Today we are going on a trip and we are going back to CRT Paradise and the Music City Multicon and we are bringing some fun stuff with us. First a 14M2U will be coming. We'll also be bringing a 1342Q. Both of these have been restored. Now this is super cool but we will not be bringing this. Sorry no, he will not be able to come. We will be bringing this which is a Trinitron pretty standard looking 13 inch except for this one has yes it's been RGB mod it has a scarred input here and this is a 13M10. We'll also have an opportunity along the way to stop at some great spots in the Nashville area and hopefully do some hunting for things that are retro for instance some video games at some local shops and then we'll hit up a couple good wills along the way. Alright there's one more CRT that we'll be bringing to the show because I need to use it for the presentation I'll be giving and the panel I'll be hosting at this convention and that is this one Sony PVM 1943 MD and it's basically in pretty darn rough shape I've never done anything with it except move it a couple times got a big chunk of the bezel here missing and I've never really worked on it it does work but we're gonna set this up for the shop class that I'm doing and presentation I will take some other things like a deflection yoke and anode cap and then like a separate Trinitron tube and that should be really fun to show off to people and go through for the class now the class is called how a CRT works and it's just gonna be a simple demonstration of myself going through that CRT you just saw and I'm gonna just talk about how a CRT works what is actually going on why it's really the best solution for analog video content if you're interested in that most of the time and of course I'm really excited to do that and meet some new people and see who actually shows up to the show and so it should be a fun experience it's a brand new presentation I've never given before so I'm excited to do that so that's what we're bringing I've also got a booth set up at the show so hopefully it'll be some fun stuff going on there and it is in the main game room and we're definitely going to check out every CRT at the show and see what's hooked up to it how it looks so as we get ready this is where we're headed we're headed here to the Farm Bureau Expo Center it looks like we have a seven-and-a-half hour 500 mile drive to do today and do you want to see somebody who's upset because they don't get to go oh my goodness what are you doing down here little buddy let's get you out of there I'm sorry you can't go let's see oh yeah of course yeah good boy all right let's get going stop recording now all right so we've arrived at our first stop here and it's at this lovely Goodwill and this is one of the best honey holes in the place that I used to live in Gallatin, Tennessee and so let's go in here and see if we could find anything today because it's been about a year since I've been back to the store now this was actually my best haul from this Goodwill and these were bought on the day they were put on the shelves which was 12, 10, 20, 20 so almost two years ago now but every single game was complete and had all the manuals and everything and they were only 4.99 each so naturally it was one of the best pickups and hauls I've ever had in my entire life so we're gonna go check out and see what this Goodwill has and hopefully we'll have anything close to this would be amazing this is what it's like shopping in Goodwill in America I got 2005 LCD HDMI and this one's be the best thing probably here that nasty thing everything's gonna sniff all right guys check it out this thing works and for some reason it still sells for well over $200 pretty regularly on eBay so it's gonna go home with me but there's not much else here worth looking at let's get out of here all right we didn't get anything too shocking in that Goodwill this time unfortunately but hey we still have the whole convention to go and a lot more cool things to look at I'm gonna go ahead now and get cleaned up and then we can finally go to the convention all right we've arrived at the Music City Multicon and now I'm gonna take you inside and we're gonna check out my Retro Tech booth got my stuff set up so let's just go ahead and roll right on in there all right so what I really love about this convention is it's just a big smorgasbord mix of different stuff I mean just for example look you got my booth right next right next to that we've got all the racing games the arcade I mean that's pretty sweet at least I don't have just you know some boring vendor next to me or something but speaking of vendors we're gonna do a quick walkthrough and see what's going on at the vendor tables next and see if we can just find anything cool so let's go check that out oh look at this we got here we got some old-school toys 89 that's pretty cool looking Robin penguin I think I used to have this penguin when I was a kid this would make sense like 89 yep I did I used to have that Batman when I was a kid this would have been right around the same time that my parents and grandparents would have been buying me this stuff I know huh hi such a mix of different things let's see what we got oh look we got some you've got some high rollers in here old-school chargers ours oh man what is that one you got to have the diamond in your hands for that one look at this one the aridactyl look here's some packs look at that a $400 pack what's that one from that's a base that's pretty crazy how you doing what we got here what do we got here some cool consoles I love hardware we have a gold star 3DO that's pretty awesome and a JVC excite oh my gosh you got a philip cdi bundle where did you come from here local oh okay it's very cool man it's first time I've seen one of those and I don't know how long got a show link a skirt cable is it okay okay wow that's cool ps4 oh they got the the sports version of the Sega Dreamcast and then you got the JVC excite with the actual JVC controller that's another bonus right there wow this is a vetrix work it comes with 20 something games and original overlays yeah reproduction yeah wow cool amazing well well well what else we got down here man this is some cool stuff heavy hitters here look at this a $1,200 ps4 game I've never even heard of that one that ones must be super rare now these I know are good classic Lord of Thunder yeah oh okay yeah oh my goodness look at that one holy crap cdi man wow amazing Star Fox 2 with the box huh it's been I know I doubt that if it was unopened to be a lot more than that wow so good booths here good stuff definitely paying a premium I mean goodness gracious that vetrix was $1,200 but I mean I've never seen any of that stuff look oh here we go controller bands yeah you doing good yeah were you in uh Connecticut this year yeah okay yeah I was there yeah I was like look this looks familiar I was like yeah I'm Steve nice to meet you anything to add to the huh what are you laughing at oh look at that those are pretty sweet those lights are cool those lights are cool let's keep rolling man let's see oh look at this see now one now if they do the weapons check how do they sneak all these in oh this is something I had been wondering about what is this for what thrust master this is what Lewis has been thrusting all about the thrust master 80 bucks man he would kill me if I bought that for 80 bucks I don't even have the right system for that hey how y'all doing good how you doing pretty good what does that go to this is a thrust master for which yeah this is an Xbox oh 360 I think it's for one oh one okay it's like the one okay on the side there but yeah I'll give you a hell of a deal um I don't want to take the pizza oh yeah I don't I don't know yet if you're in the market for a wheel the thrust masters you can't go wrong with yeah yeah in fact I'll sell pretty much all the wheels except for the switch one for 60 bucks okay they take up too much space in the car well thanks man I'll let you know I'm uh I've got a I'm I'm a panel hoster so I've got a booth over um at the entrance just with some crt set up not selling anything just like I was about to say I'll come by all year yeah yeah yeah yeah I get asked about this all the time really I missed the era where you could just get them all for free all the time well you still can you still can you just gotta look a lot harder yeah well you know eventually it was gonna be all the good ones are mostly picked through you can still find good big ones I remember back when I was a friend that worked out at Goodwill and they don't take crt's right no I was just like listen man if you sell them all outside just call me I'm all I'm just you don't have to take them in the building just go outside I'll come pick on yeah that was a sweet gig for a minute but yeah very cool man yeah I'll come to come check out your table later yeah I got a couple good crt's I got one big pvm over there okay um set up I said we should have cars somewhere yeah I just grabbed one thank you yeah definitely definitely check it out I know about that here thank you cool sometimes sometimes it's beer night you'll have like good stuff oh there's some cash I bet you can do it that's what we were all expecting you know it just happened to be a street address that's really what I all right man hi hi controllers see anything you like and some wrestling action figures down there I wish it was something I was exactly looking for but I don't see anything is this really crazy well that was a look at the vendors probably go try to find a good deal maybe on that thrust master for the pc at least that way I can play it pretty easily but 60 bucks I'm just not sure it's