Economics 481 (Online) Money and Banking

Office Hours: By appointment

Required Text: The Economics of Money, Banking, and Financial Markets, by Frederic Mishkin (any recent edition, you may purchase it from Amazon.com).

Learning Objectives: As a result of successfully completing this course, students will have proficiency on the following course objectives.

• Knowledge of institutional facts regarding financial instruments, banking, and the Federal Reserve.
• Knowledge of measures of the money stock and conceptual issues involving how to define money in a society and use it in monetary policy.
• Mastery of present value analysis, with its variety of applications in the financial world.
• Applying economic concepts to determine what features make interest rates or returns on various bonds and stocks different and what factors make them move over time.
• Knowledge of the yield curve and how to interpret its shape based upon several competing hypotheses.
• Knowledge of the fundamental structure of the individual bank and key issues involving how banks make profits as well as their vulnerabilities.
• Knowledge of the regulatory structure of US banking.
• Knowledge of issues and experiences in US banking in the post-World War II period, including the Savings and Loan bailout and the credit crisis of 2008-09, along with key banking regulations.
• Knowledge of nonbank financial intermediaries, how they operate, and how they were affected by the financial crisis of 2008-09.
• Knowledge of the process of bank loaning, how it affects the money supply, and how the process in the banking system applies to the transmission of monetary policy.
• Knowledge of the structure and operation of the Federal Reserve, its balance sheet and monetary base determination, its policy tools, and issues involving all these aspects of the Federal Reserve.
• Knowledge of the conduct of monetary policy through the Fed’s interconnected strategy initiation policy tools, the federal funds rate and other operating targets, and the Fed’s choice of intermediate targets.
• Continuous application of these facts and concepts to help understand real world events in the financial world, banking, and monetary policy on a continual basis.

Opening Thoughts

This online course consists of a three-credit, full-bodied course in Money and Banking. The course has ECN 302 as a prerequisite (although I can waive that requirement), and students cannot take this course and FN 355 both for credit. The material is extremely timely and highly applicable.  The course helps students understand fundamental institutional definitons and properties, concepts, and models in money, financial markets, banking and bank regulation, nonbank financial intermediaries, and the Federal Reserve.  This material can be readily applied to historical and current events concerning these topics so that students can understand them better with fundamental depth and sophistication. The course should significantly add to students’ knowledge of how to analyze events with bonds and interest rates, the financial sector, banking and related insitutions, the Federal Reserve, and monetary policy.  It should also provide a solid basis for further study in any of these areas, as well as in related courses such as international finance.

This course operates within the asynchronous format. This platform provides advantages of online courses, while providing many benefits of on-campus classes. The online medium enables students to take the class at literally any location that has internet capability.  Moreover, with the flexible schedule, students can complete the material on their own time, as long as they meet the deadlines in the syllabus.

At the same time, the format offers several benefits pertaining to on-campus classes. First, I will personally grade all student work and give individualized comments, with graded work returned to students within 48 hours of the stated deadline for submission.  I am a Professor Emeritus of Economics at Syracuse University, and have taught this course for over 35 years. I have also designed and have been teaching online Economics courses in the asynchronous format well-before the pandemic. I will be available by email or Zoom call (by appointment, at a mutually agreed-upon time) throughout the course to answer any student questions or concerns.  Second, the course materials described on the last page of this syllabus include my actual class lectures (along with the power point slides) from having taught ECN 481/681 during the summer in an on-campus class setting (undergraduate and graduate students had entirely different exams).  So students should experience the benefits of having material explained more fully in actual on-campus class lectures.

Please feel free to contact me whenever you have questions about the course material, assignments, exams, or logistics of the asynchronous online course.  Good luck and I hope you enjoy the class!

Course Requirements:

The course coverage is split into two equal parts.  The graded material for each part of the course consists of two homework assignments for students to complete and then a multiple choice exam on the material.

There will be two non-cumulative exams, altogether counting one-half (50%) of the final grade. The questions will be taken from material in the online lectures and Power Point slides. They will be “open book” – you may use your book, notes, slides, taped lectures, etc.  Students will take them on Blackboard, to completed by the due date specified on this syllabus.  I will curve them if I feel it’s necessary, and will notify the class of any curve. I have a sheet on Instructions for Taking the Multiple Choice Exams on Blackboard in the “Information” tab.

