The document summarizes the key aspects of the Chicago Plan, which proposed separating the monetary and credit functions of banking by requiring banks to back deposits 100% by public reserves. This would eliminate banks' ability to create money through lending and make money creation and issuance a public function. The Chicago Plan is argued to have six main advantages: 1) reducing public and private debt levels, 2) eliminating bank runs, 3) boosting economic output up to 10%, 4) better controlling bank-lending driven business cycles, 5) avoiding liquidity traps, and 6) not causing inflation according to monetary theory and history.
A fantastic presentation on how the HECM insured mortgage program can help retirees and senior citienz alike . If you are Financial Planner and have your skepticism about it, then this is a must read. Call me if you want to hear more about it. With baby boomers entering retirement, there is no better time than now to think about the future
China’s turning to “tough gradualism” in discipling local government borrowin...Terry Zhang
HONG KONG, 17 Jan 2018. Pengyuan International has released a research report, titled “China’s Turning To “Tough Gradualism” In Disciplining Local Government Borrowing Foretells Higher Risk of LGFV Default”. This research report is accessible via the link: http://www.pyrating.com/CreditResearch.
The first default on public bond of local government financing vehicles in China (LGFVs) could possibly happen in 2018, although the odds are still less than 50% according to a report published today by Pengyuan International titled “China’s Turning To ‘Tough Gradualism’ In Discipling Local Government Borrowing Foretells Higher Risk of LGFV Default”.
The central government of China launched recently a three-year critical battle against financial risks. Allowing LGFV default (“shock therapy”) may become a policy choice to dispel investor belief in implicit government support to LGFVs and thus help tame hidden local government borrowing, which occurred primarily through LGFVs.
“We believe Chinese government is turning to ‘tough gradualism’ rather than “shock therapy” in disciplining local government borrowing”, said Liang Zhong, analyst of Pengyuan International, “in another word, the central government is likely to tighten relevant discipline gradually, bearing in mind the needs to balance between achieving growth target and securing financial stability”.
The report argues that the “tough gradualist approach” means some type of credit events could happen before the others. For instance, the first default on public bond by LGFV sector in onshore market is likely to precede LGFV default on public bond in offshore.
As the risk of LGFV default rises, greater scrutiny of LGFV creditworthiness becomes increasingly necessary, including scrutinizing provincial economic and fiscal data according to the report.
“If China’s central government adheres to ‘tough gradualism’, namely tightening discipline steadily over local government borrowing, there it is good chance that the once relentless hidden LGT borrowing could be tamed markedly within three years.” Said Mr. Zhong.
ANALYSTS CONTACT
Mr. Liang Zhong
+852 3596 6140
liang.zhong@pyrating.com
MEDIA CONTACT
media@pyrating.com
OTHER ENQUIRIES
contact@pyrating.com
A fantastic presentation on how the HECM insured mortgage program can help retirees and senior citienz alike . If you are Financial Planner and have your skepticism about it, then this is a must read. Call me if you want to hear more about it. With baby boomers entering retirement, there is no better time than now to think about the future
China’s turning to “tough gradualism” in discipling local government borrowin...Terry Zhang
HONG KONG, 17 Jan 2018. Pengyuan International has released a research report, titled “China’s Turning To “Tough Gradualism” In Disciplining Local Government Borrowing Foretells Higher Risk of LGFV Default”. This research report is accessible via the link: http://www.pyrating.com/CreditResearch.
The first default on public bond of local government financing vehicles in China (LGFVs) could possibly happen in 2018, although the odds are still less than 50% according to a report published today by Pengyuan International titled “China’s Turning To ‘Tough Gradualism’ In Discipling Local Government Borrowing Foretells Higher Risk of LGFV Default”.
The central government of China launched recently a three-year critical battle against financial risks. Allowing LGFV default (“shock therapy”) may become a policy choice to dispel investor belief in implicit government support to LGFVs and thus help tame hidden local government borrowing, which occurred primarily through LGFVs.
“We believe Chinese government is turning to ‘tough gradualism’ rather than “shock therapy” in disciplining local government borrowing”, said Liang Zhong, analyst of Pengyuan International, “in another word, the central government is likely to tighten relevant discipline gradually, bearing in mind the needs to balance between achieving growth target and securing financial stability”.
The report argues that the “tough gradualist approach” means some type of credit events could happen before the others. For instance, the first default on public bond by LGFV sector in onshore market is likely to precede LGFV default on public bond in offshore.
As the risk of LGFV default rises, greater scrutiny of LGFV creditworthiness becomes increasingly necessary, including scrutinizing provincial economic and fiscal data according to the report.
