19 - SEPTEMBER/OCTOBER 1999 - Selected articles
Radio Network Inc. AM-1430
TOP 20 GREEK CD.S’’
based on the local and international sales of this month)
ΣΤΕΛΙΟΣ ΔΙΟΝΥΣΙΟΥ - Επιβάλλεται
2. ΚΑΙΤΗ ΓΑΡΜΠΗ - Δώρο Θεού
3. ΣΥΛΛΟΓΗ-Θάλασσα club (2 CD set)
4. ΝΟΤΗΣ ΣΦΑΚΙΑΝΑΚΗΣ- Ενθύμιον ( 2 CD set)
5. ΣΥΛΛΟΓΗ - Αφιέρωμα στον Διονύση Σαββόπουλο
6. ΓΙΑΝΝΗΣ ΤΑΞΙΔΙΩΤΗΣ - Ταξιδιώτης της ερήμου ( 2 CD set)
7. ΑΝΤΩΝΗΣ ΒΑΡΔΗΣ - Ξεδιπλώνοντας τις σκέψεις μου
8. ΑΝΤΖΕΛΑ ΔΗΜΗΤΡΙΟΥ - Κάνε στην άκρη
9. ΒΑΣΙΛΗΣ ΚΑΡΑΣ - Επιστρέφω
10. ΣΥΛΛΟΓΗ - Μόνο επιτυχίες 99
11. ΤΟΛΗΣ ΒΟΣΚΟΠΟΥΛΟΣ - Η νύχτα γέμισε φως
12. ΛΕΥΤΕΡΗΣ ΠΑΝΤΑΖΗΣ - Δεν θα με δεις να κλαίω
13. ΓΙΩΡΓΟΣ ΑΛΚΑΙΟΣ - Best of
14. ΣΤΑΜΑΤΗΣ ΓΟΝΙΔΗΣ - Αγάπη παράξενη
15. ΛΑΜΠΗΣ ΛΙΒΙΕΡΑΤΟΣ - Το καλύτερο παιδί
16. ΓΙΩΡΓΟΣ ΝΤΑΛΑΡΑΣ - Ζωντανά στο Ισραήλ
17. ΑΝΝΑ ΒΙΣΣΥ - Best of
18. ΕΛΕΥΘΕΡΙΑ ΑΡΒΑΝΙΤΑΚΗ - Εκτός προγράμματος ( 2 CD set)
19. ΧΡΗΣΤΟΣ ΑΝΤΩΝΙΑΔΗΣ - Εκτός προγράμματος ( 2 CD set)
20. ΒΑΣΙΛΗΣ ΤΕΡΛΕΓΚΑΣ - Ο καλύτερος
ΜΠΟΥΓΑΣ - 13
τραγούδια από χρυσάφι
- Don’t go ‘99
2. LOU VEGA - Mambo no 5
3. BONEY M 2000 - Daddy cool ’99
4. PET SHOP BOYS - Je t’ aime
5. DANA INTERNATIONAL - Woman in Love
6. YAZOO - Situation ’99
7. GIPSY KINGS - Hitmix ‘999
8. WHITNEY HOUSTON - My love is your love
9. ENRIQUE INGLESIAS - Bailamos
10. DONNA SUMMER - I will go with you
WHAT PLAYS ON RADIO
to 12 am ‘’ANTISTROFI METRISI - THE TOP 10’’ with YIANNI TAXIDIOTI
to 12 am ‘’MOUSIKI KAI ASTROLOGIA’’( all about zodiacs with humor
with Yianni Taxidiotis
to 12 am ‘’CD CLUB PRESENTS..’’ ( All the latest releases with no
prejudice, no interests, just the best) with Y.
to 12 am ;; THE QUIZ GAME’’ (knowledge & humor/play, laugh /win,
lots of giveaways) with Y. Taxidiotis
11 to 12 a.m. ‘’
RADIO CAFFE’’ ( A radio magazine with curious stuff, clever
comments, unexplained phenomena, cinema, literature etc.) with Maria
Angeli + Yianni Taxidiotis ( they are married too.. to each other)
MONETARY UNIFICATION: BENEFITS AND COSTS
Recently, there has been a tendency among nation states to form trading blocks such as the European Union (EU) and the North America Free Trade Area (NAFTA). Also, as part of their integration arrangements countries pursue monetary unification and the creation of new currencies. For example, the EURO is already a reality in the EU, and economists now study the possibility of a common currency in NAFTA. Let us not be surprised that in a few years to come we may be holding AMERICOs in our pockets! Why would a country be willing to give up its own national currency and join a monetary union? The answer to this question is not an easy one and requires a careful weighting of the benefits and costs of monetary unification. The quantification of these factors could be onerous because they involve social, political and economic considerations some of which may not be quantifiable. Here, I will outline a few economic benefits and costs of monetary unification and leave the other factors in the background -perhaps to be explored better by sociologists and/or political scientists. I will start with the category of the costs and then move on to the category of benefits.
