Index
A
Absent trade, 89
Absent transportation costs, 89
Academic economists, 256
Accounting fraud, 335
Acquisitions, development, and construction (ADC) loans, 302
Adjusted gross income (AGI), 54
Adjustment cost theory, 42
Adjustment process, investment implications, 41–42
Affordable housing, 349
After-tax cash flows, 41
After-tax rates of returns, 205
Aggregate balance sheet assets, 303
for goods, 336
Aggregate demand curve, 120
Aggregate demand, of goods, 113
Aggregate demand shocks, 394
Aggregate economy, 51
Aggregate labor supply, 51
Agricultural price support programs, impact, 175
American economy, 370
American International Group (AIG), 348
Amortization, 67
Annual depreciation, 398
Annual real GDP growth rate, 211
Anti-China advocates, 206
policy, global implications, 201–202
Anti-immigrant advocates, 194
Antiimmigrants, 78
Antitrust provision, 67
Appreciating currencies, 263
Appreciating currency, 203
country 1, Lakeland (peso), 6
country 2, Westland (notes), 6
direct, 13
indirect, 14
world equilibrium, 6
Asian Contagion, 265
Asian Flu, 156
Asset appreciation, 336
Asset backed security trusts (ABS), 323
Assimilation, 197
reverse, 200
Australian economy, 45
Autarkic equilibrium
for cheese market, 4
Lakeland, 5
Westland, 5
Autarkic equilibrium, 89
Average income tax rates, 56
B
Baa corporate bond yields, 330
Baa Corporate yields, 334
less the 10 year government bond yields, 335
Balanced Growth Act of 1978, 370
in China as percent of GDP, 403
deficits, 406
grading China’s performance, 408
Balance sheet, 313
risk, 313
Balance sheet expansion, 239
credit creation, 319
Banking system credit, 299
Bank reserves, 323
Bankruptcy, 319
Base money, 236
Beggar-thy-neighbor policies, 137
Beneficial shocks, 67
Ben, Helicopter, 257
Big Mac, 141
calculation, 409
index, 39
theory, 142
Bookkeeping, 223
Borrowing, 393
Bretton Woods, 264
Bretton Woods Agreement, 25
Broader aggregate, 267
Broader estimate, 39
Bubble years, 253
Budgetary pressures, 398
Budget constraint, 222
Burden of adjustment, 80–81
C
Cadillac plans, 359
searching for causes and cures, 351–352
Capital controls, 153
hot, 385
taxes, 296
tax rate, 314
Capital-intensive industry, 194
Capital-intensive products, 73
Capitalism, free market, 373
Capital labor ratios, 194
Cap stocks
larger, 67
smaller, 66
Carry trade, 317
fuel market, 317
searching for causes and cures, 348
Cash flow risk, 313
Cash plus demand deposit, 323
Catch and release policy, 191
Central Bank holding inventory of commodity, used as reserve, 236–237
Century date change, 298
Cheese
consumption and production, 6
consumption, in Lakeland, 5
demand curve, 5
domestic consumption, 5
prices, in Lakeland, 5
Cheese intensive, 9
Cheese production, 85
in Lakeland, 85
in Westland, 85
China current account, as percent of GDP, 395
versus China-US growth rate differential, 395
China’s currency, overvaluation, 390–391
China US growth rate differential versus relative stock returns, 395
international reserves, as percent of the Chinese money supply, 406
money creation ability limits, 406
reaction to floating exchange rate experience, 399
Chinese currency, 397
Chinese economic expansion, 395
Chinese inflation, 387
rate, 105
Chinese monetary authorities, 408
Chinese slowdown, 109
Civilian employment-population ratio, 357
Class warfare, politics of redistribution and slow growth trap, 365–366
Clinton triangulation, 149
Coefficients, generated by different equations, 120
Collateralized debt obligations (CDO), 307
Collusion effect, 93
Commercial real estate investments, 301
Commodities, 6
nontraded, 112
traded, 112
rises, effect on future inflation, 31–32
of 1999-2011, relative performance
of developed, commodity-producing economies, 158
of emerging, commodity-producing economies, 159
Commodity, targeted, 234
Competition, 14