“If China’s central government adheres to ‘tough gradualism’, namely tightening discipline steadily over local government borrowing, there it is good chance that the once relentless hidden LGT borrowing could be tamed markedly within three years.” Said Mr. Zhong.
ANALYSTS CONTACT
Mr. Liang Zhong
+852 3596 6140
liang.zhong@pyrating.com
MEDIA CONTACT
media@pyrating.com
OTHER ENQUIRIES
contact@pyrating.com
The presentation makes a compelling argument for the Joint Select Committee on Deficit Reduction ("Super Committee") to "Go Big" rather than going small.
For more info, visit http://crfb.org/go-big.
Jimmy Gentry and Gary Trennepohl present "Digging Deeper: Goodwill and Pro Forma" during Reynolds Business Journalism Week 2013.
Reynolds Business Journalism Week is an all-expenses-paid seminar for journalists looking to enhance their business coverage, and professors looking to enhance or create business journalism courses.
For more information about business journalism training, please visit businessjournalism.org.
Shock waves, natural and man-made, rocked global economies in the first six months of 2011. Economic growth faced headwinds from severe storms, floods, earthquakes, higher oil prices and a manufacturing disruption of the global component supply chain from Japan. Most of those issues have now passed, however the European sovereign and banking sector debt crisis remains unresolved. Learn more at http://www.nafcu.org/nifucs
Mercer Capital's Bank Watch | September 2021 | Fairness Opinions - Evaluating...Mercer Capital
Brought to you by the Financial Institutions Team of Mercer Capital, this monthly newsletter is focused on bank activity in five U.S. regions. Bank Watch highlights various banking metrics, including public market indicators, M&A market indicators, and key indices of the top financial institutions, providing insight into financial institution valuation issues.
Tampa FL as a reverse mortgage consultant. Chris Beard works exclusively with senior homeowners seeking a reverse mortgage, a home financing program that allows mature homeowners to utilize the equity in their homes to supplement retirement income.
Week-9 Bank RegulationMoney and Banking Econ 311Tuesdays 7 .docxalanfhall8953
Week-9 Bank Regulation
Money and Banking Econ 311
Tuesdays 7 - 9:45
Instructor: Thomas L. Thomas
Capital Adequacy Management
Bank capital helps prevent bank failure
The amount of capital affects return for the owners (equity holders) of the bank
Regulatory requirement – Regulatory Capital – Tier 1 and Tier 2 Basle Rules
Economic Capital - What is this
2
Capital Adequacy Management:
Returns to Equity Holders
3
Traditional Economic Capital Value-At-Risk (VaR) View
Frequency of Occurrence / Probability
Mean/Average Expected Losses (m)
Unexpected Losses @ 99.9% confidence Level (s)
Economic Capital
Reserves
Value-at-Risk
VAR
Before we can develop adequate credit stress testing we need to understand the differences between traditional credit loss measures and what stress tests incorporate.
Aside form standard concentration and coverage analysis, a standard portfolio credit risk analysis typically employs a Value-at-Risk view.
Credit risk in this view generally follows a positive skewed distribution (by definition one cannot have negative defaults and thus a normal distribution is not applicable).
Reserves ALLL generally cover average expected losses over a horizon. In reality these are usually allocated to general reserves since most ALLL have two components: general reserves and specific reserves for known credits that are detraining.
Economic capital functions as a cushion against unexpected loss up to some confidence level. In this case 99.9% or a single “A” rating is the regulatory standard (once every 10,000 years)
In addition to a loss cushion economic capital represents the amount of the firm’s equity that is at risk which requires a return sufficient to cover the associated risk.
The shape of the curve or tail will then reflect the underlying credit risk of the portfolio or product.
However this view has some assumptions that can miss important risk elements.
The distribution is generally based on one variable PD in this case and does necessarily fully account for other correlated factors that when combined either change the tail or increase the likelihood of default.
Second, while the event may be rare, this methodology does not tell how severe or the magnitude of the event when it occurs beyond the confidence level prescribed for economic capital.
4
Old Measure: New Ones
RAROC - Risk Adjusted Return on Capital
EVA - Economic Value Added.
Hurdle Rate – What is it. How is it measured?
5
Time Line of the Early History of Commercial Banking in the United States
6
Historical Development of the Banking System
Bank of North America chartered in 1782
Controversy over the chartering of banks.
National Bank Act of 1863 creates a new banking system of federally chartered banks
Office of the Comptroller of the Currency
Dual banking system
Federal Reserve System is created in 1913.
7
Asymmetric Information and Financial.
The presentation makes a compelling argument for the Joint Select Committee on Deficit Reduction ("Super Committee") to "Go Big" rather than going small.
