Skip to main content

Home/ IBEconomics/ Group items tagged Quantitative

Rss Feed Group items tagged

Filter: All | Bookmarks | Topics Simple Middle
Yihan Li

BBC News - Federal Reserve to buy more debt to boost US economy - 0 views

www.bbc.co.uk/...business-19592151

shared by Yihan Li on 14 Sep 12 - No Cached
  • buy "additional agency mortgage-backed securities at a pace of $40bn (£25bn) per month".
    • Yihan Li
      Yihan Li on 14 Sep 12
       
      Buying the securities increases the supply of money in the market
    • Yihan Li
      Yihan Li on 14 Sep 12
       
      Increase in supply of money is used to expand aggregate demand
    • Yihan Li
      Yihan Li on 14 Sep 12
       
      (evaluation) talk about the merits and demerits of increase in AD
  • nterest rates in the US have been close to zero for several years now, and the Fed again kept them at below 0.25% on Thursday.
    • Yihan Li
      Yihan Li on 14 Sep 12
       
      Low interest rate keeps aggregate demand high -> more spending and investment 
    • Yihan Li
      Yihan Li on 14 Sep 12
       
      Draw interest rate vs quantity of money diagram
  • quantitative easing
    • Yihan Li
      Yihan Li on 14 Sep 12
       
      quantitative easing = A monetary policy used to increase the money supply by buying government securities or other securities from the market
  • ...7 more annotations...
  • "We doubt it will be enough to get the economy on the right track. It's only a matter of time before speculation begins as to when the Fed will raise its purchases from $40bn a month."
    • Yihan Li
      Yihan Li on 14 Sep 12
       
      (evaluation) not enough money is spent by Federal Reserve 
  • the central bank buys bonds to keep the long-term cost of borrowing down.
    • Yihan Li
      Yihan Li on 14 Sep 12
       
      Increase in supply of money keeps cost of borrowing (long-term interest rate) low
  • The unemployment rate in the US has been above 8% since January 2009, but the current 8.1% is down from the recent high of 10% in October 2009.
    • Yihan Li
      Yihan Li on 14 Sep 12
       
      high unemployment = the economy is not doing well. 
    • Yihan Li
      Yihan Li on 14 Sep 12
       
      The main reason why Fed implemented the policy 
  • US presidential election.
    • Yihan Li
      Yihan Li on 14 Sep 12
       
      The decision is influenced by political factors 
  • Ben Bernanke also lowered the Fed's growth forecast for the US economy to 2% this year, down from the 2.4% it predicted in June
    • Yihan Li
      Yihan Li on 14 Sep 12
       
      Fed decided to implement the policy because economy is not growing quickly enough 
    • Yihan Li
      Yihan Li on 14 Sep 12
       
      Draw a AD-AS diagram to explain the results of AD shift on economy 
  • "The committee is concerned that, without further policy accommodation, economic growth might not be strong enough to generate sustained improvement in labour market conditions,
    • Yihan Li
      Yihan Li on 14 Sep 12
       
      Without Fed's help, unemployment may increase or be stagnant. Maybe talk about Okun's law, which states that 3% increase in output corresponds to a 1% decline in the rate of unemployment
  • Federal Reserve to buy more debt to boost US economy
    • Yihan Li
      Yihan Li on 17 Sep 12
       
      Why using monetary policy, not using fiscal policy? What are other options?  
Erica Nozawa

BBC News - India inflation rate rises faster than expected - 0 views

www.bbc.co.uk/...business-19596233

shared by Erica Nozawa on 15 Sep 12 - No Cached
  • India inflation rate rises
  • Higher food prices
  • mainly behind the rise
  • ...7 more annotations...
  • decide interest rate policy.
  • central bank policymakers with a "tricky call".
  • government cut fuel subsidies, which will force up prices.
  • The fundamentals don't justify a rate cut at this point of time because the inflationary expectations are still quite high.
  • The quantitative easing in the US is also likely to push up global commodity prices and add to inflation
  • needs a boost from lower interest rates
  • industrial output rose by just 0.1%
  • Erica Nozawa on 15 Sep 12
     
    My Macro Economics IA article.
Cynthia Huang

More foreign currencies sold -- Shanghai Daily | 上海日报 -- English Window to Ch... - 0 views

www.shanghaidaily.com/...%2Bforeign%2Bcurrencies%2Bsold

currencies exchange rates

shared by Cynthia Huang on 19 Sep 12 - No Cached
  • BANKS in China sold more foreign currencies in August than July
  • yuan funds
  • fell by 17.4 billion yuan last month from July to 25.6 trillion yuan
  • ...6 more annotations...
  • apparent capital outflow from China due to the weak economic situation
  • outflow occurred as the yuan weakened against the US dollar
  • exchange rate fell from 6.3146
  • to 6.3449
  • predicts the outflow to cease
  • quantitative easing moves by the US Federal Reserve may increase liquidity worldwide and fuel the risk appetite of investors
1 - 4 of 4
Showing 20▼ items per page