Inflation Essays (Examples)

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Stagflation Volcker and Friedman

Words: 373 Length: 1 Pages Document Type: Essay Paper #: 86850922

-What factors contributed to the stagflation of the 1970s?
Stagflation is the combination of high inflation plus high unemployment plus slow economic growth, all of which occurred in the 1970s. Monetary policy was loose, the dollar supply was going up faster than the economy was, and inflation was the result (Philadelphia Fed, 2015).
-How did Volker deal with the high inflation?
He raised the federal funds rate.
-Did high oil prices cause the stagflation or was it something else?
No, what caused stagflation was a combination of factors, as already stated: when the central bank’s printing presses start rolling, the value of the dollar goes down, and the price of everything goes up. However, loose monetary policy simply blows asset bubbles—it doesn’t actually fix the economy or reduce unemployment. High oil prices were more a combination of geopolitics and Nixon’s abandonment of the gold standard.
-Is the Fed independent? If…… [Read More]

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Price Stability

Words: 2682 Length: 8 Pages Document Type: Essay Paper #: 16009741

Inflation and Deflation: The Issue of Price Stability

Maintaining relatively stable prices is one of the major concerns in all capitalist economies. History shows us that left to its own devices; the capitalist economies undergo frequent "business cycles" that typically consist of a period of surging economic growth, interrupted by economic crises -- often accompanied by the collapse of the monetary system. Alternate bouts of inflation or deflation can also occur if the money supply in an economy is not controlled. Most advanced countries in the world take measures to keep the price stable. In the United States, the Federal Reserve Bank (known as Fed for short) was created in 1913 to avoid such undesirable movements in the economy. This paper examines the causes and consequences of inflation and deflation and the role of the Federal Reserve Bank in the prevention of inflation and deflation and maintaining price stability. It…… [Read More]

Works Cited

Buiter, Willem H. "Deflation: Prevention and Cure?." European Bank for Reconstruction and Development. 12-05-2003. February 10, 2004.

http://www.lse.ac.uk/collections/LSEPublicLecturesAndEvents/pdf/20030519t1658z001.pdf

Christiano, Lawrence J. And Terry J. Fitzgerald. "Inflation and Monetary Policy in the Twentieth Century." Economic Perspectives. 27. 1. (2003): 22+.

Makinen, Gail. "Inflation: Causes, Costs, and Current Status." Report for Congress
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Decontamination Plan Models of the

Words: 3218 Length: 11 Pages Document Type: Essay Paper #: 35106369

In their view, the assumption of indexation to past inflation is the key factor driving this result. According to them, when viewed in the light of indexation to long-run inflation, the optimal inflation volatility often moves closer to zero. They equally showed that for the welfare rankings of policies, the initial conditions do matter to a very significant extent.

In their work, Leeper Erik et al. examined how the conventional dynamic stochastic general equilibrium models, including the Christiano-Eichenbaum-Evans model is affected or impacted by government investments. As a way of explaining the effects of government investments in this regard, they considered two main factors, namely, the future fiscal adjustments to debt-financed spending and implementation delays for building public capital projects. In their work they demonstrated that, in the short run implementation delays can produce small or even negative labor and output responses; while for both a qualitative and quantitative positive…… [Read More]

Works Cited

Christiano Lawrence J., Martin Eichenbaum, & Charles Evans. "Nominal Rigidities and the Dynamic Effects of A Shock to Monetary Policy." Federal Reserve Bank of Cleveland Working Paper May 2001: 5-50.

DiCecio, Riccardo, Edward Nelson." An Estimated DSGE Model for the United Kingdom." Federal Reserve Bank of St. Louis Review July/August 2007. http://research.stlouisfed.org/publications/review/07/07/DiCecio.pdf

Fischer, Stanley. "Long-Term Contracts, Rational Expectations, and the Optimal Money Supply Rule." Journal of Political Economy. 5 June, 2011. http://www.jstor.org/pss/1828335

Keen Benjamin, Wang Yongshang. "What Is A Realistic Value for Price Adjustment Costs in Keynesian Models?" Department of Economics, University of Oklahoma. 5 June 2011.  http://faculty-staff.ou.edu/K/Benjamin.D.Keen-1/Price_adjustment_costs.pdf
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Economics Country Analysis

Words: 3685 Length: 10 Pages Document Type: Essay Paper #: 10554050

Economics - Country Analysis

Country Overview and Current Events (News)

Ethiopia, traditionally known as Abyssinia, is a landlocked Sub-Saharan country located at the Horn of Africa in East Africa, bordering Somalia, Kenya, Eritrea, Djibouti, Sudan, and the newly-created South Sudan. It covers approximately 1,126,829km2 of land; about the size of the state of Texas, and was, until the split of Sudan, the second-largest country in Africa. Being landlocked, Ethiopia largely relies on the port of Djibouti, to which it is connected by both rail and road. Economic elements such as this, together with the country's history, population, geography and economic performance have been explored in the subsequent sections of this text.

