Die Definitionskriterien der Geldmenge
Mülhaupt, Ludwig and Dolff, P.
Grundprobleme der Bankplanung unter besonderer Berücksichtigung der Institute des langfristigen Kredits
Die Bestimmung des Absatzpotentials im Rahmen der Zweigstellenplanung von Kreditinstituten
Einlegerschutzvorschriften für Kreditinstitute im Richtlinienentwurf der Kommission der Europäischen Gemeinschaften
Silveira, Antonio M.
The Money Supply: The Evidence from the Brazilian Economy
Der Aspekt der Kosten des Wertpapier-Service
Kreditkontrollen und Geldmengenregulierung in Frankreich
Theorie und Politik des Geldes (Heino Faßbender)
Pläne und Maßnahmen zur Vermögensbildung (Karl-Heinz Dignas)
Grundzüge sektoraler Wirtschaftspolitik (Karl-Heinz Dignas)
Bestimmungsgründe der nominalen Zinsentwicklung in der Bundesrepublik Deutschland (Jürgen Siebke)
"Criteria for Defining the Quantity of Money"
The study centres around the question of what conception of the quantity of money is most suitable for monetary theory and for monetary policy. Alternative "measures" are discussed. In the course of the analysis, two different types of definition criteria are crystallized out. On the one hand, the properties of money are considered from the standpoint of those with a demand for money. The quantity of money is in demand for payment purposes and as a store of value. It can be (1) interpreted in the narrower sense as the quantity of means of payment or defined in the broader sense as the quantity of perfect stores of value. The latter may be in demand (2) for the purpose of "temporarily storing purchasing power" or (3) may be held as a component of wealth which serves as a means of "permanent storing of purchasing power". Depending on the emphasis placed on the motives for holding "money", the possibilities for the quantity of "money" to influence the economy vary. On the other hand, a completely different definition criterion can be developed from the standpoint of the supply of money. The latter is geared to (4) that quantity of money in the entire economy of which the outstanding amount is exogenous, so to speak, i. e. invariable and independent of the actions of individual economic entities. As we shall see, this is a definition of the quantity of money in the very narrowest sense.
What aggregate quantity of money is represented by the "correct" definition of the quantity of money for monetary theory and monetary policy cannot be answered a priori. The definition of the quantity of money must satisfy two criteria: first, that "money" exerts a perceptible influence on the (real and/or nominal) magnitudes of the economy, and secondly, that a dividing line exists between "money" and other things which are "non-money". So that quantity of money must be defined as adequate which exhibits a close substitution relationship between money and the our chase of goods and also a close substitution between money and the purchase of assets.
Mülhaupt, Ludwig and Dolff, P.
"Fundamental Problems of Bank Planning with special reference to Banks in the Long-term Credit Business (I)"
Planning, i. e. the conscious direction and control of operations towards a goal considered right and necessary for safeguarding existence and growth, is a characteristic element of every firm. As a process oriented to the future it is superior to improvisation, but especially for the banks it raises special problems on account of the peculiarities of bank services and the rendering of those services:
- bank services are interlinked services of immaterial, abstract structure without any exactly measurable quantitative magnitudes.
- the nature and quantity of the services in demand fluctuate considerably; in their quality as service-rendering undertakings the banks are directly exposed to the impact of those fluctuations, since they cannot produce a reserve stock.
The advantages of planning (early recognition of market uncertainties and reaction to their effects, and more rapid correction of the consequences of erroneous decisions) have resulted in recent years in bank managements placing greater emphasis on planning and carrying it out more systematically than formerly. However, owing to the uncertainty of forecasting it is not possible to do without improvisation as a supplementary course of action even where bank policy stresses planning.
In setting up a planning system, planning should begin first in departments which
- exhibit a relatively easily forecastable trend,
- permit easy delimitation relative to other planning areas,
- are bottleneck areas.
The planning period for long-range planning, although it cannot be laid down generally for all banks, is five years as a rule; practicable short-range planning horizons begin at six months. Any period of less than three months involves not planning, but scheduling. It must further be taken into account that the principle of economy sets limits for bank planning, but quantifiable propositions concerning the cost and benefit of planning are impossible.
