We test the hypothesis that, when thinking about allocating money to a stock, investors mentally represent the stock by the distribution of its past returns and then evaluate this distribution in the way described by prospect theory. In a simple model of asset prices in which some investors think in this way, a stock whose past return distribution has a high (low) prospect theory value earns a ...

ILTON FRIEDMAN AND ANNA SCHWARTZ' Monetary Trends reports a great many findings—53 are enumerated in the introduction—but paramount is the stability of the demand for money in the US and Britain over the past century. The money stock controls money income. This proposition more than anything else is the point of their painstaking investigation. Friedman and Schwartz argue against what might neu...

With recession lingering and interest rates remaining high, one hears increasingly that the Fed should abandon its money growth targets and move to a policy of lowering interest rates to full employment levels. All would be well, we are told, if only the Fed would set a fixed low interest rate target consistent with full employment and then let the money stock adjust to money demand to achieve ...

We consider the evolution of the euro economies of the northern (creditor) and southern (debtor) countries during the euro crisis in terms of an idealized stocks-and-flows, two-country (North-South) model based on four key actors (banks, firms, households and governments) in each country. Each actor is characterized by a stock of money (box) and money flows (hour glases) to neighbouring actors....

1 I n t r o d u c t i o n Although some progress has been made in the area of metaphor understanding, little has been made in metaphor generation. Current solutions rely upon a rather direct encoding of alternatives. There is no computational theory that can account for metaphor generation from basic principles. Although generating all types of metaphors from basic principles is very difficult,...

This paper analyzes the stability of the exchange rate in an economy with noise traders. Noise trading is restricted to agents investing in the domestic stock market. The agents pricing foreign exchange hold rational expectations. Monetary policy is affected by the behavior of investors in the domestic stock market and in turn affects fundamental stock evaluations as well as noise trading. We s...

abstract: this paper investigates the existence of the house money effect among individual investors by using the intraday transactions dataset in iran stock market. regarding the purpose of investigation the relation between the investment gains and the change in risk taking, firstly, we calculate the profit profile of investors in each day. then, the risk taking of every investor are calculat...