Assignments for Dr. PARKES' Money and Banking class
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Course Assignments and Tentative Outline:
June 29, 2017: Continue Chapter 23 - Monetary Policy Theory
- continue Chapter 23 - Monetary Policy Theory and review
- Reponse of Monetary Policy
- Inflation target
- Response to Demand and Supply Shocks - temporary and permanent
- Stabilizing Economic Activity
- The Role Lags: the five lags
- Monetary Policy at the Zero Lower Bound
Final GDP numbers for the First Quarter
Miskin Chapter 23 PPT
Miskin Chapter 24 PPT
Miskin Chapter 25 PPT
Please fill out an evaluation for the class. THANK YOU!
July 3, 2017 AT 10:15 am - Same time! Final Exam over all material covered in the class
June 12, 2017: Chapter 9 - Banking and the Management of Financial Institutions
- Chapter 9 - Banking and the Management of Financial Institutions
- The Balance Sheet
- The 4 assets and 4 liabilities of a bank
- Basic Banking
- General Principles of Bank Management
- Asset Management
- Liability Management (money center banks)
- Capital Adequacy Management (ROA and EM)
- Managing Credit Risk (Screening and Monitoring)
- Credit Rationing
- Off Balance Sheet Activities
- Miskin Chapter 9 PPT
- Andrew's Day 5 PPT
Week 1
June 5, 2017: Chapter 1 - Why study this course?
Money Market Financial Instruments
- US Treasury Bills
- Commercial Paper
- Repurchase Agreements
- Federal Funds - borrowing of excess reserves by banks from banks
Miskin Chapter 2 PPT
Chapter 3: What is Money?
- 3 Functions of Money
- Fiat versus Commodity Money
- MMMMs - the Measurement of Money
Miskin Chapter 3 PPT
Notes for the first three chapters:
Chapter 1 Notes (Handed out in class)
Chapter 2 Notes
Chapter 3 Notes
June 6, 2017: Chapter 2: An Overview continued, and Chapter 4: The Meaning of Interest Rates
- Chapter 2 continued:
- Capital Markets
- Stocks
- Mortgages, and MBS
- Corporate Bonds
- US Government Securities
- US Government Agency Securities
- State and Local Government Bonds (Called "Munis" for Municipal Bonds)
- Commercial Loans
- The "Euro-market"
- Function of Financial Markets - make sure to pick up the definitions of
Transaction Costs, Risk Sharing, Economies of Scale, Economies of Scope,
Asymmetric Information: Adverse Selection and Moral Hazard
- A few comments on Financial Institutions and Regulation
- Chapter 4: The Meaning of Interest Rates
- Present Value and Future Value
- Four Types of Credit Market Instruments
- Simple loan
- Fixed-payment loan
- Coupon bond
- Discount bond
- Yield to Maturity
- Relationship between the price of a bond and the yield to maturity, Table 1 in the text, p. 72
- Perpetuity
- Discount Bond - calculating a dealer's profit on a Treasury Bill
- The Distinction between Interest Rates and Returns
- See Table 2, p. 77 in the text
- Real versus Nominal Interest Rates - Figure 1
- GDP 2nd release, first quarter
- Miskin Chapter 4 PPT
- Chapter 4 Notes
June 7, 2017: Chapter 5: The Behavior of Interest Rates
- Chapter 5: The Behavior of Interest Rates
- Determinants of Asset Demand
- 1. Wealth
- 2. Expected Returns
- 3. Risk
- 4. Liquidity
- The Theory of Portfolio Choice
- Supply and Demand in the Bond Market
- The Demand Curve
- The Supply Curve
- Market Equilibrium
- Shifts in the Demand Curve
- Wealth, expected interest rate, expected inflation, Risk, Liquidity
- Shifts in the Supply of Bonds
- Profitability of Investments, Expected Inflation, and Government Budget Deficit
- Three Scenarios:
- 1. The Fisher Effect
- 2. The Business Cycle Effect
- 3. Government Budget Deficits
- Miskin Chapter 5 PPT
June 8, 2017: Chapter 5: continued and Chapter 6: Risk and Term Structure of Interest Rates
- Chapter 5 continued
- Supply and Demand in the Market for Money - the Liquidity Preference Framework
- Shifts due to income, price level, and Fed changes
Chapter 6: Risk and Term Structure of Interest Rates
- Risk - default risk and the rating agencies
- Term structure and the yield curve
Chapter 6 PPT
email: andrew at andrewparkes.com
Last Update: June 29, 2017
By Andrew L. H. Parkes, Ph. D.