Project 5 Team 4 Minimized

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Team 4 Special Report : 

Team 4 Special Report The Obama Administration’s Newest Strategy to Improve the Economy

The Obama Administration’s Newest Strategy to Improve the Economy : 

The Obama Administration’s Newest Strategy to Improve the Economy Ben Bernanke makes a deal to buy a large sum of treasury bonds Objective: more jobs and avoid deflation Quantitative easing “Lost Decade”

The Effect When Companies Buy Their Own Stocks : 

The Effect When Companies Buy Their Own Stocks The 1st reason: Controlled interest rate Buyout of remaining shares Benefits shareholders The 2nd reason: Supposed underpriced stock Increases stock price and profits

The Effect When Companies Buy Their Own Stocks : 

The Effect When Companies Buy Their Own Stocks Hewlett-Packard $10 billion buyback Result = 1.5% increase in shares PepsiCo $15 billion buyback Result = 1.6% increase in shares

Corporations aren’t the only entity to try this type of “quick fix” : 

Corporations aren’t the only entity to try this type of “quick fix” JAPAN’S EXPERIENCE Failed use of Quantitative Easing

The Economy of Japan : 

The Economy of Japan Bank of Japan applies quantitative easing on March 19, 2001 Bank of Japan Plan Var-Shock event Lesson Learned from Japan’s mistake

Historical events in the United States when the government caused inflation by printing too much money : 

Historical events in the United States when the government caused inflation by printing too much money

Historical events in the United States when the government caused inflation by printing too much money : 

Historical events in the United States when the government caused inflation by printing too much money The United States Currency Collapses The 1st currency collapse: Revolutionary War Use of Continental Currency Cost of War The 2nd currency collapse: Civil War Use of Confederation Notes Trade-in of counterfeit notes

Historical events in the United States when the government caused inflation by printing too much money : 

Historical events in the United States when the government caused inflation by printing too much money The Bretton Woods Agreement Gave rise to US Currency Federal Reserve Chairman, Ben Bernanke stated that: “Quote”

Hyperinflation is a result of Government Printing Currency too fast : 

Hyperinflation is a result of Government Printing Currency too fast Importance of gold for the United States Impact on the dollar bill “Quote”

Conclusion : 

Conclusion Quantitative Easing Dangers of inflation or hyperinflation