The remaining one-half (50%) of the final grade is based upon homework.  Homework consists of course material assignments that I will post.  Students are expected to turn them in any time by the due dates specified in this syllabus.

There are four assignments on the course material, two for each part of the course.  Each includes a question that require students to work with actual data from well-known public websites from the Federal Reserve.  The assignments will be posted on Blackboard, under “Assignments”.  They are “open book” as well.

All homework assignments will be due on the deadline dates specified in this syllabus. They in turn will be graded and returned by me within 48 hours of the due-date.  The overall homework grade will be determined as follows.  The grade will be A+ = 97.5% and above, A = 92.5% to 97.4%, A- = 90.0% to 92.4%, B+ = 87.5% to 89.9%, etc.

Syracuse University Policies

Academic Integrity

Cheating on exams or homework assignments will not be tolerated in any way.  The Syracuse University Academic Integrity Policy holds students accountable for the integrity of the work they submit.  Students should be familiar with the Policy and know it is their responsibility to learn about instructor and general academic expectations with regard to proper citation of sources in written work.  The Policy also governs the integrity of work submitted in exams and assignments as well as the veracity of signatures on attendance sheets and other verifications of participation in class activities.  Serious sanctions can result from academic dishonesty of any sort.  For more information and the complete Policy, please see http://academicintegrity.syr.edu.

CDR Accommodations

Students who may need academic accommodations due to a disability are encouraged to discuss their needs with me at the beginning of the semester.  In order to obtain authorized accommodations, students should be registered with the Center for Disability Resources (CDR), 804 University Avenue, Room 309 (315-443-4498) and have an updated accommodation letter for the instructor.  Given this material, any accommodations called for by CDR will be met to the fullest extent possible.  Accommodations are not provided retroactively and must be requested in advance.  For more information about CDR services and policy, feel free to contact them.

If you have CDR accommodations, please email your CDR sheet to me as soon as you can.  From there, we can discuss how to apply your accommodations within the course.

Religious Observances

Syracuse University’s religious observances policy, found at http://supolicies.syr.edu/emp_ben/religious_observance.htm, recognizes the diversity of faiths represented among the campus community and protects the rights of students, faculty, and staff to observe religious holy days according to their tradition. Under the policy, students are provided an opportunity to make up any examination, study, or work requirements that may be missed due to a religious observance provided they notify their instructors. For fall and spring semesters, an online notification process is available through MySlice/Student Services/Enrollment/My Religious Observances.

If you have such an issue, I would appreciate if you could notify me by email as soon as possible.  We can then discuss appropriate accommodations on a case-by-case basis.

The asynchronous online format of the course should be able to permit students to complete all the coursework well-within the deadlines (see the posted deadlines toward the end of the syllabus) while at the same time being able to observe any religious holidays or occasions.  If this will not be the case for you, though, please notify me as soon as the situation becomes apparent.

Handing in Assignments, Exams, and Due Dates

For each Assignment that you turn in, please email it to me at my address, [email protected].  Please identify your name and submission (e.g. Assignment 1) when you send it.  Please turn in assignments as attachments of either Word files (my own preference) or pdfs. Also, please type your assignments (although you may draw graphs or balance sheets by hand and include downloaded files directly) and put your name on all your submitted work.  I will take off 0.5 points for Assignments submitted without names and 0.5 points for those handwritten. Please check to make sure it’s the file that you want me to receive and grade.  If you made a mistake along those lines and wish to submit me a revised file, I will accept it without penalty if submitted before the deadline.

For each Assignment submitted (and I recommend that you check your “Sent Items” to ensure it was sent properly), I will send you two emails.  The first should come soon after your submission and verifies that I received your Assignment.  The second will send your graded Assignment back to you as an attachment, most likely within 48 hours of the deadline. If you have not received an email on either occasion within these time frames, please email me ASAP so that any issues along these lines can be resolved.

The Exams will be posted and taken on Blackboard.  A sheet with instructions for taking the multiple-choice exams is in the “Information” section on Blackboard (along with the course syllabus).  Please read it before you take Exam 1.

Especially since this is an online course, it’s imperative that you meet the deadlines below in completing the Assignments and Exams.

