by Mark Thoma, University of Oregon (Department of Economics)

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Even More Speculation

Posted on June 24, 2008

Paul Krugman with even more on speculation:Speculation and Signatures, by Paul Krugman: I m trying to get my own thoughts on the oil stuff clear; so for the econowonks, atiny theoretical paper for your enjoyment and/or detestation.After reading the paper, which explains when you would and would not expect to see inventories, what contango and backwardization mean, and importantly the signatures of speculation, some of you may wonder how monetary policy fits into the model. Here's a quick first pass at showing how this works (the two graphs in the top row mimic the graphs in Krugman's model i...

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money supply , output , spot price