Competitive devaluations, 137
Competitive environment, 99
Competitive environment framework, 61
Competitive interest payment, 245
Competitiveness
integration and convergence, 99–100
in Thailand, 155
Composite goods, 145
Constant maturity treasury (CMT), 306
Consumer discretionary
income, 319
spending, 318
Consumer durables, 384
Consumer Financial Protection Bureau, 340
Consumer price index, 6
inflation rate, 342
Consumer price inflation, 24
Consumer Protection Act, 305
Consumer surplus, 35
Consumption harmonization and production divergence, link between, 90
Consumption of cheese and wine, in Lakeland, 134
Consumption, savings and net wealth, 385
Consumption smoothing, 312
Consumption tax, 184
Consumption theories, 383
in bond yields, 25
and postconvergence Euro environments, 25
Corporate debt, 290
Corporate inversions, 363
Corporate profits, 34
Corruption, 175
Country of citizenship, 195
Credibility, 409
Credit aggregates, 328
Credit and leverage economy, 296
excessive and economy, 316–317
Credit creation constraints, 299
Credit default swap (CDS), 350
Credit equation, role of real estate, 314
Credit expansion, 295
equilibrium, 299
Credit policy, 318
Creditworthiness, 296
Cronyism, 156
Currency
devaluation, 135
exchange rates, 263
substitution, 272
effect, 276
use in domestic transactions, 225–226
Currency-bank credit ratio, 329
Currency-credit ratio index, 330
in China, 205
goods delivery, impact on, 202
trade balance, effect on, 395
Currency manipulation and countervailing duties, equivalence between, 138
Currency manipulation bill, 389
Currency practices, in China, 201
Currency substitution, 237
Currency value, 264
Current dollars, 39
Current income, 295
Cyber hacking, 335
D
Debts, 311
service, as percent of disposable personal income, 312
tax deductible, 314
Debt service of economy, 295
Debt service-to-income ratios, 296
Debt-to-household net worth, 313
total credit as a percent, 313
Deductibility, 318
Defense spending as a percent of GDP, 364
Deflationary, 262
pressure, 323
Degree of distortion, 343
and policy differences, in economy output level, 106–107
Degree of mobility, 387
Degrees of freedom, 239
Demand and supply response, 103
aggregate, 147
Democratic capitalism, 68
Democratic constituency, 364
of credit and income smoothing, 312–313
Depreciation, 41
rate, 86
Deregulation, 289
Derivative markets, 304
Derivatives, 315
Destabilizing effect, 350
Developed and emerging economies performance, relative to the United States, 151
Developed economies, 177
Dirigiste policies, 373
Dirigistes, 247
Discount factor, 374
Discretionary approach, 255
household net worth, 313
Disposable personal income, 165
savings rate, 336
as share of net worth, 166
Disturbance, 41
Divergence
dismantling of Bretton woods, 25–26
effect, 28
Diversity and harmonization, 91
Dollar
cheaper price, 395
cycles, 149
price, 145
value against an index of currencies, 148
Domestic aggregate demand, 163
Domestic central bank, 401
Domestic cheese, 9
Domestic corporate inversions, 52
Domestic credit, 299
Domestic credit creation, 406
capital flows, 407
Domestic demand, 146
Domestic employment, 184
Domestic goods, 131
Domestic inflation rate, 7
Domestic labor groups, 193
Domestic monetary aggregates, 267
Domestic monetary base, 272
creation, 380
supply, 244
Domestic policy, 102
Domestic price, 40
levels, 39
Domestic production, 71
Domestic spending, 373
Domestic stability, 179
Dominican Republic, 234
Dynamic scoring, and legislative process, 363
E
Econometrics, 19
Economic conditions, 339–340
improvement, 373
Economic data, 339
Economic dependency, 175
reduction, 91
Economic depression, 341
Economic deterioration, 370
events, 152
global economy’s adjustments, 112–114
Economic downturn, 374
Economic environment, 66
in China, 380
Economic expansion, in China, 102
Economic expansions, 299