really worth that pretty rare stuff in there that I don't think I've ever seen I mean the cdi bundle but it was pal and it was $800 and then some of those other things man they were just expensive good condition but expensive but we're going to have to see what's next because I'm done looking at vendors all right this is the biggest part of this entire vlogging video and that is what I'm going to go around the show and show you all these amazing CRTs and how they've got them set up and it's going to be like the most amazing run through on consumer CRTs you've probably ever experienced uh first off we're here at the booth and I've got this beat up 1943 md but it's a beauty and people really love looking at it the pvm's just so great but let's look at some other things around here behind me first we'll start why not just right here check this out man this is one of these sam songs this slim fit crt with dolby digital surround now we got hooked up to it it's knuckles chaotic 32x mushroom style on the sega genesis and i'm going to guess this is composite video yeah and that's probably why it looks so slimy and if we look back here on the label model is tx t208 to 20 inches and this one you can't see it very well but it does support composite video down here so that's pretty our component video i'm sorry so you could definitely get a better picture on this thing next up is a just standard phillips magnivox smart plus series how about that we've got some goofy fighting sticks from assi wear of course i love assi wear stuff oh yeah you know i'm just running through showing everybody your amazing crt collection i've only made it to the second one that was uh dave the show show man right there he's he's the man in charge the man who owns all these lovely crt's got the vcr dvb player combo on a 20 inch flat trip flat screen to shiba see we got any good inputs down there wow look at that i i don't even i don't even think we've got anything better than composite video on that so that might be a disappointment for that one next we've got just a good old-fashioned rca tube these guys are really great and the good thing about them is usually can use them in arcade cabinets if you have an issue now this is next to that is a jvc and some trash this jvc has a streets of rage 2 game going on in it now this one is obviously not the d series and it's not the l art or the i art or whatever they want to say that our first sony of the night this is a trinitron that's seen its better days i'm guessing somebody dropped it down it's got a sega master system hooked up to it and of course we got just about every input you could imagine for analog back there this is a 27 inch from 2001 we've actually got a sweet pc engine turbo graphics set up here with good old keith courage right the most common i think game for the turbo graphics in america and that's set up to another sony trinitron in better shape let's see what this is a vega and this is a fs 120 from 2005 definitely going to have some high end inputs on it but a little bit newer of that trinitron right there and the dance party's getting started in here some of the things are going to the philips magnavox check this out with r type one on the pc core graphics cool bubble tube here philips magnavox got another jvc this is the older jvc with the cool look at that the super the super add-on so you can play those other six to ten games or whatever that's available i really like these older jvcs they kind of have a good look another sony trinitron now this is a d-series oh yeah look at that sega saturn on the d-series this is a 24 27 inch 27 inch i'm going to think definitely looks better than the 20 inch one anyway there's another panasonic panasonic and saturn it's bigger it's better it's better the s and k kidney bean xeno crisis nice on a sony trinitron let's see what we've got on this trinitron we've got an fs 100 i don't know if you can see that so well fs 100 from 2002 let's throw of inputs and of course we're going to be using the fronts as a composite so everything here is on composite wow this is a big philips before we go see what it is in the front it's got all kinds of good inputs philips from i can't see that where it's a 27 inch here okay let's see oh yeah look at that magnavox big flat screen oh look at this look at this what is this it's an interesting navigation i've never seen any buttons like that what does that do i think it's power oh volume okay we've seen one of those look at that so volume and i don't know that's what channel oh i think i just turned it off messing with the av inputs look at me which one are we on okay there we go bank of super street fighter so that's interesting i've never seen a channel checker up there like that that's pretty cool oh this looks like a sweet chanochon look at that one 3do baby you got to get in the geck's rca true flat these are fun magician lord on it you gotta love magician lord on a true flat another design with the power buttons up top it's pretty interesting just like what an fs something or other 10 110 120 fs 120 so it's got that flat screen and then check it out it's got that long kind of back to it that's very very common for that era of a trinitron kind of give you that look dinex baby this is one of them good old knockoff dinexes as some of these on this end i've realized aren't really working properly i mean and nobody ever really messes with this stuff unfortunately because why i don't know i mean i'm not trying to be a jerk but why would you have any interest in playing the odyssey when you got a thousand different things here that's better than it i've never seen anybody spend more than two or three minutes this is the in television to phone system i mean sorry controller and uh it's hooked up to a dead samson true tech it's like the true blood of crts does anybody ever remember that show true blood like what the hell ever happened to that show i don't get it like he used to be the number one thing in the world and then nobody cared about it anymore it's like everybody forgot about vampires good old donkey kong rca nothing too special there now this is that good old sylvania 20 inch composite only but i do like the way these look and then there's like an emerson version of this television flat screen 20 inches um not the best but not too bad 7800 i always liked the 7800 this is the only time where you could really like pull off this goofy controller at least it looks goofy but it actually works pretty darn well another atari just on a magnivox same sylvania this one's not working this is like the atari the place where no one people come to just like chill out and relax unfortunately not many people are coming here to play you know space jockey on a magnivox in 2022 so you know i think that's pretty much past its prime right about crystal quest atari 7800 on a sanyo flat screen here's this emerson again another button this one's not working either this time we got an atari xe system which my son was actually laughing at he didn't understand he was sitting there hit the help button dreamcast set up over here love seeing that i'm not sure what we've got for low to save what games going on in there but nice little 20 inch kv here that is a sony from the 90s next to that another sony from the 90s with a dreamcast and crazy taxi this is a cool little table area game cube set up fs what do you think 120 here man where the smash boy's at where's my buddy shank he would love to be sitting right in front of this phillips smashing some people and we've got another sony this is like mostly sonys we got the random phillips right here we've got a beautiful golden eye set up here and then more in 64 right golden eye a little bit of mario kart on that 20 inch sony got a magnivox here with dk 20 inch magnivox 20 inch super nintendo lovely super mario a lot of these magnivoxes look at this these are all these smart series tv's looks like somebody got a good deal on five of them because i think that's how many i've run into at the show so far so we've got a memorex memorex look at this you got a power button on their own more buttons on the top ways are which is an unusual one interesting our last two future jaguar kasumi ninja insignia is the brand you got a dvd player in case you're going to watch something tonight sony's gonna finish us off here with our alien verse predator i love this game even though probably nobody else does i sure do all right so that's your tour of all the crt's on the floor and i decided to do it now because it's the first night of the show it's getting to be late and um there's not as many people on them right now as there probably will be tomorrow when the full big show day is now one thing that is popping right now is the fight game esports section over here which when the tournament really gets hopped in tomorrow we'll go visit some friends over there see if we can see what's really happening behind the curtain because there's a lot of stuff going on over there all kinds of different tournaments and you know this year the fight tournament guys really brought something cool they brought a third strike setup and they got a dual blast city new astro city's cab that they brought i mean let's look at that how cool is this this is probably the best crt setup here is this awesome stuff we're here day two for the big music city multicon and of course i've already done my presentation it went great and it was a lot of fun and i didn't get to film it but don't worry the show promoter did and i'll definitely let you all know in that episode of that clinic will be out because i did sit there with this lovely 1943 and kind of tear it apart and wow some people by showing them how