You’re welcome to submit completed work to me at any time – including one or more days -- before the given deadline.  I have already posted Assignments #1 and #2 and will post Assignments #3 and #4 shortly after Exam 1 begins.  I will have each Exam posted at 12:00AM (US Eastern time) on its first date of appearance.  I will also grade the pertinent Assignments and send them back to you before the exam period ends, so that you can use this feedback when you take the corresponding Exam.

For homework submitted within the deadline, I will grade your Assignments and return the graded results to you within 24 hours of the stated deadline (note that this guarantee does not hold for work submitted late).  The Exams will be taken down from Blackboard 24 hours after the deadline date specified in this syllabus.

For these reasons along with the time-compressed schedule, I put forth strict policies on lateness of completed materials without an excuse given to me and approved before the stated deadlines.  Please read the policy written below carefully.

All work is due by 11:59:00PM (US Eastern Time) on the due date listed below, except for CDR or unusual extensions that I approve when notified before the deadline (like the policies of the normal workplace).  For Assignments submitted late without an appropriate excuse, I reserve the right to impose a 10% penalty for each day (i.e. 24 hour period) submitted beyond the due date.  For Exams completed within 24 hours after the deadline, I will impose a 10% penalty.  For students who still have not submitted the Exam by 24 hours after the deadline, the exam will be turned off and I will manually grade what you’ve completed (after assigning the 10% penalty).

**Here are two important points with regard to meeting deadlines.

First, the asynchronous online course format offers you plenty of time to plan ahead in anticipating events in your life that may occur around the deadlines (e.g. travel, family gatherings, work).  I will make every effort to post Assignments and Exams as timely as possible and give you at least several days to complete and submit them.  Therefore, feel free to hand in your completed assignments early so that you can meet deadlines and at the same time do any individual life-event.

Second, I strongly advise that you seek to submit the assignments and exams at least 6 hours before the formal deadline.  This policy enables you to handle any last-minute occurrences that may arise which affect your submission (e.g. problems with your laptop).

I will take these two points into consideration when considering any requests for extensions.**

Deadline Dates

This is a very time-intensive winterlude course, which formally begins on December 20, 2023 (I will open the Blackboard site a few days beforehand).  The key dates are as follows.  So that you can easily access these deadline dates, I provide a separate file on Blackboard with the table below, named “Course Schedule and Deadlines”, in the “Information” tab (below the syllabus).

Task Videos Covered Date Posted Deadline Date

Assignment 1 Units 1-2 Posted 12/27

Assignment 2 Units 3-5 Posted 1/1

Exam 1 Units 1-6 1/1 1/3

Assignment 3 Units 7-8 1/1 1/7

Assignment 4 Units 9-12 1/1 1/11

Exam 2 Units 7-13 1/12 1/13

Each Task (Assignment or Exam) will appear at 12:01AM of the “Date Posted” listed in the Table above.  The corresponding deadline will be 11:59:00PM of the “Deadline Date” listed above.  Exams will remain up for 24 hours after the Deadline Date (until 11:59:00PM), with a 10% lateness penalty for completing the Task during that time.  After 24 hours beyond the Deadline Date, the Exam will be removed from Blackboard and graded including the 10% penalty (with grades entered on Blackboard) based upon what you’ve done.

Assignments submitted late will be penalized 10% for each day (24 hour period) that they are late.  Exceptions are for approved excuses sent to me before the deadline, and CDR considerations that I had been made aware of before the Task.

Note that the 11:59PM deadline on Blackboard actually means 11:59:00PM, so late submissions are applied to that time.

Course Coverage

The set of material for the course, listed by units, appears below.

Unit

1. Money
2. Financial Markets and Instruments
3. Measuring Interest Rates and Return
4. Interest Rate Determination
5. The Yield Curve
6. The Banking Firm
7.  Bank Regulation and the US Banking Experience
8. Nonbank Financial Intermediaries
9. The Money Supply Process
10. The Federal Reserve -- Structure
11. The Federal Reserve Balance Sheet
12. Monetary Policy Tools
13.  The Conduct of Monetary Policy

Course Materials

Power Point Slides

Power Point slides for each of the above units will be posted on the Blackboard site within the course, under “Content”.  These slides form the basis of the course material within my online lectures.