Economic failures, 374
Economic fluctuations, 99
Economic freedom, 108
Economic goods, 373
and price support programs, 176
trade balance and stock market performance, 168–169
in US, 137
Economic improvements, 373
Economic inelasticity, 176
Economic instability, in China, 102
Economic integration, degree, 94–95
states’ fiscal policies, effect of, 97–98
Economic interdependency, 101
Economic modeling, 3
framework regional, 66
ranking, 371–373
Economic performance during cycles, 149–152
Economic performance of economy, 256
Economic program, 369
Economic recession, 214
average, 357
slow, 373
Economic statistics, 148
Economic system, 290
Economic variables, 369
Economic vitality, 56
Economic volatility, 290
Economists, 112
Economy and market adjustments, 41
Economy relative performance, 149
Economy’s adjustment process, 4
Economy’s growth rate, 64
Educational system, 362
Emerging economies, 159
Emigration, 61
into California, 63
Endowments, 90
Equalization, 71
Equalization of returns, 3
left side, exploration, 244–246
Equations set, mentioned significant coefficients, 121
Equilibrium disturbance, 301
Equilibrium process, 329
Equilibrium under autarky, 4
Equity investment, 297
Equity returns, 42
Equivalence between price and tax increases, 36
Ethnic groups, 193
Euro
convergence, 24
implementation, 24
Euroland, 94
European Euroesclerosis situation, 365
selected countries risk premium, 50
appreciation, 387
appreciation, 87
changes, empirical relationships, 273–276
depreciation, 86
of dollar in selected countries
M3, and real GDP growth, 275
monetary base, and real GDP growth, 274
equation, 86
fixed system, 86
fixed system, scenarios, 380
floating system, 86
floating system, possibilities under, 379–380
fluctuation, 24
fluctuations, 132
index, 39
management, 163
management, protectionist case, 139
and terms of trade effects, 150
nominal and US-China terms of trade, 390
nominal, cases, 140
and organization of monetary system, 86–87
perfect substitutability, 271
textbook flexible, 271–272
Export price index
in China, 205
versus terms of trade, in China, 206
Exports & imports, impact on jobs, 168
Export subsidies, 180
Ex-post, 334
F
Factor price equalization theorem, 12
Fannie and Freddie crisis, 303–306
role and carry trade, 317
Fed balance sheet changes, 325
Federal deposit insurance, 302
Federal disability, 178
Federal Home Loan Bank Board, 301
Federally chartered stock associations, 301
Federal Reserve, 321
Federal Reserve System
crisis response, 341–342
and other government agencies
searching for causes and cures, 351–352
precrisis success, 257–258
Federal reserve system (Fed), 259
policies, 262
Federal Savings and Loan Insurance Corporation, 303
Federal tax policy, 51
Fiat standard, 262
Finanacial crisis, 36, 49, 54, 144, 152, 203, 239, 248, 255, 257, 295, 297, 301, 309, 312, 315, 318, 321, 327, 328, 334, 343
dealing with potential crisis, 298
preconditions, 297
primer, 306–307
Finance future consumption, 7
Financial crisis, 289
Financial innovations, 289
and loss of transparency, 315
Financial shock, 324
Financial turbulence, 381
Financing, 312
searching for causes and cures, 350
shocks, 149
solution, 202
in China, 160
experience relative to regions, 161
mechanism and its impact on domestic monetary base, 232–233
mechanism link to domestic money supply, 405
system, 268
Fixed-exchange rate system, 155
distortion, 343–345
securities, 263
Fixed rate assets, 301
Foreign competition, 71
unfair, 179
Foreign consumer basket, 147
Foreign demand, 273
Foreign deposit, 47
Foreign-earned profits, 363
Foreign earnings, 91
Foreign economy, 29
of dollar, 164
trade-weighted, 203
Foreign goods, 163
Foreign markets, 183
Foreign policy, 209
Foreign policy shocks, 106
Foreign trade, 179
Fracking, 36
Fractional backing of currency, 237
Franco Modigliani’s lifecycle hypothesis, 385
