Dr. Econ
Dr. Econ answers many questions with a focus on monetary policy and Federal Reserve related issues. The Doctor does not do homework, give financial advice or provide research support.
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What effects do recessions have on college students?
Dr. Econ examines potential dilemmas faced by college students including shrinking education budgets, reduced household income, and increased competition for jobs.
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How did the Fed change its approach to monetary policy in the late 1970s and early 1980s?
Learn about the history of monetary policy and find out why the FOMC changed its approach to monetary policy in the early 1980s.
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What are the similarities and differences between the 2001 recession and the Great Depression?
While there are some similarities between the 2001 recession and the Great Depression, there are also several key differences between the two business cycles.
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What is the difference between private and social costs, and how do they relate to pollution and production?
First, definitions of private costs, external costs, and social costs. Next, an examination of the impact external costs can have on prices, production, resource allocation, and competition.
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What are some of the factors that contribute to a rise in inflation?
Dr. Econ discusses how inflation is defined and measured, the types and causes of inflation, and who measures inflation.
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Does the Federal Reserve System hold stocks or other commonly traded equities like the Bank of Japan recently started doing?
The Federal Reserve System does not hold corporate stocks, but it does hold government securities. In 2001 government securities accounted for a significant share of Federal Reserve System’s $654 billion in assets. The Federal Reserve’s securities portfolio is composed of securities issued by the United States government or government agencies.
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How low has the Federal Reserve’s Discount Rate fallen in the past? Has it ever fallen to zero?
The discount rate is the interest rate the Federal Reserve Banks set onsecured overnight loans to depository institutions. The Federal ReserveBank of New York’s discount rate was 1.00 percent from August 1937 toJanuary 1948. A new Fed proposal may change how the discount rate isset.
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I heard an investment analyst say that the Fed had increased the money supply, and that would lead to economic growth. What indicators would tell me about the money supply and Fed monetary policy?
The Federal Reserve Board publishes information on a variety of interest rates and monetary aggregates that you might find useful. Let me recommend some sources for you to keep up to date on Fed policy actions, interest rate and money supply statistics, and other online publications.
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What is the relationship between the discount rate and mortgage rates?
The Discount Rate is the interest rate the Federal Reserve Banks charge depository institutions on overnight loans. The primary conventional mortgage rate is a market-determined interest rate for long-term residential mortgage loans. How do these two interest rates behave over time?
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What are business cycles and how do they affect the economy?
Business cycles are the “ups and downs” in economic activity, defined in terms of periods of expansion or recession. During expansions, the economy, measured by indicators like jobs, production, and sales, is growing–in real terms, after excluding the effects of inflation. Recessions are periods when the economy is shrinking or contracting.