Online Lectures

The Blackboard site also contains a series of online lectures that cover each unit of the course, also posted in the “Content” section.  They will be based on the Power Point slides for the unit, but will certainly supplement the material. These lectures, which come from my actual classes, provide the primary, comprehensive set of material that form the basis for the exams and homework assignments. For purposes of freshness and authenticity, they were “filmed in front of a live audience,” while I was teaching an actual ECN 481/681 course at SU in summer 2015 (the course had entirely different exams for the undergraduates and Master’s students).  Consequently, you may hear student questions as well as periodic references to aspects within the context of their particular course.  For the same reason, I did all these lectures in “one-take.”  So while they may have less than fully polished stretches, they are exactly the same lectures that I used in teaching my on-campus ECN 481/681 summer course in 2015.  For the most part, the Money and Banking core material is fundamental and literally timeless.

The one exception to this is for Units (12) and (13).  Some significant changes have occurred since I taped the lectures in summer 2015.  So I re-taped the lectures for these two units via Zoom, as of December 2023.  These video-lectures are in the content section under the class videos. For this reason, please watch the 6/22/15 video just up to the 1:00 mark, where I begin Unit (12).

In these lectures I certainly add to the material on the power point slides and use other presentation devices (e.g. graphs).  So it’s imperative that you watch these lectures and take notes. To prepare for watching the online lectures, I recommend that you download and review the slides on the appropriate unit before the lecture.  Then I recommend that while you’re watching the online lecture, you take notes on the downloaded slides or in a notebook that corresponds to the course.  This definitely includes drawing the graphs as they’re covered in the online lectures.

The first half of the course, culminating in Exam 1, is contained in the lectures titled 5/18/15, 5/19/15, 5/20/15, 5/21/15, 5/26/15, 5/27/15, 5/28/15, 6/1/15, 6/2/15, 6/3/15, and 6/4/15.  The second half of the course, culminating in Exam 2, is contained in the lectures titled 6/9/15, 6/10/15, 6/11/15, 6/15/15, 6/16/15, 6/17/15, 6/18/15, 6/22/15 up to the 1:00 mark, and the updated videos for Unit (12) and Unit (13).

The material on the power point slides and online lectures stand as the primary material for the course, and this will be reflected on the Assignments and Exams. Indeed, in places in which the material in the textbook may differ from this coverage, the material from the power point slides and online lectures supersedes the textbook.

The online lectures can be found on Blackboard within the “Content” part, listed as Course Lectures, underneath the files of Power Point slides.  They are closed-captioned.  If the closed-captioning feature is not already on, you can activate it by clicking on the CC box in the bottom-right of the screen and then clicking “English”.  The titles of the indidivual lectures come from the actual dates when they were filmed in 2015.  The video Econ 681 Intro consists of a brief introduction to the course, including the online format.  Aside from that introduction, there are 21 online lectures in all, 11 for the first half of the course, and 10 for the second half of the course.

To repeat, the first half of the course, culminating in Exam 1, is contained in the lectures titled 5/18/15, 5/19/15, 5/20/15, 5/21/15, 5/26/15, 5/27/15, 5/28/15, 6/1/15, 6/2/15, 6/3/15, and 6/4/15.  The second half of the course, culminating in Exam 2, is contained in the lectures titled 6/9/15, 6/10/15, 6/11/15, 6/15/15, 6/16/15, 6/17/15, 6/18/15, 6/22/15 up to the 1:00 mark, and the updated videos on Unit (12) and Unit (13).

Final Note

With the original lectures having been taped in 2015, it’s clear that some of the course material does not include more recent developments, in particular Money and Banking aspects involving the Pandemic of 2020 and beyond (it does, though, have A LOT of coverage of the Great Recession of 2008-09 and its aftermath).  As I wrote above, I did update the videos for Unit (12) and Unit (13) as of December 2023, due to some significant changes taking place in these areas since 2015.

However, nearly all the course material consists of fundamental institutions and concepts which continue to apply today.  As you’ll see in the writeup I’ll provide at the end of the course, with the exception of Units (12) and (13) not much and nothing consequential has happened since the course was originally videotaped in summer 2015.

Indeed, the course coverage gives students a set of fundamental tools for gaining increased depth of understanding in Money and Banking.  They help students understand better events that have happened in the past.  And more importantly, developments that happen beyond finishing the course, even into the future.

Toward the end of the course, I will provide a writeup on these updates and post it on Blackboard -- I’ll let students know by class email when it’s available.  I will not test on this material in my Assignments and Exams.