Bubble mania

The nature of the second decade of the 21st century seems to be able to create bubble mania. What I mean by this term is bubbles of all sorts from tech (which The Economist thinks there is a new one) to property; equity, bond, hedge funds, commodities.

I am wondering if normal distribution is applicable? Perhaps something adapted to it can be called bubble distribution with the mean and the variance not being zero and one.

To Write

Writing is an art, which gets its nutrition from itself only. The more you write the better it gets vice versa.

It is "fill in the blanks" time.

IS – LM MODEL

How would IS – LM model work in the current economy? On LM side, there is a huge injection into the economy through quantitaitve easing but interest rates are kept at record low levels with central bank decision. Theoretically injection should bring the interest rates down but it is staying at its current levels. Where in the economy is this absorbed is a question coming to the mind of this blogger.

As far as follwed, IS schedule is only affected by a contraction in aggregate demand and supply components.

How those two schedules will interact to determine the equilibrium income and interest rate is something this blogger will be watching in the second half of the year.

BRICs

While reading 'The World in 2011', it was noticed that BRIC's I and R approximately have the same GDP but I has 10fold more population than R.
I & C leading with their over one billion population whereas B & R are 195million , 141 million respectively.

How would it look like to have them as 1) BR & IC or 2) RI & BC and add other emerging nations to each in accordance to population in 1) GDP in 2)?

OR just focus on growth rates?

Banking

Brilliant publication, The Economist's current debate on banking is quite interesting on whether more competition makes banking more dangerous or not.

I believe the core of the problem is the expertise. Expertise in understanding the financial products, which is a scarce resource. And expertise is linked to competition.

1) Competition with more / new banks; then banking is more dangerous (lack of scarce resource)
2) With existing banks getting more competitive; then again more dangerous considering the nature of the industry.

Tripled Magic Words

MORE BACKGROUND

Having grown up in a business orientated and intellectual family environment made the biggest impact on the way of life. On paternal side, dad a self made tradesman, cousins manufacturers with two factories and few stores in various countries. On maternal side more professions orientated from CFO to accountant, nurse, teacher, engineer. My views have always been taken very seriously by my businessmen paternal sides and I was always asked what I thought on specific cases.

Not only in the family but also in all jobs I have worked in by my seniors. Developing an economic model to decide whether to buy a large portfolio of houses was one of those.

Book of the month

It is very exciting days.

"Between Recession and Depression" will be featured as the book of the month in May.

Further details will be coming at the end of April.

Published Businessweek Background of Author in November 2008
BACKGROUND

Ms. Zozan Yilmaz is the Financial Controller at GP Bullhound Limited. Prior to joining GP Bullhound, she was working at Big Lottery Fund as Grant Accountant. During this time she has managed budgets, cash flow forecasts and management accounts reports for various programmes in England, Northern Ireland, Scotland and Wales. She also did management accounts in Housing Association where she assisted the Finance Director in building an economic model in deciding to buy a ... large portfolio of houses. She completed her Masters Degree in Financial and Business Economics at University of Essex. She is currently at strategic level of CIMA.

Bayes's Theorem

The theorem is used in many different areas such as modelling climate change, predicting the behaviour of stock markets, a different approach than Blaise Pascal's.

Merry Christmas and Happy New Year

It is that time of the year again. Counting backwards started both for Christmas and New Year.

Merry Christmas and a happy - peaceful new year.