Economic Disturbances and Equilibrium in an Integrated Global Economy: Investment Insights and Policy Analysis helps readers develop a framework for analyzing economic events and make better, more consistent decisions. Victor Canto presents the theoretical building blocks that make up the overall framework, then expands the framework to tackle more complex problems, applying additional considerations to actual policy or investment issues. Drawing upon the most recent trends in monetary policy and international economics, the book offers sustained direct engagement with the main research question and makes innovative use of the simple concepts of supply and demand to illuminate modern finance literature.
The book succeeds by highlighting the often-forgotten interconnectedness of different economic processes. How do we respond to a change in policy or an economic shock? Are all the expected changes to the general equilibrium consistent with each other?
1. Introduction: Asset Allocation: Indexing, Smart Beta, and ValueTiming - p. xiii 2. Section I: Arbitrage and Mobility - p. xxvi 3. Chapter 1: Arbitrage, Mobility, and Equilibrium Prices - p. xxvi 4. Chapter 2: Practical Applications: The Investment and Policy Insights and Implications Derived From Arbitrage and Mobility - p. 17 5. Chapter 3: Are Commodity Price Increases Equivalent to Tax Increases? - p. 29 6. Chapter 4: The Terms of Trade - p. 37 7. Chapter 5: Yields, Risk Premium, and Terms of Trade - p. 46 8. Chapter 6: The Competitive Economic Environment: Lessons From the States - p. 50 9. Chapter 7: Economic Policy and Performance: The Small-Cap and Country Effect - p. 64 10. Chapter 8: Migration: A Political Problem, an Economic Problem, or Both? - p. 69 11. Section II: The Trade Balance - p. 81 12. Chapter 9: Global Investing: The Macro Prospective Building Blocks - p. 81 13. Chapter 10: Diversity and Harmonization - p. 88 14. Chapter 11: The State Competitive Environment: Integration and Convergence - p. 92 15. Chapter 12: The Degree of Global Integration and National Economies’ Policy Options and Limitations - p. 100 16. Chapter 13: A Unified Theory: Terms of Trade, Real GDP Growth Rate Differentials, the Trade Balance, Capital Flows, and the Relative Stock Market Performance - p. 109 17. Abstract - p. 109 18. The Two Possibilities - p. 111 19. The Terms of Trade - p. 112 20. The Global Economy’s Adjustments to Economic Disturbances and the Correlation Among the Key Economic Variables - p. 112 21. What Does the Global Data Tell Us? - p. 114 22. A Unified Theory - p. 116 23. Appendix - p. 127 24. Section III: Exchange Rate and the Terms of Trade - p. 127 25. Chapter 14: Protectionism, Devaluation, and the Terms of Trade - p. 127 26. Chapter 15: Exchange Rates, Devaluations, and the Terms of Trade - p. 136 27. Chapter 16: The Nominal Exchange Rate, the Terms of Trade, and the Economy - p. 144 28. Chapter 17: The US Experience: An Interpretation - p. 162 29. Chapter 18: Relative Price Changes, Income Redistribution, and the Politics of Envy - p. 172 30. Chapter 19: Self-Sufficiency, Nationalism, and Protectionism: The Common Elements - p. 181 31. Chapter 20: Immigration and Protectionism - p. 189 32. Chapter 21: Trade Policy, Protectionism, and Currency Manipulation - p. 200 33. Chapter 22: Protectionism and Trade Policy - p. 207 34. Section IV: The Balance of Payments - p. 218 35. Chapter 23: Global Investing: The Balance of Payments - p. 218 36. Chapter 24: Monetary Views: Part I - p. 238 37. Chapter 25: Monetary Views: Part II - p. 242 38. Chapter 26: The Greenspan Monetary Rule - p. 250 39. Chapter 27: Transparency and Rule-Based Monetary Policy - p. 254 40. Chapter 28: A Single or Dual Mandate - p. 258 41. Chapter 29: The Demise of the Global Price Rule - p. 262 42. Chapter 30: The US Inflation Rate - p. 265 43. Chapter 31: The Exchange Rate and the Rest of the World Inflation - p. 269 