For more info, visit http://crfb.org/go-big.
Jimmy Gentry and Gary Trennepohl present "Digging Deeper: Goodwill and Pro Forma" during Reynolds Business Journalism Week 2013.
Reynolds Business Journalism Week is an all-expenses-paid seminar for journalists looking to enhance their business coverage, and professors looking to enhance or create business journalism courses.
For more information about business journalism training, please visit businessjournalism.org.
Shock waves, natural and man-made, rocked global economies in the first six months of 2011. Economic growth faced headwinds from severe storms, floods, earthquakes, higher oil prices and a manufacturing disruption of the global component supply chain from Japan. Most of those issues have now passed, however the European sovereign and banking sector debt crisis remains unresolved. Learn more at http://www.nafcu.org/nifucs
Mercer Capital's Bank Watch | September 2021 | Fairness Opinions - Evaluating...Mercer Capital
Brought to you by the Financial Institutions Team of Mercer Capital, this monthly newsletter is focused on bank activity in five U.S. regions. Bank Watch highlights various banking metrics, including public market indicators, M&A market indicators, and key indices of the top financial institutions, providing insight into financial institution valuation issues.
Tampa FL as a reverse mortgage consultant. Chris Beard works exclusively with senior homeowners seeking a reverse mortgage, a home financing program that allows mature homeowners to utilize the equity in their homes to supplement retirement income.
Week-9 Bank RegulationMoney and Banking Econ 311Tuesdays 7 .docxalanfhall8953
Week-9 Bank Regulation
Money and Banking Econ 311
Tuesdays 7 - 9:45
Instructor: Thomas L. Thomas
Capital Adequacy Management
Bank capital helps prevent bank failure
The amount of capital affects return for the owners (equity holders) of the bank
Regulatory requirement – Regulatory Capital – Tier 1 and Tier 2 Basle Rules
Economic Capital - What is this
2
Capital Adequacy Management:
Returns to Equity Holders
3
Traditional Economic Capital Value-At-Risk (VaR) View
Frequency of Occurrence / Probability
Mean/Average Expected Losses (m)
Unexpected Losses @ 99.9% confidence Level (s)
Economic Capital
Reserves
Value-at-Risk
VAR
Before we can develop adequate credit stress testing we need to understand the differences between traditional credit loss measures and what stress tests incorporate.
Aside form standard concentration and coverage analysis, a standard portfolio credit risk analysis typically employs a Value-at-Risk view.
Credit risk in this view generally follows a positive skewed distribution (by definition one cannot have negative defaults and thus a normal distribution is not applicable).
Reserves ALLL generally cover average expected losses over a horizon. In reality these are usually allocated to general reserves since most ALLL have two components: general reserves and specific reserves for known credits that are detraining.
Economic capital functions as a cushion against unexpected loss up to some confidence level. In this case 99.9% or a single “A” rating is the regulatory standard (once every 10,000 years)
In addition to a loss cushion economic capital represents the amount of the firm’s equity that is at risk which requires a return sufficient to cover the associated risk.
The shape of the curve or tail will then reflect the underlying credit risk of the portfolio or product.
However this view has some assumptions that can miss important risk elements.
The distribution is generally based on one variable PD in this case and does necessarily fully account for other correlated factors that when combined either change the tail or increase the likelihood of default.
Second, while the event may be rare, this methodology does not tell how severe or the magnitude of the event when it occurs beyond the confidence level prescribed for economic capital.
4
Old Measure: New Ones
RAROC - Risk Adjusted Return on Capital
EVA - Economic Value Added.
Hurdle Rate – What is it. How is it measured?
5
Time Line of the Early History of Commercial Banking in the United States
6
Historical Development of the Banking System
Bank of North America chartered in 1782
Controversy over the chartering of banks.
National Bank Act of 1863 creates a new banking system of federally chartered banks
Office of the Comptroller of the Currency
Dual banking system
Federal Reserve System is created in 1913.
7
Asymmetric Information and Financial.
Greensill Capital Investor Presentation Deck March 2016.pdfBryann Alexandros
Greensill Capital was a financial services company based in the UK and Australia. It specialized in providing supply chain financing and related services. The company was founded in 2011 by Lex Greensill, a former banker and adviser to the UK government. It claimed to have revolutionized the way businesses pay their suppliers and access working capital. It had over 1,000 clients and 5 million suppliers in 175 countries by 2020. However, Greensill Capital failed in March 2021 after losing its main insurer and facing a liquidity crisis. The company was accused of misrepresenting its assets, overexposing itself to a single client (GFG Alliance), and engaging in questionable practices such as reverse factoring and future receivables. The company filed for insolvency protection on 8 March 2021 and was sold to Apollo Global Management for $60 million134. The failure of Greensill Capital triggered a series of investigations, lawsuits, and scandals involving its investors (such as Credit Suisse and SoftBank), its customers (such as GFG Alliance and Sanjeev Gupta), its regulators (such as the UK Financial Conduct Authority and the Swiss Financial Market Supervisory Authority), and its lobbyists (such as former UK Prime Minister David Cameron).
