Economics and finance
Interest and debt
Accounting and financial statements
Stocks and bonds
Investment vehicles, insurance and retirement
Money, banking and central banks
Options, swaps, futures, MBSs, CDOs, and other derivatives
Discussions of economic topics and how they relate to current events.
Money, banking and central banks
We all use money and most of us use banks. Despite this, the actual working of the banking system is a bit of a mystery to most (especially fractional reserve banking). This older tutorial (bad handwriting and resolution) starts from a basic society looking to do more than barter and incrementally builds to a modern society with fraction reserve banking. Through this process, you will hopefully gain a deep understanding of how money and banking works in our modern world.
- Banking 1
- Banking 2: A bank's income statement
- Banking 3: Fractional reserve banking
- Banking 4: Multiplier effect and the money supply
- Banking 5: Introduction to bank notes
- Banking 6: Bank notes and checks
- Banking 7: Giving out loans without giving out gold
- Banking 8: Reserve ratios
- Banking 9: More on reserve ratios (bad sound)
- Banking 10: Introduction to leverage (bad sound)
- Banking 11: A reserve bank
- Banking 12: Treasuries (government debt)
- Banking 13: Open market operations
- Banking 14: Fed funds rate
- Banking 15: More on the Fed funds rate
- Banking 16: Why target rates vs. money supply
- Banking 17: What happened to the gold?
- Banking 18: Big picture discussion
- The discount rate
- Repurchase agreements (repo transactions)
- Federal Reserve balance sheet
- Fractional Reserve banking commentary 1
- FRB commentary 2: Deposit insurance
- FRB commentary 3: Big picture
You know that the Federal Reserve (or central banks in general) controls the money supply and short-term interest rates. But how exactly do they do this. Even more, how is "quantitative easing" different than regular open market operations. This tutorial explains it all in the context of the Federal Reserves attempts to stave off deflation during the 2008-2012 recession.
In 2008, the entire financial system was at a potential breaking point because of a popping housing bubble. This tutorial breaks down how the government attempted to address this (historical note: Sal made these videos as the crisis was unfolding).
- Bailout 1: Liquidity vs. solvency
- Bailout 2: Book value
- Bailout 3: Book value vs. market value
- Bailout 4: Mark-to-model vs. mark-to-market
- Bailout 5: Paying off the debt
- Bailout 6: Getting an equity infusion
- Bailout 7: Bank goes into bankruptcy
- Bailout 8: Systemic risk
- Bailout 9: Paulson's plan
- Bailout 10: Moral hazard
- Bailout 11: Why these CDOs could be worth nothing
- Bailout 12: Lone Star transaction
- Bailout 13: Does the bailout have a chance of working?
- Bailout 14: Possible solution
- Bailout 15: More on the solution
- CNN: Understanding the crisis
The poop really started to hit the fan in the fall of 2008. When the new administration took office in early 2009, the poop was still there. This is tutorial explains an attempt--probably not a well thought out one--to clean the poop and slow the fan. Videos on the Geithner Plan to solve the continuing banking crisis in early 2009.
This tutorial walks through how China's undervaluing of its currency impacts trade and prices (which also fuels cheap borrowing for the U.S.).
This tutorial contains short videos that explain how China and the United States are intertwined through currency and debt. This is key for understanding the current global macro picture.
- Floating exchange resolving trade imbalance
- China pegs to dollar to keep trade imbalance
- China buys US bonds
- Review of China US currency situation
- Data on Chinese M1 increase in 2010
- Data on Chinese foreign assets increase in 2010
- Data on Chinese US balance of payments
- Chinese inflation
- Floating exchange effect on China
- Floating exchange effect on US
The Greek government incurred debt beyond its means but didn't have control over its own currency to inflate away its obligations. From austerity, to a bailout, to leaving the Eurozone, none of the options looked great. In this tutorial, Sal walks through the situation Greece was in and its options (these videos were made as the crisis was unfolding).
Learn about bitcoins and how they work. Videos by Zulfikar Ramzan. Zulfikar is a world-leading expert in computer security and cryptography and is currently the Chief Scientist at Sourcefire. He received his Ph.D. in computer science from MIT.