Population: the U.S. Census Bureau, in June 2013, estimated Ethiopia's population to be 93,877,025; a figure that makes the country the second-most populous in Africa, after Nigeria (orld Bank, Index Mundi). Ethiopia's population has been on a steady increase…… [Read More]

Works Cited

AFDB. "Inflation Dynamics in Selected East African Countries: Ethiopia, Kenya, Tanzania and Uganda." AFDB Brief, 2012. Web. 18 March 2014 http://www.afdb.org/fileadmin/uploads/afdb/Documents/Publications/07022012Inflatin%20East%20Africa%20-%20ENG%20-%20Internal.pdf

This article analyses the trend in Ethiopia's inflation rates vis-a-vis those of other countries in the Sub-Saharan region and was a valuable source of regional statistics, which formed the main basis for comparison.

Broussar, Nzinga, and Tekleselassie Tsegay. "Youth Unemployment: Ethiopia; Country Study." International Growth Center, 2012. Web. 18 March 2014  http://www.afdb.org/fileadmin/uploads/afdb/Documents/Publications/07022012Inflation%20East%20Africa%20-%20ENG%20-%20Internal.pdf 

This article analyzes the trend in Ethiopia's employment patterns. It reinforced my arguments that unemployment is more prevalent in urban Ethiopia, and that the country's informal sector contributes more to GDP than the formal sector.
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Bond Pricing the Most Fundamental

Words: 1833 Length: 6 Pages Document Type: Essay Paper #: 82343339

For example, if the Fed sees inflation as a risk going forward, the market will place a weighting on that statement, allocating some form of increased interest rate to the future cash flows.

At the time of course, the exact implications of the Fed's comments are unknown. They imply that rates may move in one direction or another, but they are not an actual movement and the Fed reserves the right to change its mind before it meets again. The bond market is thus working with imperfect information. This can lead to general price movements but of unknown quantity. Over time, a reasonable correlation can be established, such as the elasticity of bond prices in relation to, for example, strong warnings from the Fed about inflation. Such a correlation can be drawn with a large enough sample size that it can be used in bond prices.

Overall, though, the exercise…… [Read More]

Works Cited:

No author. (2009). Advanced Bond Concepts: Bond Pricing. Investopedia. Retrieved April 29, 2009 from  http://www.investopedia.com/university/advancedbond/advancedbond2.asp 

No author. (2009). The Grand Illusion. The Economist. Retrieved April 29, 2009 from http://www.economist.com/finance/displaystory.cfm?story_id=13240822

Heakal, Reem. (2009). Forces Behind Interest Rates. Investopedia. Retrieved April 29, 2009 from  http://www.investopedia.com/articles/03/111203.asp
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Johnson Controls Capital Investments

Words: 1415 Length: 5 Pages Document Type: Essay Paper #: 58178607

Johnson Controls

Emerging markets are riskier than established ones, and because of that Johnson Controls should make some adjustments to the method by which it evaluates capital investments when dealing in emerging markets. The 2013 Outlook and Strategic Review does not explain how risk is evaluated at Johnson, but the company would normally subject its capital investments to analysis that includes sensitivity analysis, and NPV with sensitivity analysis.

For emerging markets, the hurdle rate would be higher in order to account for the higher degree of risk. China represents over 50% of Johnson's business in Asia, so the company has a significant amount of knowledge about the risk conditions in the Chinese market. Thus, the company can set a hurdle rate that is appropriate to the Chinese market using available information. The company can also estimate the growth rate of China for the coming years, and the risk of inflation.…… [Read More]

Works Cited

Bloomberg. (2013). China's inflation accelerates as chill boosts food prices. Bloomberg News. Retrieved March 1, 2013 from http://www.bloomberg.com/news/2013-01-11/china-dec-inflation-2-5-exceeding-economists-est-.html

Saltelli, A., Tarantola, S., Campolongo, F. & Ratto, M. (2004) Sensitivity Analysis in practice: A guide to assessing scientific models. John Wiley & Sons.

Schall, L., Sundem, G. & Geijsbeek, W. (1978). Journal of Finance. Vol. 33 (1) 281-287.

Zhang, C. & Clovis, J. (2010). China inflation dynamics: Persistence and policy regimes. Journal of Policy Modeling. Vol. 32 (3) 373-388.
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Translation Reporting and Prices

Words: 1971 Length: 6 Pages Document Type: Essay Paper #: 26321799

Translation, eporting, And Prices

Briefly describe the corporation you researched.

The organization researched is a multinational called Walmart. The chain store is a retailer organization whose home office is located in America. The company operates by providing products to its customer through a chain of retail outlets. The public owned organization is the largest in the global market. The company has grown over the years through implementing policies that allow it to sell at a lower price that its competition. The company is the largest retailer is the globe with majority of its shares held by the public. The founding family still has a controlling share of the business with the family controlling over 48% of the shares. The company founded in 1962 and incorporated in 1969 is among the most successful companies in the globe. Its headquarters is located in Arkansas and is currently the largest grocery retailer in…… [Read More]

References

Akta?, R., & Kar?

n, M. (2011). Timeliness of Reporting and the Quality of Financial Information. International Research Journal Of Finance & Economics, (63), 71-77.