Freddie hedge, 297
Free exchange, 89
Free lunch, 403
Free-market capitalism, 340
Free market economists, 173
Free mobility, 94
Freer trade, 67
in goods and services, 10
Free trade equilibrium, 89
Friedman consumption function theories, 383
Fringe benefits, 359
Future consumption, 334
G
Gains of trade, 104
General equilibrium framework, 114
Gentrification, 23
German economy, 45
Global and national equilibrium, 4–7
Global commodity, 102
Global depression, 138
equilibrium output, China’s impact on, 107–108
framework, 85–86
implications and insights, in China, 108–109
country effects, 122
and trade accounts, 7
Global price rule, elements of, 263–264
Global production, of goods, 113
Gold exchange standard, 237
Government enterprises, 356
Government policies, 177
Government regulations, 68
Government securities, 385
searching for causes and cures, 348–349
Government taxation, 365
Government tax policy, 359
Gramm-Rudman-Hollings law, 373
Great depression, 163
Great Society programs, 26
Greenspan, 357
Greenspan Fed, 322
Greenspan FED preemptive strike, 321
countries growth, less than US GDP growth, 115
growth, 209
growth rate, 86
percent, changes in trade balance, 117
percent, US imports and exports, 168
pitfalls, 121
during the Reagan and Obama administration, cumulative rise, 356
real and employment growth, 167
real growth and trade balance, 210–216
real growth rate, 253
real growth rate differential, 114
real growth versus inflation, 257
states’ relative performance, 66
in US as percent of rest of the world, 169
in US, as percent of the world versus terms of trade, 171
in US, percent of the world versus foreign exchange value of the dollar, 170
weighted index, 39
Gross state product (GSP), 20
Alaska’s share, 23
real growth and terms of trade, 22
Growth company, 164
Guest worker programs, 76
H
H-1b, for skilled workers, 195
of tax rates, 100
Harmonized tax rate, 94
Health care, 359
Helicopter ben’s crisis response, 323–325
Home equity market, 317
Home mortgages, 318
Home ownership and education, 361
Homeowners, searching for causes and cures, 349–350
Household expenditures, 164
Household net worth, 336
as percent of disposable personal income, 165
Housing market spreads, 319
Housing supply, 295
Human capital, 296
Humphrey-Hawkins mandate, 256
Hyperinflation, 398
I
Illegal immigrants, 76
Immigrants, 91
inflow, 73
undocumented, 191
alternative schemes, effect of, 198–200
and crime, 192
as economic problem, 75
enforcement campaign, 192
family affiliation system, 76
flows, 75
illegal, 191–192
implicit assumptions and their implications, 193–195
legal, economic issues, 193
policies, 75
in European Union, 75
in the U.S., 75
politics, 78
quotas and preference systems, 195
security issues, 192
skill-based program, 76
skills-based system, case, 196
system, low-skilled, 196
system, unintended consequences, 196–198
Imports of goods, 166
Incentives taxpayers, 93
Income elasticity, 222
Income flows, 312
Income less expenditures, 383
Income realization patterns, 383
policies, 363
Income statement, 313
Income taxpayers, 56
Inconsistent theories, 379
Incremental savings, 384
Industrial production index, 327
Inelastic money demand, 245
Ineptness, 165
augmented, 146
In China and money growth rates, 398
differential rate, 235
local results, 26–27
output trade-off, 241
rate
and capacity utilization, 260
differential, 150
global, 202
and growth in quantity of money, 403
interest rates, slope ofyield curve, and credit spread, 342–343
in US, 402
in US, 1926-2010, 370
in US and China, 388
in the US, CPI, 328
world, 202
target mandates, 263
in US and MZM growth rate, 248
in US and MZM velocity, 248
US rate, 145
US Rate and M3, 269
world rate, 145
Inflation, 86
empirical relationships, 274–285
growth in M3, and real GDP, 281
and US inflation rate, 285