Tracking money and fund flows from one financial entity to another will lead to a long chain or network of entities spread all over the world. Along with the funds financial risks also flow across the network. They can have a devastating cascading effect when one entity collapses. The financial melt down of global markets in 2007-08 was precipitated by failure in such networks. We present the dimensions and complexity in modelling fund flows in these networks.
Foreign Investment Into China - presented at UCITS & AIFMD Feb 25, 2015. China is too big too ignore, regulatory changes are pointing to more and greater opening in the financial services industry particularly for global asset managers. Institutional Investors will begin to allocate to China equity and fixed income in size in the coming years, who will benefit?
Data Quality in the Banking Industry: Turning Regulatory Compliance into Busi...Precisely
During the last 15 years, regulatory requirements in financial services have grown substantially in order to reduce the risk of global, systemic economic failure. Quality data provided through effective data governance and data quality processes is central to achieving effective compliance reporting. Not only does data quality help ensure accurate reporting, but successful compliance significantly enhances other business decisions which rely on high quality data.
This webinar looks at the ramp up in reporting complexity, how successful compliance is linked to data governance and data quality, and how data quality helps empower financial institutions to make better decisions to increase revenue and decrease expense.
View this webinar on-demand for a discussion on:
• Tracing the background for regulatory reporting and key financial regulations
• Understanding how data quality helps institutions succeed with regulatory reporting compliance
• How regulatory reporting improves data for other business decisions
• How financial institutions leverage Trillium DQ to deliver quality data
Current Trends in Selected Industries: BankingEren Ocakverdi
Conceptual introduction to Banking for the first week of the elective course (AD487). Presentation relies heavily on Frederic Mishkin's textbook: The Economics of Money, Banking and Financial Markets, 9th ed,
Similar to Dr Michael Kumhof: "The Chicago Plan Revisited" (20)
Cross-border cooperation in the electricity sector - the Nordic exampleGlobal Utmaning
Seminar
NORDIC ENERGY WAYS – WHAT‘S IN IT FOR US?
Monday, 2 June 2014
Arne Mogren, European Climate Foundation, gave a presentation on the history of electricity and Nordic electricity cooperation.
Nordic Energy ways in Europe – Clean, Competitive and ConnectedGlobal Utmaning
Seminar: NORDIC ENERGY WAYS – WHAT‘S IN IT FOR US?
Monday, 2 June 2014
Anders Olsson, vice CEO E.ON Norden, presented the main conclusions of the report Nordic Energy Ways in Europe. Read the full report here: www.globalutmaning.se/wp-content/uploads/2013/11/Nordic-Energy-Ways-in-Europe1.pdf
A presentation held by the Swedish Minister for Finance Anders Borg at Global Utmaning's and the Swedish House of Finance's seminar "Combating the Debt Addiction" at the Stockholm School of Economics, Thursday May 22, 2014.
A presentation held by Ph.D. Ulf Dahlsten at Global Utmaning's and the Swedish House of Finance's seminar "Combating the Debt Addiction" at the Stockholm School of Economics, Thursday May 22, 2014.
Challenges with high household debt levels - a Swedish perspectiveGlobal Utmaning
A presentation held by Lord Adair Turner from INET at Global Utmaning's and the Swedish House of Finance's seminar "Combating the Debt Addiction" at the Stockholm School of Economics, Thursday May 22, 2014.
Ed Groark presents State of the World 2014: Governing for sustainabilityGlobal Utmaning
Ed Groark, Chairman of the Worldwatch institute, presented the annual report State of the World, this year themed "Governing for sustainability" at a seminar hosted by Norden i Fokus and Global Utmaning on the 7th of May 2014.
Energiewende - Status of the German Energy reformsGlobal Utmaning
A presentation given in Stockholm, March 20th 2014, by Dr. Ralf Bartels, Industriegewerkschaft Bergbau, Chemie, Energie
Head of Department Energy Reforms / Sustainability
at Global Challenge's and E.ON's seminar "A Nordic Energiewende?"
how to sell pi coins effectively (from 50 - 100k pi)DOT TECH
Anywhere in the world, including Africa, America, and Europe, you can sell Pi Network Coins online and receive cash through online payment options.