Albuquerque, R., De Francisco, E., & Marques, L.B. (2008). Marketwide Private Information in Stocks: Forecasting Currency Returns. Journal Of Finance, 63(5), 2297-2343.

Bartov, E. (1997). Foreign Currency Exposure of Multinational Firms: Accounting Measures and Market Valuation. Contemporary Accounting Research, 14(4), 623-652.
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Economic and Financial Crisis 2008-2009 the Federal

Words: 1521 Length: 4 Pages Document Type: Essay Paper #: 6097338

economic and financial crisis (2008-2009), the Federal Reserve took exceptional measures in order to combat the effects of the crisis on the American economy. These measures translated into an expansionary policy that included pumping money in the economy and purchasing assets that were in trouble. Through its expansionary work, the government was able to balance some of the effects of the crisis.

The question that seems to be on everybody's mind (and lips) today is where does it all end? One thing everyone can agree on is that this type of expansionary policy cannot last forever. The United States economy functions as a free market economy where the laws of supply and demand govern the realities of the market. A continuous and permanent intervention of the Federal Reserve is neither possible, nor healthy. What nobody can agree on, however, is when the expansionary approach should stop: now, in the near…… [Read More]

Bibliography

1. Krugman, Paul. The Conscience of a Liberal. The New York Times. November 2013. On the Internet at http://krugman.blogs.nytimes.com/2013/11/25/nowhere-near-the-exit/. Last retrieved on December 13, 2013

2. Mankiw, Gregory. In Fed Policy, the Exit Music May Be Hard to Hear. The New York Times. November 2013. On the Internet at http://www.nytimes.com/2013/11/24/business/in-fed-policy-the-exit-music-may-be-hard-to-hear.html?_r=0. Last retrieved on December 13, 2013

3. Spicer, Jonathan, Lange, Jason. Fed officials signal next policy battle: rate guidance. Global Post. On the Internet at  http://www.globalpost.com/dispatch/news/thomson-reuters/131121/fed-officials-signal-next-policy-battle-rate-guidance . Last retrieved on December 13, 2013

4. Expansionary Policy. Investopedia. On the Internet at  http://www.investopedia.com/terms/e/expansionary_policy.asp . Last retrieved on December 13, 2013
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China Economics

Words: 693 Length: 2 Pages Document Type: Essay Paper #: 78722443

2014) about China's inflation rate notes that the official consumer price index in the People's epublic of China is 2%, which is below the official government target of 3.5%. Furthermore, this CPI is at its lowest level in 13 months. The article then discusses some of the causes of this inflation rate, and the implications that it has both for China and other stakeholder economies.

Falling producer prices are leading to the deceleration of the inflation rate in China, and this is generally viewed as being favorable by Chinese leaders. There has been a need in China to push ahead with economic reforms, but this pushed had been constrained by the risk of rapid growth. The country also experienced its largest trade deficit in two years, after exports dropped 18% and imports increased 10.1%. The article noted that some of the data is skewed -- in particular export data --…… [Read More]

References

Butt, R. (2014).. China inflation slows to 13-month low. Reuters. Retrieved March 31, 2014 from http://www.bloomberg.com/news/2014-03-09/china-inflation-slows-to-13-month-low.html

Holland, T. (2014). Fears over a tail risk hard landing in China are growing. South China Morning Post. Retrieved March 31, 2014 from  http://www.scmp.com/business/article/1431315/fears-over-tail-risk-hard-landing-china-are-growing
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Fiscal and Monetary Policy and Economic Fluctuations

Words: 1049 Length: 3 Pages Document Type: Essay Paper #: 10263461

Fiscal and Monetary Policy and Economic Fluctuations

The global economy was relatively doing fine more than five years ago before it was hit by economic downturn or recession. During this period, the American economy was at its peak, particularly in the fourth quarter of 2007. However, this was followed by a mild recession at the beginning of 2008, which eventually turned into a severe credit crisis across the world approximately one year later. While only a few countries escaped the economic recession, virtually no country could avoid the severe bear markets in stock (Norris, 2012). Some countries like the United States experienced changes in gross domestic product and stock markets. Since it has the best record of the main developed countries, the United States was severely affected by the recession. As the economic downturn came to end, America started the process of recovery from the effects of the recession. This…… [Read More]

References:

Davidson, P. (2013, September 11). Economy is Still Bruised Five Years After Crisis. USA

Today. Retrieved November 24, 2013, from  http://www.usatoday.com/story/money/business/2013/09/10/economy-2008-financial-crisis-lehman/2789841/ 

Klimasinska, K. & Chandra, S. (2013, August 27). America Resilient Five Years After Great

Recession. Bloomberg. Retrieved November 24, 2013, from http://www.bloomberg.com/news/2013-08-27/america-resilient-five-years-after-great-recession.html
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U S Current Macroeconomic Situation Similar to the

Words: 924 Length: 3 Pages Document Type: Essay Paper #: 5969301

U.S. Current Macroeconomic Situation:

Similar to the rest of the world, the macroeconomic conditions in the United States are currently fragile. This is mainly because the rate of unemployment is high though is slowly declining, the currency valuation is fluctuating up and down, and the European financial unrest has continued to have significant impacts on the nation's economy. These conditions are coupled by a slow increase in manufacturing and upward trend of the stock markets. As a result of these macroeconomic conditions, there are huge speculations that the United States Federal eserve will enforce more stimulus plans in attempts to boost the stalled recovery of the economy.