44. Abstract - p. 269 45. The Perfect Substitutability or Fixed Exchange Rate - p. 271 46. The Textbook Flexible Exchange Rate - p. 271 47. The Partial Substitutability Case - p. 272 48. Empirical Relationships: The Exchange Rate Changes - p. 273 49. Empirical Relationships: The Inflation Rate - p. 276 50. Section V: The Financial Crisis—A Case Study - p. 286 51. Chapter 32: The Financial Crisis: Inflection Point or Black Swan? - p. 286 52. Chapter 33: The Financial Crisis: Could We Have Avoided It or At Least Minimize Its Impact? - p. 294 53. Chapter 34: The Roadmap to a Backcast - p. 299 54. Chapter 35: Credit, the Carry Trade, Tax Rates, and the Residential Real Estate Market: A Retrospective - p. 310 55. Chapter 36: The Fed’s Crisis Response - p. 319 56. Chapter 37: Monetary Policy and the Interaction Between the Money and Credit Markets - p. 325 57. Chapter 38: Is Central Banking an Art? - p. 331 58. Chapter 39: After the Deluge? - p. 337 59. Chapter 40: The Panic of 2008: Cause and Consequences - p. 345 60. Chapter 41: Realignment? - p. 353 61. Chapter 42: Obamanomics: An Evaluation - p. 367 62. Section VI: China—A Case Study - p. 376 63. Chapter 43: China in a Global Economy: An Interpretation - p. 376 64. Chapter 44: China’s Wealth, Income, and the Savings Rate: The Complete Markets Case - p. 381 65. Chapter 45: Examining China: Purchasing Power Parity, Terms of Trade, and Real Exchange Rates - p. 386 66. Chapter 46: Examining China: Economic Growth, Exchange Rates, and Relative Stock Performance - p. 391 67. Chapter 47: Examining China: Monetary Policy, Inflation Potential, and the Organization of the Monetary System Under a Floating Exchange Rate System - p. 396 68. Chapter 48: Examining China: Monetary Policy, Inflation Potential, and the Organization of the Monetary System Under a Fixed Exchange Rate System - p. 399 69. Chapter 49: Examining China: China as a Nonreserve Currency Country - p. 404 70. Index - p. 411
Economic Disturbances and Equilibrium in an Integrated Global Economy: Investment Insights and Policy Analysis helps readers develop a framework for analyzing economic events and make better, more consistent decisions. Victor Canto presents the theoretical building blocks that make up the overall framework, then expands the framework to tackle more complex problems, applying additional considerations to actual policy or investment issues. Drawing upon the most recent trends in monetary policy and international economics, the book offers sustained direct engagement with the main research question and makes innovative use of the simple concepts of supply and demand to illuminate modern finance literature.
The book succeeds by highlighting the often-forgotten interconnectedness of different economic processes. How do we respond to a change in policy or an economic shock? Are all the expected changes to the general equilibrium consistent with each other?
1. Introduction: Asset Allocation: Indexing, Smart Beta, and ValueTiming - p. xiii 2. Section I: Arbitrage and Mobility - p. xxvi 3. Chapter 1: Arbitrage, Mobility, and Equilibrium Prices - p. xxvi 4. Chapter 2: Practical Applications: The Investment and Policy Insights and Implications Derived From Arbitrage and Mobility - p. 17 5. Chapter 3: Are Commodity Price Increases Equivalent to Tax Increases? - p. 29 6. Chapter 4: The Terms of Trade - p. 37 7. Chapter 5: Yields, Risk Premium, and Terms of Trade - p. 46 8. Chapter 6: The Competitive Economic Environment: Lessons From the States - p. 50 9. Chapter 7: Economic Policy and Performance: The Small-Cap and Country Effect - p. 64 10. Chapter 8: Migration: A Political Problem, an Economic Problem, or Both? - p. 69 11. Section II: The Trade Balance - p. 81 12. Chapter 9: Global Investing: The Macro Prospective Building Blocks - p. 81 13. Chapter 10: Diversity and Harmonization - p. 88 14. Chapter 11: The State Competitive Environment: Integration and Convergence - p. 92 15. Chapter 12: The Degree of Global Integration and National Economies’ Policy Options and Limitations - p. 100 16. Chapter 13: A Unified Theory: Terms of Trade, Real GDP Growth Rate Differentials, the Trade Balance, Capital Flows, and the Relative Stock Market Performance - p. 109 17. Abstract - p. 109 18. The Two Possibilities - p. 111 19. The Terms of Trade - p. 112 20. The Global Economy’s Adjustments to Economic Disturbances and the Correlation Among the Key Economic Variables - p. 112 21. What Does the Global Data Tell Us? - p. 114 22. A Unified Theory - p. 116 23. Appendix - p. 127 24. Section III: Exchange Rate and the Terms of Trade - p. 127 25. Chapter 14: Protectionism, Devaluation, and the Terms of Trade - p. 127 26. Chapter 15: Exchange Rates, Devaluations, and the Terms of Trade - p. 136 27. Chapter 16: The Nominal Exchange Rate, the Terms of Trade, and the Economy - p. 144 28. Chapter 17: The US Experience: An Interpretation - p. 162 29. Chapter 18: Relative Price Changes, Income Redistribution, and the Politics of Envy - p. 172 30. Chapter 19: Self-Sufficiency, Nationalism, and Protectionism: The Common Elements - p. 181 31. Chapter 20: Immigration and Protectionism - p. 189 32. Chapter 21: Trade Policy, Protectionism, and Currency Manipulation - p. 200 33. Chapter 22: Protectionism and Trade Policy - p. 207 34. Section IV: The Balance of Payments - p. 218 35. Chapter 23: Global Investing: The Balance of Payments - p. 218 36. Chapter 24: Monetary Views: Part I - p. 238 37. Chapter 25: Monetary Views: Part II - p. 242 38. Chapter 26: The Greenspan Monetary Rule - p. 250 39. Chapter 27: Transparency and Rule-Based Monetary Policy - p. 254 40. Chapter 28: A Single or Dual Mandate - p. 258 41. Chapter 29: The Demise of the Global Price Rule - p. 262 42. Chapter 30: The US Inflation Rate - p. 265 43. Chapter 31: The Exchange Rate and the Rest of the World Inflation - p. 269 44. Abstract - p. 269 45. The Perfect Substitutability or Fixed Exchange Rate - p. 271 46. The Textbook Flexible Exchange Rate - p. 271 47. The Partial Substitutability Case - p. 272 48. Empirical Relationships: The Exchange Rate Changes - p. 273 49. Empirical Relationships: The Inflation Rate - p. 276 50. Section V: The Financial Crisis—A Case Study - p. 286 51. Chapter 32: The Financial Crisis: Inflection Point or Black Swan? - p. 286 52. Chapter 33: The Financial Crisis: Could We Have Avoided It or At Least Minimize Its Impact? - p. 294 53. Chapter 34: The Roadmap to a Backcast - p. 299 54. Chapter 35: Credit, the Carry Trade, Tax Rates, and the Residential Real Estate Market: A Retrospective - p. 310 55. Chapter 36: The Fed’s Crisis Response - p. 319 56. Chapter 37: Monetary Policy and the Interaction Between the Money and Credit Markets - p. 325 57. Chapter 38: Is Central Banking an Art? - p. 331 58. Chapter 39: After the Deluge? - p. 337 59. Chapter 40: The Panic of 2008: Cause and Consequences - p. 345 60. Chapter 41: Realignment? - p. 353 61. Chapter 42: Obamanomics: An Evaluation - p. 367 62. Section VI: China—A Case Study - p. 376 63. Chapter 43: China in a Global Economy: An Interpretation - p. 376 64. Chapter 44: China’s Wealth, Income, and the Savings Rate: The Complete Markets Case - p. 381 65. Chapter 45: Examining China: Purchasing Power Parity, Terms of Trade, and Real Exchange Rates - p. 386 66. Chapter 46: Examining China: Economic Growth, Exchange Rates, and Relative Stock Performance - p. 391 67. Chapter 47: Examining China: Monetary Policy, Inflation Potential, and the Organization of the Monetary System Under a Floating Exchange Rate System - p. 396 68. Chapter 48: Examining China: Monetary Policy, Inflation Potential, and the Organization of the Monetary System Under a Fixed Exchange Rate System - p. 399 69. Chapter 49: Examining China: China as a Nonreserve Currency Country - p. 404 70. Index - p. 411
