Money Growth and Inflation- Macro Topic 5.3

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Money Growth and Inflation- Macro Topic 5.3

Рет қаралды 346,292

6 жыл бұрын

In this video I explain the difference between the money market and the loanable funds market and explain why one of them is labeled nominal interest rate and the other is labeled REAL interest rate.
I also show how both graphs are related to each other and how they can shift in the short run and in the long run. In the bonus round I talk about the natural rate or interest and the Swedish economist Knut Wicksell. Sverige är bäst
Please keep in mind that this video is designed for students that have already learned these concepts and graphs. If it goes over your head, please go back and watch the Macro Unit 4 Summary Video or the videos below.
Thank you so much for watching my videos and subscribing to my channel. You rock!
Do you need help in your macro class?
Please check out my Ultimate Review Packet. It has everything you need including practice questions access to additional practice videos. Here is the link:
www.acdcecon.co...

Пікірлер: 117

@travismickle2849 6 жыл бұрын

another incoming wave of viewers as we study for this test.

@alanwu2213 Жыл бұрын

Man Clifford is GOATED. I have a Macro final exam in 15 minutes and he's taught me more about monetary policy than my professor has in an entire semester.

@nanfeng6123 6 жыл бұрын

That really solves my problem. I am not convenient to buy the packet but I really want to say something to support Mr. Clifford. Actually, the videos he gave us for free are just enough for study. There is no reason to criticize someone who really offers great help first and asks for some return which is certainly deserving.

@JacobAClifford 6 жыл бұрын

What do you think? Was this video helpful? Let me know.

@NeufStudios 6 жыл бұрын

Love when you produce vids on these more advanced topics! I've read a bit about r* but this makes the concept quite a bit clearer. Any willingness to do more vids of this type (or maybe a 200 level econ series?)

@k13dude 6 жыл бұрын

please more technical videos! really love your work, as an econ major and tutor, it has been some of the most helpful content on the web.

@ioanaturcan5702 6 жыл бұрын

Very !!! Thank youu !

@shabnamsharminsharnali7717 6 жыл бұрын

Your vdos have been really really helpful! Best teacher ever!! Keep on doing what you do ^_^

@danielche2349 6 жыл бұрын

Yes! I had this question on my mind even before I saw this video!

@marouanedoulal2038 4 жыл бұрын

2020 BOARD VICTIMS WHERE YOU AT???????

@lemonscented6246 6 жыл бұрын

literally have a test on this tomorrow i love u mr clifford

@Cimone10 6 жыл бұрын

literally same!

@oliverslicey 3 жыл бұрын

Same !!

@followingmyapostle Жыл бұрын

What are you doing today? You posted this 5 years ago, after all 😊

@MemoMan217 3 жыл бұрын

I know this is an old series and all but I just needed to say thank you. You have essentially been my teacher lately, and an amazing one at that.

@nainakapil9292 6 жыл бұрын

OMG...You are God of Economics!!!! how can your concepts be so impeccably clear?? where did you do your graduation from Professor??

@portiakarim427 5 жыл бұрын

I'm from South Africa and i use your videos to study macro economics, such a life saver. Than you so much for the work you do Jacob. Not all heroes wear capes

@Chillo56 5 жыл бұрын

Portia Karim Ayyy UCT ECO1011S by any chance?? Haha probably not

@portiakarim427 5 жыл бұрын

@@Chillo56 lol nah UP Ekn 120 BUT GOOD GUESS.

@VIRALCATSR 6 жыл бұрын

Sir, thanks for sharing your knowledge with us. you are my favorite teacher

@armelamikli5299 6 жыл бұрын

Abdul Rehman Baabar A highter supply of dollar in a country that uses yen currency cases a devaluation of dollar currency compared with other currency( yen currency). That cases that american product in your country(as america is a country that uses dollar currency) be cheaper in your country 'cuz as i said it has been a devaluation of dollar in exchange market.

@s7234 3 жыл бұрын

@@armelamikli5299 what the ...

@vigilantslacker6039 5 жыл бұрын

I sincerely hope you know that you’re looked at as some sort of cult deity across American high schools everywhere. Seriously, ask any economics student if they know who Clifford is, and they’ll say something along the lines of “I owe everything to him”. Peace dude!!! 😂😂

@kingofthecosmos3253 5 жыл бұрын

I owe my 1 on the AP test due to him

@ishaanawasthi416 3 ай бұрын

@@kingofthecosmos3253 First place???

@nikocvitanic7701 4 жыл бұрын

People like you make them world for round! I thank you with the most sincere heart.

@m_dreamer3628 4 жыл бұрын

Thank you! You help so many students and even economics teachers.

