The Role of Vilmos Tarján in the History of the Newyork Coffeehouse

The purpose of the study. To examine how the Newyork Coffeehouse was run between 1920 and 1936. What were Vilmos Tarján’s, the executive board member and main shareholder’s, business policies. What profile did he intend for the Coffeehouse? The Coffeehouses were struggling between the two World Wars. What were the Coffeehouse’s solutions for the post- World War challenges and the problems of the Great Depression? Applied methods. To get to know the Newyork Coffeehouse Company Limited, the sources were the documents of the Company Registry. These helped to reconstruct the list of the shareholders. The balance and profit loss accounts were used to examine the profitability of the Coffeehouse. The problems of the Coffeehouses in Budapest between 1920 and 1936 were examined through the articles of professional journals. To understand Vilmos Tarján’s aspirations, his own books and articles of the daily newspapers were used. Outcomes. Vilmos Tarján wanted to turn the Newyork Coffeehouse into a luxorious, highend Coffeehouse. In order to reach this goal, he renovated the interior, later refurbished and modernized it several times. He established one of the best kitchen in the city and engaged the audience with frequent performances and concerts. With these aspirations he could solve the post-World War problems successfully. However, his skills and role in the associations of the industry were not enough to face the challenges that arose during the Great Depression.

Popular indicators of the crisis in financial markets

The article provides an overview of the factors that ensure the growth of the US stock market despite the fact that a number of popular indicators signal the opposite. The dynamics of indicators (Total Market Cap) / GDP, (Total Market Cap) / (GDP + Total Assets of Fed) and P/E, Shiller P/E ratios are presented. According to Buffett’s Total Market Cap / GDP indicator, the stock market is now “significantly overvalued” and the Shiller P/E ratio has surpassed the “Great Depression” period. At the same time, an increase in the amount of money in circulation as a result of the implementation of Quantitative easing (QE) programs of the FRS, inflation risk and a decrease in the profitability of investments in alternative assets (government and corporate bonds) are forcing investors to stay in stocks and continue to build up positions despite the increase risks and a decrease in potential profitability in the future. The growth of the US stock market is also stimulated by the buyback programs of companies and the inflow of foreign capital. In 2020, there was a V-shaped recovery in the economy, and an absolute record for the amount of funds raised was set in the IPO market. Thanks to financial incentives, the stock market will continue to grow even despite the pandemic and overvalued assets, but the notorious “black swan” may become the “trigger” for the start of the crisis in the financial markets.

The Turn of 20th Contemporary Art under the Big Social Crisis

The current COVID-19 pandemic has immensely impacted artists and their artwork. Such as the spread of the epidemic has led to the emergence of a new art form-NFT and so on, and also made online art exhibitions and virtual spaces became a popular way of viewing exhibitions. The same applies to the 20th century, artists knew that they had entered a unique and modern age of artistic expression. The modern world would bring both opportunities and challenges to the people. Historical evidence has shown that art is a highly dynamic field characterized by its ever-changing nature. Characterized by various social crises such as the Great Depression, 1918 Influenza Pandemic, First World War, and the Second World War, among many others. The Great Depression of the 1930s influenced art, particularly painting, to a great extent. During the depression, art became a tool for reflecting the current conditions, social critique, and activism.

From American Exceptionalism to the Great Compression

The United States was an anomaly, beginning without clear class distinctions and with substantial egalitarian sentiment. Inexpensive land meant workers who were not enslaved were relatively free. However, as the frontier closed and industrialization took off after the Civil War, inequality soared and workers increasingly lost control over their workplaces. Worker agitation led to improved living standards, but gains were limited by the persuasiveness of the elite’s ideology. The hardships of the Great Depression, however, significantly delegitimated the elite’s ideology, resulting in substantially decreased inequality between the 1930s and 1970s. Robust economic growth following World War II and workers’ greater political power permitted unparalleled improvements in working-class living standards. By the 1960s, for the first time in history, a generation came of age without fear of dire material privation, generating among many of the young a dramatic change in values and attitudes, privileging social justice and self-realization over material concerns.

What Future for Inequality?

Because the struggle over inequality is the principal defining issue of history, it will also be the defining issue of humanity’s future. This concluding chapter briefly surveys reasons for pessimism and optimism concerning future inequality. On the side of pessimism, since the rise of the state 5,500 years ago, elites have almost always taken all of producers’ surpluses, leaving them with bare subsistence. Only partial delegitimation of elites’ ideology during the Great Depression led to 40 years of political measures reducing inequality. The resurgence of laissez-faire ideology and inequality over the past 45 years does not inspire optimism. Yet enormous progress has been made over the course of human history, and especially in the past several centuries. This has been especially impressive in the development of science and human critical faculties which privilege rule by reason. This book goes to press amidst growing awareness of inequality’s unfairness and negative consequences.

Banking crises and financial instability: Empirical and historical lessons

The paper examines the importance of financial instability for the development of four Norwegian banking crises. The crises are the Post First World War Crisis during the early 1920s, the mid 1920s Monetary Crisis, the Great Depression in the 1930s, and the Scandinavian Banking Crisis of 1987–1993. The paper first offers a description of the financial instability hypothesis applied by Minsky and Kindleberger, and in a recent dynamic financial crisis model. Financial instability is defined as a lack of financial markets and institutions that provide capital and liquidity at a sustainable level under stress. Financial instability basically evolves during times of overheating, overspending and extended credit granting. This is most common during significant booms. The process has devastating effects after markets have turned into a state of negative development.The paper tests the validity of the financial instability hypothesis using a quantitative structural time series model. It reveals upheaval of 10 financial and macroeconomic indicators prior to all the four crises, resulting in a state of economic overheating and asset bubble creation. This is basically explained by huge growth in debts. The overheating caused the following banking crises. Finally, the paper discusses the four crises qualitatively. Again, the conclusion is that a significant increase in money supply and debt caused overheating, asset bubbles, and thereafter, financial and banking crises, which in turn spread to other markets and industries and caused huge slumps in the real economy.

Agent-based modeling for benchmarking banking regulation regimes: Application for the CBDC

COVID-19 pandemic challenges the sustainability of the modern financial system. International central bankers claim that banks are solid. They have accumulated significant capital buffers. Those buffers should be further more augmented by 2027 in line with Basel III reforms. However, disregarding such a consecutive rise in the banking capital adequacy requirements, the US financial authorities undertook an unprecedented step. First time in the country history they lowered the reserve requirement to zero at the end of March 2020. Friedrich von Hayek demonstrated the fragility of the modern fractional reserve banking systems. Together with Ludwig von Mises (von Mises, 1978) he was thus able to predict the Great Depression of 1929 and explain its mechanics much in advance. Thus, we wish to utilize the agent-based modeling technique to extend von Hayek’s rationale to the previously unstudied interaction of capital adequacy and reserve requirement regulation. We find that the full reserve requirement regime even without capital adequacy regulation provides more stable financial environment than the existing one. Rise in capital adequacy adds to modern banking sustainability, but it still preserves the system remarkably fragile compared to the full reserve requirement. We also prove that capital adequacy regulation is redundant when the latter environment is in place. We discuss our findings application to the potential Central Bank Digital Currencies regulation.