Macroeconomic Outlook for 2012:

The backbone of America's economic recovery since the end of recent recession has been private consumption. The U.S. economy accelerated in the fourth quarter of 2011 and continued its slow recovery in the first quarter of this year after…… [Read More]

References:

Morris, K. (2010, October 7). Current Macroeconomic Situation. Retrieved October 18, 2012,

from http://socyberty.com/economics/current-macroeconomic-situation/

"U.S. Quarterly Macroeconomic Review -- Q1 2012." (2012, April 19). Macroeconomic

Quarterly. Retrieved October 18, 2012, from http://cebviews.com/uploads/2012/05/U.S.-Quarterly-Report-Q2_2012-FINAL.pdf
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Economic Situation What Current Macroeconomic Situation U S

Words: 1044 Length: 3 Pages Document Type: Essay Paper #: 92847461

Economic Situation

What "current macroeconomic situation" U.S. (e.g. U.S. economy concerned unemployment, inflation, recession,)? What fiscal policies monetary policies time? Key concepts include paper -- data trends unemployment, inflation, GDP growth, expansionary fiscal policy tools, FOMC, easy money policy tools terms class.

What is the current macroeconomic situation in the U.S.

The United States is no longer mired in a full-blown recession as it was in 2008, but the process of economic recovery has been long, slow, and onerous. At present, unemployment is hovering around 7.9%. This reflects a slight increase from the last quarter. The U.S. seems to be in a precarious position, neither in full-blown recessionary mode but not entirely recovered. Of particular concern is the fact that "the increase [in unemployment] was much sharper for millennials, up from 11.5% the month before and 10.9% in November 2012" (Kingkade 2013). Young people were particularly hard-hit by the recession.…… [Read More]

References

Cassidy, John. (2012). Reagan, Bush, and Obama: We are still all Keynesians. The New Yorker.

Retrieved: http://www.newyorker.com/online/blogs/johncassidy/2012/06/the-republican-economy.html

Davidson, Paul. (2012). Fed ties interest rates to 6.5% unemployment. USA Today. Retrieved:

 http://www.usatoday.com/story/money/business/2012/12/12/fed-buys-treasuries/1762459/
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Macroeconomic Situation in the U S Corrective Fiscal

Words: 941 Length: 3 Pages Document Type: Essay Paper #: 1463806

Macroeconomic Situation in the U.S.: Corrective Fiscal and Monetary Policy

December 2007 marked the onset of the Great recession, which ended in mid-2009 but left the U.S. economy struggling through the damage wrought by its severity. Federal policy has gone a long way in the prevention of an occurrence of another recession, but growth remains too sluggish and inadequate for the full-health restoration of the economy. Vigorous and sustained fiscal and monetary support is needed if the economy is to recover and achieve the pre-depression employment level.

Save for the temporary hiring of census officials, the overall economy recorded a drastic fall in employment levels during the last half of 2009. In December 2012, the unemployment rate was reported at 8.1% - approximately 3.5 percentage points above the average rate in 2007, at the end of which the Great ecession struck (Bureau of Labor Statistics, 2014). This rate further exceeds…… [Read More]

References

Bureau of Labor Statistics. (2014). Labor Force Statistics from the Current Population Survey. Bureau of Labor Force Statistics. Retrieved from http://data.bls.gov/timeseries/LNS14

Council for Economic Education. (2013). Fiscal and Monetary Policy Process. Council for Economic Education. Retrieved from http://www.econedlink.org/lessons/index.php?lid=352&type=student

Greenlaw, G., Hamilton, J. Hooper, P. & Mishkin, F. (2013). Crunch Time: Fiscal Crises and the Role of Monetary Policy (No w19297). National Bureau of Economic Research.

US Inflation. (2013). U.S. Inflation Rate. U.S. Inflation. Retrieved from  http://usinflation.org/us-inflation-rate/
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Quanitity Theory of Money Wicksell

Words: 725 Length: 2 Pages Document Type: Essay Paper #: 17195818

In the long run, the volatility of money supply will also only cause changes in inflation rate and thus the nominal GDP of the country, as believed by monetarists, as the markets are believed to be always approaching their full employment rate.

But with evolution of capital markets and appearance of numerous wealth capitalization methods besides holding M1, the velocity of money became very variable rather than stable and equal to one, which made scholars hesitate on the validity of Quantity Theory of Money, while equation of exchange is supported by majority of economics schools.