the deflection yoke works but as you can tell i got something pretty goofy playing on the screen here and that's because this is my best new pickup i've got from the show and it's this a working pioneer laser karaoke machine it came with this awesome demo that just shows like two minutes of a bunch of films and a ton of like literally like one minute of a bunch of music videos and songs which is which is a little bit hysterical but again i gotta say a special thank you to my friend who brought that to me at the show you know who you are and uh you definitely gave me a good deal on that i got it for a hundred bucks very happy about it's definitely look for some more information on that coming in the future but for tonight we're going to look at a couple new things we're going to go around and we're going to check out first this this is the fight game section for the fight game community i did a little bit of a second look at this here for this blast city new astro city last night you saw those set up that's just awesome so what they got here is a nice tournament going on it looks like we're at king of fighters over here there's the main stage really crazy stuff man so let's go to the main stage see if we can find somebody we know around here there's the king arturo and chris my friends discussing let's see he showed them it all yeah hey last year they had set up on the other side and i tried to go say to him and i like they like almost tackled me because i they're like i thought i was going to trip over and like knock everything out and i was like i'm cool i know they're like oh you're cool you're cool you're fine i was like i promise i know him and they're like sir sir and they're like yeah oh and they went over and he said yeah they're like oh okay come on back well how about that we're gonna go check out some stuff here with arturo let's get ready for his championship match well that's the end of the trip and i'm sorry to leave you on a cliff hanger like that but i will let you know that my buddy art aka nyc furby he actually won his tournament so he got first place and congratulations to you buddy you're the best street fighter i know so that was the big trip i hope you enjoyed a look at all those amazing crt's and i just want to say one last thing uh the best part probably about this entire trip was the opportunity to go and to see people again live and in person i mean it was just an awesome chance to be able to meet a lot of you that came to the show i can't say you thank you enough for anybody who showed up it was actually quite a bit uh larger turnout this year to the class i gave then any year prior and almost 30 people were there so that was a really good turnout for my crt class and i was extremely excited to give that i think it will just lead to more opportunities down the road hopefully for awareness and things like that and that kind of presentation in the future and once that has been produced and uploaded to the music city multicons youtube page then i will share it here and everywhere else on my social media platforms but what did you think i mean this event is definitely the capstone or the end of the season for me as far as conventions are concerned i won't be going to another one till 2023 so did you get a chance to go to any shows what did you think about it how was it was it better than you expected or maybe worse than you expected please let me know what you think with a comment below and also if you enjoyed this video please do me a favor and leave a like on the video and if you're new to the channel and you sat all the way through this and you may want to consider subscribing if you liked anything about this video because my channel is dedicated to this style of content we really highlight this retro older outdated hardware and we can still see how it's flourishing in some modern environments which i love to see again thank you so much for joining me today i will see you all next time with some more retro content


I thought marriage is a living relationship. So, isn't marriage a living relationship? Are the living separately? There are some marriages like that I know, but first of all we must understand why are we forming a relationship. Right now this… in your language, the West has seeped in too strongly in your language because in somewhere in your mind, if you utter the word relationship, you are only thinking about sex-based relationships. That's not how it's been in this country. When we say relationships in this country, we thought we have a relationship with our parents, our friends, our brothers, our sisters, all kinds of relationships. But if you go in the West and you say a relationship, it means body-based relationship. First drop that idea. Relationships can be on many different levels, isn't it? Why are we making only one particular relationship so important against the other? Yes, it is also an important relationship, but not against the other, isn't it? But right now slowly we are building this Western ideology that this relationship versus the rest. We need not be so. The reason why in this country, you know, marriages have been very stable, not always because two people are getting along great, not always. Because when they got married, a few thousand people got married along with them. Brian and the groom were a small aspect of the marriage. There are so many other people involved. Now if you have to break it, you have to break it on all levels, you can't break it. You know, your father and his father or your father and her father may be having such a wonderful friendship, you can't break it now. Even if you want to break it with your wife, you can't break it because the whole family has joined up in so many ways. It's not just about two people. Is this good or bad? See, in the course of living together people, today you got into some kind of situation in the evening. Today you thought, this is it, I don't want to see your face again, finished. But tomorrow morning you are again in love. Hasn't this happened to you any number of times? Yes? If there is a whole lot of people around you, when that evening, when that feeling came that I don't want to see your face again, at that moment if you pack up and leave, it's finished. You can't come back tomorrow morning. But now there's a whole lot of situation that you can't leave.  Unfortunately most human beings are still like this, isn't it? They can't be so aware and every day they can manage everything beautifully. That's not how it's going, life, isn't it so? Ugly things happen, isn't it, in beautiful relationships? Don't they happen?  To sustain those moments of ugliness, you need some support system.  So once children come, it gets a little more difficult. But before that, all the others are important. So what is this new thing about living, live in and marriage? So what you're saying is, I'll walk out whenever I feel like it, isn't it? That's not good for anybody. This is a huge load on human consciousness. There is no emotional security. I think United States of America just recently, I was addressing a group of people just a week ago and I was telling them, one big reason they were talking about the economic meltdown, why are we not productive, why is it that this has happened, that's it. One important thing is there's no emotional security for the man and the woman.  You don't know whether your wife will be waiting for you or not. This is there on most people's minds, at least fifty percent of the people's minds. With this level of insecurity, your husband goes to the office, you don't know whether he'll come back or go away with the secretary. When this emotional insecurity is there, you cannot focus on anything. People cannot be productive when there is no stable emotional situation for themselves. Here we fix the marriage in such a way, no matter what happens, you can't break this.  That gives a certain sense of security. There may be a lot of ugliness in the situation, but still there is a stability where you can focus on what you're doing. So, when you say marriage versus live in, what is it? Uncommitedly you want to live in, that's all, isn't it? You don't want to live in a committed way. I don't think living in an uncommitted way together is a good thing, nor is there any… I'm not saying marriage means some poojari has to come and say a mantra for you, but it must be a committed relationship. If there is no commitment, there is no real sense of respect. When there is intimacy, there must also be respect for the other person's body, mind and everything, isn't it? When you say I'm not committed to you, whenever I feel like it, I'll walk out. There is no sense of value and respect for the other person, isn't it? So marriage is not some fairytale thing happening, nor is it happening in heaven. It is just a statement of commitment that I'm with you, isn't it? If you're against commitment, no, I don't think that's a good thing to do.  If you're just looking for pleasure, it's up to you. But if you're looking for a stable situation, it takes commitment. Without commitment, there is no stable situation. So marriage is not performed by somebody. That is only for social reasons. Marriage is between two people that there is a sense of commitment. I'm with you, isn't it? Whether we actually go through a ceremony or do not go through a ceremony could be a choice, but I don't think there is a choice about whether we are committed to each other or not. Then you will never know the joy of being together. It'll always be a calculation, isn't it? It'll always be a calculation, isn't it? What can I get out of you? Once there is what can I get out of you? A relationship cannot be beautiful.


