Students and professors from the Department of Economics might leave the recession richer than the rest of us.
Emory University professor Tanya Molodtsova came to The Plains Sept. 11, and presented her paper, "Stock Return Predictability and The Taylor Rule."
The New Palgrave Dictionary of Economics defines the Taylor Rule as monetary policy rules providing direction to central banks changing interest rate policies in response to inflation. It promotes a high interest rate in times of heavy inflation to alleviate pressure.
"(Professor of Agricultural Economics) Henry Thompson invited me to give this talk to the Economics Department, and I was very happy to see so many students and professors," Molodtsova said. "I hope that they will be able to use this information in their studies."
Molodtsova said in her presentation economic models using fundamentals from the Taylor Rule allow for an anticipated return.
She said when U.S. policies characterized by these rules and data are examined monthly rather than quarterly, predictability will be stronger. If able to tell the future of the market, the federal government could avoid another financial crisis, not to mention private citizens could make a considerable profit.
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