Is the official currency of Japan. It is the 3rd most traded in Forex after the US dollar and the Euro. It is widely used as a reserve currency (a widely held currency that provides market liquidity / used to pay for international transactions). Composition of OfficeMax foreign exchange reserves in 2009:
1 62.2% USD
2. 27.% Euro
3. 4.3% GBP
4. 3.0% YEN
5. 0.1% Swiss Franc
The meaning of the word yen refers to the shape of a coin "round object".
1/31/11
1/27/11
Moody's Corporation
Moody's Corporation (NYSE: MCO) is the holding company for Moody's Analytics and Moody's Investors Service, a credit rating agency which performs international financial research and analysis on commercial and government entities. The company also ranks the credit-worthiness of borrowers using a standardized ratings scale. The company has a 40% share in the world credit rating market, as does its main rival, Standard & Poor's; and it is one of the credit rating agencies (Standard & Poor's, Moody's Investor Service and Fitch Ratings).
Standard & Poor's
Standard & Poor's (S&P) is a United States-based financial services company. It is a division of The McGraw-Hill Companies that publishes a wide range of financial research and analysis on stocks and bonds. It is well known for the stock market indexes, the US-based S&P 500, the Australian S&P/ASX 200, the Canadian S&P/TSX, the Italian S&P/MIB and India's S&P CNX Nifty. It is one of the Big Three credit rating agencies (Standard & Poor's, Moody's Investor Service and Fitch Ratings).
Standard & Poor's, as a credit rating agency (CRA), issues credit ratings for the debt of public and private corporations. It is one of several CRAs that have been designated a Nationally Recognized Statistical Rating Organization by the U.S. Securities and Exchange Commission.
It issues both short-term and long-term credit ratings that can be very critical to market sentiment.
Standard & Poor's, as a credit rating agency (CRA), issues credit ratings for the debt of public and private corporations. It is one of several CRAs that have been designated a Nationally Recognized Statistical Rating Organization by the U.S. Securities and Exchange Commission.
It issues both short-term and long-term credit ratings that can be very critical to market sentiment.
International Monetary Fund - IMF
About
The International Monetary Fund was conceived in July 1944 originally with 45 members and came into existence in December 1945 when 29 countries signed the agreement, with a goal to stabilize exchange rates and assist the reconstruction of the world's international payment system. Countries contributed to a pool which could be borrowed from, on a temporary basis, by countries with payment imbalances (Condon, 2007). The IMF was important when it was first created because it helped the world stabilize the economic system. The IMF works to improve the economies of its member countries. The IMF describes itself as "an organization of 187 countries (as of July 2010), working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty".
The International Monetary Fund was conceived in July 1944 originally with 45 members and came into existence in December 1945 when 29 countries signed the agreement, with a goal to stabilize exchange rates and assist the reconstruction of the world's international payment system. Countries contributed to a pool which could be borrowed from, on a temporary basis, by countries with payment imbalances (Condon, 2007). The IMF was important when it was first created because it helped the world stabilize the economic system. The IMF works to improve the economies of its member countries. The IMF describes itself as "an organization of 187 countries (as of July 2010), working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty".
1/24/11
Consumer Price Index - CPI
Also called headline inflation or inflation rate.
A measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food and medical care. The CPI is calculated by taking price changes for each item in the predetermined basket of goods and averaging them; the goods are weighted according to their importance. Changes in CPI are used to assess price changes associated with the cost of living.
CPI figures are often used to determine monetary policy and to set benchmark rates. Many Central Banks have inflationary targets that are based off of the CPI data that is typically giving in YOY (year-over-year) and MOM (month-over-month) format. If the target for inflation is between 1.5 to 2.0% and the CPI comes in at 2.5% it warrants measures to contain inflation which includes the possibility of increasing the benchmark rates.
Many criticisms of this method revolve around the the problem that CPI data does not accurately reflect the actual inflation. This is clearly seen from prices paid by the consumer when getting fuel, buying groceries, and other essential cost of living that everyone can clearly see in the real world. This can end up really hurting a society and it's economy in the long run by underestimating the real inflation.
A measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food and medical care. The CPI is calculated by taking price changes for each item in the predetermined basket of goods and averaging them; the goods are weighted according to their importance. Changes in CPI are used to assess price changes associated with the cost of living.
CPI figures are often used to determine monetary policy and to set benchmark rates. Many Central Banks have inflationary targets that are based off of the CPI data that is typically giving in YOY (year-over-year) and MOM (month-over-month) format. If the target for inflation is between 1.5 to 2.0% and the CPI comes in at 2.5% it warrants measures to contain inflation which includes the possibility of increasing the benchmark rates.
Many criticisms of this method revolve around the the problem that CPI data does not accurately reflect the actual inflation. This is clearly seen from prices paid by the consumer when getting fuel, buying groceries, and other essential cost of living that everyone can clearly see in the real world. This can end up really hurting a society and it's economy in the long run by underestimating the real inflation.
Jawboning
To try to influence or pressure through strong persuasion, especially to urge to comply voluntarily. Exercising the persuasive power of talk rather than legislation.
1/22/11
Subprime Loan -- also called bad credit loan
A type of loan that is offered at a rate above prime to individuals who do not qualify for prime rate loans. Quite often, subprime borrowers are often turned away from traditional lenders because of their low credit ratings or other factors that suggest that they have a reasonable chance of defaulting on the debt repayment.
Quantitative Easing
An unconventional monetary policy that ultimately leads to inflation. Central banks tend to use quantitative easing when interest rates have already been lowered to near 0% levels and have run out of other options to stimulate an economy. The basic mechanism for quantitative easing is the buying of government securities or other securities from the market.
for example:
The central bank creates money which it uses to buy government bonds and other financial assets, in order to increase the money supply and the excess reserves of the banking system; this also raises the prices of the financial assets bought (which lowers their yield).
for example:
The central bank creates money which it uses to buy government bonds and other financial assets, in order to increase the money supply and the excess reserves of the banking system; this also raises the prices of the financial assets bought (which lowers their yield).
Keynesian economics
Keynesian economics is an economic theory where it is the government's job to smooth out the bumps in business cycles to spur economic growth and stability. Intervention would come in the form of government spending and tax breaks in order to stimulate the economy, and government spending cuts and tax hikes in good times, in order to curb inflation.
Many economists believe that Keynesian economic theory is more efficient than supply-side economics, though critics point to the theory's inability to explain stagflation in the United States during the 1970s.
Many economists believe that Keynesian economic theory is more efficient than supply-side economics, though critics point to the theory's inability to explain stagflation in the United States during the 1970s.
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