Money, Banking & the Economy

Catalog description

This course focuses on the essential features and functions of money and credit in a capitalist economy operating with a fiat currency in a flexible exchange rate regime such as the U.S. economy. We study the role of the U.S. Federal Reserve Bank (The Fed), the U.S. Treasurer and the commercial banking sector in the U.S. economy, the banking and financial systems. The fundamental elements of financial markets, instruments and investments, and their links to the monetary and banking systems are examined. Special attention is given to the institutional structure and the accounting procedures through which the Fed and the Treasurer coordinate monetary policy. We examine the endogenous nature of crises and financial instability in capitalist economies. Here, we study the theories provided by prominent 20th century economists - Hyman Minsky and J.M. Keynes - whose names and theoretical contributions have been widely evoked during the 2008 Financial Crisis. We identify the causes and implications of financial crises, and understand possible policy solutions. Such policies emphasize the need to understand the recent evolution of the regulatory framework in the financial and banking industry.