The Costs of Monetary Unification
The loss of government revenue from siegnorage A sovereign state has monopoly power over the supply of its national currency. The printing of new money to satisfy government budgetary needs leads eventually to inflation which reduces the purchasing power of money and those people who hold the national currency stand to lose -both nationals and foreign citizens. In fact, this loss of purchasing power by the public is a gain for the government in the form of an inflation tax imposed on people. Small countries with less developed tax institutions prefer this form of taxation, but it is an insignificant practice for developed economies. Thus a country, especially a small one, loses this source of government revenue following the adoption of a common currency with no control over its money supply.
The loss national exchange rate policy When countries have their own currencies, their bilateral exchange rates are determined either by the forces of supply and demand in the foreign exchange market (flexible rates) or by explicit fixed exchange rate parity agreements among countries (fixed rates). Here, the exchange rate can be used as a policy instrument by a government for the attainment of a specific objective. For instance, a currency may be devalued by the government to address an imbalance in the balance of payments and boost domestic employment. Virtually all governments have used the exchange as an instrument to achieve macroeconomic equilibrium. Obviously, when a country joins a monetary union, the exchange rate disappears and can not be used as a policy instrument.
The loss of national monetary policy Perhaps, this is the most important consideration in deciding to join a monetary union. Without a national currency, a country loses permanently the option of using monetary policy to achieve domestic economic objectives. For example, when the economy is in a recession, expansion of the money supply by the national central bank reduces the rate of interest rate, increases the rate of investment and helps the economy to recover. Similarly, when the economy is over-heated, a reduction in the money supply avoids prolonged over-expansion and inflationary pressures. When a country joins a common currency area the central bank of the union determines the overall monetary policy for the member countries. No country can exercise its own autonomous money policy. For this precise reason, some countries like the UK and Denmark decided not to join the European Monetary Union (EMU) in January 1999.
The Benefits of Monetary Unification
The elimination of transaction costs By introducing a single currency, a monetary union automatically eliminates the costs associated with converting one currency into another to meet particular demands for foreign exchange. This cost can often be substantial. The economist Charles Bean from the London School of Economics, estimated that a "round trip" through all EU currencies would result in the loss of fully half the original sum. Of course this loss is avoided in a monetary union with a single currency.
The elimination of exchange rate uncertainty For almost all the major currencies, bilateral exchange rates are determined in the foreign exchange market by the powerful forces of supply and demand for foreign exchange. However, random disturbances that affect demand and supply cause wide swings in spot exchange rates, thus hampering international trade in goods, services and financial assets. Economists have spent a lot of time and effort attempting to explain and predict exchange rate volatility. It has been proven quite difficult to do so, given the spectacular efficiency of asset markets (including foreign exchange markets) to process and incorporate information in prices. The best predicting model has been the "random walk" according to which the change in the exchange rate is still random. According to this "best" model, the best forecast of the exchange rate in the future is its value that you observe today. Indeed, this not of very much help to those whose job is forecasting asset prices. On the other hand, a monetary union by definition eliminates exchange rates and thus exchange rate uncertainty. This makes other prices more predictable in the union and facilitates trade and exchange among nations. Also, it puts some speculators out of business.
The establishment of macroeconomic stability When each country pursues its own monetary policy, there are often negative consequences that may arise. For instance, the tendency of governments to increase the domestic money supply to meet their internal budgetary needs, leads eventually to inflation and to macroeconomic instability. This results in low investment and economic growth and hence falling living standards in the future. In a monetary union such a practice can not happen because the central bank of the union is now responsible for the common monetary policy for all member states. An important goal of the central bank is price stability, low inflation and responsible monetary policies that keep interest rates low to spur economic growth. Evidence for the success of these policies can be found in the recent experience of the EU countries, and more specifically in the ongoing developments of the Greek economy. In the last five years, Greece has made strides to reduce inflation, interest rates, debts and deficits in order to meet the Maastricht criteria for participation in the EMU. The resultant macroeconomic stability has sustained economic growth in the order of 3% to 4% and has given unprecedented potential to Greek stock market. The general market index has reached new unchartered levels and some people have become instant millionaires. They should be careful though because markets are volatile and inherently unpredictable. It is easy to lose a fortune because bubbles eventually burst.
Leo Michelis, PhD. Associate Professor of Economics Ryerson Polytechnic University
This little pig went to
Along with fundamental and technical analysis, investors also need to look at behavioural or psychological factors before investing. But, all the proper planning and analysis can still lead to losses. Companies can still do poorly due to unforeseen events or more importantly their stock could fall out of favour with investors for any number of reasons.
Prudent Investing vs.
Bulls and bears make
money, but (greedy) pigs get slaughtered.
The house always wins.
Play the odds.
when to fold them.
Learn to earn.
William Mingopoulos, M.A., CIM, FCSI, financial guide/educator, can be reached at (416) 864-6561 or via e-mail at HYPERLINK mailto:email@example.com firstname.lastname@example.org or found on the web at www.greekvillage.com/hellasfinancial.
<< BACK TO HYPHEN OCTOBER
© Copyright 1996 Station 1. All rights reserved. For more information, or your suggestions, e-mail us at email@example.com