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Most models in finance assume that agents make trading plans over the infinite future. We consider instead that they are boundedly rational and may only form forecasts over a limited horizon.

The global economy has continued to grow at a robust pace since the July Monetary Policy Report Update.

Growth in the global economy began to slow in the fourth quarter of 2007 and the first quarter of 2008. This reflected the effects of the slowdown in the U.S. economy and ongoing dislocations in global financial markets.

Canada’s inflation-control targets establish a specific medium-term objective for monetary policy.

The Canadian economy continues to adjust to major global developments.

This is the second in a series of semi-annual reports designed to increase the transparency and understanding of Canadian monetary policy.

We study how the distribution of information supply by the news media affects the macroeconomy. We find that media coverage focuses particularly on the largest firms, and that firms’ equity financing and investment increase after media coverage. But these equity and investment responses are largest among small, rarely covered firms. Our quantitative studies highlight that the aggregate effects of media coverage depend crucially on how that coverage is allocated.

Over the last six months, most countries have continued to register strong economic growth.

We develop a principal-agent model of cyber-attacking with fee-paying clients who delegate security decisions to financial platforms. We derive testable implications about clients’ vulnerability to cyber attacks and about the fees charged.

The Canadian economy continues to adjust to developments in the global economy.