of Bard College
... the term speculation for the activity of forecasting the psychology of the market and enterprise for the activity of forecasting the prospective yield of assets over their whole life, it is by no means always the case that speculation predominates over As the organization of investment ...
... the term speculation for the activity of forecasting the psychology of the market and enterprise for the activity of forecasting the prospective yield of assets over their whole life, it is by no means always the case that speculation predominates over As the organization of investment ...
Review Sheet - Syracuse University
... (a) what sellers generally accept and buyers generally use to pay for goods and services. (b) an asset that can be used to transport purchasing power from one period of time to another. (c) a standard unit that provides a consistent way of quoting prices. (d) the ability to buy something today but t ...
... (a) what sellers generally accept and buyers generally use to pay for goods and services. (b) an asset that can be used to transport purchasing power from one period of time to another. (c) a standard unit that provides a consistent way of quoting prices. (d) the ability to buy something today but t ...
Nonlinear Bubbles in Chinese Stock Markets in the 1990s
... direction). We also use Hurst coefficient methodology of rescaled range analysis (RSS), which was initially developed for detecting persistence of annual flooding patterns on the Nile River [Hurst, 1951], with short-term persistence of residuals away from fundamentals again being viewed as prima fac ...
... direction). We also use Hurst coefficient methodology of rescaled range analysis (RSS), which was initially developed for detecting persistence of annual flooding patterns on the Nile River [Hurst, 1951], with short-term persistence of residuals away from fundamentals again being viewed as prima fac ...
Word Document
... Say’s Law – total supply of goods and services will equal total demand derived from consumption; a general glut (economy-wide over-supply) is impossible money illusion – nominal vs. real confusion (wages or prices) crowding out – fiscal policy is ineffective because a rise in government spendi ...
... Say’s Law – total supply of goods and services will equal total demand derived from consumption; a general glut (economy-wide over-supply) is impossible money illusion – nominal vs. real confusion (wages or prices) crowding out – fiscal policy is ineffective because a rise in government spendi ...
Summary of IS-LM
... • Crisis spread from one country to another • Fundamental problems were less true of later countries – but they still had a crisis • Contagion is “psychological” – Investors make judgement about one invest based on performance of another ...
... • Crisis spread from one country to another • Fundamental problems were less true of later countries – but they still had a crisis • Contagion is “psychological” – Investors make judgement about one invest based on performance of another ...
PowerPoint-presentation
... Loosening monetary policy increases leverage of intermediaries: easier for an unexpected shock to trigger crisis Monetary policy affects risk of financial crisis and should not be the complete solution: ...
... Loosening monetary policy increases leverage of intermediaries: easier for an unexpected shock to trigger crisis Monetary policy affects risk of financial crisis and should not be the complete solution: ...
The General Theory as the gateway to the re
... Kaldor on Keynes’s liquidity Mr Keynes, in certain parts of The General Theory appears to use the term ‘liquidity’ in a sense which comes very close to our concept of ‘perfect marketability’; ie goods which can be sold at any time for the same price, or nearly the same price, at which they can be b ...
... Kaldor on Keynes’s liquidity Mr Keynes, in certain parts of The General Theory appears to use the term ‘liquidity’ in a sense which comes very close to our concept of ‘perfect marketability’; ie goods which can be sold at any time for the same price, or nearly the same price, at which they can be b ...
Global Real Assets Launches Direct Real Asset Investment Platform
... “Institutional investors are increasingly seeking to complement their real asset fund holdings with direct investments. However, for both the investor and the investment manager, direct investing is fundamentally different from fund investing,” said Joe Azelby, Global Head of Real Assets. “The forma ...
... “Institutional investors are increasingly seeking to complement their real asset fund holdings with direct investments. However, for both the investor and the investment manager, direct investing is fundamentally different from fund investing,” said Joe Azelby, Global Head of Real Assets. “The forma ...
The Economic Theories all in one
... • Monetarist believe in the Fed doing minimal policy making. • Monetary policy is more effective than fiscal policy • Competition is best to keep prices stable • Too much money in circulation will lead to inflation. ...
... • Monetarist believe in the Fed doing minimal policy making. • Monetary policy is more effective than fiscal policy • Competition is best to keep prices stable • Too much money in circulation will lead to inflation. ...
FRBSF L CONOMIC
... beat. One reason might be that there are implicit rather than explicit wage contracts between workers and firms that mimic formal union agreements. However, the authors also find that they can match U.S. GDP and inflation data just as well using a more decentralized model in which workers and firms ...
... beat. One reason might be that there are implicit rather than explicit wage contracts between workers and firms that mimic formal union agreements. However, the authors also find that they can match U.S. GDP and inflation data just as well using a more decentralized model in which workers and firms ...
Intermediate Macroeconomics - College Of Business and
... Post-war elections determined by inflation, unemployment, GDP growth Representative of ideological conflict ...
... Post-war elections determined by inflation, unemployment, GDP growth Representative of ideological conflict ...
Economic bubble
![](https://commons.wikimedia.org/wiki/Special:FilePath/South_Sea_Bubble_Cards-Tree.png?width=300)
An economic bubble (sometimes referred to as a speculative bubble, a market bubble, a price bubble, a financial bubble, a speculative mania or a balloon) is trade in an asset at a price or price range that strongly deviates from the corresponding asset's intrinsic value. It could also be described as a situation in which asset prices appear to be based on implausible or inconsistent views about the future.Because it is often difficult to observe intrinsic values in real-life markets, bubbles are often conclusively identified only in retrospect, when a sudden drop in prices appears. Such a drop is known as a crash or a bubble burst. Both the boom and the burst phases of the bubble are examples of a positive feedback mechanism, in contrast to the negative feedback mechanism that determines the equilibrium price under normal market circumstances. Prices in an economic bubble can fluctuate erratically, and become impossible to predict from supply and demand alone.While some economists deny that bubbles occur, the cause of bubbles remains disputed by those who are convinced that asset prices often deviate strongly from intrinsic values. Many explanations have been suggested, and research has recently shown that bubbles may appear even without uncertainty, speculation, or bounded rationality. In such cases, the bubbles may be argued to be rational, where investors at every point fully compensated for the possibility that the bubble might collapse by higher returns. These approaches require that the timing of the bubble collapse can only be forecast probabilistically and the bubble process is often modelled using a Markov switching model. It has also been suggested that bubbles might ultimately be caused by processes of price coordination or emerging social norms.