This article is from the Thursday, April 18, 2002 edition of the New York Times.
It discusses the implications of Federal Reserve Chairman Alan Greenspan testimony in front of Congress. He said that the Federal Reserve Board would not increase interest rates when the meet again on May 7 because of they are unsure of the economy's strength due to the recession earlier this year. So far they have lowered rates to 40 year lows 11 times last year to help ameliorate the recessionary gap in the economy. So far it seems like the fed's actions have been successful in recovering from the crises but it is still uncertain whether our economy has reached natural equilibrium in unemployment and Real GDP. So as not to upset and swing the economy back into recession the Fed will avoid raising rates.
The economy first went into the recessionary gap as the Real GDP fell from point 1 to point 2 on graph A but the Keynesian transmission mechanism was implemented skillfully by the Federal Reserve board to have the economy emerge out of the gap. As exemplified on graph C an increase in money supply from point 1 to point 2 caused the supply of money for loans to go up which also caused the interest rate to increase from point 2 to point 1. Also the investment in market goods shown in graph B goes up as the interest rate falls because the interest rate and the quantity of investment are inversely related. .
In graph D the keynesian model is displayed in which an increase in investment causes spending to increase which also shifts the aggregate demand cure over to the right this is all assuming that the aggregate supply curve is horizontal. As corporations employ more workers for maintaining and producing in their factories the unemployment rate falls causing a problem clearly exemplified by the Phillips curve on graph F where the very low unemployment is associated with high inflation and high unemployment associated with low inflation.
Research Assignment ALAN GREENSPAN My choice for a paper was to write about ALAN GREENSPAN. ... Alan Greenspan also has a say in interest rates and rate hikes. ... Greenspan's liberalism. ... Greenspan said. ... Alan Greenspan is now 76 years old. ...
Some may say Alan Greenspan is the second most powerful man in the world, today. ... "A mere word from Greenspan can cause the stock market and the dollar to rise and fall.""... Alan Greenspan is currently the chairman of the Federal Reserve Bank. " Officially, Mr. ... Whatever it is Alan Greenspan knows about it. ... And all that pressure sits atop one mans shoulders and that is Alan Greenspan. ...
Alan Greenspan Alan Greenspan is the second most ruling person in the United States of America, after the president, but is also like the many other numerous people in government today. ... Greenspan first got into politics in 1967; he was director of the domestic policy research for Richard M. ... Greenspan is determined to keep the rise in the general level of prices down and gain consumer confidence in the economy. ... Greenspan wants to contribute to the process of growth in consumer and employment assurance. Alan Greenspan will always be famous for making some very important decisi...
Sam Greenspan answers that question in his recent article, Media Effects on Children: Television. ... Greenspan begins by talking about the ever so popular Jerry Springer Show. ... Greenspan's article displays cumulative effect theory clearly, nobody can escape the media or its messages! ... Greenspan interviews a mother, Karen, who has a 13 year old child. ... The magic bullet theory is a key issue in Greenspan's text. ...
Allan Greenspan has offered a solution to some of the current problems ailing the American job market. Greenspan feels that American workers need to be better educated on the job. ... "The capacity of workers, after being displaced, to find a new job that will eventually provide nearly comparable pay most often depends on the general knowledge of the worker and the ability of that individual to learn new skills," Greenspan said. ...
Upon sighting a major slowdown in 2001, Alan Greenspan, Chairman of the Federal Reserve, took action by trying to curb this slowdown through introducing a series of interest rates cuts. ... According to Greenspan, "economic growth was close to "stalling out- - Because of this, the Federal Reserve was ready to continue cutting rates to enhance the economy and hopefully prevent it from falling into a recession. ... Furthermore, Alan Greenspan, Chairman of the Federal Reserve, though pessimistic about the short- term effects on the economy brought on by the terrorists attacks was optimistic abou...
Upon sighting a major slowdown in 2001, Alan Greenspan, Chairman of the Federal Reserve, took action by trying to curb this slowdown through introducing a series of interest rates cuts. ... According to Greenspan, "economic growth was close to "stalling out- - Because of this, the Federal Reserve was ready to continue cutting rates to enhance the economy and hopefully prevent it from falling into a recession. ... Furthermore, Alan Greenspan, Chairman of the Federal Reserve, though pessimistic about the short- term effects on the economy brought on by the terrorists attacks was optimistic abou...
Other exchange markets in the world reacted equally sensitive on Greenspan's words. ... Greenspan suggests and traders try to find out what he has suggested. ... What is amazing is that the information Alan Greenspan conveys in addresses is something very subjective. ... It is questionable if anyone could have inferred this not very aggressive monetary policy from Greenspan words. ... Trust However people decipher what Greenspan says, they appear to trust him. ...