US M3, and real GDP growth, 283
US monetary base, and real GDP growth, 282
growth in monetary base, and real GDP, 280
and M3, real GDP, and US inflation rate, 282
and US inflation rate, 284
in U.S., selected countries dollar exchange rates
M3 and real GDP growth, 278
monetary base and real GDP growth, 277
relative, 279
Inflationary shocks, 26
average for the states, 22
in China versus Chinese money growth net of China GDP growth Q2, 404
local in US dollars, 27
in the US, 29
Inflation statistics, worldwide
in local currencies, 27
in US dollars terms, 28
Inflection point, 290
Insurance companies, 335
approach, 105
Integrated national economy, 95
lower yields, 334–335
Internal migration, 51
International agencies, 175
International economic analysis, 19
International monetary, 410
changes as percent of GDP, versus the China-US GDP growth rate differential, 407
held by China central bank as percent of the Chinese money supply, 403
International Trade Commission (ITC), 188
Intertemporal considerations, 186–188
Investment banks, 323
Investment implications, 68
Investment indicator, 45
state competitive environment, limitations, 99
Isolated economies, 111
J
Japanese economy, 297
Japanese ex-pats, 197
Job creation, 168
Job protection policies, politics, 90–91
Junk bonds, 292
K
track record, 336
L
Labor and capital, distribution, 194
in factors of production economy, 194
immigration, effect of, 194
Labor income, 373
economic well-being, 371
Labor supply elasticities, 52
Lakeland Central Bank, 225
Lakeland inflation rate, 7
Lakeland’s supply curve, 5
Large-cap stocks, cumulative increase, 358
Latin Pumas and Mexican devaluation, 153
Lawlessness, 177
flows, 324
institutions, 319
tree, 362
Leverage buyouts (LBOs), 292
Liability, 302
Life cycle, 384
optimization, 384
Lifetime expenditures, 385
in economy, 252
Local currency, 229
Low-income years, 351
Low-interest rates, 317
M
Maastricht Treaty convergence, 24
Macroeconomic, 239
equilibrium, 394
policymaking, 347
Macroinvestors, 165
Marginal rate of transformation, 134
Marginal tax rates, 374
Market-clearing equilibrium, 194
Market elasticity, 176
Market segmentation, 68
Markets savings premium, 384
Mean revert, 103
Mean-reverting process, 47
Measured responses, 254
Measurement errors, 29
Medium of exchange, 402
Mercantilism and its impact on economics, 179
Mercantilists, 263
Mercantilist trade, 201
Merrill Lynch High Yield Index, 334
lower than BBB bond yields, 335
Mexican devaluation, 152
Mexico and Tequila effect, 152–153
Migration, 71
into California, 63
economic determinants, 77
economic impact on economies, 73
in Europe and Middle East, 72–73
flows, noneconomic component, 73
gains, 52
inflows, 54
international, 74
patterns, interaction between Right-to-Work laws, 59
patterns in the United States, 65
policies, 75
and right-to-work states, 58
Sjaastad model, 65
states’ economic environment, 57
in states, with rising and falling income tax rates, 57
in US across states, 2008-2015, 55
Milton Friedman’s permanent income hypothesis, 385
Minimum wage, 360
and its Components, 261
stock returns, and size effects during different administrations, 371
and stock returns rankings, 372
in the US, 1926-2010, 371
and incidence of taxes and other economic shocks, 15–16
trade and equalization
of price and factor returns, across borders, 12
Mobility of goods, 271
and services, 86
Monetarism, 241
framework, policy implications, 267
views, 243–244
after crisis, 342
nominal variables, effect on, 239
real GDP, effect on, 239
Monetary approach, 405
Monetary arrangement, 405
Monetary autarky, 226
Monetary authorities, 239
and bank credit growth rates, 342
bank credit, MZM, and financial crisis, 340
growth, 322
growth, 273
growth rate, 248
and industrial production growth rate, 328
conceptual problem, 147
