192 definitions by Abu Yahya
(FINANCE) a stock whose price movements determine the value of a financial derivative. For example, when a hedge fund manager writes a call option for Citigroup (NYSE:C) at 4.25/share, C is the underlying stock.
"Underlying" can be used to refer to other things besides stocks; for example, commodities, currencies, or bonds.
"Underlying" can be used to refer to other things besides stocks; for example, commodities, currencies, or bonds.
by Abu Yahya April 5, 2010
a type of shantytown whose buildings are made with mud brick, mortar, or found materials.
Prior to the 1950's, a "hutment" could mean any sort of temporary barracks.
Prior to the 1950's, a "hutment" could mean any sort of temporary barracks.
These hutment colonies consist of hovels made of a variety of hard and soft materials like pieces of wood, rags, tin sheets, mud, bricks and any such thing that comes in handy.
Pushpa Agnihotri, *Poverty amidst prosperity: survey of slums* (1994), p.44
Pushpa Agnihotri, *Poverty amidst prosperity: survey of slums* (1994), p.44
by Abu Yahya April 10, 2010
*noun*, term used in economics to refer to the New Classical economics. The fresh water school was lead by Robert E. Lucas, Thomas J. Sargent, and Robert Barro; its position was that fiscal policy and monetary policy are doomed to be ineffective, since they rely on "fooling the public."
Instead, they argued that even tax cuts had no stimulus effect (in contrast to "supply side economics"), and of course they were resolutely opposed to government spending. Instead, the fresh water school maintained that a recession was caused by markets adjusting to a technology shock to create a structurally different economic system. The best thing to do was to allow the markets to restructure industry on their own.
The fresh water school was known for their support of the "rational expectations hypothesis" (REH) and "real business cycle" (RBC) theory.
Instead, they argued that even tax cuts had no stimulus effect (in contrast to "supply side economics"), and of course they were resolutely opposed to government spending. Instead, the fresh water school maintained that a recession was caused by markets adjusting to a technology shock to create a structurally different economic system. The best thing to do was to allow the markets to restructure industry on their own.
The fresh water school was known for their support of the "rational expectations hypothesis" (REH) and "real business cycle" (RBC) theory.
But lately, a ...school of skeptics who think the Government usually just gums things up is gaining attention and influence. The skeptics are known as the "fresh water school," less for the purity of their thought than for their origins at universities along the shores of the Great Lakes.
"'Fresh Water' Economists Gain," *New York Times*, 23 July 1988
"'Fresh Water' Economists Gain," *New York Times*, 23 July 1988
by Abu Yahya March 5, 2009
The largest Hispanophonic countries, in order of population, are
Mexico (111,211,789)
Colombia (43,677,372)
Argentina (40,913,584)
Spain (40,525,002)
USA (35,000,000?)
Peru (29,546,963)
Venezuela (26,814,843)
Chile (16,601,707)
Ecuador (14,573,101)
Guatemala (13,276,517)
Cuba (11,451,652)
Bolivia (9,775,246)
The Dominican Republic (9,650,054)
Honduras (7,833,696)
El Salvador (7,185,218)
Paraguay (6,995,655)
Nicaragua (5,891,199)
Costa Rica (4,253,877)
Mexico (111,211,789)
Colombia (43,677,372)
Argentina (40,913,584)
Spain (40,525,002)
USA (35,000,000?)
Peru (29,546,963)
Venezuela (26,814,843)
Chile (16,601,707)
Ecuador (14,573,101)
Guatemala (13,276,517)
Cuba (11,451,652)
Bolivia (9,775,246)
The Dominican Republic (9,650,054)
Honduras (7,833,696)
El Salvador (7,185,218)
Paraguay (6,995,655)
Nicaragua (5,891,199)
Costa Rica (4,253,877)
by Abu Yahya May 17, 2010
*noun*; global economic collapse; in the USA, this began in 1929 and persisted to 1939; most other industrialized countries emerged from the Depression earlier.
During the Great Depression, unemployment reached over 25% in the USA, and those who had jobs suffered severe wage cuts. The index of industrial output fell over 53% from its high in July '29, while trade and capital markets plummeted to mere fractions of their former levels.
