A Quantification Of The 2008-2009 US Bailout Package

A Quantification Of The 2008-2009 US Bailout Package

By examining the credit crunch causes and effects, this paper reflects on the necessity of the banks bailout package and its alternatives and quantifies a maximum non-inflationary bailout amount which is unlikely to cause permanent adjustments in the long term (trade-weighted) exchange rate equilibr...

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Bibliographic Details
Main Author: Cicero I. LIMBEREA
Format: Article
Language:English
Published: Sciendo 2009-05-01
Series:Review of Economic and Business Studies
Subjects:
credit crunch
M1
M3
ISLM equilibrium
demand shock
Keynesian multiplier
monetary policy
fiscal policy
mortgage prepayments changes
MBS
velocity of money supply
long term equilibrium of exchange rates
Online Access:http://rebs.ro/resource/REBS_3/Research%20Paper/Cicero_LIMBEREA_-_A_Quantification_Of_The_2008-2009.pdf
Description
Summary:By examining the credit crunch causes and effects, this paper reflects on the necessity of the banks bailout package and its alternatives and quantifies a maximum non-inflationary bailout amount which is unlikely to cause permanent adjustments in the long term (trade-weighted) exchange rate equilibrium level of the US dollar. Furthermore it determines that the current bailout amounts are less than the maximum non-inflationary bailout amount and determines that to resolve the underlying credit crunch problem, an increase in non-bank bailout M1 and/or a tax reduction is necessary.
ISSN:1843-763X

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