@terriweiss8293 6 жыл бұрын

Loved the video. I made a note to show it when we finish both topics this year. I literally laughed out a loud when you spoke about the difference between theory and practical application; I had that discussion in my Macro class just today. Thanks for the video.

@stivicanka2703 3 жыл бұрын

We love you, Mr. Clifford!

@therealsamw 2 жыл бұрын

Greatest of all time, you are doing gods work for the students with bad professors thank you.

@tylerzhang5442 4 жыл бұрын

This difference in Nominal and Real has confused me for a VERY VERY LONG time which my teacher never cares to explain..... Thanks for the explanation!!!

@fossilfighters101 6 жыл бұрын

*YES MORE GRAPHS*

@DrDubMemes 2 жыл бұрын

Great video outlining these two models. I got some great info out of it, and it helps to have someone talented at explaining things clearly because teachers can be confusing at times.

@9678willy 2 жыл бұрын

Studying whole new concept the night before the AP exam! LESGOBB!!!!

@linhnguyenduongthuy3951 6 жыл бұрын

All of your videos help me go through my first year. From the bottom of my heart, thank you!

@hatrang5143 Жыл бұрын

Wish there could be a Jacob in each subjects that i have to deal at school😌

@kayleeejs 3 жыл бұрын

i have a quiz on this in an hour

@vads8265 3 жыл бұрын

how'd it go?

@goyaldev0911 6 жыл бұрын

U r a great teacher, wish i had u as my teacherr

@paulk314 6 жыл бұрын

Nice video! Do you think that Hayek's stages of production has implications here? Since interest rates impact short and long term projects differently, lower interest rates will allow for a greater investment into longer-term projects (i.e. projects where the time delay between initial investment and ROI is great) than when interest interest rates are high. A fluctuating interest rate can wreak havoc on an advanced, industrial economy. It seems that aggregating concepts like "investment" without differentiating between short and long term investment can make this difficult to realize.

@alexryyan 2 жыл бұрын

Me watching in 2022 and hearing there is no inflation rn thinking *he doesnt know yet* LOL. Appreciate the videos alot! Helping me so much reviewing for the AP exam right now

@Violet-uf2ti 5 жыл бұрын

Where did your 4.16 video go? It was so helpful :(

@markharris2579 6 жыл бұрын

Love you Mr. Clifford.

@cameronabernethy476 6 жыл бұрын

This was a great video, my man. Come to Raleigh North Carolina on your tour please! Thank for sharing your knowledge with the world.

@jaco200 5 жыл бұрын

You are my favourite teacher

@000ppphan2 5 жыл бұрын

I think a lot of these introductory explanation on monetary stuff misses the mechanism that drives the short run and long run responses of people to monetary policy. At least that was how I felt when I first learn it. I think a particularly helpful illustration would be to stress the importance of stickiness of price in this picture. Stickiness of price and wage causes important fluctuation in the short run, from the goods market to labor market.

@Jeremy-jc5th 6 жыл бұрын

And why would decrease in nominal interest rate cause real interest rate to go down? In the previous example we said that the real interest rate doesn't change (5%)?

@Alice-gl6um 5 жыл бұрын

I LOVE you videos!!!!

@thesecretjin5988 3 жыл бұрын

REALLY NEEDED THOSE SUBTITLES HEREEE

@sarimzahid3481 4 жыл бұрын

Technical videos are awesome

@josephamoako4963 Жыл бұрын

I really like your videos ✅♥️

@flock221 6 жыл бұрын

can you do a bigger analysis of the crowding out phenomenon?

@TheSugar9005 5 жыл бұрын

Why haven’t I been watching these before.....

@giselegiram 6 жыл бұрын

A great video. Nice explanation.

@kenslylandry6655 6 жыл бұрын

These videos are the reason im going to pass my ap exam tomorrow, thank you so much

@suviowens6799 4 жыл бұрын

what score did u get?

@kenslylandry6655 4 жыл бұрын

suvi owens got a 3 and passed :)

@isabellazhang6296 4 жыл бұрын

Thank you! WIll take AP 2 weeks later

@ilovefood9362 3 ай бұрын

You remind me so much of Marshall from HIMYM

@chriswyse3345 5 жыл бұрын

This was the first video I watched of yours that I found confusing - specifically with regards to the Loanable Funds segment. If I understood you correctly, the Fisher Effect states that the Nominal Interest Rate is ACTUALLY the Real Interest Rate, because expectations about future inflation are constantly influencing the Nominal Interest Rate. Meaning, we don't need to adjust the Nominal Interest Rate for loans because the Nominal Interest Rate is already taking into account future expectations about inflation? ::confusing::

@ilskanonskan 6 жыл бұрын

Hey man, been watching a lot of your videos for an exam (Uni) to revise, but it seems you are missing the theories on IS-LM curves, goodsmarket and money market and its derrivation to the AS-AD curve and putting that together. Love the vids though!