Pi has not yet been launched on any exchange because we are currently using the confined Mainnet. The planned launch date for Pi is June 28, 2026.
Reselling to investors who want to hold until the mainnet launch in 2026 is currently the sole way to sell.
Consequently, right now. All you need to do is select the right pi network provider.
Who is a pi merchant?
An individual who buys coins from miners on the pi network and resells them to investors hoping to hang onto them until the mainnet is launched is known as a pi merchant.
debuts.
I'll provide you the Telegram username
@Pi_vendor_247
what is the best method to sell pi coins in 2024DOT TECH
The best way to sell your pi coins safely is trading with an exchange..but since pi is not launched in any exchange, and second option is through a VERIFIED pi merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and pioneers and resell them to Investors looking forward to hold massive amounts before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade pi coins with.
@Pi_vendor_247
Turin Startup Ecosystem 2024 - Ricerca sulle Startup e il Sistema dell'Innov...Quotidiano Piemontese
Turin Startup Ecosystem 2024
Una ricerca de il Club degli Investitori, in collaborazione con ToTeM Torino Tech Map e con il supporto della ESCP Business School e di Growth Capital
how to sell pi coins at high rate quickly.DOT TECH
Where can I sell my pi coins at a high rate.
Pi is not launched yet on any exchange. But one can easily sell his or her pi coins to investors who want to hold pi till mainnet launch.
This means crypto whales want to hold pi. And you can get a good rate for selling pi to them. I will leave the telegram contact of my personal pi vendor below.
A vendor is someone who buys from a miner and resell it to a holder or crypto whale.
Here is the telegram contact of my vendor:
@Pi_vendor_247
how to sell pi coins on Bitmart crypto exchangeDOT TECH
Yes. Pi network coins can be exchanged but not on bitmart exchange. Because pi network is still in the enclosed mainnet. The only way pioneers are able to trade pi coins is by reselling the pi coins to pi verified merchants.
A verified merchant is someone who buys pi network coins and resell it to exchanges looking forward to hold till mainnet launch.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
how can i use my minded pi coins I need some funds.DOT TECH
If you are interested in selling your pi coins, i have a verified pi merchant, who buys pi coins and resell them to exchanges looking forward to hold till mainnet launch.
Because the core team has announced that pi network will not be doing any pre-sale. The only way exchanges like huobi, bitmart and hotbit can get pi is by buying from miners.
Now a merchant stands in between these exchanges and the miners. As a link to make transactions smooth. Because right now in the enclosed mainnet you can't sell pi coins your self. You need the help of a merchant,
i will leave the telegram contact of my personal pi merchant below. 👇 I and my friends has traded more than 3000pi coins with him successfully.
@Pi_vendor_247
USDA Loans in California: A Comprehensive Overview.pptxmarketing367770
USDA Loans in California: A Comprehensive Overview
If you're dreaming of owning a home in California's rural or suburban areas, a USDA loan might be the perfect solution. The U.S. Department of Agriculture (USDA) offers these loans to help low-to-moderate-income individuals and families achieve homeownership.
Key Features of USDA Loans:
Zero Down Payment: USDA loans require no down payment, making homeownership more accessible.
Competitive Interest Rates: These loans often come with lower interest rates compared to conventional loans.
Flexible Credit Requirements: USDA loans have more lenient credit score requirements, helping those with less-than-perfect credit.
Guaranteed Loan Program: The USDA guarantees a portion of the loan, reducing risk for lenders and expanding borrowing options.
Eligibility Criteria:
Location: The property must be located in a USDA-designated rural or suburban area. Many areas in California qualify.
Income Limits: Applicants must meet income guidelines, which vary by region and household size.
Primary Residence: The home must be used as the borrower's primary residence.
Application Process:
Find a USDA-Approved Lender: Not all lenders offer USDA loans, so it's essential to choose one approved by the USDA.
Pre-Qualification: Determine your eligibility and the amount you can borrow.
Property Search: Look for properties in eligible rural or suburban areas.
Loan Application: Submit your application, including financial and personal information.
Processing and Approval: The lender and USDA will review your application. If approved, you can proceed to closing.
USDA loans are an excellent option for those looking to buy a home in California's rural and suburban areas. With no down payment and flexible requirements, these loans make homeownership more attainable for many families. Explore your eligibility today and take the first step toward owning your dream home.
What website can I sell pi coins securely.DOT TECH
Currently there are no website or exchange that allow buying or selling of pi coins..
But you can still easily sell pi coins, by reselling it to exchanges/crypto whales interested in holding thousands of pi coins before the mainnet launch.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and resell to these crypto whales and holders of pi..
