The Source of Fluctuations in Money


Book Description

This paper tests the importance of technology shocks versus financial shocks for explaining, fluctuations in money. The model presented extends the theory of King and Plosser by recognizing that both money and trade credit provide transactions services. The model shows that the comovements between money and trade credit can reveal the nature of the underlying shocks. The empirical results strongly suggest that shocks to the financial system account for most of the fluctuations in money. Thus, the results cast doubt on the hypothesis that nonfinancial technology shocks are the main source of the money-income correlation.




The Federal Reserve System Purposes and Functions


Book Description

Provides an in-depth overview of the Federal Reserve System, including information about monetary policy and the economy, the Federal Reserve in the international sphere, supervision and regulation, consumer and community affairs and services offered by Reserve Banks. Contains several appendixes, including a brief explanation of Federal Reserve regulations, a glossary of terms, and a list of additional publications.




Monetary Policy Rules


Book Description

This timely volume presents the latest thinking on the monetary policy rules and seeks to determine just what types of rules and policy guidelines function best. A unique cooperative research effort that allowed contributors to evaluate different policy rules using their own specific approaches, this collection presents their striking findings on the potential response of interest rates to an array of variables, including alterations in the rates of inflation, unemployment, and exchange. Monetary Policy Rules illustrates that simple policy rules are more robust and more efficient than complex rules with multiple variables. A state-of-the-art appraisal of the fundamental issues facing the Federal Reserve Board and other central banks, Monetary Policy Rules is essential reading for economic analysts and policymakers alike.




Financial Crises Explanations, Types, and Implications


Book Description

This paper reviews the literature on financial crises focusing on three specific aspects. First, what are the main factors explaining financial crises? Since many theories on the sources of financial crises highlight the importance of sharp fluctuations in asset and credit markets, the paper briefly reviews theoretical and empirical studies on developments in these markets around financial crises. Second, what are the major types of financial crises? The paper focuses on the main theoretical and empirical explanations of four types of financial crises—currency crises, sudden stops, debt crises, and banking crises—and presents a survey of the literature that attempts to identify these episodes. Third, what are the real and financial sector implications of crises? The paper briefly reviews the short- and medium-run implications of crises for the real economy and financial sector. It concludes with a summary of the main lessons from the literature and future research directions.




Financial Fluctuations


Book Description

Financial Fluctuations: The Heartbeat of Your Money Matters Do you want to understand how the ups and downs of the economy affect your personal and professional finances? Do you want to learn how to navigate the economic cycle and make smart decisions in any situation? Do you want to discover the secrets of financial stability and prosperity in a volatile world? If you answered yes to any of these questions, then this book is for you. Financial Fluctuations: The Heartbeat of Your Money Matters is a comprehensive and practical guide that will teach you everything you need to know about the economic cycle and its impact on your money matters. In this book, you will learn: - What is the economic cycle and what are its four stages: expansion, peak, contraction, and trough - How to identify the current stage of the economic cycle and what it means for your income, spending, saving, investing, and borrowing - How to anticipate and prepare for the next stage of the economic cycle and avoid common pitfalls and mistakes - How to use financial factors, such as interest rates, inflation, exchange rates, and market risk, to your advantage and protect your wealth - How to create a personalized financial plan that suits your goals, needs, and risk tolerance - How to adapt your financial plan to changing circumstances and opportunities - How to achieve financial freedom and happiness in any economic environment Financial Fluctuations: The Heartbeat of Your Money Matters is more than just a book. It is a roadmap to financial success and security. It is a tool to help you take control of your money and your life. It is a source of inspiration and motivation to help you achieve your dreams. Whether you are a beginner or an expert, a student or a professional, a saver or an investor, a spender or a borrower, this book will help you make the most of your money matters. It will help you understand the heartbeat of the economy and how to sync it with your own. Don't let the economic cycle dictate your financial destiny. Take charge of your money matters and make them work for you.







Money and the Economy


Book Description




Financial Sources of Macroeconomic Fluctuations, an Empirical Investigation


Book Description

The idea that financial structure and output determination may be interrelated has gone through several cycles over the past half a century since its inception at the time of the Great Depression. In its latest reincarnation in the theory of 'Financial Acceleration', it considers financial factors as propagation mechanisms for the disturbances originating from the ' real' economy, where 'agency costs' of credit allocation by the financial intermediaries play a central role. Financial factors have rarely been studied as potential 'sources ' of variation in the economy. Our study, however, investigates the ' origination' of disturbances from money and bank credit and allows for the 'propagation' of disturbances within a relatively simple macro-dynamic system that utilizes the new approach of 'Structural Vector Autoregression'. Our findings for the Canadian as well as British economies indicate that money, but not credit, accounts for a sizable variation in output and other macroeconomic variables over varioustime horizons. However, bank credit serves as a propagation ch nnel through which money disturbances are exacerbated. The results call for greater attention to monetary, in particular money demand, disturbances by the authorities.