Besides many contributions made by Knut Wicksell into the economic theory, the major appreciated work is the interest theory implications from his work Interest and Prices, where he separated the notion of monetary interest rate, or interest rate derived from the capital markets; and the natural interest rate, or the interest rate neutral to the…… [Read More]

References Available at  http://ingrimayne.com/econ/Money/Equation.html 

Friedman, Milton and Schwartz, Anna J. (1965). The Great Contraction 1929-1933. Princeton: Princeton University Press. Available at  http://www.econweb.com/MacroWelcome/monetarism/notes.html#3Available  at http://www.dallasfed.org/research/ei/ei0401.html. Available at
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Macroeconomic Situation in the U S

Words: 628 Length: 2 Pages Document Type: Essay Paper #: 19123314

It continues to buy government securities to infuse more cash into the economy. "The target range for the federal funds rate at 0 to 1/4% and continues to anticipate that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels of the federal funds rate for an extended period. To provide support to mortgage lending and housing markets and to improve overall conditions in private credit markets, the Federal eserve will purchase a total of $1.25 trillion of agency mortgage-backed securities and about $175 billion of agency debt. The amount of agency debt purchases, while somewhat less than the previously announced maximum of $200 billion, is consistent with the recent path of purchases and reflects the limited availability of agency debt" (Fed, 2009).

Consumer credit card debt and rates of foreclosures remain high, so the Fed will likely…… [Read More]

References

Gross Domestic Product (GDP): Third Quarter 2009. Bureau of Economic Analysis (BEA).

Retrieved December 3, 2009 at  http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm 

Press release: November 2009. (200). Federal Reserve (Fed). Retrieved December 3, 2009 at  http://www.federalreserve.gov/newsevents/press/monetary/20091104a.htm
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U S Economy the May 2007 Economy Presented

Words: 870 Length: 3 Pages Document Type: Essay Paper #: 89656035

U.S. Economy

The May 2007 economy presented a rosy picture: the lowest unemployment rate of the Bush Administration 4.4% (Bureau of Labor Statistics.gov. 2012. PP. 1), the peak of housing values, strong GDP growth of 3.6% (Trading Economics.com. 2012. PP. 1), a stable inflation rate of 2.2% (Trading Economics.com. 2012. PP. 1), and a normalized non-emergency FED Funds of 5.25% (Moneycafe.com. 2012. PP. 1). Yet, the collapse was imminent as the "Great Recession" began in the fourth quarter of 2007, decimating the economy and bringing the global financial system to a grinding halt. Now five years later the economy is regaining its footing in a ponderous yet upward trajectory which began in the second quarter of 2009. An espy of May 2012 presents a dramatically different story than of 2007: unemployment stands at 8.1% (Bureau of Labor Statistics.gov. 2012. PP. 1), housing values have plummeted; "Americans overall have lost almost…… [Read More]

One of the noteworthy aspects of the U.S. economy is that consumer spending

"accounts for 70% of economic activity" (Crutsinger, M. May 15, 2012. PP. 1). Business is on a never ending quest to create products, services, and pricing which will maximize revenue and increase profit. Price discrimination and segmentation are common in the marketplace (airline tickets as one of a plethora of examples); consumers may respond through indifference or anger towards the company, but are in the preponderance of economic activities likely to choose based on: perceived value, availability, rewards, or pricing options. Business can choose to discount products or services to entice certain groups: new customers, income sensitive customers, or competitor's customers.

The crux of the question on discounts for certain customers rather than others is really one of questioning the role government in the process. The government already chooses certain customers for assistance based on income, unemployment, opportunity, or other criterion. Food stamps have become plentiful over the last five years, a sign of a soft economy and one of an expanded government role. The qualifications are income-based which has struck many taxpayers as unfair because they are subsidizing a segment of the population. So too with unemployment benefits which in some cases have been
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Economic Impacts of the Following

Words: 1374 Length: 5 Pages Document Type: Essay Paper #: 31288179



Even more, high inflation attracted large budget deficits. In order to cover them from one fiscal period to another, a great part of Canada's national savings had to be directed towards this direction. The effects consisted in public debt accumulation, which in turn led to increased risks in the country's interest rates.

And the chain of effects did not stop here. The situation continued with discouraged investments, especially where equipment and technology were concerned. This is a very important aspect, because of the fact that these factors directly influenced productivity.

In other words, without massive and continuous investments in equipment and technology, productivity cannot be improved. If productivity does not reach satisfactory levels at least, the general economic situation cannot improve. As a consequence, individual economic situation cannot be a satisfactory one either.

Even if matters seemed to be clear from this point-of-view, it took a while until Canada came…… [Read More]

Reference list:

1. Canada (2009). Central Intelligence Agency. The World Factbook. Retrieved June 11, 2009 from  https://www.cia.gov/library/publications/the-world-factbook/ geos/CA.html.

2. Dodge, David (2002). Bank of Canada. Governor of the Bank of Canada's Speech to the Canadian Society of New York. Retrieved June 11, 2009.

