Summarize in your own real estate, oil, crypto, and art markets respond to increases or decreases in the money supply enacted by the Federal Reserve. 

 

2.Consider the following situation policy and its effects on the following stakeholders. Be sure to frame your answer in the form of an "ethics" question that considers the harm and benefit to each stake holder. Write three to four paragraphs describing how the stakeholder uses money, how the policy would hurt or help them, and what if you think anything should be done to limit the help or harm to that stakeholder. 

Policy: You are approached by the West Texas A&M administration to examine the potential returns to an endowed scholarship fund. The donor has given a diverse portfolio of commodities (gold and oil), art (Picasso, Renoir, Garfunkel), and real estate (rented out ranch land in western Kansas). As this is not a traditional portfolio of bonds and equities, the pricing is quite difficult. Mainly the administration wishes to know if there will be a stable return to the portfolio so they can dole out proper amounts of scholarship money to deserving students. The Taylor Rule suggests that the Federal Reserve will continue contracting the money supply (increasing interest rates) into 2023 and 2024. 

• Despite the variety of these assets, what is the general conclusión of the portfolio value if the Federal Reserve continues to contract money supply? Explain your answer. 
• Consider the stakeholder "scholarship recipients". How much harm or benefit will they see based on receiving assistance depdendent on these assets in 2023 and 2024? Why? 
• Consider the stakeholder "donor". If their goal is to maximize stable Student aid to deserving students, are they best served by a portfolio with these assets instead of bonds or stocks? Why or why not? 

Answer rating: 100% (QA)

The general conclusion of the portfolio value if the Federal Reserve continues to contract the money supply is that the portfolios value may experienc... View the full answer