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The dual use of the word "duration", as both the weighted average time until repayment and as the percentage change in price, often causes confusion. Strictly speaking, Macaulay duration is the name given to the weighted average time until cash flows are received and is measured in years. Modified duration is the name given to the price ...
The Federal Reserve's present-day dual mandate monetary policy objectives to keep prices stable and unemployment low has replaced past practices under a gold standard where the main concern was the gold equivalent of the local currency, or under a gold exchange standard where the concern is fixing the exchange rate versus another gold ...
The Coinage Act of 1792 (also known as the Mint Act; officially: An act establishing a mint, and regulating the Coins of the United States), passed by the United States Congress on April 2, 1792, created the United States dollar as the country's standard unit of money, established the United States Mint, and regulated the coinage of the United States. [1]
Under a system of fiat fixed rates, the local government or monetary authority declares a fixed exchange rate but does not actively buy or sell currency to maintain the rate. Instead, the rate is enforced by non-convertibility measures (e.g. capital controls, import/export licenses, etc.). In this case, there is a black market exchange rate ...
The alternative to a commodity money system is fiat money which is defined by a central bank and government law as legal tender even if it has no intrinsic value. Originally fiat money was paper currency or base metal coinage, but in modern economies it mainly exists as data such as bank balances and records of credit or debit card purchases, [3] and the fraction that exists as notes and coins ...
Mandatory spending plays a large role in larger fiscal trends. During economic downturns, government revenues fall and expenditures rise as more people become eligible for mandatory programs such as Unemployment Insurance and Income Security programs. This causes deficits to increase or surpluses to shrink.
Replacing Treasury Secretary Lloyd Bentsen early in December 1994, Robert E. Rubin responded to the dollar’s depreciation with: “A strong dollar is in our national interest.” [34] [35] Thus, in 1995, Rubin re-set U.S. dollar policy, stating, in paraphrase: The strong-dollar policy is a U.S. government policy based on the assumption that a ...
The closing of the gold window was a fix that was assigned to "free…foreign policy from constraints imposed by weaknesses in the financial system" (Gowa, 1983, p. 69). US Monetary Hegemony persists as does the Bretton Woods System, as Dooley, Folkerts-Landau, Garber (2003) contend in their work An Essay on The Revised Bretton Woods System ...