3. Ragan, C. (2005). The Exchange Rate and Canadian Inflation Targeting. The Bank of Canada. Retrieved June 11, 2009.

4. Phelps, Edmund (1970). Inflation Policy and Unemployment. MacMillan. Retrieved June 11, 2009.
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Federal Funds Rate the Federal Fund Rate

Words: 3201 Length: 10 Pages Document Type: Essay Paper #: 31382085

Federal Funds Rate

The federal fund rate was part of the solution, comprised in the Federal Reserve Act of 1913, to centralize the banking system and gain public control of the money supply, inflation, and economic growth. The banking crisis of 1907 was a result of decentralized, unregulated banking that caused confusion with private bank notes being used as currency. There were occasional episodes of monetary mismanagement where the money supply was not appropriate to fulfill the needs of the economy. Too much money caused rapid inflation where too little money stunted economic growth by hindering production and the exchange of goods and services. There were no nationally consistent banking policies and no one entity had control to implement policies until the Federal Reserve Act of 1913 became a national law.

The Federal Reserve System was created with the Federal Reserve Act of 1913 with a oard of Governors to…… [Read More]

Bibliography

Amadeo, K. About.com U.S. Economy. 24 Jan 2012. Article. 14 Aug 2012.

Bankrate.com. How the federal funds rate affects finance. n.d. article. 15 Aug 2012.

Bofah, K. What Effect does the Fed Fund Rate Have on Stock Prices. n.d. Article. 15 Aug 2012.

Madrick, J. "Paul Volcker, Jimmy Carter, and Ronald Reagan." Madrick, J. Age of Greed. New York, NY: Alfred A. Knopf, 2011. 160-176. Book.
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Macroeconomic the Contemporaneous Societies Reveal

Words: 1122 Length: 4 Pages Document Type: Essay Paper #: 8810330

If on the other hand, the real inflation rate is above both targeted and past values, the BA could change its current approach and implement more aggressive means of decreasing inflation, such as reducing the amount of money in circulation or increasing the interest rates. A higher interest rate will reduce the amount of money in circulation by making the goods and services less accessible to the public. This in turn will materialize in a reduced demand for currency, reducing as such the levels of inflation.

3. educing the Expansionary Gap

An expansionary gap, often known as an inflationary gap, generally occurs at changing stages of the business cycle and is generally pegged to high levels of inflation. It can best be understood in terms of production and input in the meaning that it occurs when the final output of production is larger that the output of the labor force.…… [Read More]

References:

King, W., Two Sides of Fiscal Policy, Drexel University, LeBow College of Business, http://william-king.www.drexel.edu/top/prin/txt/fiscal/gap1.html last accessed on September 21, 2009

White, L.H., the Concise Encyclopedia of Economics -- Inflation, Library of Economics and Liberty,  http://www.econlib.org/library/Enc/Inflation.html  last accessed on September 21, 2009

2009, Website of the Reserve Bank of Australia,  http://www.rba.gov.au  last accessed on September 21, 2009
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Economic Situation U S Compared 5 Years Ago

Words: 866 Length: 2 Pages Document Type: Essay Paper #: 97675243

economic situation U.S. compared (5) years ago. Include interest rates, inflation, unemployment analysis. 2.Propose (2) strategies federal government implement encourage people spend money order create employment opportunities.

Q1.Analyze the current economic situation in the U.S. As compared to five (5) years ago. Include interest rates, inflation, and unemployment in your analysis.

The unemployment rate in January 2012 was 8.3%. The relative improvement in the economy has caused many to pressure Fed chairman Ben Bernanke to raise interest rates above their current record lows to curb inflation, although Bernanke still feels that the economy is fragile enough to justify keeping rates extremely low. "The unemployment rate has fallen for five straight months and employers have added an average of 200,000 net jobs per month from November through January" (Crustinger 2012). Until recently, the Fed has believed that there has been little risk of inflation due to an excess in the money…… [Read More]

References

Barger, Melvin. (1984). What killed Ma Bell? AT&T Divestiture. Porticus. Retrieved:

http://www.porticus.org/bell/whatkilledmabell.html

Block, Sandra. (2012). Inflation could lead to a modest tax cut. USA Today. Retrieved:

 http://www.usatoday.com/money/perfi/columnist/block/story/2011-09-19/inflation-tax-brackets/50469496/1
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Fund the Pictet Funds Euro

Words: 789 Length: 3 Pages Document Type: Essay Paper #: 69765296

However, such successes have been limited over the life of the fund. Examining the manager's comments and the comments in the annual report, it appears as though fund management is generally reactive to trends rather than proactive. The discussion centers on what happen in the economy and to the fund, rather than any discussion on what the fund is going to do to exploit opportunities.

The fund's heavy concentration in the French market has left it particularly vulnerable to shocks emanating from that market. For example, in the first quarter of 2007, the inflation index in France moved sharply lower, which was not anticipated by the fund managers. In the second quarter, the risk of a hike in VAT increased the volatility of French securities, in particular the short-range maturities. The result of this high level of exposure to the French market was that the fund suffered over this period…… [Read More]

Works Cited

PF (Lux) EUR Inflation Linked Bonds Fact Sheet, October 2008.

Pictet Funds (Lux) 2007 Annual Report, p.31, 199-200.