Hello friends, myself, assembly assistant professor from Walsh and the Institute of Technology at Solaapur Mechanical Department. Today I am going to explain the general introductions of the power transmission system. For this, the learning outcome of this topic is at the end of this session, the student will able to describe the construction and working of the power transmission system like belts, ropes, chains, gears, so these are the different type of what you call power transmission systems are there. So, these are the contents power transmission systems that is belt and ropes the first one, second one is a chains one, third one is a gear one. In the first one, when you have to select the any type of power transmission system, we have to know what are the different media you can use it. For that you can three type of varieties are to be there regularly used that is a belts and ropes then chains are there, gears are there in the gears different type of gears and gear trains are to be used here. The first of all the belts and ropes are there, the motion is transmitted between the input shaft and output shaft the driver and the follower that is due to the friction between the belt and the pulley surfaces. The pulleys are to be mounted on the driver and the driven or follower shafts are there and the frictional resistance between these pulleys and the belts the reason of for the power transmission systems basically there are two type the belts are there flat belt v belt and sometimes circular type that is core type belts are to be used for the power transmission. So, these are the some diagrams I am showing here it is a flat belt type, it is a belt and this section one that is a pulley one, it is a v belt type when you to go for the v belt type the angle this angle is to be minimum or sorry maximum 30 degrees to be there and it is a rope type that is a circular just I am explaining once now you go for a next one chains. So, when you to go for a belt drive belt drive is not a positive drive because there is a slippage to be there and the creep is to be there. So, chain drive is a positive drive chain is to be used for the transmission larger center distance between the two shafts that is the distance between the input shafts and the output shaft is a more one you can use the chain and positive power transmission system is to be there and these are made of some linkages are there metal linkages to be there heavier metal linkages to be there with respect to the belt one when you to go for the belt material belt is a leather is there cotton is there metal threads are there plastic threads are there and when the friction between the belt and the pulley is to be motion is to be transmitted heat is to be produced and when the heat is to be produced elongation is to be there expansion is to be there of that belt of that belt material and due to which the length of the belt is slightly increased when the length of the belt is slightly increases slippages are to be there. So, that is not happened in the chain drive because in the chain drive instead of chain some linkages of the metals are to be used for that the main only importance for the chain linkages to be there regular lubrication is to be required that is lubrication is at the required time to time and these are the some diagrams I am showing the block chains inverted tooth chain roller chains are there these lower bushings and these are distance between the pin and is called as a pitch. So, these are the just a simple example is a bicycle chain that is a simple example of the chain. So, friends when you know the type of the belt, belt material belt drive you know the chain chain drive then you have to think that which is the most favorable one regarding the power transfer system think over that we get pause for some seconds we think over that and give me answers yes. So, when you to compare the belt drive and the chain drive chain is a positive transmission system is to be there with respect to the belt because in the belt due to the friction heat is produced and due to that heat elongation is there due to the elongation length of the belt is increased and due to which slippages is to be there, but that is not happening in the chain pause the video question is why chains are to be used think over that the answer for this one is chain drives are used to transmit a power from one end to another end. Now, the third type you have to go for the gears. So, gear is 100 percent most power transmission is to be there and in this gear the power transmission is because of the outer surface teeths are there and these teeths are come in contact with each other driver and the follower and they are in a tapered intersection because slightly come in contact and then initially two teeths come in contact with the 20 percent then you are then increasing gradually 40 percent then 60 percent then 80 percent because all of a sudden load is not transmitted in the gear. So, that's why when you have to go for some simple example for the scooter when you have to engage that scooter where to start the scooter and it is to be moved on you have to go for the first gear then go for a second gear then go for the third gear and due to that rotational the what you call rotational mechanical energy to increase.  So, that's why the motion is transmitted in the gear that is due to slightly come in come in contact then gradually goes on increasing and the motion is to be transmitted. So, gear is also a positive drive chain also is a positive drive when you have to compare the belt ropes chains and gears gear is a 100 percent motion transmit system is to be there and these are the some different type of the gears are there spur gears helical gears these are double helical gears are there bevel gears are there and in the gear the spur gear the teeths are a parallel to the shaft these call as the simple gear is to be there sometimes the outermost teeths are not parallel here it is a parallel here in this case in the it call as the helical gear they are making helix angle it is a double helical angles are to be there here in the spur gear helical gear double helical gear the driver shaft and the driven shafts the driver shaft and the driven shafts they are on the same plane that is horizontal to the horizontal and roti to the roti here horizontal to horizontal roti to roti but sometimes you have to required the motion from horizontal to the vertical one or vertical to the horizontal one at that we go for a bevel gears. Here the motion is rotary to the rotary but the input shaft horizontal and output shaft is a vertical one. This is another type and the another type is to be there. Sometimes you have to required rotary motion to the reciprocating motion is to be there. So at that go for racket and pinion arrangements are to be there. So these are the different type of the gears are there. In the gears also there are gear trains are there simple gear train and the compound gear train. In the simple gear train only one gear is attached on each shaft that is driver shafts and the followed shafts and only one motion is to be transmitted. When I go for a compound gear drive here more than one motion you get it from a single input shafts means what? In the single input shafts only one gear is attached but in the output shaft driver shafts more than one gears are attached. So more than one motion you have to get it. That is a under type of gear drive that is a compound gear drive okay. Now you think that when you to compare the chain drive chain motion transmission is there and gear motion transmission is there which is more positive transmission think over that. Yes comparing to the chain drive gear drive is a more positive transmission systems are to be there. Here with the belt drive two types are there open belt drive and the cross belt drive. In the open belt drive motion is transmitted from rotary to the rotary on the same motion but in the cross belt drive motion is transmitted from rotary to the clockwise to the anticlockwise directions. So both are moving in a different directions. In the chain drive comparing with a belt drive positive transmission is to be there. When you to go for a belt drive there are no slipages are there due to the slipages power is get wasted. Gears gear is a hundred percent motion transmission is to be there but the initial cost is to be more and here the gear drives are there and the outermost motion is transmitted due to the teeth and teeth are in tapered conditions. So these are the different type of the power transfer systems are to be there. So for these references I am going for this ignore YouTube link is to be there. Thank you.