@Jeremy-jc5th 6 жыл бұрын

At 6:52 why does decrease in interest rate lead to more lending? Shouldn't investment increase, and the demand curve of loanable funds be the one shifting right? somebody pls help ;;

@henryacquah7763 6 жыл бұрын

Good explanations

@vawa_82 5 жыл бұрын

Thank you!!!

@sammypickell2543 6 жыл бұрын

"in the LOOOOOONG run"

@wangyiyi3220 4 жыл бұрын

could you please explain what you meant by "since that money has been used for transaction"(8:05)? And why does an increase in transaction costs causes the decrease of supplies?

@aussieanteater 4 жыл бұрын

Because if the transaction costs increase it would be more costly to supply a product/service therefore there would be a decrease in supply. ( don't know if this would help )

@indomie8813 3 жыл бұрын

Lol ap macro tommorow

@betsywilliams9954 4 жыл бұрын

my savior

@muhammadsyukri2292 2 жыл бұрын

Nice Video

@Klarissedoeslife 6 жыл бұрын

Haven't seen your videos since graduating high school 2 years ago hah... How you doin with Malcolm passing away?

@adrianomattia5625 6 жыл бұрын

Hi, Mr Clifford. What do you think about the Austrian School views about manipulation of interest rates by central banks ad the source of the boom bust cycle. In their views, more money injected in the real loanable funds market, drives the i. rate down artificially stimulating consumption and investment. I suggest that you look for it. Thanks!

@shamailajaved8027 4 жыл бұрын

hey .I have been trying to look at the basic graphs on credit market but couldn't find any.can u please share since Iam new to this concept..thanx

@nainakapil9292 6 жыл бұрын

I would like to meet you in person Professor. I am pursuing Masters at Sanford School of Public Policy, Duke University, Durham.

@julianaboujaoude2485 3 жыл бұрын

KING

@SilentSapa 6 жыл бұрын

Hello Mr. Clifford. Did I understand you write, that there is no sense in showing the influence of the monetary policy on the LF graph as I has no influence on the real interest rate?

@marthamasinja2195 6 жыл бұрын

yes it is was helpful , i guess these concepts just need i little more practice

@jojochu9188 4 жыл бұрын

Omg thank you

@manwithnoname2355 Жыл бұрын

Intro goes hard ngl

@charliejennifer3874 6 жыл бұрын

I'm confused in the loanable funds market...if interest rates increase won't the SLF increase and the DLF decrease?

@elaee527 2 жыл бұрын

6:53 MS increase and ir will decrease, so why supply of loanable funds doesn't decrease?

@imeqa5409 3 жыл бұрын

Haubner test tomorrow, and I'm screwed

@fabiolalopez5585 Жыл бұрын

Fabi was here

@hopematschner3715 4 жыл бұрын

I just don't understand why the formula for nominal interest rates adds in inflation when nominal interest rates don't account for inflation and real interest rates subtract out inflation when real interest rates account for inflation. please help me understand and comment back.

@MrSalad-om8td 2 жыл бұрын

Hi Im from the future. And inflation has been the highest in the past 40 years.

@naziazaman40 5 жыл бұрын

KNUTWICKSELL! 😂

@cyrussuleman1982 2 жыл бұрын

4:30

@VIRALCATSR 6 жыл бұрын

Sir, Please teach me that why some country's currency are much low values. like 1 Dollar= Japanese Yun 0.0096.

@yarkieee 6 жыл бұрын

That's just relative to the American dollar. The yen just uses bigger amounts, but holds about the same buying power. So a $3 cup of coffee would be 330 yen in japan.

@uniuser Жыл бұрын

ECON 1102

@Kristin-hn5eu 6 жыл бұрын

How old is this man

@jeanclgn 3 жыл бұрын

1:27

@syedmuzammil2995 6 жыл бұрын

You should reply

@yeahcolin 4 жыл бұрын

I have never been more confused

@vinacherviana6998 6 жыл бұрын

I don’t understand why the supply curve shift to left when charge the higher nominal interest rate? Is the quantity for loanable fund will decrease or remain the same?

@FrancescoBosco12 6 жыл бұрын

Remember that people's expectations is a curve shifter. If people think inflation is gonna increase, lenders won't want to lend as much (since inflation effectively lowers the amount of money the make on loans) and borrowers want to borrow more because they have to effectively pay a lower interest rate on their loan. This double shift causes the nominal interest to increase so that the real interest rate remains the same as it was before and so the amount of loans exchanged in the market remains the same.