European Central Bank

R. David Ranson addresses the failure of the Federal Reserve Bank. He states, “The ultimate test of its role as overseer and regulator of the commercial banking system met with a very poor result.” (Ranson 407). Ranson is a critic of the Federal Reserve and its policies. Milton Friedman, in concurrence with Ranson, claims “If Congress had been in control of monetary policy, you would not have had the Great Depression.” (Friedman 635). Dean Baker, co-director for Centre for Economic and Policy…

Excel and taking the exact value instead of onl 4 significant figures. The same calculation were repeated until year 2001 using Microsoft Excel. Thirdly, for the interest profit calculation, the assumption that all of the money supply was kept in the bank for the whole 10 years was made. This means all the profit from interest is only usable at the end of the tenth year but as for bond, the profit was received annually. This is an advantage for the bond as the money received earlier could be…

system is set up as floating system. Essentially the rand exchange rate will be determined by the market. Similar to other systems, the Reserve Bank can influence the rate by buying and selling in the foreign exchange market, yet they typically try not to intervene with the market aside from building up foreign exchange reserves (although the Reserve Bank says this is to manage liquidity and not to influence the exchange rate) (Resbank). There has been much speculation from economists that,…

There seems to be a need for increased understanding in academia. In a speech at the Federal Reserve Bank of Boston on 14 October, Ms. Yellen requested that economists help the FED try to gain a deeper understanding of how recent global trends are shaping the effects of monetary policy. As a reason for why the Fed has been unable to stimulate the economy…

The Federal Reserve System, the main group who control the money supply in the United States. The Federal Reserve consists of 12 Federal Reserve district banks with 25 branches. The Federal Reserve System is the central banker for the nation and provides banking services to commercial banks, the federal government, and other financial institutions. They also regulate, supervise and is responsible for policies concerning money. The president and congress consult with the Federal Reserve System to…

a speech on February 16th, 2016, titled “Lessons from the Crisis: Ending Too Big to Fail”. In his speech, Mr. Kashkari discusses various takes on the too-big-to-fail policy, in which I believe his most vital claim is that he believes “the biggest banks are still too big to fail and continue to pose a significant, ongoing risk to our economy (www.minneapolisfed.org).” Mr. Kashkari also issues a warning that we cannot assume that policymakers will predict the next financial crisis. Just like the…

There is no denying the fact that china is economic miracle of 21st century. China is what it is because of the reforms intiated by its leadership (since 1978). Deng Xiaoping who intiated the reforms back in the 70s, described his approach as “crossing a river by feeling the stones” . Over years china has transformed itself from a hardcore socialistic economy to a socialistic market economy where investments in infrastructure has become the main pillar to generate economic growth and raise the…

inspires virtually all macroeconomic theory. Mathematical economists depend on this so-called classical separation, or later kinds of it, to forecast the belongings of economic policy. Assume a macroeconomist is reviewing monetary policy from a central bank, such as the Federal Reserve. When the Fed involves in open market operations, the macroeconomist does not accept that variations in the money supply will variation future capital equipment, employment stages or actual wealth in long-run…

Here, DUR(a) = average duration of assets DUR(l) = average duration of liabilities L = market value of liabilities A = market value of assets Where, DUR(a) = 2.70 L = 95 A = 100 DUR(l) = 1.03 Thus: DUR(gap) = 2.70 – (95/100×1.03) = 1.72 years The bank manager uses the DUR(gap) calculation of equation 1 to estimate what will happen if interest rates changes and to obtain the change in the market value of the net worth as a percentage of total assets. We can also say that it is the change in…

weaknesses and inadequate monetary policy by Asian governments. This paper will discuss three important central bank institutional features - central bank independence, central bank transparency and inflation targeting – and examine whether these features changed after the financial crisis and their impact in terms of helping Asian economies transform into healthier situations post-crisis. 4.1 Central Bank Independence Prior to the 1997 crisis, monetary policy in Asian countries was believed…