Mechanic checks cop's tire, then spots green nest inside. The McHenry County Sheriff's Office in Illinois employs over 400 people, and the sheriffs who work there are described as conservators of peace on the department's website. No doubt officers come across some strange situations on the job, but one sheriff of the department was about to go home with a story that he'd be telling for years to come. The unnamed deputy involved in this story had just returned from a holiday. He'd enjoyed his time off but was eager to get back to serving his community. But upon arrival, he discovered that his squad car wasn't roadworthy. Although this wasn't a serious issue, he made a plan to take the car in for some repairs, a little annoyed that this had happened on his first day back, but this would be a trip to the mechanic unlike any other. The mechanic quickly got to work on the deputy sheriff's vehicle, but immediately noticed something very peculiar. Having worked in the industry for years, he'd seen some odd things, but never anything like this. Deputy Sandra Rogers explained the specifics in an interview. The mechanic began replacing the headlight and noticed that the wire had been chewed. But what could have caused it? While there are numerous reasons for frayed wiring inside a vehicle, the main suspect was a rodent. Rats and mice are notorious for causing expensive damages by getting inside a stationary car and chewing the wires. Nevertheless, the mechanic pressed on with the repair of the squad car's headlight, but what he discovered next was even stranger. This routine repair was about to get a whole lot more interesting. The mechanic delved deeper into the inner workings of the car to find out what had caused the damage to the wiring. But then he found something completely unexpected. He started to fix the wiring when he saw a whole bunch of leaves. Deputy Rogers explained, the mechanic thinking that the prime suspect had been identified as a rat followed the trail of leaves to the suspected source of the headlight problem. The deputy sheriff thinking that the car would be fixed quickly had gone back to work. After all, a broken headlight shouldn't cause too much trouble. But he was in for the surprise of his career. Shortly after he left the shop, he received a call and immediately knew that something was wrong. To say that the repair hadn't gone as planned would be an understatement. The mechanic on the other end of the line gave no explanation, but instructed the officer to come back to the shop immediately. He couldn't explain what he'd found on the phone, he needed to show him. Intrigued and a little concerned, the officer rushed back to the shop in another police car that he'd borrowed from the department. But his confusion turned into disbelief when the mechanic showed him exactly what was in his car. Upon arrival, the mechanic told the officer that he couldn't believe what he had found. The sheriff didn't know what to think and assumed the worst, that the car would require a bit more work than he had anticipated. The mechanic took him to his squad car and showed him the pile of leaves. But when he looked closer, he understood. Inside the nest of leaves were four baby squirrels, Rogers recalled. The mechanic was incredulous, he'd never seen anything like this in all his years of working on cars. The officer's eyes widened, it was clear that a mother squirrel had managed to squeeze into the wheel's arch and had left a big surprise. Four newborn squirrels, a first for this car repair shop. The mechanic loves animals and didn't want to damage the baby squirrels or their nest, so he carefully removed the wheel from the car and extracted the nest. He didn't even wake the babies. They were all in perfect condition and sleeping soundly when they were removed by the mechanics, said Deputy Rogers. What was to be done with the babies now that they'd been found? The nest was in the officer's car, so it was his responsibility. It was really cute because their eyes were still closed and they were all tucked in a circle, shared Rogers. After the squirrels were removed from the vehicle, the deputy took them home with him. He wasn't planning on raising the squirrels, he wanted to try and reunite them with their mother. He put the sleeping baby squirrels in their nest in a box and he put it in the exact spot that his squad car had been parked before going to the mechanic. The deputy gently put the cardboard box on the ground and left the babies, just like that with only a hot water bottle to keep them warm while he waited. He prayed that the mother squirrel was still nearby, but as the hours passed, he grew increasingly worried that he'd made the wrong decision. A long hour took forever to pass before he finally caught a glimpse of a squirrel coming to investigate the box on the ground. She just couldn't stay away from the cries of her hungry babies calling for her. She checked inside and then firmly gripped one baby by its neck and took it away with her. But she didn't come back. For another few hours, the deputy waited patiently. He knew exactly what had happened. I believe once she'd picked the first one up and knew the others were safe in the box, she waited until it got dark to get the rest, as she must not have felt safe moving them in daylight, he said. Sure enough, as the sun lost its hold on the world, she returned for another and then another, until they were all back where they belonged. The officer was afraid he might have disturbed or contaminated the nest and that the mother might not return, but nature is a beautiful thing. The mother squirrel returned to the spot she'd left her nest of babies, gathered them up one by one and took them to a new home, hopefully a safer one. But why had she hidden them in his car? Apparently this is a common occurrence with squirrels as they frequently make nests in cars due to the heat that they give off. One site explained, they are attracted by the warmth of the engine which creates a cozy place for them to nestle. Squirrels create a fine mess once they bring in nuts, acorns and nesting material, but this can lead to disastrous outcomes. The Canadian Wildlife Federation said that this is actually a very common issue in rural areas as they've suggested that people could try to decrease the occurrences by making their car a less attractive nesting spot. One tip is to leave the car hood open so that the vehicle is cooler and other options include using taste deterrents to repel squirrels from biting wires. A bitter apple spray is a harmless option that drives squirrels away. It is recommended that you get some advice from your mechanic and a veterinarian on what will work best at keeping squirrels away while avoiding damage to your car. And most importantly, follow the great example that the deputy at McHenry County Sheriff's Office said. Squirrels might be irritating at times, but the deputy at the MCSO showed a value that all police officers and all civilians should have, which is showing concern for other beings. If he hadn't found them in time or made sure they were returned to their mom, this story could have ended very differently. These baby squirrels no doubt appreciate what the officer did for them.


