World_Politics_Lecture_Slides_Octobe_273th

World_Politics_Lecture_Slides_Octobe_273th - Monetary...

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Unformatted text preview: Monetary Policy Who Wants What? History of International Monetary Systems When Things Go Wrong When Things Go Right POLSC 333: World Politics International Monetary Relations: Three C's: Currencies, Capitalism and Con ict Dr. Amanda Murdie October 28 POLSC 333: World Politics Monetary Policy Who Wants What? History of International Monetary Systems When Things Go Wrong When Things Go Right Goals for Today 1 Outline the role monetary exchange policies have in international political economy 2 Discuss how domestic and international interests in uence monetary policy. 3 Go over what happens when monetary policies go wrong. POLSC 333: World Politics Monetary Policy Who Wants What? History of International Monetary Systems When Things Go Wrong When Things Go Right Question from Last Time - Who does the US Own 1. United Kingdom 2. Canada 3. Japan 4. Cayman Islands 5. France (15) - China http://www.treas.gov/press/releases/tg842.htm POLSC 333: World Politics Monetary Policy Who Wants What? History of International Monetary Systems When Things Go Wrong When Things Go Right Icebreaker Question Should governments take actions to prevent unemployment? what actions? What if these actions cause in ation? is this a worry? POLSC 333: World Politics Monetary Policy Who Wants What? History of International Monetary Systems When Things Go Wrong When Things Go Right Icebreaker Question Should governments take actions to prevent unemployment? what actions? What if these actions cause in ation? is this a worry? POLSC 333: World Politics Monetary Policy Who Wants What? History of International Monetary Systems When Things Go Wrong When Things Go Right What is Wrong With In ation? lower interest rates- put more borrowing power in the hands of consumers, typically causes companies to hire workers when consumers spend more, the economy grows, naturally creating in ation (demand) in ation- rises in the prices of goods and services Now - If a government's central bank decides that the economy is growing too fast then it can raise interest rates, slowing the amount of cash entering the economy most agree- low levels of in ation ok hyperin ation- drastic in ation (sometimes over 100%) over a short period of time (months) Germany post WWI - December 1923 - 4,200,000,000,000 Marks to 1 US dollar POLSC 333: World Politics Monetary Policy Who Wants What? History of International Monetary Systems When Things Go Wrong When Things Go Right What is Wrong With In ation? lower interest rates- put more borrowing power in the hands of consumers, typically causes companies to hire workers when consumers spend more, the economy grows, naturally creating in ation (demand) in ation- rises in the prices of goods and services Now - If a government's central bank decides that the economy is growing too fast then it can raise interest rates, slowing the amount of cash entering the economy most agree- low levels of in ation ok hyperin ation- drastic in ation (sometimes over 100%) over a short period of time (months)...
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This note was uploaded on 09/06/2011 for the course POLSC 333 taught by Professor Aren during the Spring '11 term at Kansas State University.

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World_Politics_Lecture_Slides_Octobe_273th - Monetary...

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