Monetary emission, 257
under floating exchange rate, 224
burden, 336
in China, 379
in China and fixed-rate experience, 402–404
in China and floating exchange rate experience, 398
deconstruction, 256
framework, 256
post-crisis, evaluation, 262
solution, 202
in the United States, 239
Monetary responses, anticipation, 256–257
organization and mandates, interaction between, 260–261
Monetary union, 271
Money and banking mechanics, 323
Money and credit multipliers, 323
Money/credit multiplier, 245
curve, 245
functions, alternative assumption, 224–225
implications and insights, 228
shifts, 222
and supply shocks, 329–331
Money desks, 302
Money growth, 87
Money holdings, 235
Money markets, 327
and demand for cash, 327–328
uncertainty, 327–328
and monetary base, 249
and MZM velocity, 248
Money multiplier and credit multiplier, 316
growth, 201
Moody’s Baa, 334
Moral argument, 360
Moral hazard, 307
problem, 304
Mortgage-backed securities, 293
Mortgage financing, 302
Multiple economies and currencies, framework, 224
Multiplier theory, 363–364
Mutual funds, 297
MZM, 325
currency-credit ratio, 330
growth and inflation rate, 325
growth rate versus
10-year government bond yield, 343
government-Baa corporate yield spread, 344
slope of the yield curve, 344
T-Bill yields, 343
growth versus PCE inflation rate, 247
index and bank credit per unit of industrial output, 341
indices and its currency and credit components, 330
quantity of money, 341
N
Narrow aggregate, 267
National borders, 11
National economy, 217
accounting and global equilibrium, 187
National markets, 85
National security, 191
Natural endowments, 68
Negative savings, 383
Net capital, 298
Net income loss, 61
Net income transfer, 174
Net inflows, 54
Net outflow, 61
Net worth, 257
New dollar, 133
price and output adjustment, 102–103
Nixon devaluation, 260
Nominal exchange rate, 144
Nominal interest rates, 8
Nominal variables, 255
Non-defense spending as a percent of GDP, 364
equilibrium relationships, 233–234
Non-reserve currency issues, 265
Nontraded commodity, 146
Normal expectations, 289
Notes, 224
in Westland, 225
O
Obama administration, 358
Obama, Barack, 355
Obamanomics, 357
Obfuscation, 255
Oil and agricultural products, 176
One-sided bet, 307
OPEC, 36
Open economy, 102
Open market, 323
policies, 251
Optimal quantity of money, 241
Outward shift
effects in demand curve, 32
effects in supply curve, 32
Overall economy, 173
P
Panama papers, 366
Partial substitutability case, 272–273
Partisan politician, 369
Patient Protection and Affordable Health Care Act, 359
Payment deficit, 161
Pension funds, 307
Per capita personal income of Florida, as percentage of US personal income, 199
Performance economy, 399
Perpetuity, 253
Personal expenditures, 314
Personal income ratios, 312
Personal income tax rate
2017 and 2008, 53
reduction, 293
inflation rate, 225
in Lakeland, 225
and dual mandate, 241
Pie expansion, 365
Policies differences measurement, across the states, 98
Policy consistency, 187
Policy disturbances, 88
Policy-induced moral hazard, and substitution effects, 358–363
Policy initiatives, 370
Policy intervention, 180
Policy links, 40–41
Political pressures, 398
Post-financial crisis, 262
Precrisis success, 257
Preemptive, 252
Pretax income, 41
Price index, 141
Price rule, 251
case, 247
system, 235
Price taker, 15
Product differentiation, 68
Production labor costs, 3
Productivity gains, 394
Progressive states, 361
Promotion policies, for export and import, 185
Protected sector, of economy, 185
Protectionist pressure, 385
versus free trade arguments, 179–180
Public bonds, 306
Public debt, 336
Public funds, 74
Public goods, 65
Public spending, 356
programs, 63
Purchase theory, conquest, 218
Purchasing power parity (PPP), 4, 19, 39, 47, 66, 86, 94, 112, 132, 133, 141, 145, 387–388, 398, 401