Okay, thanks a lot. It's a great honor to be here to honor you. I would like to resonate very much what President Mario Draghi said about your abilities, your interest, your curiosity in macro finance, in particular financial stability and our discussions we had over the years. I value them very much. In particular, remember when we once walked on the banks of the River Rhine and we talked about various things in particular one particular issue. And it also showed you open-mindedness and your curiosity in the intellectual exchange. I really value this and I hope you can stay in touch afterwards. What I want to talk today, I want to talk about financial frictions in macro models. I think that's one of the themes Constancia was pushing very much so within the ECB and the ECB actually was doing a lot of progress in these dimensions. But I would like to go a little beyond that. Also go into tokens and blockchains and inside money creation. Because once you think of financial frictions, money has a particular role and then actually new forms of money might interplay with that. And so the talk will be in two parts. One is on the macro models and the second part will be on the models of money in the digital age. And I will also touch upon some currency competition which some things I'm recently interested in. But the first part is on macro models and essentially I would like to say one aspect which came up before is a shift away from impulse response functions much more to a risk dynamics or resilience view of the macro economy. So additionally what we did in macro economics essentially we have a one-time shock and the one-time shock hits the economy like say here and then it propagates over time so it will last even though it's a one-time shock it will last long and it might be amplified because it feeds back and so it might be amplified much more today as well. So there's a persistent element to it and there's an amplification. The famous models Benaki Götler-Gerlich risk, Kiotaki Moore and so forth who have pushed this line. But importantly that they return to the steady state is actually deterministic. So once you have a shock you for sure everybody in the economy knows that you walk back. There's no uncertainty how long the recession will last and how risky it will be subsequently. And that's essentially what was the predominant few before the crisis. And with financial frictions risk matters a lot because essentially finance is mostly about risk and the question is how to capture more risky, more rich environment which captures the resiliency of the system and whether we drop off to a lower growth path or whether we return back to the existing growth path. So what the macro literature has done since the crisis is very much focused on non-linearities saying there's not a linear effect so it can be very different once you move further away from the steady state so things amplify much more dramatically.  And you get skewness or downside shocks act very differently from upside shocks and with financial frictions that's very natural because a downside shock comes with capital constraints and other liquidity constraints which amplifies in downside but not might not amplify so much in the upside. So you get skewness in the macro dynamics. And what I would like to stress is this endogenous volatility dynamics. So the volatility might change dramatically and is time varying. So it's not always the same suddenly volatility we go in a much more volatile environment and things move around. So what I've plotted here is just if you have a state variable you have a drift which is given by this so the state variable is essentially at the steady state at this point because the drift is zero so it doesn't here the drift is negative so the system drifts back and here the drift is positive it drifts to this and you end up in this stochastic steady state but it's never the case that you're in this steady state because the system is constantly shocked and the volatility itself is also much higher. So in this range the volatility is just given by the fundamental volatility but in that range below the steady state you have the total volatility because it's the fundamental volatility plus some amplification some endogenous volatility which makes the total volatility much higher. So new macro will reflect all this stochastic volatility environments and makes us a much richer environment. And what does it mean to have this stochastic volatility? The precautionary motive plays a very important role because if the world becomes more uncertain people shift into different assets to behave differently they're safe more and everything feeds back and makes the whole world and again more stochastic. Okay that's essentially what this does and two paradox we essentially I would like to emphasize and stress here is the volatility paradox. The volatility paradox says if the current volatility is very low if you measure the volatility is very low then the risk is building up in the background and be aware that's actually when the times are most risky. So that's essentially low measures of volatility is actually a danger rather than a sign of a great moderation. And the second one is this paradox of prudence and I will come back to this. Essentially what's micro prudent is not necessarily macro prudent it's most likely macroimprudent. Okay that's essentially very close to Keyneson's paradox of drift just applied to the risk space rather than the consumption saving space. So that's essentially what I wanted to stress and the second component which essentially comes more from the finance literature which entered a macro if you focus on traditional macro if you saw how the asset prices how they affected, how a long jump on price affected they're most affected by exchange in cash flows. If you change the interest rate there will be less interest rates down the road but the reason literature is actually shown that actually this stochastic this con factor matters much more and the stochastic this con factor reflects risk premia. So essentially risk premia met a much more news about the confidence and risk premia met a much more than the cash flow news itself. And that's empirically well documented in the failure of the expectations hypothesis the expectations hypothesis essentially saying that future risk, future interest rate matter for understanding long jump on prices but empirically what matters is much more the change in the risk premia. The same is true for the uncovered interest repairity and other puzzles, empirical puzzles which all point to a time varying risk premia as a key driver in the macro economy. Of course it makes the whole modeling way more challenging because we have to go away from a stock and a flow analysis much more to a risk and a risk premium analysis and that's a much more difficult animal to handle especially if it's moving around if it's time varying. So that's essentially the shift in macro models away from stock flow to more risk perspective and a resilience perspective. Then I would like to go once you go to this risk perspective to say oh the markets are imperfect the financial markets are imperfect and then a natural role for money emerges because you would like to hold some money because there's a risky world out there and hopefully money is less risky and people rush into money. Okay so where's the traditional models and the old G model which is traditional way to justify money but there's also money as a store of value or as a safe asset where the beauty model, you know, money essentially is the way to save in a safe form and you have some idiosyncratic endowment shocks you have some labor income suddenly the unemployment uncertainty is much going up then you would like to save more and then demand for money is growing up. I've worked with Ulyssanikov on a different type of model there's also idiosyncratic risk but idiosyncratic risk comes with investment so physical capital investments have become much more risky in recessions and then you would like to shift your portfolio more into less risky money rather than investing in capital so everybody shifts away from physical capital investments towards much less risky money investments and then there's of course the money as a medium of exchange and money has a lower transaction cost and that's essentially models of outside money where there's no big role for the financial sector and of course then what you want to do is you want to create a financial sector which should be core of any macro model which creates this money inside money not only the outside money but also inside money and banks play a particular role not only a monitoring role but also diversifying a way some of this idiosyncratic risk you have in various models and they can absorb and diversify a way the syncratic risk and if the banks under capitalized they cannot do this job anymore and they push idiosyncratic risk back to the households and that leads to even more money demand more banks that create some inside money and the inside money that will come back to this might be even better than outside money as a medium of exchange and we will come back in future types of money it might be that there might be new forms of money where the banks or IT firms play a more important role so let me just say to this the second idea essentially that if you look back in history we have different forms of money this is a yab stone which was the unit of account it's a fixed supply, it's hard to forge and you can see one of this outside monies it's a good unit of account but it's not a good medium of exchange you can try it and lift it and see whether you can pause it onto somebody else so typically what you would like to have here is essentially pause on this medium of exchange to somebody else and if you can't pause it on what you derive claims from this thing so as somebody comes along I give you a token or a piece of paper which gives you a claim on this type of stone and then this piece of paper is traveling around when you make payments that's essentially creating inside money and I will come back new forms of money in form of tokens, electronic tokens will do the same thing gold is the same thing but the interesting is typically new forms of money like bitcoin and cryptocurrencies are criticized for being a bad store of value and for being bad mediums of exchange