thedeterminantsofinterestrates∶competingideas(编辑修改稿)

thedeterminantsofinterestrates∶competingideas(编辑修改稿)内容摘要：

eory of Interest Total Supply of Loanable Funds (Credit) Interest Rate Amount of Loanable Funds Total Supply = domestic savings + newly created money + foreign lending – hoarding demand  2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 5 28 The Loanable Funds Theory of Interest The Equilibrium Interest Rate Interest Rate Amount of Loanable Funds rE QE  Demand Supply  2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 5 29 The Loanable Funds Theory of Interest  At equilibrium:  Planned savings = planned investment across the whole economic system  Money supply = money demand  Supply of loanable funds = demand for loanable funds  Net foreign demand for loanable funds = exports  2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 5 30 The Loanable Funds Theory of Interest  Interest rates will be stable only when the economy, money market, loanable funds market, and foreign currency markets are simultaneously in equilibrium.  2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 5 31 The Rational Expectations Theory of Interest  The rational expectations theory builds on a growing body of research evidence that the money and capital markets are highly efficient in digesting new information that affects interest rates and security prices.  2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 5 32 The Rational Expectations Theory of Interest  The public forms rational and unbiased expectations about the future demand and supply of credit, and hence interest rates. Interest Rate Amount of Loanable Funds rE QE  Expected Demand Expected Supply  2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 5 33 The Rational Expectations Theory of Interest  If the money and capital markets are highly efficient, then interest rates will always be very near their equilibrium levels, and the optimal forecast of next period’s interest rate is the current interest rate.  Interest rates will change only if entirely new and unexpected information appears, and the direction of change depends on the public’s current set of expectations.  2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 5 34 The Rational Expectations Theory of Interest Limitations  At the moment, we do not know very much about how the public forms its expectations.  The cost of gathering and analyzing information relevant to the pricing of assets is not always negligible, as assumed.  Not all interest rates and security prices appear to display the kind of behavior implied by the rational expectations theory.  2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 5 35 Money and Capital Markets in Cyberspace  Many websites explore topics related to interest rates. See, for example,      2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 5 36 Chapter Review  Introduction  Functions of the Interest Rate in the Economy  The Classical Theory of Interest Rates  Savings by Households, Business Firms and Governments  The Demand for Investment Funds  The Equilibrium Interest Rate  Limitations of the Classical Theory  2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 5 37 Chapter Review  The Liquidity Preference or Cash Balances Theory of Interest Rates  The Demand for Liquidity  The Supply of Money (Cash Balances)  The Equilibrium Interest Rate  Limitations of the Liquidity Preference Theory  2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 5 38 Chapter Review  The Loanable Funds Theory of Interest  The Demand for Loanable Funds  The Supply of Loanable Funds  The Equilibrium Interest Rate  The Rational Expectations Theory of Interest  2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 5 39 Money and Capital Markets 6 C h a p t e r Eighth Edition Financial Institutions and Instruments in a Global Marketplace Peter S. Rose Slide by YeeTien (Ted) FuMeasuring and Calculating Interest Rates and Financial Asset Prices  2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 5 40  Learning Objectives   To learn how to measure and calculate interest rates and the prices of financial assets.  To understand the relationship between the interest rate on a financial instrument and its market value.  To look at the many different ways that banks and other lending institutions calculate the interest rates they charge borrowers for loans.  2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 5 41  Learning Objectives   To determine how interest rates or yields on deposits in banks, credit unions, and other depository institutions are figured.  2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 5 42 Units of Measurement For Interest Rates and Security Prices  The interest rate is the price that is charged to a borrower for the loan of money.  Interest Fee required by the lender for rate on = the borrower to obtain credit  100。