PF (Lux) EUR Inflation Linked Bonds Manager's Comment, October 2008

PF (Lux) EUR Inflation Linked Bonds Fact Sheet, October 2008.
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Existence of an Individual Which

Words: 782 Length: 2 Pages Document Type: Essay Paper #: 11659629

There were certain moments in my life which did not allow me to pursue my study programs as desired; yet it was precisely this set of obstacles which consisted a challenge for me and determined me ever more strongly to pursue my goal. Therefore, I am due to graduate in May 2008 with a presentation entitled "Have Central Banks and Private Agents Become Wiser?" conducted under the supervision of Dr. Dennis Novy who has also offered me considerable support in trying to address issues such as inflation, the role of central banks, and their relation with private agents. His precious advice has led me to follow lines of thought different from the ones already addressed by the literature and has opened new research directions I intend to analyze in my future studies.

Aside from the traditional academic environment created by the universities I attended, another important input represented the experience…… [Read More]

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Finance While Highly Inflated Countries

Words: 590 Length: 2 Pages Document Type: Essay Paper #: 78998328

The difference in the interest rates would have predicted a much greater change in the exchange rates between these two countries. This begs the question as to why the rates did not change further.

There are a few possible explanations for this discrepancy. The first is that the expected inflation in Brazil failed to material, and the second is that inflation in the U.S. was higher than expected. U.S. inflation is not high, but it is growing, whereas interest rates are not growing yet. In contrast, the Brazilian government's response to its inflation situation is more in line with what would be expected.

The real has underperformed expectations, and there could also be domestic factors. If we look at the six factors that affect exchange rates, we can see that there may be issues with respect to public debt (if Brazil has performed worse than expected) or political stability and…… [Read More]

Works Cited:

Bureau of Labor Statistics. (2012). Consumer price index -- February 2012. BLS.gov. Retrieved March 16, 2012 from  http://www.bls.gov/ news.release/pdf/cpi.pdf

Investopedia. (2012). Inflation and interest rates. Investopedia. Retrieved March 16, 2012 from  http://www.investopedia.com/university/inflation/inflation3.asp#axzz1pI61aUrV 

Oanda. (2012). USD/CAD details. Oanda.com. Retrieved March 16, 2012 from http://www.oanda.com/currency/converter/

Spicer, J. (2012). In historic shift, Fed sets inflation target. Reuters. Retrieved March 16, 2012 from http://www.reuters.com/article/2012/01/25/us-usa-fed-inflation-target-idUSTRE80O25C20120125
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Capital Investments in Emerging Markets

Words: 1619 Length: 5 Pages Document Type: Essay Paper #: 27297037

General Electric Company is one of the most acknowledged companies across the world. The company's center of operations is situated in Boston. In particular, the manufacturing company has various business operations in different segments. These include oil and gas, power and water, aviation and transportation. This shows the company's versatility in manufacturing as it ranges from the engineering industry to automotive industry. The company's prevailing revenue generated lies in the range of $140.39 billion as of the 2015 fiscal year. In the 2012 financial year, the company was ranked as the fourth biggest firm in the world. General Electric Company manufactures aircraft engines, locomotives and other transportation apparatus, lighting, electric control gear, generators and turbines, and medical imaging paraphernalia. In addition, the company is the owner of GE Capital, which provides commercial finance, commercial aircraft leasing, real estate, and financial services for the energy sector (Hoovers, 2016). Since its establishment…… [Read More]

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S& l the Discussion Explored the

Words: 1942 Length: 6 Pages Document Type: Essay Paper #: 3346939



Solutions

As a response to the savings and loans debacle, there have been several attempts by congress and other governmental agencies to assists consumers and some financial institutions alike. The most significant and some say extreme solution thus far came when the Federal government assisted JP Morgan with the purchase of Bear Stearns for $2 per share.

One of the most discussed solutions has to do with baling out the mortgage lenders and assisting borrowers. There are several different remedies that have been proposed. These remedies include everything from a moratorium on foreclosures to the freezing of interest rates.

As it pertains to the mortgage companies it has been suggested that limits should be lifted so that companies can purchase jumbo housing loans. According to one article this type of mortgage relief could help staunch the hemorrhaging in high-priced housing markets...where buyers have had difficulty getting loans and are paying…… [Read More]

Works Cited

Jumbo Loans Spell Relief; Analysts See Economic Fix. (2008, January 29). The Washington Times, p. A01.

Kuttner, R. (2007, October). The Bubble Economy: The Financial Meltdown Is the Logical Consequence of Deregulation. Will We Reverse Field in Time to Prevent Another 1929?. The American Prospect, 18, 20+.

Peterson, J.R. (2005). Designer Mortgages: The Boom in Nontraditional Mortgage Loans May Be a Double-Edged Sword. So Far, Most Banks Have Moved Cautiously. ABA Banking Journal, 97(10), 30+.

What is the real definition of inflation?." Retrieved May 8, 2007 from; http://www.inflationdata.com/Inflation/Articles/Definitions.asp
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Real Cause of Unemployment Is

Words: 851 Length: 3 Pages Document Type: Essay Paper #: 13678107



It is measured as the annual percentage increase in prices and the most often quoted figure is the annual change. The prices inflation usually measures are retail prices. Unemployment is one of many factors that impact inflation. Typically, unemployment and inflation are opposites except in instances of stagflation where these two variables rise together. If unemployment goes too high, inflation goes down, because high unemployment drives wages downwards. Price decreases follow because goods are being produced so economically that prices can fall and producers can still make a profit. This generally happens after major productivity enhancements as Nussbaum points out in his article.

