The Dollar as an Irrational Speculative Bubble - read free eBook in online reader or directly download on the web page. Select files or add your book in reader. Download and read online ebook The Dollar as an Irrational Speculative Bubble write by Kenneth A. Froot. This book was released on 1987. The Dollar as an Irrational Speculative Bubble available in PDF, EPUB and Kindle. Several recent developments have inspired us to consider a non-standard model of the dollar as a speculative bubble without the constraint of fully rational expectations: (1) the dollar continued to rise in 1984 after real interest rate differentials and other fundamentals began moving the wrong way; (2) the results of market efficiency tests imply, that the rationally expected rate of dollar depreciation has been less than the forward discount; (3) Krugman-Marris current account calculations suggest that the rationally expected rate of depreciation is greater than the forward discount; (4) survey data show an expected rate of depreciation that is also greater than the forward discount; (5) the hypothesis of a "safe-haven" shift into U.S. assets and a decrease in the U.S. risk premium, which would explain some of the foregoing, is contradicted by a decline in the differential between off shore interest rates (covered) and U.S. interest rates. Our model features three classes of actors: fundamentalists, chartists and portfolio managers. Fundamentalists forecast a depreciation of the dollar based on an overshooting model that would be rational if there were no chartists. Chartists extrapolate recent trends based on an information set that includes no fundamentals. Portfolio managers take positions in the market, and thus determine the exchange rate, based on expectations that area weighted average of the fundamentalists and chartists. The first stage of the dollar appreciation after 1980 is explained by increases in real interest differentials. The second stage is explained by the endogenous takeoff of a speculative bubble when the fundamentalists have mis-forecast for so long that they have lost credibility. In 1985, the dollar may have entered a third stage in which an ever-worsening current account deficit begins a reversal of the bubble
Bursting the Bubble: Rationality in a Seemingly Irrational Market
Bursting the Bubble: Rationality in a Seemingly Irrational Market - read free eBook in online reader or directly download on the web page. Select files or add your book in reader. Download and read online ebook Bursting the Bubble: Rationality in a Seemingly Irrational Market write by David F. DeRosa. This book was released on 2021-04-02. Bursting the Bubble: Rationality in a Seemingly Irrational Market available in PDF, EPUB and Kindle. The presence of speculative bubbles in capital markets (an important area of interest in financial history) is widely accepted across many circles. Talk of them is pervasive in the media and especially in the popular financial press. Bubbles are thought to be found primarily in the stock market, which is our main interest, although bubbles are said to occur in other markets. Bubbles go hand in hand with the notion that markets can be irrational. The academic community has a great interest in bubbles, and it has produced scholarly literature that is voluminous. For some economists, doing bubble research is like joining the vanguard of a Kuhnian paradigm shift in economic thinking. Not so fast. If bubbles did exist, they would pose a serious challenge to neoclassical finance. Bubbles would contradict the ideas that markets are rational or work in an informationally efficient manner. That’s what makes the topic of bubbles interesting. This book reviews and evaluates the academic literature as well as some popular investment books on the possible existence of speculative bubbles in the stock market. The main question is whether there is convincing empirical evidence that bubbles exist. A second question is whether the theoretical concepts that have been advanced for bubbles make them plausible. The reader will discover that I am skeptical that bubbles actually exist. But I do not think I or anyone else will ever be able to conclusively prove that there has never been a bubble. From studying the literature and from reading history, I find that many famous purported bubbles reflect inaccurate history or mistakes in analysis or simply cannot be shown to have existed. In other instances, bubbles might have existed. But in each of those cases, there are credible rational explanations. And good evidence exists for the idea that even if bubbles do exist, they are not of great importance to understanding the stock market.
Speculative Bubbles, Speculative Attacks, and Policy Switching
Speculative Bubbles, Speculative Attacks, and Policy Switching - read free eBook in online reader or directly download on the web page. Select files or add your book in reader. Download and read online ebook Speculative Bubbles, Speculative Attacks, and Policy Switching write by Robert P. Flood. This book was released on 1994. Speculative Bubbles, Speculative Attacks, and Policy Switching available in PDF, EPUB and Kindle. The papers in this book are grouped into three sections: the first on price bubbles is primarily financial; the second on speculative attacks (on exchange rate regimes) is international in scope; and the third, on policy switching, is concerned with monetary policy.
The Dollar as a Speculative Bubble
The Dollar as a Speculative Bubble - read free eBook in online reader or directly download on the web page. Select files or add your book in reader. Download and read online ebook The Dollar as a Speculative Bubble write by . This book was released on 1986. The Dollar as a Speculative Bubble available in PDF, EPUB and Kindle.
Irrational Exuberance
Irrational Exuberance - read free eBook in online reader or directly download on the web page. Select files or add your book in reader. Download and read online ebook Irrational Exuberance write by Robert J. Shiller. This book was released on 2000. Irrational Exuberance available in PDF, EPUB and Kindle. No Marketing Blurb
