Need Help-Macroeconomics Problems
Intro Macro N. Sheflin
Extra Credit Do any ONE of the following that appeals to you. Write your report as though addressing a clever friend who knew little economics, and use graphical or algebraic analysis as appropriate. Your work should be submitted via the ASSIGNMENT tool in Sakai as a WORD ATTACHMENT. It is due by December 16 9pm– no late submissions will be accepted.
DO NOT CHEAT. Your submission will automatically be checked by TURNITIN for plagiarism and checked against previous semester’s submissions. Be very careful to cite any sources used, use only your own words, not use the work of others without citation. The extra credit can add as much as 2% to your total points, but unless it is perfect, will likely add less. It will be given a 0-100% grade which sakai will convert into a 0-2% addition to your total points. There is no penalty for not doing the extra credit. Note that the final exam is a much more important determinant of your grade in the course so do not allow the extra credit to reduce your study time for the final.
TO GET ANY CREDIT, YOU MUST: INCLUDE and answer THE QUESTIONS I provide (copy and paste any of the following questions right into your report). If you do not include my questions with your answers after each one, you will receive no credit. NOT QUOTE from the book/article or anywhere else – Answer questions in YOUR OWN WORDS ANALYZE the material – you will be graded on your analysis, not your ability to summarize the source. RELATE the reading to what we are studying in this course. NOT write a book reports – ANSWER THE QUESTIONS NOT USE OTHERS WORK OR WORDS WITHOUT CITING THEM – don’t plagiarize (don’t copy and paste from Wikipedia, google searches, etc). Submit a 6-8 ‘typed’, double-spaced document in 11 point font.as a word attachment via Sakai’s ASSIGNMENT tool (not as a pdf)
1. Read Naked Money: A Revealing Look at What it is and Why it Matters, by Charles Wheelan, 2016, W.W. Norton and Company) and select at least one interesting point in each chapter and briefly summarize and relate it to what we have covered this semester. You must number and highlight each point, and then discuss/explain it. Ex: chapter 1 Why Gold is not a good money. As discussed in class, ….
2. Read at least sections I, II, III and V of Alan Blinder’s After the Music Stopped (2013) and explain his answers to the three questions he posed in chapter 1: 1. How Did We Ever Get Into Such A Mess, 2. What was Done and Why, and 3. Did We ‘Waste’ The Crisis?
3. Read “John Maynard Keynes Is the Economist the World Needs Now” http://www.businessweek.com/articles/2014-10-30/why-john-maynard-keyness-theories-can-fix- the-world-economy and a. explain WHY we needed Keynes then/ (financial crisis and great recession) by listing 10 important points made in the article and below each explain in terms of the theories and concepts developed in the course. Be sure to include points made about the recent U.S. and European recession as well as the great depression. i. Ex: 1. Austerity the article refers to austerity which is … Keynes explains this through the paradox of thrift in which …
b. Do we need Keynes NOW, given the state of the economy in 2016?
c. Read the Keynes Biographical sketch http://www.pbs.org/wgbh/commandingheights/shared/minitext/prof_johnmaynardkeynes.html and list and list and i) explain 10 interesting economic and biographical items in discusses. (again, list a point and then discuss it below it). ii) Was Keynes a socialist?
3. Read MAESTRO: Greenspan’s Fed and the American Boom by Bob Woodward, 2000, Touchstone Books. This fast-reading book covers Greenspan’s term at the Fed, up to 2001 and explains the economic events and the workings of the Fed in a non-technical way. Of course it is quite dated now, but good intro to how the Fed works and a quick read. Answer each of the following. a. Select three crises that occurred under Greenspan’s term, summarize the causes, consequences, and role of the Fed in each. b. Why was Greenspan (as Fed Chairman) concerned with such non-Fed issues as: i. the Federal Government Budget Deficit ii. the Bond market iii. the Social Security and Medicaid problems iv. That is, what did these have to do with the Fed? c. In hindsight, what errors did Greenspan make in his term as Chair of the Fed? d. Find 3 interesting personal facts about Greenspan and explain. Also, what is his, somewhat indirect, connection to Rutgers? e. Compare Bernanke’s term with Greenspan’s in terms of challenges and responses (this is not in the book-do some research here) i. What were the major issues of each Chair? ii. What was the basic public persona of each? iii. What was the educational and professional background of each? f. And what about Yellen’s term in comparison so far?
(There is a newer and more comprehensive biography of Greenspan by Mallaby The Man Who Knew but I’m still reading it)
4. Read http://larrysummers.com/2016/02/17/the-age-of-secular-stagnation/ and http://www.economist.com/blogs/graphicdetail/2014/11/secular-stagnation-graphics and https://www.weforum.org/agenda/2016/01/the-fourth-industrial-revolution-what-it-means-and-how- to-respond/ and http://time.com/4269733/secular-stagnation-larry-summers/ and answer the following: a. In what ways has the recovery from the recession been surprising? b. What is secular stagnation according to Summers, and what is the ‘core problem’? c. What evidence is there that we face secular stagnation? d. What are some of the alternative explanations of the issues, (liquidity trap, savings glut, etc).? e. What role do interest rates play in secular stagnation f. How does the ‘fourth industrial revolution / new economy” enter into secular stagnation? g. What does Summers’ see as the ‘cure’ h. What are some of the international policy implications of secular stagnation according to Summers? i. What are some political implications?
5. Read Burton Malkiel’s A Random Walk Down Wall Street (2016, W W Norton & Co;). Do the following, based on reading at least chapters 1-10 and 15 with the stress on part II. a. Why is the book titled “A Random Walk …”? b. Why are (some) markets efficient and why do stocks follow a random walk?
c. Explain why you can’t beat the market, according to Malkiel? d. What are the arguments/ evidence against efficient market theory? In favor? e. What are the implications for your personal investing of efficient markets hypothesis? f. What did the speculative episodes described in chapter 2 have in common? g. Define and defend Fundamental Analysis and explain why it doesn’t work. h. Explain and critique Technical Analysis and explain why it is widely used in light of your critique i. What are the main investment lessons of behavioral economics/finance – list and very briefly explain? j. Find 4 examples from recent news articles dealing with issues raised by Malkiel, cite and comment upon them. (copy and paste the headlines and briefly comment) k. What does Malkiel feel about the bubbles of the 2000s? l. How does Malkiel suggest you invest once you start working?