Special factors in the case of banks engaging in long-term credits consist in the fact that owing to the narrower range of services the volume of planning tasks is smaller, but on the other hand is particularly dependent on the course of the business cycle and the trend on the capital market, so that
- the greater the proportion of new business in total business, and
- the greater the number of big customers, the more problematical it becomes.
On account of the relatively weak ties of customers, banks in the long-term credit business are more sensitive to competition; furthermore, they cannot react so flexibly to market changes as mixed-banking institutions.
Within the framework of objective planning, the objective system of a bank must be derived from its basic mission. In this connection distinctions must be drawn between security objectives (minimum objectives which are subordinate to the main objective and serve to safeguard the bank's existence) and mission objectives, that is, objectives for the business spheres responsible for the public mission. Mission objectives may be superseded temporarily, if attainment of the security objectives appear to be jeopardized.
"Determination of Potential Business in Branch Office Planning of Banks"
The limitation of potential business that goes hand in hand with the increasing concentration of the branch office network and the rising costs in the field of personnel and physical assets demand a careful examination of the investment decision when opening new branches. In this connection decisive importance attaches to the anticipated business potential, since the success of a branch office depends essentially on the volume of business.
Since branch office policy, as an instrument of business policy, is oriented primarily to customers sensitive to spatial preferences, the business activities of branch offices are limited mainly to business with the general public (mass business), and in this latter type of business the main emphasis - from the standpoint of the effect on the balance sheet - is on savings deposits.
The expected volume of savings deposited with a branch office is obtained from the expected number of savers multiplied by the expected average credit balance per saver. Both values can be derived from experience at existing branch offices. In this connection it is important to know the determinants on which the size of the market share depends. In this respect, apart from the mean distance from the potential customer to the branch office, mention should be made above all of population growth in conjunction with the propensity to contract, competition intensity, the number of outward commuters and the age of a branch office. Similarly it is necessary to determine the factors on which the amount of the average credit balance per saver depends. If these data obtained from existing branch offices are applied to the market area of planned branch offices, it is possible to derive the expected volume of savings deposits via the expected number of savers and the presumable average credit balance. A similar procedure can be adopted to determine the potential business in other services.
"Rules on Depositor Protection laid down for Banks in the Draft Guidelines of the Commission of the European Communities"
In the coordination of the law relating to bank supervision in the EC countries, special importance attaches to the treatment of regulations for the protection of creditors. A draft guideline presented by the Commission of the European Community in July 1972 provides that, in assessing the liquidity and solvency of banks, the bank supervisory authorities of the Community countries should in future apply a net worth criterion, a participation criterion and three liquidity criteria. The present contribution attempts to judge whether the net worth and liquidity criteria formulated in the draft guideline are appropriately geared to the objective of depositor protection.
According to the net worth criterion of the draft guideline, the solvency of banks is considered adequate, if the risks of property losses connected with bank assets are covered by the banks own resources. Since it is intended that these risks should be measured solely by varying deductions from banks' investments, which are divided into three categories, the draft does not take account of the fact that effective protection against insolvency is ensured only if the business policy of the banks is also oriented to obviation of heavy losses in the case of individual borrowers and of cumulation of similar risks in the case of borrowers in one und the same line of business. Apart from the lacking diversification requirement, a point that seems particularly disquieting in the draft guideline is that the risk of credit commitments is to be assessed on the basis of the security provided for credits.
In the draft guideline, supervision of banks' solvency and willingness to pay is to be effected on the principle of the theory of inactive deposits. Investments in assets of specific degrees of liquidity are limited by three ratios to certain proportions of the stocks of financing resources with specified maturities. Under the present, not entirely unambiguous version of the draft, it is possible that on account of lacking provision for count ability of surplus cover in the long-term criteria, banks might be induced in the case of the short-term criteria to resort to far-reaching exploitation of possibilities for extending maturities into the long-term brackets.
