Arzu ALVAN

Author: Arzu ALVAN

  • Gold Ounce Price vs. DXY Index

    There has always been an inverse relationship between gold price and the dollar. One of the measurement scales of the demand for the dollar is the DXY index, which is the average index of the dollar equivalent of 5 countries’ currencies. If the DXY index is increasing, it means that the demand for dollars in the world is increasing. As can be seen in the graph, the reverse relationship between the dollar DXY index and the gold ounce price in the last year is quite clear. With the DXY rising, the gold price is falling and vice versa. The DXY index has started to decline accordingly, as the reserve currency of the dollar has weakened more and more, and gold has started to attack. This was an expected development. (more…)

  • PARTIAL RESERVE MONETARY SYSTEM

    Money is created in two basic ways today. The first is cash (fiat / fiat currency) in paper and metal form issued by Central Banks, and the other is loans (debt) created by commercial banks depending on the partial reserve system. Here, we’ll talk about partial reserve banking. It would be descriptive and useful to talk about full reserve banking before partial reserve banking.In the previous system there was a “limited money system”. The Central Bank was able to issue  money in exchange for gold owned by the state. This system was applied in the USA between 1871-1914. The system is called the “classical gold standard” based on limited money or 100 percent gold. (more…)

  • REPO, REVERSE REPO, FED

    The Federal Reserve, the Fed, started overnight reverse repo transactions in 2013. The aim of reverse repo transactions is to control the short-term interest rates. Reverse repo (RRP), reverse repurchase agreements, is a transaction that central banks implement when they want to reduce excess cash in the market. In this way, it is aimed to suppress the downward interest rate. The central bank takes money from banks and issues bonds in return.

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  • Limited/Unlimited Money

    Money can essentially be studied in two forms, these are the limited (solid) form and the unlimited form. Limited money is the metals with intrinsic value such as gold, silver, platinum, which cannot be produced in the desired amount by the states, whose amount is limited in the world. Recently, digital currencies have been tried to be added to these. The limited feature adds solidity to the money. (more…)

  • Global Household Debt-to-GDP and Central Banks’ Balance Sheet as of % of GDP

    The ratio of the total household debt to production, which includes the debt of the private sector and households on a country basis as well as the debt of the states in the world, is another important indicator that can give an idea about the magnitude of the destruction to be experienced in the crisis. (more…)

  • Global Government Debts-to-GDP Ratio

     

    In the monetary system of the world, the ballooning created by the unlimitedly printed money in the markets is the most important factor triggering the systemic crisis. Here, the question arises of how countries will be affected by the impending global financial disaster. (more…)

  • REAL ESTATE MARKET ON THE WAY TO CRISIS

    Another important indicator of the global crisis is the ballooning in the real estate market as a result of excessive pricing. It is necessary to briefly summarize the situations in which there is a problem in the real estate market and many of them will show the risk of collapse in the market if they happen. (more…)

  • 10-Year US Bond Rates and US Real GDP Growth Rates

    In Figure 1, we can see the 10-year bond interest rates and real GDP growth rates of the USA.  If we look at the crisis years mentioned earlier, we see that the Real GDP growth rate was lower than the 10-year bond rate, especially in the 2001 crisis. (more…)

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