because it can't handle the transaction volume but Visa card and other electronic forms of money inside money do but the same it could have been said to gold in the olden days whenever there was a new discovery of a new gold source suddenly the value of gold changed dramatically or whenever a new ship came from the new world to the old world and suddenly gold supply tripled so you could have said the volatility was very high so you could have criticized gold as a good source of outside money as well and there's this famous paper by Tom Sarge and François Valdes saying the big problem is small change so the problem is essentially if you have gold coins it's they're too valuable to pay little things okay and that was a big problem so it was not a gold itself was not an ideal way to do the role of medium of exchange either so in a sense there is you know for different forms of outside money like gap stones or gold are not the ideal form either and this is a way we should see in the context of new cryptocurrencies and how this, the things will play out so essentially we will always end up most likely with a two tier financial system with fractured reserve banking and as was mentioned before the initiative in Switzerland which will be voted upon on two 10s is along this line to get rid of this fractured reserve banking so you will have an anchor currency this gold or the gap stone which will serve as a unit of account and you will have some currency which is essentially not a claim to anybody but then you have deposits which essentially is inside money on these anchor currencies and that serves mostly as a medium of exchange and then you have credit and you have this triangle here where the anchor is typically a very small supply but then the credit is expanding and the triangle is expanding essentially at the bottom up and down and the banking of this initial anchor could be commodity like gold could be less liquid credit claims or it could be just data so it might be just some data control by certain IT firms so let me go back to this two tier financial system and emphasize this is from my work with Unisonicov essentially how such a fractured reserve banking system is prone to things we have seen and Victor has experienced during the crisis so you have essentially banks which have some risky claims let's say some credit and loans to one sector in particular and this sector is also holding some money and the bank is issuing inside money there will be some outside money that's in form of reserves which is held by the banking sector and let's see what happens if you have a negative shock to one sector in the economy for which the banking sector is very exposed to so it could be some housing sector whatever sector it is and let's dissect the whole shock the implications of the shock into four steps so the first step essentially is that there will be some losses in the assets but because the banks have exposure to this sector the banks will suffer too and of course they can diversify across these sectors so there will be some average of some assets will lose more others will lose less and the banks diversify across this but there will be an overall loss if it's a sector-wide shock or a macro-economy-wide shock the banks will suffer and their net worth is going down and if these risky claims go down by 5% because of leverage the net worth will go down by much more than 5% by 40% and this way after the loss the banks will be way more levered than there are before and what is the micro-bruden response to that the micro-bruden response to this is to shrink a balance sheet so that's what triggers the whole thing now if you can just say let's stop here and the banks keep on doing and diversify all the cities and got a risk from the sector away things will be fine but now they shrink the balance sheets and they're de-lever so essentially they extend less credit to this and this extending less credit means this sector has to shrink the balance sheets too and they have to fire sell some of the assets and this fire selling of these assets will actually lead to this liquidity spirals and depressed the asset price even further which lowers the asset value of this sector as well lowers the risky claims which hurts the banks again so if there would be one monopolistic bank it wouldn't do that but if they're competing banks they don't internalize this fires externalities and that's why it translates into more losses for the other banks and that's where this paradox of prudence comes in so if you think of every bank on its own is acting micro prudent they say after the shock I was way more levered I have to bring back my leverage ratio again and that's actually a prudent thing to do but by doing this you fact all the asset prices and that makes the whole thing on the macro scale much more dangerous and much more risky because you lose them further on the assets of the sector you lose risky claims value and this actually brings losses down further and that's essentially what is micro prudent might not be micro prudent it's the same thing as what Keynes said in the saving space if everybody starts to save at a higher rate if I save more than I spend less and your income is less and hence the total income is going down it's and we ultimately save in dollar terms or in euro terms we save less so the interesting thing is also that when the banks still ever not only on the asset side there's this fire sellers going on but there are also great less inside money when there's a great less inside money total money supply shrinks so the inside money so outside money supply is still fixed but the inside money is shrinking so total money supply is shrinking and that leads to disinflationary pressures and lower inflation and that lowers this increases the real value of this liabilities for the banks which shrinks the net worth even further so I might say what's about money demand what happens money supply shrinking but money demand is actually expanding why? because the banks that take out idiosyncratic risk and the economy diversified away and if they're not active anymore the idiosyncratic risk has to be held back by the households and as the households have to hold more idiosyncratic risk they shift away from physical investments into more money holding so the portfolio choice which let's say was 70-30 before will now be 60-40 so they want to ask more money so you have a shrinkage in money supply and expansion in money demand and both forces essentially lead to lower inflation and to less activity in the real economy and so forth and this essentially you would like to stop that's where the central bank comes in and essentially as the inside money shrinks you expand the outside money and contrast that and this might also be done just through stabilizing the financial banking system now let me go back to this essentially you can think of this triangle you can think as inside money expands and shrinks and holding outside money fixed you can think of this triangle essentially going together in the recession and expansion expands further and that's essentially the way you can think this outside money and not inside money kicking in now in a world with a digital economy we have to rethink money the way it is but we essentially we don't have to rethink so much we just go back to the foundations and there will be some new elements to it so what's the role of cash and reserves what forms of money will emerge you know what should central banks endorse and fight should they fight digital money or central bank digital currencies should they endorse cryptocurrency or the blockchain technology more generally and how does it affect the competition among currencies and that's essentially what I want to focus in and then I talk at the end about tokenization so that's basically what paper I've done with Joseph Abadi so the first thing you might ask you know how does the old system was we always had a centralized ledger and it was controlled by some intermediaries that keep track of the banking accounts and all this and the way you incentivize a bank from not lying and from not distorting the facts is through a franchise value so you give them in dynamic incentives over time if they're lied, they lose the franchise value and then you know the value goes away in a blockchain environment you have many people who keep track of the same ledger so it's distributed it's distributed and you keep essentially you lose the centralized franchise value because there's free entry so everybody can become a miner or write on a blockchain and so you don't have this franchise value so this dynamic incentivization is gone you essentially need some static incentivization so essentially you can classify this in things so if you have the traditional setting you have one monopolist let's say and he has a franchise value or a few players he has a franchise value you can incentivize this monopolist to do the right thing by giving him some franchise value you have some carrots over time he doesn't want to ruin his future in profits so he will actually do the right thing on the other hand if you have a blockchain you don't have the dynamic incentivize free entry so you have many potential writers and you need a different incentive scheme and the way you can characterize blockchain so the private existing system is very much centralized intermediaries who keep track of things on a ledger or on a central record keeping device and blockchains with a public blockchain are down there permission blockchains are in between so as a permission blockchains are essentially settings like Ripple who are actually a few players have the right to write on this ledger and not many of them I mean nobody can there's no free entry so in between okay so the last thing I would like to emphasize is the fork so once you have a blockchain a blockchain consists of a chain of blocks that's why it's called blockchain so you have different blocks and then at some point some people might say oh that's what we want to write as a true history of transaction of payments or others might disagree and split in some different framework or it might also be that in this blockchain we have implemented a certain monetary policy rule so the monetary policy rule might say 5% inflation and others say no we don't like this we want to fork off or fork away from this blockchain