The draft guideline should be reappraised, not only with respect to specific definitions and delimitations, but also in its basic conception with regard to the objective of protecting bank depositors.
Silveira, Antonio M.
"The Money Supply: The Evidence from the Brazilian Economy"
The study analyses the money supply process in the Brazilian economy from 1948 to 1967. During this period the rate of increase in prices averaged thirty-one per cent per year and the money supply rose at an average annual rate of thirty-six per cent. A review of the institutional setting indicates that the monetary authorities were submissive to the Presidency of the country during these two decades.
The technical feasibility for controlling the stock of money is considered. Ninety-six per cent of the variability of the stock is explained by the monetary base and the expansion ratio is estimated at 2.35. The monetary authorities had the technical ability to control the discount mechanism and there serve requirement changes. We conclude that, "fine tuning" apart, the authorities, had the means to control the money stock.
Discretionary control of the base is brought forward for consideration. The base is explained in terms of the budget, the changes in international reserves and the set of goals chosen by the monetary authorities. The monetary authorities offset part of the effect of the deficits and the changes in reserves. Price stability and variations-in-output-growth avoidance seam to have significant effect in the base.
The data show the independence of factors affecting the money demand and supply functions. The exogeneity of the base remains and the monetary authorities ability and discretion to control it is verifiable even in this extreme Brazilian case.
"Small Shareholders - The Cost Aspect of Servicing Securities"
In the past twenty years, the number of shareholders in the Federal Republic of Germany has multiplied, while the average share portfolio per safe custody deposit has dropped sharply in the same period. On account of its positive macro economic aspect, this trend has been supported and welcomed. For issuers, however, the cost of servicing securities has consequently increased by many millions, especially since the new joint stock company act came into force.
In the United States, more and more companies have gone over to purchasing their own shares from time to time. In a number of cases very small shareholders were bought out in this way, thus reducing security servicing costs and the cost of equity capital. In Germany, too, these costs could be cut by concentration of scattered holdings, but only under aggravating conditions. Such transactions can be formally treated as investment projects, as illustrated by the approaches to calculating the net cash value and the optimal scope of concentration activities. The fact that such activities have not been observed so far in Germany, is probably due mainly to the prevailing trends in German wealth policy.
In any case, the problem of security costs can be solved by concentration campaigns only for individual issuers. Taken as a whole, firms are dependent on the small shareholder. Since there is a small-shareholder problem, but no small-creditor problem, the question presents itself of whether special institutions engaging in lot size transformation in the domain of shares might not operate quite as successfully as banks in the field of credit instruments. The experience of German investment trusts suggest that the answer is negative. However, in the case of such special-purpose institutions, too, unlike unit trusts, there can be a certain guarantee of profit side by side with risk transformation only by way of diversification and side by side with lot size transformation. This would bring them considerably closer to the tried and proven model of the banks.
"Credit Controls and Regulation of the Quantity of Money in France"
France is undoubtedly the country in which the mechanism of credit control and regulation of the quantity of money have been changed most frequently, on the one hand on account of the very recent progress made in industrial and financial structures, and on the other owing to the attention paid to regulations designed to protect the external value of the franc. In a historical introduction the author describes what traditional financing methods of the firm (use of bill of exchange) and what habits of the population (large proportion of bank notes in the total quantity of money) may impede the effectiveness of modern control instruments. Then, first of all, a description is given of the existing restrictions applying to non-residents who wish to invest, lend or borrow funds in France; in this respect efforts are made to preserve a certain degree of freedom of capital movements. Subsequently the domestic controls are depicted, especially the minimum reserves for demand and time deposits, the minimum of medium-term securities or debentures which the banks must hold. The author deals thoroughly with the instrument of reserves for credit increments and, in conclusion, the supplementary reserves for those increments, which are practically tantamount to a ceiling. All these measures are augmented by various more recent means of intervention, which re-introduce the conception of selective, qualitative controls which was abandoned in principle in 1967. The author is of the opinion that these complicated regulations should one day be adapted to those of other countries in the EC. He is very sceptical of their efficiency, in particular because too little attention is paid to structural differences.