*What Happened*
_____________________________________
Many people imagine that the Stock Market Crash (Oct '29) and the Great Depression are the same thing. However, it took another three years for employment, bank failures, and declining industrial output to run its course.
In 1929 the USA had 25,000 banks. By 1933, 10,000 had either failed or been merged with another to avoid failure. At this time there was no FDIC, so depositors mostly lost their money.
Another phenomenon was plunging prices: the consumer price index fell 25% during the first four years. For businesses, this was a disaster, and forced them to lay off millions.
The Great Depression made farms in much of the Southwest unviable; ruined farmers fled to California or Washington, and their abandoned farms succumbed to the Dust Bowl. This was the single largest ecological disaster in recorded history.
*How It Happened*
_____________________________________
There are basically three main explanations for the Great Depression.
1. During the 1920's, there was a huge and growing disparity between rich and poor. The incomes of the great majority rose much more slowly than productivity, but this was masked by increased borrowing. People were able to borrow because the market value of their assets was larger than what they owed; but when a rash of defaults occurred, then the market value of assets plummeted, and people owed more than their assets were worth. Businesses had to lay off workers, which further reduced aggregate demand.
2. The Great Depression began as another minor downturn, but was made much worse by the failure of the Federal Reserve to respond adequately (see Milton Friedman & Anna Schwartz). While the Fed reduced interest rates, prices fell even faster, so real interest rates soared. This made a quick recovery impossible.
3. The financial markets (combined with Fed supervision) distributed capital badly; for example, speculative ventures in growing wheat in the Great American Desert, real estate in Florida, and so on. When this arrangement of productive resources failed, it constituted an extremely large technology shock. Subsequent policy intervention tended to withhold capital and labor from the most productive enterprises, making the depression deeper.
(Explanation 3 is the New Classical economics explanation; see Harold Cole & Lee Ohanian.)
*Roosevelt Administration*
_____________________________________
Franklin D. Roosevelt was elected by a landslide in 1932, and inaugurated 4 March 1933. The White House immediately used emergency powers to close, restructure, and re-open the nation's banks. During the first 100 days of the FDR administration, Congress passed the New Deal which greatly eased the impact of the Depression on the hardest hit.
The New Deal did not significantly hasten the end of the Great Depression, because it was too small to provide a meaningful fiscal stimulus. However, it did introduce many important programs to help those affected by poverty. The Depression had ended in most of the world by 1937; the US was mostly recovered by 1939, when World War 2 broke out.
During the Great Depression, unemployment reached over 25% in the USA, and those who had jobs suffered severe wage cuts. The index of industrial output fell over 53% from its high in July '29, while trade and capital markets plummeted to mere fractions of their former levels.
*What Happened*
_____________________________________
Many people imagine that the Stock Market Crash (Oct '29) and the Great Depression are the same thing. However, it took another three years for employment, bank failures, and declining industrial output to run its course.
In 1929 the USA had 25,000 banks. By 1933, 10,000 had either failed or been merged with another to avoid failure. At this time there was no FDIC, so depositors mostly lost their money.
Another phenomenon was plunging prices: the consumer price index fell 25% during the first four years. For businesses, this was a disaster, and forced them to lay off millions.
The Great Depression made farms in much of the Southwest unviable; ruined farmers fled to California or Washington, and their abandoned farms succumbed to the Dust Bowl. This was the single largest ecological disaster in recorded history.
*How It Happened*
_____________________________________
There are basically three main explanations for the Great Depression.
1. During the 1920's, there was a huge and growing disparity between rich and poor. The incomes of the great majority rose much more slowly than productivity, but this was masked by increased borrowing. People were able to borrow because the market value of their assets was larger than what they owed; but when a rash of defaults occurred, then the market value of assets plummeted, and people owed more than their assets were worth. Businesses had to lay off workers, which further reduced aggregate demand.
2. The Great Depression began as another minor downturn, but was made much worse by the failure of the Federal Reserve to respond adequately (see Milton Friedman & Anna Schwartz). While the Fed reduced interest rates, prices fell even faster, so real interest rates soared. This made a quick recovery impossible.
3. The financial markets (combined with Fed supervision) distributed capital badly; for example, speculative ventures in growing wheat in the Great American Desert, real estate in Florida, and so on. When this arrangement of productive resources failed, it constituted an extremely large technology shock. Subsequent policy intervention tended to withhold capital and labor from the most productive enterprises, making the depression deeper.
