This session covers the Review Lecture for the first half of the course. NOTE: The videos for this lecture are not available on the BU site or the ColumbiaLearn YouTube playlist, but you can access them directly through the Coursera site or through the playlist linked above. The lecture gives a brief overview of the …

Discussion — Midterm Review Lecture Read More »

This session covers Lecture 13: Chartallism, Metallism, and Key Currencies. Lecture 13 Notes In the first half of the course, we focused on two prices of money: par and interest rates. With the next four lectures, we explore a third price of money: foreign exchange. This allows us to revisit fundamental questions about the nature …

Discussion — Lecture 13 Read More »

This session covers Lecture 14: Money and the State: International and the Robert Mundell reading, which is a revised version of his 1999 Nobel Prize speech on the international monetary history of the 20th century. Lecture 14 Notes Mundell Study Questions Mundell divides the 20th century into three parts. He views the 19th-century gold standard …

Discussion — Lecture 14 & Reading 7: Robert Mundell Read More »

This session covers Lecture 15: Banks and Global Liquidity and Lecture 16: Foreign Exchange Lecture 15 Notes Lecture 16 Notes Lecture 15 uses the context of a 19th-century gold-standard world to introduce the Treynor model to foreign exchange markets. We flesh out the international dimension to what we covered in Lecture 9. FX dealers operate …

Discussion — Lectures 15 & 16 Read More »

This session covers Reading 8: The Dollar and World Liquidity: A Minority View, a 1966 article by Charles P. Kindleberger, Walter Despres, and Walter S. Salant, which originally appeared in The Economist. By viewing the United States as a bank to the rest of the world, Kindleberger tries to allay concerns about a U.S. balance-of-payments …

Discussion — Reading 8: Charles P. Kindleberger Read More »

This session covers Lecture 17: Direct and Indirect Finance and Lecture 18: Forwards and Futures. Lecture 17 Notes Lecture 18 Notes Lecture 17—starting with a simple description of "traditional" commercial banks—describes the evolution and emergence of shadow banking as the money market and capital market became intertwined through an iterative process of intermediation and disintermediation. …

Discussion — Lectures 17 & 18 Read More »

This session covers Reading 9: the first part of Chapter 5 of Money in a Theory of Finance by Gurley and Shaw (1960) Gurley & Shaw Study Questions Reinforcing some of what we learned in Lecture 17, Gurley and Shaw present a model of money and banking that emphasizes funding over payments. "Primary debt" is …

Discussion — Reading 9: Gurley & Shaw Read More »

This session covers Lecture 19: Interest Rate Swaps and Lecture 20: Credit Default Swaps Lecture 19 Notes Lecture 20 Notes Part 4 of Lecture 19 is missing from Perry Mehrling's site and the YouTube playlist. Here's a direct link. Lecture 19 — Part 4: What is a Swap Part 4 of Lecture 20 is cut …

Discussion — Lectures 19 & 20 Read More »