Courses and Other Academic Components
The following four courses will be offered in the Program in Spring 2010. Note that the first three courses count for Economics elective credit, while the fourth course, on Architecture and Urbanism, does not (although it counts for Duke credit).
All classes are held at the Kimmel Center. Classroom_Schedule.pdf
Econ 195.90 International Finance (QS, SS). Faculty: Michael Connolly
Tuesdays & Thursdays, 9:30 - 12:00 until Spring Break.
Course Description: This course is designed to provide a working knowledge of international business finance. We study instruments used by currency traders and hedgers. We also analyze how managers of international corporations do or should behave. Emphasis is on the mechanics of the foreign exchange market, reviewing spot, forwards, futures, swaps and options markets: the main tools used to hedge exchange rate risk. The course constructs the building blocks of international finance: (i). interest rate parity, (ii) purchasing power parity and (iii) the international Fisher arbitrage equation. We then introduce corporate aspects of international finance, especially hedging techniques. Transactions exposure, operating exposure, and accounting exposure are analyzed. Currency risk management and hedging techniques are explored in detail. The course reviews international management issues, such as transfer pricing, offshore banking, working capital management, international mergers and acquisitions, international business planning, and optimal international portfolios. Finally, we analyze some international financial scams and swindles involving pyramid schemes, corporate governance failures, and trading abuses, especially in derivatives. It concludes with a review of the Sarbanes-Oxley Act of 2002 that attempts to address financial malfeasance.
Econ 195.91 Financial Markets in the Global Economy (QS, SS). Faculty: Michael Connolly
Wednesdays & Fridays, 9:30 - 12:00 until Spring Break.
Course Description: This course covers monetary policy and linkages between domestic and global financial markets through the international Fisher equation. We review the institutional background: the Federal Reserve System, the European Central Bank, The People.s Bank of China, as well as the international monetary institutions, the International Monetary Fund and the World Bank. The transmission mechanism of monetary and interest rate shocks from one asset market to another is outlined in detail. The world supply and demand for risk-free credit are seen as determining a global risk-free rate of interest. We study the determination of risk premiums on emerging market sovereigns, corporate bonds and equities by credit risk, market risk, political risk, liquidity risk, currency risk, and inflation risk. Guest lectures and panels from diverse fields of the financial services industry will occur in Friday lectures to provide an inside view of different financial markets in the global economy. Speakers from Banc of America, Bear Stearns, Deloitte Touche, the Federal Reserve Bank of New York, Goldman Sachs, the Perch Bay Group, Morgan Stanley, NERA, NFL, UBS, and Warburg Pincus will participate in these Friday lectures.
Econ 195.29 The Economics of Financial Derivatives and Financial Engineering (QS, SS). Faculty: George Tauchen
Tuesdays & Thursdays, 9:30 - 12:00 after Spring Break.
Course Description: This course is a basic introduction to derivatives with a focus on their economic functions as tools for hedging and risk management. The main topics include: Forwards, futures, swaps, options, parity conditions, binomial options pricing, the Black-Scholes formula, and financial engineering for risk management Value-at-Risk (VAR). Although the subject of derivatives is analytical, the course will emphasize economic intuition and common sense ways to implement the technical material. Abuses of derivatives and potentials for arbitrage profits will be considered, but the main emphasis of the course remains on the economic role of derivatives markets in facilitating risk shifting and diversification.
Econ 50: Architecture and Urbanism in New York City
Faculty: Malka Simon (Visiting Instructor)
Wednesdays & Fridays, 9:30 - 12:00 after Spring Break.
Course Description: This course will explore the history of architecture and urbanism in New York City from the colonial period through the present day. We will study well-known monuments along with lesser-known but important works, and consider the political, cultural, and economic factors that fueled the development of New York’s built environment. This course will situate the architecture of New York City within the broader discourse of American architectural history, and will consider the impact that New York had on nationwide architectural trends. Classroom lectures will be regularly supplemented with site visits across the city.
This course has been chosen as a different educational experience than the three finance-related courses, while taking advantage of the Duke in New York program's unique and important location.
