Endogenous Money in a Coherent Stock-Flow Framework

A method advocated by Wynne Godley to model monetary macroeconomics, is presented. The method, based on a transactions matrix, essentially makes sure that every flow goes somewhere and comes from somewhere, so that there are no black holes. The method is put to use for several purposes: to illustrate the monetary circuit of credit money; to demonstrate that there can be a separate portfolio (stock) demand for money, but not one independent from the rest of the model; to show that there cannot be an excess supply of credit; to handle the cases of credit for speculation purposes and high liquidity preference; to underline that endogenous money at fixed interest rates is still compatible with any government deficit; and to show that even when banks have liquidity norms, larger amounts of loans do not necessarily induce higher interest rates. Briefly stated, the paper shows that many of the claims made by Horizontalist authors are confirmed when a fully coherent accounting framework is put in place to assess their claims.

"Endogenous Money in a Coherent Stock-Flow Framework"

A method advocated by Wynne Godley to model monetary macroeconomics, is presented. The method, based on a transactions matrix, essentially makes sure that every flow goes somewhere and comes from somewhere, so that there are no black holes. The method is put to use for several purposes: to illustrate the monetary circuit of credit money; to demonstrate that there can be a separate portfolio (stock) demand for money, but not one independent from the rest of the model; to show that there cannot be an excess supply of credit; to handle the cases of credit for speculation purposes and high liquidity preference; to underline that endogenous money at fixed interest rates is still compatible with any government deficit; and to show that even when banks have liquidity norms, larger amounts of loans do not necessarily induce higher interest rates. Briefly stated, the paper shows that many of the claims made by Horizontalist authors are confirmed when a fully coherent accounting framework is put in place to assess their claims.

Equity research –advanced micro devices (AMD)

Advanced Micro Devices (AMD) is a Silicon Valley-born semiconductor company,that had its IPO in 1972. Despiteits rough past, in the most recent years,AMD has beenable togaincompetitive advantage in relation to its industry peers,as well asmarket sharedue to its continuous innovative products’ lines of EPYC and Ryzen processors, and Radeon graphics.Furthermore, recentlyestablished partnerships and launched products give the company good growth prospects, in the near future.For these reasons an Equity Research Report was conducted on AMD, in order to get to a fair value of the stock.AMD’s valuationin the reportwas assessed through the Discounted Cash Flow (DCF)method, considering various factors that could affect the company’s financial statement lineitems.Among those factors are the Average Selling Price of its products, Units Shipments, Gross Margin, investments in innovation (R&D), and several partnerships alongside with the company’s Market Share.A scenario analysison the effects of the tariffs, comingfrom the Trade War,was also conductedon AMD’s price.The price target arrived for December 31, 2020 was $52.75, leading to a BUYinvestment recommendation, considering normal market conditions

Book reviews [1976, Vol. 3, nos.1-4]

Books reviewed are: Arthur Lowes Dickinson, Accounting Practice and Procedure, Reviewed by Jack L. Krogstad; Institute of Chartered Accountants in England, Historical Accounting Literature, Reviewed by Adrian L. Kline; Arthur H. Woolf, A Short History of Accountants and Accountancy, Reviewed by Kenneth O. Elvik; Osamu Kojima, Historical Studies of Double Entry Bookkeeping, Reviewed by Richard H. Homburger; Wilmer L. Green, History and Survey of Accountancy, Reviewed by Horace R. Givens; Doris Langley Moore, Lord Byron Accounts Rendered, Reviewed by Hans Johnson; Arthur Andersen & Co., The First Sixty Years 1913-1973, Reviewed by S. J. Lambert; Haskins & Sells: Our First Seventy-Five Years, Reviewed by Joyce C. Lambert; Francis William Pixley, Auditors: Their Duties and Responsibilities Under the Joint-Stock Companies Acts and the Friendly Societies and Industrial and Provident Societies Acts, Reviewed by Bill D. Jarnagin