relationship yields, 231
versus terms of trade, 389–390
Q
Quantity of money
control by Federal reserve system, 244
rule, case, 246–247
Quantity rule, 251
R
Ranking of states, 66
Rate of exchange, 14
and relative price differentials, across national economies, 388–389
Ratio of bank credit to bank deposits, 408
versus change in international reserves as a percent of GDP, 408
Ratio of US to rest of the world stock market indices, 217
Reagan administration, 373
Reagan and Obama administration
cumulative stock size differential, 358
Reagan policies, 42
Reagan recession, 215
Reagan Revolution, 179
Reagan, Ronald, 372
Reagan tax rate, 302
cuts, 303
shocks, 255
Real estate equity
as percent of household net worth, 314
as percent of the real estate value, 314
Real estate investment trusts (REITs), 323
appreciation, 41
Real exchange rate cycles, 40
Real foreign exchange value, 141
of dollar, 143
Real interest rate, 113
Real rate of return of an economy, 9
of trade appreciation, 9
Real return differential, 48
Recessionary slippery slope, 327
Redistributionist policies, 180
Redistributionist programs, 366
Redistributionists, 373
Regional economic performance, 94
framework, 94
Regression analysis, 20
Regulation, lack of, 348
Regulatory agencies, 296
Regulatory burden, 375
Regulatory environments, 67
Regulatory jurisdiction, 66
Reinvestment of income, 252
Relative costs, 359
Relative factor endowments, 5
Relative growth rates, 150
Relative inflation, 268
Relative price demand shift, 35
Relative price of cheese, 134
in Lakeland, 134
Relative profitability, 301
performance, 121
performance and size effect, 66–67
returns, 120
yield, 116
Relative valuations, 132
Repression, 73
Republican tax rate policies, 356
Reserve currency, 264
Reserve fund, 324
Residential mortgage-backed security (RMBS), 306
Residential real estate, 314
Rest of world (ROW), 184
exports, 185
imports, 185
production declination, 188
Retention rates, 290
Retirement, 385
Right to Work, 61
laws, 56
migration and state income tax rates, interaction, 56–61
principle, 56
Risk exposure, 334
Risk management, 251
impact on asset valuation, 48
Risk returns of the economy, 290
Risky investments, 316
Rules versus discretion, 241
relative to corresponding data from the United States, 157
S
assets, 302
crisis, primer, 301–302
regulatory changes, impact, 302
regulatory changes, impact of, 302
spillover effects, 302–303
Savings rate, 383
Secretary of the Treasury, 390
agents, 307
Securitization, 289
Seigniorage, 236
Self-interest, 104
Self-sufficiency policies
and budget constraints, 184
or trade restriction policy equivalences, 185
pitfalls, 183
and protectionism, 188–189
Shortage of money, 380
Short-term interest rates, 35
Short-term securities, 306
Signal extraction, 147
Single commodity, 39
Slope of yield curve versus corporate spread, 344
Small-cap stocks, 66
Smaller cap stocks, 375
Smoot-Hawley experience, 205
Smuggling, 76
Social programs, 74
Social safety net, 74
Social security, 360
income, 334
Social services programs, 76
Social spending, 75
Social transformation, 196
Special interest groups, 174
politics, 185
Special interest groups, politics, 364–365
Speed of adjustment to equilibrium, 16
Spending rates, 49
Spillover effects, 307–309
State and Federal regulations, 301
State economy, 99
State gross product, 98
States’ competitive environment, 52
States’ economies degree of integration, 96
States’ gross state product growth rate, 21
States’ income tax rates, for competitive environment, 52–54
State tax base, 24
Statistically significant coefficients, 276
summary in in different estimated exchange rate equations, 279
Steel industry
Chinese overproduction, 188
tariffs, 188
Stock-held institutions, 301
appreciation, 374
decline, 298
performance, 376
relative performance, 393
Stock price index, 180
