【PPT精品课件】货币金融学7版英文课件-15-大学课件2

1、Chapter 15Multiple Deposit Creation and the Money Supply Process 2005 Pearson Education Canada Inc.Four Players in the Money Supply Process1.Central bank: the Bank of Canada2.Banks3.Depositors4.Borrowers from banksBank of Canada1.Conducts monetary policy2.Clears checks3.Regulates banks2 2005 Pearson

2、 Education Canada Inc.Pearson Education Canada Inc.The Banks Balance SheetBank of CanadaGovernment securitiesAdvances to banksCurrency in circulationSettlement balancesAssetsLiabilitiesMonetary Base, MB = C + R3 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.Control of the Monetary B

3、aseMB = C + ROpen Market Purchase from bankThe Banking SystemThe Bank of CanadaAssetsLiabilitiesAssetsLiabilitiesSecurities $100Securities + $100Reserves + $100Reserves + $100Open Market Purchase from PublicPublic The Bank of CanadaAssetsLiabilitiesAssetsLiabilitiesSecurities $100Securities + $100Re

4、serves + $100Deposits + $100Banking SystemAssetsLiabilitiesReservesChequable Deposits+ $100+ $100Result: R $100, MB $1004 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.If Person Cashes ChequePublic The Bank of CanadaAssetsLiabilitiesAssetsLiabilitiesSecurities $100Securities + $100

5、Currency + $100Currency + $100Result: R unchanged, MB $100Effect on MB certain, on R uncertainThe effect of an open market purchase on R depends on whether the seller of the bonds keeps the proceeds from the sale in deposits or in currency.The effect of an open market purchase on MB, however, is alw

6、ays the same whether the seller of the bonds keeps the proceeds from the sale in deposits or in currency.5 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.Open Market Sale of BondsMB = C + ROpen Market Sale to a bankThe Banking SystemThe Bank of CanadaAssetsLiabilitiesAssetsLiabilitie

7、sSecurities + $100Securities - $100Reserves - $100Reserves - $100Open Market Sale to the PublicPublic The Bank of CanadaAssetsLiabilitiesAssetsLiabilitiesSecurities + $100Securities - $100Reserves - $100Deposits - $100Banking SystemAssetsLiabilitiesReservesChequable Deposits- $100- $100Result: R $10

8、0, MB $1006 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.Open Market Purchase in the Foreign Exchange (FX) MarketMB = C + ROpen Market Purchase of foreign exchange from a bankThe Banking SystemThe Bank of CanadaAssetsLiabilitiesAssetsLiabilitiesFX $100FX + $100Reserves + $100Reserv

9、es + $100Open Market Purchase of foreign exchange from the PublicPublic The Bank of CanadaAssetsLiabilitiesAssetsLiabilitiesFX $100FX + $100Reserves + $100Deposits + $100Banking SystemAssetsLiabilitiesReservesChequable Deposits+ $100+ $100Result: R $100, MB $1007 2005 Pearson Education Canada Inc.Pe

10、arson Education Canada Inc.If Person Cashes ChequePublic The Bank of CanadaAssetsLiabilitiesAssetsLiabilitiesFX $100FX + $100 Currency + $100Currency + $100Result: R unchanged, MB $100Effect on MB certain, on R uncertainAgain, the effect of an open market purchase on R depends on whether the seller

11、of FX keeps the proceeds from the sale in deposits or in currency.The effect of an open market purchase of FX on MB, however, is always the same whether the seller of the FX keeps the proceeds from the sale in deposits or in currency.8 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.O

12、pen Market Sale in the FX MarketMB = C + ROpen Market Sale of FX to a bankThe Banking SystemThe Bank of CanadaAssetsLiabilitiesAssetsLiabilitiesFX + $100FX - $100Reserves - $100Reserves -$100Open Market Sale of FX to the PublicPublic The Bank of CanadaAssetsLiabilitiesAssetsLiabilitiesFX + $100FX -

13、$100Reserves - $100Deposits - $100Banking SystemAssetsLiabilitiesReservesChequable Deposits- $100- $100Result: R $100, MB $1009 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.Shifts from Deposits into CurrencyEven if the Bank of Canada does not conduct open market operations, a shift

14、 from deposits into currency will affect R. However, such a shift will have no effect on MB.Shifts From Deposits into Currency:Public The Bank of CanadaAssetsLiabilitiesAssetsLiabilitiesDeposits $100Currency + $100Currency + $100Reserves $100Banking SystemAssetsLiabilitiesReserves $100Deposits $100R

15、esult: R $100, MB unchanged10 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.AdvancesBanking System The Bank of CanadaAssetsLiabilitiesAssetsLiabilitiesReserves AdvancesAdvancesReserves + $100 + $100 + $100 + $100Result: R $100, MB $100Conclusion: Bank of Canada has better ability to

16、 control MB than R11 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.Deposit Creation: Single BankConsider a $100 open market purchase from First BankFirst BankAssets LiabilitiesSecurities $100Reserves+ $100First BankAssets LiabilitiesSecurities $100Deposits+ $100Reserves+ $100Loans+

17、$10012 2005 Pearson Education Canada Inc.Pearson Education Canada Inc. A bank cannot safely make loans for an amount greater than the excess reserves it has before it makes the loan. The final T-account of the First Bank (after the reserves have been withdrawn) is:First BankAssets LiabilitiesSecurit

18、ies $100Loans+ $10013 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.Deposit Creation: Banking System (r = 10%)Bank AAssets LiabilitiesReserves+ $100Deposits+ $100Bank AAssets LiabilitiesReserves+ $10Deposits+ $100Loans + $90Bank BAssets LiabilitiesReserves+ $90Deposits+ $90Bank BAss

19、ets LiabilitiesReserves+ $ 9Deposits+ $90Loans + $8114 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.Deposit Creation15 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.Banking System As a WholeBanking SystemAssets LiabilitiesSecurities $100Deposits+ $1000Reserves+ $10

20、0Loans+ $100016 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.Same Result when Banks Invest their ER in Securities If the banks choose to invest their ER in securities, the result is the same. If Bank A buys securities with $90 chequeBank AAssets LiabilitiesReserves+ $10Deposits+ $1

21、00Securities+ $90Seller deposits $90 at Bank B and process is sameHence, whether a bank chooses to use its ER to make loans or to buy securities, the effect on deposit expansion is the same.17 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.Simple Deposit MultiplierSimple Deposit Mult

22、iplier1D = RrDeriving the formulaR = RR = r D1D = Rr1D = Rr18 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.Multiple Deposit ContractionThe multiple deposit creation process should also work in reverse. When the Bank of Canada withdraws reserves from the banking system , there shoul

23、d be a multiple contraction of deposits. In fact, the contraction in deposits will be D = (1/ r ) RExample:If R = -100 and (1/ r ) = 10 because r =.10, then D = -1000.19 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.Multiple Deposit Contraction: The Banking SystemBanking SystemAsset

24、s LiabilitiesSecurities+ $100Deposits- $1000Reserves- $100Loans- $100020 2005 Pearson Education Canada Inc.Pearson Education Canada Inc.Critique of the Simple ModelOur simple model seems to indicate that the Bank of Canada has complete control over D. It ignores, however, the fact that deposit creation stops if: Proceeds from