ScienceGuy

The six-member panel under former RBI Governor Jalan was appointed on December 26, 2018, to review the economic capital framework (ECF) for the RBI after the Finance Ministry asked the Central Bank to transfer more surplus to the government from its excess reserves (Livemint 2019).

Role of the central bank balance sheet 1. Ultimate means of settlement: One of the interesting features of the central bank's balance sheet is that its main liabilities are banknotes and commercial bank reserves, which are a form of money in the modern economy.

- Based on the book by Niall Ferguson According to Friedrich Engels and Karl Marx, money was merely an instrument of capitalist exploitation. I, personally, would not disagree with them too much.

-  by  Ben Bernanke in  G eorge Washington University   Money market funds (MMMFs) are investment companies that sell shares and invest the proceeds in short-term assets. MMMFs historically has almost always maintained stable 1 dollar share prices, so they act very much like a bank.

-  Based on  Lecture (4) by  Ben Bernanke in  G eorge Washington University   This lecture discusses monetary policy responses to the recession, the sluggish recovery, post-crisis changes in financial regulation, and implications of the crisis for central bank practice.

-  Based on  Lecture (3) by  Ben Bernanke in  G eorge Washington University   This lecture describes the financial crisis, its implications and the policy responses by the federal reserve. 

-  Based on  Lecture (2) by  Ben Bernanke in  G eorge Washington University   This lecture explains the development of central banking after world war 2, focusing on the origins of the recent financial crisis (2008-09).

-  Based on  Lecture (1) by  Ben Bernanke in  G eorge Washington University   This lecture explains what central banks do, the origin of central banking in the United States, and the experience of the Fed during the Great Depression.

The founding father, perhaps the grand-father of physics (theoretical physics per se), whose idea changed our world and post which our perception about the world changed forever was proposed by an ancient Greek pre-Socratic philosopher Democritus in 4 century BC.

Economics and Rocket Science I am more of a macro-economics guy, so why should I care about rocket science?

Latitude lines, the parallels, stay parallel to each other, encircling the earth in concentric circles with decreasing radii. The meridians of longitude go the other way.

On 14 th  November 2008, the Moon Impact Probe separated from Chandrayaan-1 orbiter and struck the south pole, creating history as India became the fourth country to research and develop its own technology and place its flag on the moon.

Is government debt a problem? There are two parts to a question of government debt: 

EXPECTATIONS IN AS -  INFLATION We have already incorporated expectations of the price level into the model.

As we had seen, in the short and medium run fluctuations (shocks and policy changes) dominate. In the long-run capital accumulation and technological change dominates.

The openness of the economy has three distinct dimensions: 1. Openness in the goods market: Free trade restrictions include tariffs and quotas.

In the short run,  we had assumed that the expectations of prices are fixed in the short run but not in the medium run. In the short run price expectations can be wrong, in the medium run they cannot.

In the dynamic AD-AS model, we remove the assumption that the inflation rate, the expectation for the inflation rate and output growth are zero in the medium run. Additionally, we had assumed that there is no growth in the medium run.

Historically, one of the main reasons countries have borrowed abroad is to finance productive investments that would have been hard to finance out of domestic savings alone.

Intertemporal trade and Current Account balances (Model Without Investment)

Endgame: Was it really Avenged? A Quantum Mechanical perspective “All we can do is our best and sometimes the best we can do is to start over” - Peggy Carter

In this model, the government has its objective to minimize the loss function given by,

A currency crisis is a type of financial crisis. It is a situation when there is serious doubt if the central banks have enough foreign exchange reserves to maintain the peg of the currency.

With increased world integration there was a need to study the transmission of policy in one part of the world to other country's.

Unlike Mundel Flemming model, this model introduces dynamics. Further, it takes the role of expectations into account. Dornbusch's model was highly influential because, at the time of writing, the world had recently shifted to a floating exchange rate regime and a little was understood about exchange rate volatilities.

The monetary model is better for a long run explanation of exchange rates. It assumes full employment with flexible prices. Furthermore, real income can be exogenously decided which determine the demand for real balances.

For Floating Exchange Rates Assumptions:  1. AS curve is vertical. Therefore, the long run determinants only effect the output. Further, prices are flexible (another long run phenomenon).

Abstract Using the lens of game theory, the paper attempts to describe the ways in which it can enhance undergraduate understanding in international relations.

We all know 2nd law of thermodynamics. It says that the entropy of the universe is continuously increasing.   This means everything in the universe is getting more and more disordered.

We are fortunate to be witnessing a “eureka” moment of humanity. It opens new doors to our understanding of the universe and subsequently our own self. 100 years ago Einstein’s theory of general relativity predicted the formation of black holes.

Law of one price says that if two goods are identical, they must sell at the same price. This happens due to arbitrageurs. If prices differ arbitrage tries to close the gap.

Studies have shown that we might have a new entrant to wobble the already shaken climatic system of our planet. We have another loud and clear alarm from nature before we put an axe to our own foot.

European Communities were basically three internal organizations that were governed by the same set of institutions i.e. European Coal and Steel Community (ECSC), European Atomic Energy Community (EAEC) and the European Economic Community (EEC).

There are two main distortions in the New Keynesian model: 1. markups due to imperfect competition (leads to low employment in the long run): we assume that it is controlled by the fiscal authority.

Click here to read an easy-to-understand guide to Brexit - beginning with the basics, then a look at the current negotiations, followed by a selection of answers to questions the BBC has been sent.

This story is featured in BBC Future’s “Best of 2017” collection. Click here to read.

The Monetary Institute's "Our Money, Our Banks, Our Country - Money Creation in the Modern Economy" conference was held in Zurich, Switzerland on February 5, 2018.

NK model takes the RBC model backbone and adds to that the price stickiness. To incorporate price stickiness we assume that firms are price-setters and thus move away from the perfect competition assumption.

In our models so far we had assumed that agents live infinitely, which everybody knows is unrealistic. So, in this model attempt was made to relax this assumption.

Click here to view the concise self-made notes. 

T he Real Business cycle model, as discussed in another article, does not include monetary components in its analysis.

​ According to the Keynes theory, the source of fluctuations in the aggregate demand.

T his plot of log Real GNP shows the growth of real GNP in time. What we see is that the GNP has grown smoothly and consistently on average (red line) however, with some fluctuations (blue line).

Monetarist school of thought gained a reputation during the 1970's when the US was battling high inflation and slow economic growth period to which the Keynesian's had no answer.

T he control variable is a variable that you control whereas a state variable is a variable that we cannot control but nevertheless it's affected by what we choose as our control variable.

1. Mercantilism  The economic system of trade between 16th to 18th century. They believed that the amount of wealth in the world was static and so national strength could be maximized by limiting imports and maximizing exports.

Enough with UPA vs NDA for NPA...excellent discussion by Ravish to expose the political will independent of any party, behind the stressed Indian Banking System.

Ironically as the Rupee started to weaken, the politics started to heat up with politicians restarting their age-old blame game.

Abstract: Many questions have been raised regarding the need & efficacy of demonetization. Different sceptics have different speculations related to the impact of the move on the growth of the Indian economy, with general perception supporting the quantity theory of money.

1. Introduction The world has seen unprecedented growth in the past few decades. But has everyone been benefited from this growth, or has it been only for few big economies at the cost of others?