This is because pi network is not doing any pre-sale. The only way exchanges can get pi is by buying from miners and pi merchants stands in between the miners and the exchanges.
How can I sell my pi coins?
Selling pi coins is really easy, but first you need to migrate to mainnet wallet before you can do that. I will leave the telegram contact of my personal pi merchant to trade with.
Tele-gram.
@Pi_vendor_247
Lecture slide titled Fraud Risk Mitigation, Webinar Lecture Delivered at the Society for West African Internal Audit Practitioners (SWAIAP) on Wednesday, November 8, 2023.
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
What price will pi network be listed on exchangesDOT TECH
The rate at which pi will be listed is practically unknown. But due to speculations surrounding it the predicted rate is tends to be from 30$ — 50$.
So if you are interested in selling your pi network coins at a high rate tho. Or you can't wait till the mainnet launch in 2026. You can easily trade your pi coins with a merchant.
A merchant is someone who buys pi coins from miners and resell them to Investors looking forward to hold massive quantities till mainnet launch.
I will leave the telegram contact of my personal pi vendor to trade with.
@Pi_vendor_247
The secret way to sell pi coins effortlessly.DOT TECH
Well as we all know pi isn't launched yet. But you can still sell your pi coins effortlessly because some whales in China are interested in holding massive pi coins. And they are willing to pay good money for it. If you are interested in selling I will leave a contact for you. Just telegram this number below. I sold about 3000 pi coins to him and he paid me immediately.
Telegram: @Pi_vendor_247
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
#pi #sell #nigeria #pinetwork #picoins #sellpi #Nigerian #tradepi #pinetworkcoins #sellmypi
Transkredit Finance Company Products Presentation (1).pptx
Dr Michael Kumhof: "The Chicago Plan Revisited"
1. The Chicago Plan Revisited
Jaromir Benes, International Monetary Fund
Michael Kumhof, International Monetary Fund
September 13, 2013
2. Disclaimer
The views expressed herein are those of the authors and should not be
attributed to the IMF, its Executive Board, or its management.
3. Plan of the Talk
1. Introduction
2. Understanding Banks: Key Insights
3. The Six Advantages of the Chicago Plan
4. Will Government Money Issuance Cause Inflation?
5. Summary
6. Discussion
4. 1 Introduction
• The Great Recession triggered significant reform of the financial system.
• The Great Depression is a useful reference point: It provoked a very deep in-
tellectual debate about how to make the financial system safer, culminating
not only in the 1933/35 Banking Acts but also in the Chicago Plan.
• The Chicago Plan was supported by Frederick Soddy, Irving Fisher, Henry
Simons, Frank Knight, Milton Friedman, many others.
• In a nutshell, the Chicago Plan proposed:
— Separation of the monetary and credit functions of banking.
— Deposits/money must be backed 100% by public reserves.
— Credit cannot be financed by creation, ex nihilo, of bank deposits.
5. 2 Understanding Banks: Key Insights
2.1 Key Function: Money Creation, not Intermediation
• The key functions of banks: Creation (and destruction) of money, ex nihilo.
• Are they also “intermediaries”?
— Intermediary: Accepts and on-lends non-banks’ deposits of savings.
— Under this definition banks are not intermediaries.
— Because loans come before deposits, not vice versa.
6. Incorrect View: Intermediation of Savings (Loanable Funds Theory)
Bank Balance Sheet
Saver
Deposit of
new savings
by Joe Saver
Granting of
new loan to
Jim Investor
Investor
Implicitly savings
are in the form of
goods dumped at
the bank.
GOODS are spent
on other goods.
Correct View: Creation of Money = Creation of “Loanable Funds”
Deposits are in the
form of money.
They are created
by the bank in the
act of lending.
Bank Balance Sheet
Investor
Granting of
new loan to
Jim Investor
Creation of new
deposit for
Jim Investor Investor
MONEY is spent on goods.
Seller ends up being a saver.
7. Bank Money Creation - Implications
• Banks can easily start a lending boom:
— They simply grow their balance sheets by expanding the money supply.
— They do not have to attract deposits of existing money.
• Reserves or cash balances impose no limits on this process (see below).
• The only constraints are solvency and profitability: The key is banks’ poten-
tially very volatile sentiment concerning their borrowers’ creditworthiness.
8. 2.2 The “Deposit Multiplier” is a Myth
• Deposit Multiplier:
— Central bank fixes narrow money aggregates first.
— Broad money aggregates are a function of narrow money.
• Kydland and Prescott (1990) referred to this as a myth. Why?
— It turns the actual monetary transmission mechanism on its head.
— Monetarist Era:
∗ Broad money aggregates lead the cycle.
∗ Narrow money aggregates lag the cycle.
