Posts Tagged ‘Auto Trader’

Which measure of the money supply to use?

Saturday, January 9th, 2010


Unfortunately, the matter does not end here. As we saw in Chapter 10, there are different definitions of “money supply,” ranging from the narrowest (M1), which includes only currency plus demand deposits, to broader definitions such as M2, which includes non-chequing  savings deposits and personal term deposits. These definitions are reviewed in Figure 11-6. Due to the great difference in the sizes of M1 and M2, it is obviously important that the Bank of Canada select the appropriate one as its “target” for its measurement and control of the money supply.

From 1975 to 1982, the Bank of Canada used M1 as its target for monetary policy. In his 1978 Annual Report of the Governor of the Bank of Canada to the Minister of Finance, Gerald Bouey stated that M1 had been chosen because “it moves with the trend of aggregate spending in the economy in a fairly predictable manner and it is susceptible to control by the central bank through the adjustment of short-term interest rates…Our experience to date in using M1 has confirmed in my mind its usefulness as a proximate target in the conduct of monetary policy.” In short, the Bank of Canada regarded M1 as the most relevant measure of the money supply because it includes those most immediately spendable funds (currency plus demand deposits) that have the greatest influence on the level of aggregate demand in the economy, and thus on the performance of the economy.

The Different Sizes of M1 and M2 February 1982

Currency Outside Banks

$10 038

Demand Deposits

- 13 322

Total: Ml

$23 360

Other Chequable Deposits

7138

Total: MiB

30498

Notice and Personal Term Deposits

91074

Total: M2

121 572

FIGURE 11-6 The D of M and M2 February 1982

Millions of  Dollars

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The National Debt

Thursday, September 17th, 2009


We have seen that the use of government fiscal policy to stimulate the economy during recessions requires that the government borrow money (mostly through bond issues) in order to finance its budget deficits. The total amount of federal government debt thus incurred – the amount of money owed by the federal government – is called the “National Debt.” By 1983 the National Debt will amount t over $100 billion, or nearly $4000 for every man, woman, and child in Canada.

The National Debt has, over the years, been the subject of a great deal of misunderstandings, fears, myths and political hypocrisy. Many Canadians believe, for instance, that the National Debt is owed to other countries and that Canada may go bankrupt because of it. Both of these ideas are myths. On the other hand, few Canadians appreciate the real dangers concerning the National Debt. We will examine first the myths, then the real dangers.

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Reduction in Taxes

Monday, August 24th, 2009



 Reduction in Taxes

While traditional theory would insist that taxes be increased in order to balance the increases in government spending referred to above, Keynesian theory argues that tax increases would only depress spending by consumers and businesses, worsening the recession.
Thus, taxes should not be increased during a recession; indeed, if anything, they should be reduced, so as to help raise the level of aggregate demand. The most popular policy of this type is the personal income tax cut, intended to increase personal disposable income and consumer spending, although temporary sales tax cuts have also been used for this purpose. To promote higher levels of business investment spending, various types of tax reductions may be used, including cuts in corporate income (profits) taxes and increased capital cost allowances, which permit businesses to depreciate assets more quickly, thus reducing their taxable income an

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Current Forex Market – Strategies & Tools

Monday, May 25th, 2009


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The German Economy Shrinks 3.8% In Q1 – Forex Trading, Currency … – The German Economy Shrinks 3.8% In Q1 The German economy contracted in the first quarter by 3.8%, as the preliminary read showed. The released number represents the biggest quarterly drop since records first begun, in 1970.

Purchase Forex Software that Works – Are you sincerely considering trading forex online? If so, then you are likely to know that you can’t take on this challenge without any kind of help. No forex trader who has brought in consistent earnings from carrying out trading …

Being Better With Your Forex Strategies – The Forex trading software has provided many reasons to make the markets much better. The software efficiently integrates different currencies in their respective markets worldwide.

Forex Market Regulation ~ Forex Trading Made Easy – Not like the Forex trading is completely unregulated, but there isn’t such thing a SEC (Securities and Exchange Commission) for the Forex market. There is no central location and the company that would own the market (like NYSE Euronext …

 

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Add to Technorati Favorites

Monday, April 13th, 2009



tech fav 1 Add to Technorati Favorites

Forex Forex Currency Economics

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