Unfortunately, factors other than productivity such as higher energy and commodity costs are having a significant impact on inflation (Kirchhoff and Hansen, 2004). The median forecast is for the consumer price index to rise three percent in the twelve months ending in September 2004 and 3.1% in…… [Read More]

Bibliography

Inflation - explanation. Retrieved October 17, 2004 from Web site: http://www.bized.ac.uk/virtual/economy/policy/outcomes/inflation/inflex.htm

Kirchhoff, S. And Hansen, B. (2004, August 22). Economists dial back growth forecasts. USA Today.

Retrieved October 17, 2004 from Web site: http://www.usatoday.com/money/economy/2004-08-22-econ-survey_x.htm

Nussbaum, B. (2004, March 22). Where are the jobs? Business Week. Retrieved October 17, 2004 from Web site: http://www.businessweek.com/magazine/content/04_12/b3875601.htm
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Eurozone Maastricht Treaty Euro Zone Treaty the

Words: 3044 Length: 10 Pages Document Type: Essay Paper #: 71231999

Eurozone Maastricht Treaty

Euro zone Treaty

The European Community established the convergence criteria. These criteria was established in order to allow its EU Member states to take part in the Euro Zone, and using the Euro, as an official currency. The members of the European Union formed the Maastricht Treaty in 1992. The principle goals of the treaty were to establish an economic and monetary union, strengthen the democratic legitimacy of its institutions, better the effectiveness of its institutions, come up with the community social dimension, and also establish a unified foreign and security policy (Charles 1998).

The criteria contain several principles governing inflation rates, government finance, exchange rate, and long-term interest rates. The percentage points for inflation rates should not be 1.5 higher than the average the top three members states in performance of the EU. Government finance covers both the annual government deficit and the government debt. Under…… [Read More]

References

Charles K. (1998). Interest Rates: A Decision-Making Approach. New York, NY: Dryden

Press

David, J.H. (1999). "Advertising's Overdue Revolution" Speech delivered at the week

New York, NY: John Wiley & Sons
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Federal Reserve the Current State of the

Words: 2290 Length: 7 Pages Document Type: Essay Paper #: 90938431

Federal eserve

The current state of the United States economy is not encouraging. Even though there has been false hope about it, the chances are that it will hardly last for long. The long-term trends that are negatively impacting the economy and financial system are showing no signs of reducing. As each day passes, the economic foundations of the country continue to crumble. The debt of the country has increased and the population is consuming more wealth than what is produced. In addition, unemployment and inflation levels are high coupled with slow economic growth, which remain the main features of the U.S. economy. The Federal eserve is the key to solving the current economic situation that is experienced in the U.S. This is because it is the central bank of the United States and the operations of every bank are monitored by the Federal eserve (Hafer, 2005). In 1913, the…… [Read More]

References

Axilrod, S. (2009). Inside the Fed: Monetary Policy and its Management, Martin through Greenspan to Bernanke, New York: MIT Press.

Hafer, R. (2005). The Federal Reserve System: An Encyclopedia, Westport: Greenwood Publishing Group.

Mankiw, G. (2011). Principles of Economics, New York: Cengage Learning

Meltzer, A. (2010). A history of the Federal Reserve, Volume 2, New York: University of Chicago Press.
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Economic Indicators Are Used to Measure the

Words: 1305 Length: 4 Pages Document Type: Essay Paper #: 43863270

Economic indicators are used to measure the financial health of the economy. There are many methods and tools for measuring the economy and every economist has his favorite method. The health of the economy is measured by tracking certain indicators. Different economists use these indicators in various combinations. Some economists place more or less weight on different ones in making their predictions about which direction the economy will go. It is important to note the differences in measurement when assessing the opinions of popular economists of today.

This paper will be primarily concerned with the indicators, which would indicate whether we are currently in an inflationary economy or a deflationary economy. A recession occurs when real GDP declines for two successive quarters. However, the National Bureau of Economic Research (NBER) officially defines a recession as a "significant decline in activity spread across the economy, lasting more than a few months."…… [Read More]

Works Cited

Canto, Victor A. Crisis Revisited. Bizjpirnals.com. 2002. http://sanjose.bizjournals.com/sanjose/stories/2002/03/04/daily12.html. Accessed April

Clifford, Stephanie. How to keep tabs on the United States economic health.

Cheat Sheet: A Civilian's Guide to the Economy. 2002 Business 2.0 Media Inc. August 2001 Issue. http://www.business2.com/articles/mag/0,1640,16701|5,FF.html. Accessed Hester, William. Focus on Fed Funds. Bloomberg.com. October 1999. http://www.bloomberg.com/personal/archives/mw_A9910_econ.html. Accessed April 22,

Morrison, Joanne UPDATE 1-U.S. fourth-quarter GDP growth revised higher. Reuters News