A Lender of Last Resort (LLR) is an institution, usually a country's Central Bank (like the Federal Reserve in the United States), that offers loans to banks or other organizations that are having financial difficulties or that are near a collapse or a bankruptcy. Generally, LLRs borrow money to those companies or financial institutions whose … Continue reading What is a Lender of Last Resort?
Donald Trump conducted an interview on May 4 with the Economist. Here follows the accurate transcription: [talking about his tax plan] But beyond that it’s OK if the tax plan increases the deficit? It is OK, because it won’t increase it for long. You may have two years where you’ll…you understand the expression “prime the … Continue reading Donald Trump: “you understand the expression prime the pump?”
John Maynard Keynes (1883-1946) was a famous British economist, mainly known for his book "The General Theory of Employment, Interest and Money", published in 1936, and for being the father of Keynesian Economics. In particular, Keynes was a strong advocate of full employment and government intervention in order to stop economic recessions: in his opinion, absolutely … Continue reading John Maynard Keynes
A financial bubble is an economic period in which the prices of particular types of assets increase in an exaggerated way, strongly exceeding their intrinsic value, only to contract later, when the bubble burst. It is usually originated by an exuberant bullish market and it ends when no more investors or speculators are willing to … Continue reading What is a financial bubble?
We all hear talking about inflation, but how does it really work? It is define as the rate of change of prices, and the change can be more or less fast (if it is really high we are talking about hyperinflation); positive or negative (deflation). If we have a little amount of inflation it doesn't … Continue reading 101 Inflation
Human capital refers to the stock of knowledge, habits, social and personality attributes, including creativity, embodied in the ability to perform labor so as to produce economic value. "Schooling, a computer training course, expenditures on medical care, and lectures on the virtues of punctuality and honesty are capital too in the sense that they improve … Continue reading Gary S. Becker: Human Capital
Before talking about small and medium enterprises (SME) we have to face a problem: global SME are not always comparable, we do not have certain data to look at. European commission defines SME as less than 250 employees, but USA set the amount at 500, on the contrary in Australia the number is less than … Continue reading The Big Role of Small Enterprises