Stocks, small-cap, 94
Structured investment vehicles (SIV), 306
Substation effect, 363
degree, 344
Substitutability argument, 269
Substitute hypothesis, 193
Sunk costs, 72
Supply shift, 33
Supply shocks, 394
Supply side disturbance, 113
Sustained market expansion, 289
Symmetry theorem, 180
T
Taft-Hartley Act, 56
Targeted spending, 364
Tariffs issue, 138–139
Tax base, 93
Tax bracket, 241
for California and its neighbors, 63
Tax deductibles, 318
Tax exempt, 359
Tax harmonization, 65
Tax havens, 366
Tax jurisdiction, 51
changes, 52
competition, 94
constellation, impact on the incentive structure, 291
cut, 40
increase, 32
marginal, 75
minimization, 52
reductions, 289
relative marginal rate of the states, 98–99
top, 375
Tequila Effect, 265
period, 156
analysis, 9
change, 31
changes, 116
in China, 205
cycles, 149
effects and devaluation, 147
fluctuations, 148
as indicator, 142
percent changes, 118
real exchange rate, 8
in the US, 142
in US-China, 389
Terrorism crisis, 191
Thai blood baht
and Asian flu, 154–156
relative to corresponding data from the United States, 154
Tiebout Hypothesis, 65
Tit-for-tax enactment, 202
Total credit and bank credit as percent of GDP, 316
Tradable goods, 399
Trade
actions, US recessions, and high growth periods, 216
and capital account, 216–217
and economy’s P/E ratio, 165–166
and employment growth, 213
as percent of GDP, versus employment growth, 167
in US as percent of GDP, versus US GDP, 169
value or growth signal, 164–165
change, 174
as percent of GDP, 210
as percent of GDP versus real GDP growth moving average, 212
employment and growth, 166–167
flows, 143
policy, 179
restrictions, 177–178
weighted index, 141
Trade agreements, 91
Trade appreciate, 151
Trade balance
deterioration, 236
and capital flows, 87
deficit, 90
deterioration, 150
of Lakeland and Westland, 134
as percent of GDP, versus unemployment rate, 92
in predictable directions, 88
Trade barriers, 71
Traded goods, 146
and services, 401
Trade equation, 9
Trade flows, 91
Trade in goods, 71
Tradeoff, between wine and cheese, 134
Trade skepticism, 91
Trade weighted index, 39
Transaction balances, 323
and worldwide equilibrium
in Lakeland (peso), 13
in Westland (notes), 13
Transaction money, 329
Transformational change, 373–376
Trans-Pacific Partnership (TPP), 91
Transportation costs, 11, 52, 71, 73, 95, 102, 103, 111, 112, 145, 146, 185, 200, 221, 388, 399, 401
and degree of integration, 103–105
framework expansion, 146
and overall equilibrium, 13–15
Trojan horse, 315
2X2X2X2 world, 4
two countries, 4
two currencies, 4
two factors of production, 4
two goods, 4
U
Undervaluation, 201
Undesirable outcomes, 347
and capacity utilization, 260
and inflation rates, 260
excess rates, 261
in US, 1926-2010, 370
Unified theory, 116–122
US economy, 167
overall performance, 259
US energy policies, 253
U.S. Federal Reserve, 402
US financial system, 298
US import tax, 185
US inflation rate, 256
US Securities and Exchange Commission (SEC), 305
US stock market, 217
in Australia, 44
EMU, 45
in Mexico, 46
ratio of the United States, 43
US Trade Policy changes, 1930-81, 211
Utility maximization, 7
V
Valuation model, denominator, 357
Value at risk (VAR), 289
Value stock, 164
MZM, 245
MZM velocity versus MZM money multiplier, 246
Voluntary restraints, 179
W
Wayne Gretzky approach, 19
Wealth, income and savings rate, 384
implications, 384–385
Wealth-to-income ratio, 252
Westland cheese sector, 10
Westland inflation rate, 7
Westland wine sector, 10
Windfall, 176
Wine intensive, 9
World Economic Forum database, 114
stability, 252
World money supply, 268
World Trade Organization, 209
X
Xenophobia, 198
Y
Y2K, 255
Z
Zero substitutability, 133
..................Content has been hidden....................
You can't read the all page of ebook, please click here login for view all page.