— Inflation Targeting Era:
∗ If you control a price (the interest rate), ...
∗ then you have to let quantities (reserves) adjust.
• The evidence for this, both institutional and empirical, is overwhelming.
9. 2.3 Understanding Banks: Conclusions
• Transmission starts with loan creation = deposit creation, and ends with
reserve creation.
• Alan Holmes, Vice President of the New York Federal Reserve, 1969:
In the real world, banks extend credit, creating deposits in the process,
and look for the reserves later.
• Banks are therefore almost fully in control of the money creation process.
• The only tool the Fed has for affecting the money supply is very blunt:
The policy rate works by making potential borrowers not creditworthy.
10. 3 The Six Advantages of the Chicago Plan
Advantage 1: Dramatic reduction of the (net) public debt
Advantage 2: Dramatic reduction of private debts
11. Current Banking System Balance Sheet
20 Government Bonds
100 Short-Term and
Mortgage Loans
80 Investment Loans
16 Bank Equity
184 Deposits
Assets Liabilities
All numbers are in percent of U.S. GDP
12. Transition to Chicago Plan Step 1
20 Government Bonds
100 Short-Term and
Mortgage Loans
80 Investment Loans
16 Bank Equity
184 Reserves 184 Treasury Credit
Banks purchase 100% reserve cover against treasury credit IOU
100%
Reserve
Cover
184 Deposits
Assets Liabilities
13. Transition to Chicago Plan Step 2
20 Government Bonds
100 Short-Term and
Mortgage Loans
80 Investment Loans
16 Bank Equity
184 Treasury Credit
184 Reserves 184 Deposits
Banks are split into money banks and credit investment trusts
Money Banks
Credit Investment TrustsAssets Liabilities
LiabilitiesAssets
14. Transition to Chicago Plan Step 3
20 Government Bonds
100 Short-Term and
Mortgage Loans
80 Investment Loans
16 Bank Equity
184 Treasury Credit
184 Reserves 184 Deposits
Bank-held government bonds are cancelled against treasury credit
Money Banks
Credit Investment TrustsAssets
Assets Liabilities
Liabilities
15. Transition to Chicago Plan Step 3 - completed
100 Short-Term and
Mortgage Loans
80 Investment Loans
16 Bank Equity
164 Treasury Credit
184 Reserves 184 Deposits
Bank-held government bonds are cancelled against treasury credit
Money Banks
Credit Investment Trusts
Assets
Assets Liabilities
Liabilities
16. Transition to Chicago Plan Step 4
100 Short-Term and
Mortgage Loans
80 Investment Loans
16 Bank Equity
184 Reserves 184 Deposits
Part of treasury credit is distributed as a citizens’ dividend
Money Banks
Credit Investment Trusts
64 Treasury Credit
100 Citizens’ Accounts
Assets
Assets Liabilities
Liabilities
17. Transition to Chicago Plan Step 5
100 Short-Term and
Mortgage Loans
80 Investment Loans
16 Bank Equity
184 Reserves 184 Deposits
Mandatory first use of citizens’ dividend is repayment of any debts
Money Banks
Credit Investment Trusts
64 Treasury Credit
100 Citizens’ Accounts
Assets
Assets
Liabilities
Liabilities
18. Transition to Chicago Plan Step 5 - completed
80 Investment Loans
16 Bank Equity
184 Reserves 184 Deposits
Mandatory first use of citizens’ dividend is repayment of any debts
Money Banks
Credit Investment Trusts
64 Treasury Credit
Assets
Assets
Liabilities
Liabilities
19. Transition to Chicago Plan Step 6
80 Investment Loans
9 Bank Equity
184 Reserves 184 Deposits
Bank equity distribution due to reduced balance sheet size
Money Banks
Credit Investment Trusts
71 Treasury Credit
Equity replaced by additional treasury credit
Assets
Assets
Liabilities
Liabilities
20. Transition to Chicago Plan Step 7 - Optional
80 Investment Loans
9 Bank Equity
184 Reserves 184 Deposits
Treasury credit used to repay all remaining government debt
held outside the financial system
Money Banks
Credit Investment Trusts
11 Treasury Credit
• This is shown to illustrate that there is no need
for government to have a dominant role in credit provision
• But the drawback is that this completely removes an
important financial market benchmark
and saving instrument
60 Long-Term
Non-Monetary
Private Deposits
Assets
Assets Liabilities
Liabilities
21. 80 Gov. Bonds
(Debt)
184 Treasury
Credit
(Financial
Asset)
184 Reserves
(Equity)
Prior to Chicago Plan Chicago Plan: 100% Reserve Backing Chicago Plan: Final Balance Sheet
80 Gov. Bonds
(Debt)
80 Other Net
Assets
80 Other Net
Assets
80 Other Net Assets
11 Net Treas. Credit
91 Reserves
minus Loan
Buy-Backs
(Equity)
Net government
debt becomes
negative.
