Econ 135: Monetary Economics Summer 2023
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Econ 135: monetary economics
Summer 2023
1 Zoom
You will find the Zoom link for each class in Canvas under the Zoom tab.
2 General information
The ongoing global pandemic has had devastating effects on the global economy and has led to exceptional fiscal and monetary policy actions of a scale not seen since
the financial crisis of 2008. More recently there have been some bank bailouts due to the failure of Silicon Valley Bank. This course will help students obtain a better understanding of how monetary policy works and what current policy makers, both in the U.S. and abroad, are trying to achieve through their policies. Though the class uses concepts from microeconomics, monetary economics is centrally a branch of macroeconomics. Students are therefore expected to have a good understanding of both intermediate microeconomics and macroeconomics: hence Econ 100B and Econ 101 are prerequisites.
We will also be learning how to download data and graph in R. I will give you everything you need to make it fairly painless. The template to get everything set up for R is on the Canvas site.
Course Requirements: There are three, equally weighted exams. The first exam will take place during class on TBA, the second exam will take place during class on TBA, and the third exam will be held during the last day of class.
2.1 Course Materials
. Book (required)
– Required Text: Cecchetti and Schoenholtz, Money, Banking, and Financial Markets, 6th edition.
– Class policy: There will be 3 equally weighted exams. No make-up exams are given. If you miss one of the exams the other 2 exams will be re- weighted to 50% each. If you are a student with a disability and would like to discuss special academic accommodations, please contact me during office hours. Campus regulations on academic integrity apply; cheating will trigger a report to the Office of Judicial Affairs and usually a course grade F. All course materials and the intellectual content of the course itself are protected by United States Federal Copyright Law and the California Civil Code. UC Policy expressly prohibits students (and all other persons) from recording lectures or discussions and from distributing or selling lectures notes and all other course materials without the prior written permission of the instructor.
3 grading
. exams: 70%
. homework: 15%; Smartbook 5%
. R homework and graphs: 10%
4 Using R
. Data
– You will learn how to find and examine data that come from the source, such as the Bureau of Labor Statistics (BLS) or the Bureau of Economic Analysis (BEA). To analyze data you will become familiar with R. R is a (free) open source programming and graphing language that is not too difficult to learn but does has some upfront setup. I will get you going with R but you should get it downloaded before class starts. We will work through downloading, manipulating and presenting data. Why? It is a highly valued skill in many professions and will look very good on your resume! I will provide templates so it will be fairly straightforward.Here is the link for R and Rstudio. Rstudio is a very good all-in-one solution that I recommend for first time users. I realize that programming skills differ immensely and I am not trying to turn anyone into a programmer. However, this simple tool will be valuable for many different careers.
– Get the above downloaded before the first day of class and start playing around with it, there are lots and lots of resources on the web to help you get going. The UCSB library also has R and RStudio to use.
– It is also possible to run a regressions in R and many different ways to manipulate data.
1 8/7 Why study money, banking, and financial markets? Ch. 1
2 8/8 Money and the payments system Ch. 2
3 8/9 Financial instruments Ch. 3
4 8/14 Future value, present value and interest rates Ch. 4
5 8/15 Understanding risk Ch. 5
6 8/16 Bonds Ch. 6
8/21 Exam 1 Ch. 1-6 and slides
7 8/22 Term structure of interest rates Ch. 7
8 8/23 Stocks Ch. 8
9 8/28 Financial intermediation Ch. 11
10 8/29 Depository institutions Ch. 12
11 8/30 Financial industry structure Ch. 13
12 9/4 Labor Day
9/5 Exam 2 Ch. 7, 8, 11, 12, 13 and slides
14 9/11 Bank runs: Silicon Valley Bank, etc. slides
15 9/12 Central banks and money Ch. 16, 17, 20
9/13 Exam 3 Ch. 14, 16, 17, 20 and slides
6 some useful sites
. Money and banking blog by Cecchetti and Schoenholtz
. Econsnapshot by Paul Gomme and Peter Rupert
2023-08-08