(Explanation 3 is the New Classical economics explanation; see Harold Cole & Lee Ohanian.)
*Roosevelt Administration*
_____________________________________
Franklin D. Roosevelt was elected by a landslide in 1932, and inaugurated 4 March 1933. The White House immediately used emergency powers to close, restructure, and re-open the nation's banks. During the first 100 days of the FDR administration, Congress passed the New Deal which greatly eased the impact of the Depression on the hardest hit.
The New Deal did not significantly hasten the end of the Great Depression, because it was too small to provide a meaningful fiscal stimulus. However, it did introduce many important programs to help those affected by poverty. The Depression had ended in most of the world by 1937; the US was mostly recovered by 1939, when World War 2 broke out.
The NBER business cycle chronology dates the start of the Great Depression in August 1929. For this reason many have said that the Depression started on Main Street and not Wall Street. Be that as it may, the stock market plummeted in October of 1929. The bursting of the speculative bubble had been achieved and the economy was now headed in an ominous direction.
Randall Parker, "An Overview of the Great Depression" (2002)
Randall Parker, "An Overview of the Great Depression" (2002)
by Abu Yahya March 6, 2009
(ECONOMICS) seasonally adjusted annualized rate.
Economic statistics are often reported as rates of change from month to month, or quarter to quarter. However, some months, such as November and December, have very high retail sales, while May through September have very high home sales. For this reason, data is sometimes "seasonally adjusted" to offset ordinary seasonal variations.
The US Federal Reserve System reports changes in GDP from quarter to quarter in annualized form; so, for example, during the last quarter of 2004, US GDP was (about) $3,044.6 billion. But it was reported as an annualized (and seasonally adjusted) $11734.9. If you divide that by 4 you get 2957.8, which reflects the fact that the Fed shaved 86.8 billion off its estimate of economic activity for 2004Q4 and reallocated it to Q1 & Q2.
The reason the Fed (and everyone else) does this is to measure economic change separately from the usual seasonal change in business activity.
Economic statistics are often reported as rates of change from month to month, or quarter to quarter. However, some months, such as November and December, have very high retail sales, while May through September have very high home sales. For this reason, data is sometimes "seasonally adjusted" to offset ordinary seasonal variations.
The US Federal Reserve System reports changes in GDP from quarter to quarter in annualized form; so, for example, during the last quarter of 2004, US GDP was (about) $3,044.6 billion. But it was reported as an annualized (and seasonally adjusted) $11734.9. If you divide that by 4 you get 2957.8, which reflects the fact that the Fed shaved 86.8 billion off its estimate of economic activity for 2004Q4 and reallocated it to Q1 & Q2.
The reason the Fed (and everyone else) does this is to measure economic change separately from the usual seasonal change in business activity.
In Brazil, household spending continued to ease to 0.8% quarter-to-quarter (3.1% SAAR) from 1.4% q/q (5.6% SAAR) in Q1 2010, and investment lost momentum, increasing 2.4% q/q (9.8% SAAR) compared with 7.3% q/q (32.4% SAAR) in Q1.
{Nouriel Robuini, "RGE's Wednesday Note - Brazil's Economy Exhales" (10 Sep 2010)}
{Nouriel Robuini, "RGE's Wednesday Note - Brazil's Economy Exhales" (10 Sep 2010)}
by Abu Yahya September 8, 2010
(US ECONOMY) One of the 12 district Federal Reserve Banks. Based in New York (2nd FR district). Along with members of the Federal Reserve Board, enjoys a permanent seat on the FOMC (other district banks only get to rotate).
Main job is to regulate banks and administer monetary policy through open market operations. Former New York Fed president Tim Geithner is now Secretary of the US Treasury Department (as of early 2009).
Main job is to regulate banks and administer monetary policy through open market operations. Former New York Fed president Tim Geithner is now Secretary of the US Treasury Department (as of early 2009).
Prior to 1928, the President of the Federal Reserve Bank of New York was the de facto leader of the entire system. This was because of the powerful personality and connections of Benjamin Strong, a former J.P. Morgan partner.
by Abu Yahya September 10, 2010