Reserves are
equity in the
commonwealth,
not debt.
Changes in Government Balance Sheet in Transition Period
22. Advantage 3: Complete elimination of bank runs
• Money is completely safe because its value does not depend on the perfor-
mance of private debts.
• Credit problems therefore have no effect on the safety of the payments
system.
23. Advantage 4: Large output gains approaching 10% - three reasons:
1. Lower interest rates: Due to lower debt levels.
2. Lower tax rates: Due to non-inflationary revenue from money creation.
3. Lower monitoring costs: Because money creation no longer requires moni-
toring of private debts.
26. Advantage 5: Much better control of bank-lending-driven business cycles
• Under the Chicago Plan bank money creation becomes impossible.
• Banks now become true intermediaries rather than money creators.
• This makes it much easier to prevent credit cycles.
28. Advantage 6: No liquidity traps
• Definition: Central bank loses its ability to stimulate the economy by:
1. Increasing the money supply.
2. Lowering the interest rate.
• Neither is a problem under the Chicago Plan:
1. Broad money is directly controlled by government, rather than by banks.
2. The interest rate on treasury credit can become negative
⇒ no zero interest rate floor (ZIF).
29. 4 Will Government Money Issuance Cause Inflation?
No, for three sets of reasons, based on:
1. Monetary Theory.
2. Monetary History.
3. Institutional Arrangements for Money Issuance.
30. 1. Government-Issued Money and Inflation - Theory
• Inflation is determined by the relative quantities of money in private hands
and of goods.
• The quantity of money in private hands remains virtually unchanged when
transitioning to the Chicago Plan.
• This can therefore not be inflationary.
31. 100 Short-Term and
Mortgage Loans
20 Gov. Bonds
80 Investment
Loans
16 Equity
184 Deposits
16 Equity
Prior to Chicago Plan Chicago Plan: 100% Reserve Backing Chicago Plan: Final Balance Sheet
184 Reserves
20 Gov. Bonds
100 Short-Term and
Mortgage Loans
80 Investment
Loans
184 Deposits
184 Deposits
184 Treasury
Credit
184 Reserves
9 Equity
71 Treasury
Credit80 Investment
Loans
The Chicago Plan Is Completely Non-Inflationary
Deposits in private hands
remain completely
unchanged throughout.
Inflation is determined by
the relative supplies of
deposits versus goods
and services.
What changes is what
deposits represent:
Indestructible public money
rather than volatile,
destructible private money.
32. 2. Government-Issued Money and Inflation - History
• A long line of distinguished thinkers has advocated government money is-
suance under the rule of law.
• Historical experience is very strongly in favor of it:
— Periods of private money issuance: Constant financial crises.
— Periods of government money issuance: Stability, very few crises.
• Are the many financial crises of the last 100 years a counter-argument?
— This would be a very serious logical error.
— Over the last 100 years governments have only ever been in charge of
narrow money, and private banks in charge of overall money.
— If anything, recent financial crises must thus have been caused to a
significant extent by banks.
33. 3. Government-Issued Money and Inflation - Institutional Arrangements
• Proposal: Turn money issuance over to a fourth power of government.
• Constitutional independence, in U.S. context, similar to that of the Supreme
Court.
• This would insulate money issuance from pressures coming from both gov-
ernment and private interests.
34. 5 Summary
• Whether the Chicago Plan is desirable comes down to a cost-benefit analysis.
• The Benefits:
1. Dramatic reduction of the (net) public debt, to around zero.
2. Dramatic reduction of private debts, to around half.
3. Much better control of bank-lending-driven business cycles.
4. Complete elimination of bank runs.
5. Large output gains approaching 10%.
6. No liquidity trap problems, zero long-run inflation attainable.
• The Costs:
1. Transition period may be difficult.
2. Substitute monies could perhaps become a problem.
3. All other arguments concerning alleged costs can be refuted.
• Given the large benefits, the difficulties of the transition would have to be
enormous to justify not considering the Chicago Plan at all.
35. 6 Discussion
• The Great Recession has shown that too much of an “exciting”, “innovative”
financial system can cause significant problems that distract attention from
the productive sector.
• But we need a really exciting productive sector more than ever.
• What we need in order to facilitate that is a really boring financial system:
— A completely safe, crisis-proof payments system.
— Lending banks that act as conservative intermediaries.
• The Chicago Plan has many elements of such a system.