Improving Financial Literacy: From Corporate Finance to Personal Finance

The Iran war took a turn for the better on the weekend as the US halted strikes after 13 days and Iran said it will maintain a ceasefire so long as the US remains on pause. The developments have raised hopes for peace and that should lead to a negative start in the oil market….

How exposed are open economies to global demand shocks? In equilibrium, foreign booms can be absorbed either by domestic consumption (“quantities”) or by real exchange rate appreciation (“prices”). We show that failures of Ricardian equivalence and global financial market imperfections, two frictions popular in much recent work, have opposite effects on the split: while elevated…