*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 05, 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
(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
(FINANCE) when a corporation "goes public"; the first sale of stock by a corporation. All sales of stock or bonds on the stock market require the services of an underwriter, or investment bank. Outside of the USA and China, it is common for regular banks to offer underwriting for corporations.
Incorporation is a legal status that allows (but by no means requires) a firm to issue stock. Moreover, once a corporation lists stock, it does not necessarily do so on a major exchange. Some corporations areclosely held, which means they have a small number of shareholders who are mostly affiliated with management; other corporations are "private," which means they have no stock issues at all, and control/shares of profits are determined contractually.
Some corporations have issues of stock, and that stock is traded, but it is not listed. Instead, it is traded on the "pink pages." Such companies are usually in a bad way, but not necessarily.
An IPO is the first issue of stock by a corporation THAT DOESN'T ALREADY have a listed stock. If a company is "taken private" (i.e., bought out by a PE fund and de-listed) then it can have another IPO (or "sponsored IPO"). Most likely, however, if a listed company will need to raise money on the stock market, it will have a "follow-on offering."
Incorporation is a legal status that allows (but by no means requires) a firm to issue stock. Moreover, once a corporation lists stock, it does not necessarily do so on a major exchange. Some corporations areclosely held, which means they have a small number of shareholders who are mostly affiliated with management; other corporations are "private," which means they have no stock issues at all, and control/shares of profits are determined contractually.
Some corporations have issues of stock, and that stock is traded, but it is not listed. Instead, it is traded on the "pink pages." Such companies are usually in a bad way, but not necessarily.
An IPO is the first issue of stock by a corporation THAT DOESN'T ALREADY have a listed stock. If a company is "taken private" (i.e., bought out by a PE fund and de-listed) then it can have another IPO (or "sponsored IPO"). Most likely, however, if a listed company will need to raise money on the stock market, it will have a "follow-on offering."
A fantasy of many entrepreneurs is "going public" with a big initial public offering, and retiring to a beachfront mansion.
by Abu Yahya September 02, 2010
the gap between revenues and expenditures for a government (over a given period of time); often referred to as an internal deficit or public deficit.
The public deficit accumulates over each time period (usually a year) into what is known as the public debt.
According to Keynesian and Neo-Keynesian economic theory, fiscal deficits are usually the most effective tool for stimulating economic activity; the actual choice of how the money is spent is less important.
The public deficit accumulates over each time period (usually a year) into what is known as the public debt.
According to Keynesian and Neo-Keynesian economic theory, fiscal deficits are usually the most effective tool for stimulating economic activity; the actual choice of how the money is spent is less important.
In the USA, most states are not allowed to run fiscal deficits. In other federal republics, such as India and Argentina, they are allowed and frequently account for much of those countries' internal deficits.
by Abu Yahya February 15, 2009
(FINANCE) a situation in which an investor owns financial instruments (shares, bonds, financial derivatives, etc.) that will make the most money IF some other thing declines in value.
Therefore, one always has to take a short position on something in particular. A short position on gold means the investor expects gold to decline in value in the near future, and has bought various things to make money if it does.
Some ways to take a short position on X include:
(1) buying a put option on X
(2) writing a call option on X
(3) borrowing X and selling it (shorting a stock)
#3 is the classical way to take a short position. It was dangerous because a skillful trader could squeeze the shorts using a corner.
Therefore, one always has to take a short position on something in particular. A short position on gold means the investor expects gold to decline in value in the near future, and has bought various things to make money if it does.
Some ways to take a short position on X include:
(1) buying a put option on X
(2) writing a call option on X
(3) borrowing X and selling it (shorting a stock)
#3 is the classical way to take a short position. It was dangerous because a skillful trader could squeeze the shorts using a corner.
BILL: I guess you took a bath when the stock market tanked, huh?
ANA: Nope. I took a short position on all of the nine largest banks. Did rather well, thank you very much.
BIL: Sweet!
ANA: Nope. I took a short position on all of the nine largest banks. Did rather well, thank you very much.
BIL: Sweet!
by Abu Yahya April 05, 2010
*noun*; one of the factors of production. Fixed capital refers to physical objects used to produce goods or services. Examples include cash registers, drill presses or car jacks, and civil aircraft.
Pretty much anything can be used as fixed capital, provided it is used by the entrepreneur/firm to provide a service or produce something valuable. If the firm is a hotel, then pillows and vacuum cleaners are fixed capital; if it's a store, then the cash register, the shelves, and the mop are fixed capital.
Another form of business capital is circulating capital. This is called capital because it's a physical object used to produce value, but its purpose is to be sold or used up in production.
Pretty much anything can be used as fixed capital, provided it is used by the entrepreneur/firm to provide a service or produce something valuable. If the firm is a hotel, then pillows and vacuum cleaners are fixed capital; if it's a store, then the cash register, the shelves, and the mop are fixed capital.
Another form of business capital is circulating capital. This is called capital because it's a physical object used to produce value, but its purpose is to be sold or used up in production.
Some part of the capital of every master artificer or manufacturer must be fixed in the instruments of his trade...In other works a much greater fixed capital is required. In a great iron-work, for example, the furnace for melting the ore, the forge, the slitt-mill, are instruments of trade which cannot be erected without a very great expense.
Adam Smith, *The Wealth of Nations* (1776)
Adam Smith, *The Wealth of Nations* (1776)
by Abu Yahya March 03, 2009