and go for 2% inflation okay so you can have through this blockchain you can have competition across different monetary policy rules where some fraction of minus or writers decide okay we go for a different rule and then depends whether the users of this cryptocurrency will come along to this new framework or not so essentially there are two forms of competition so one form of competition is this free entry that makes this blockchain this public blockchain different and as I mentioned before the restricted entry leads to this permission blockchains but the other difference in competition is this ability to fork okay and what makes this ability to fork so different from existing competition the ability to fork once you fork you carry all information on the blockchain with you okay so one if let's suppose there's a currency out there and I want to create a new currency I don't know who has much in what wallet and all this it's very hard to carry over to a new currency but in blockchain technology I can just fork the whole blockchain and all the information which was on the existing branch of the blockchain will carry over to the new branch okay this makes competition way more fierce among these currencies well let me put it differently if you look at the old-fashioned Hayekian currency competition so there's cash which you can think of imaginary ledger or each of you has some money in their wallets and if I write everything down I would have this imaginary ledger and nobody really knows the distribution of this cash of this cash and if I want to propose a new currency it will be very hard to coordinate over and bring to this new currency on the other hand if I have a cryptocurrency I can propose a new fork, a new branch branching away and all the information which was an existing branch will be carried over to the new branch so it's way easier to start up a new currency and say okay I will propose a currency with a lower inflation rate over the different monetary rule and of course I have to coordinate many people which I have to do at the moment right now but it's more and more easy okay so this reminds me of some analogy of 1922 increase and I see that Yanis is here there was actually a forking going on in 1922 when at some point what's nice about the Greek currency at that time is that you had it it was always written five minute here and five minute here and there was a law where you can cut the money into two parts and then you can use both parts and one part you can convert was supposedly converted into a bond and the other one was back in circulation and essentially this way it's like a fork competition because you don't need to know who has how much money but all the information is actually kept and I fork it nicely off so let me jump over that let me just keep to the final point was that I talked about this inside money but you can think of a system where essentially the unit of account and the initial transaction among the banks is done in a cryptocurrency way but what really happens on the private issues when people pay on the iPhone back and forth these are just tokens from some IT companies and that's what you see in China in another Asian countries evolving and coming up so essentially it will be less of the crypto side so the crypto side will be much more the outside money side and will be the interbank market might do on a permission blockchain some crypto transactions but the private transactions will happen much more on token basis because the banks or some people or some entities which are part of this interbank market Tencent, Alipayaba and so forth they will issue tokens and then people pay with these tokens and this can be done at much higher frequency than compared to what the blockchain technology allows one so let me conclude so we have macro models I think we moved away from the simple response function world to an endogenous volatility dynamics the paradox of prudence I think is very important here and then we have various money models and because of financial frictions and this leads combined with EDIS and GRIDIS leads to endogenous demand for money and that's essentially can expand and shrink depending how the volatility moves around over the cycle money in a digital age we will hear I think next more in the next panel traditional way is to have a centralized monopolist ledger new ways to have this decentralized ledgers but I think the interesting thing in terms of currency competition is this fork competition where the competition can be much more powerful because it requires much less coordination compared to existing currency competition so it's way more powerful than an Hayekian competition and then we will have this tokenization by social media firms and payment firms like Tencent, Alipay, Amazon and Apple there it will be very similar to the free banking era in the 19th century in the US the inside money will be the tokens the outside money will be a cryptocurrency potentially and perhaps we need some digital money after all because machines will have to pay each other rather than humans so I stop with this futuristic thought thanks again I'm trying this thank you so I'm certainly very delighted to be here on our invitor and to me one of the titans that essentially kept the eurozone together I see many of them here but you were certainly very centra in all these and as Mario mentioned you certainly had to deal with many, many shocks and I learned today that you did that while holding an enormous number of office hours to my co-panelists here so I admire you for that, Vitor so let, Marcus sent me three papers last Friday all of them fascinating as always with his work and I invite you to, I recommend that you actually read them I will focus on one of the topics the one that relates to what he calls they call the eye theory of money I think it's a great framework to study the interaction between price stability and financial stability it's just to remind you what it does it's a framework within complete markets households essentially have projects but they cannot sell claims on these projects intermediaries play the role of absorbing the part of the idiosyncratic risk generated by households' projects and at the same time they supply inside money which they used to provide here is money in the Samuelson sense of sort of value but it's a way of diversifying your portfolio making your portfolio a little safer given that you're so invested in these projects with idiosyncratic risk now when the balance sheet of intermediaries become impaired then both functions essentially are heard and that I think is the point that I like the most of all this work work that Julian and Marcus have done which that produces an imbalance in the risk market essentially agents need to demand more money because they now need to absorb too much risk and they don't want to hold that risk and that's what leads to this downward spiral that he described now in that role monetary policy then when you look at monetary policy from that perspective really what it's trying to do is to try to help again the agents to absorb the risk that the productive structure needs to generate in order to function and but what he highlights as well is that well if money is distracted in doing this you know in helping with the risk markets then you are likely to generate more hazard and you need to have another tool to deal with that so very naturally complementary you have monetary policy and macro potential policy sort of operating together when risk markets are the focus of analysis so I think this again I love every single paper they have written together not only for the messages of the individual papers but I think again it aligns very well at least with something that I think is very core for macroeconomics and I think their work is very instrumental in shifting a bit macro into what I something I like to characterize as recent macroeconomics and let me summarize it with this very simple diagram the way we normally think about macro models regular macro models and ones we use for everyday recessions and the ones we write in papers typically is mostly about sort of the upper boxes there a productive capacity when it expands capital generates output and we need to find the demand for that output and monetary policy is a lot about finding the demand and fiscal policy about finding the demand for that output but when output expands when an economy grows it also generates risks there are new risks that arise and we also need to find the demand for that risk and lately when at least we will get significant financial events actually the imbalance is much larger in the bottom panels than in the top panel so the key game is how do we generate demand for the risk that the productive structure very naturally generates and that obviously what matters is not the risk is generated but also the risk that is perceived by economic agents so at times like this the red box that comes from the supply side looks enormous to economic agents and the red box that is on the demand side looks very small and we can think about monetary policy conventional monetary policy is just increasing the appetite for that risk if you lower interest rate for any given expected return capital gains that you may have on risky assets then by lowering the interest rate you increase the sharp ratio of risky assets and that induces sort of an increase in demand for risk now in a good significant financial event like the one you had to deal here with that's not gonna be enough that you can expand a little bit that red box to the right but it's never gonna be enough to absorb sort of all the risks that you have on the left and if you're not able to do that then asset prices collapse that relates to what Roger was talking about asset prices collapse that fits into aggregate demand and then that contaminates immediately the goods markets and so you can think about QE policies especially when they have a credit component and so on is really about adding appetite for risk somehow either or is about shrinking a little bit the supply of assets by absorbing that into the balance sheet of somebody that is not as sensitive to risk as households and investors are so I see their work very much as moving us in the direction of thinking about macro more in these terms I've done some work and it's easier when you receive the papers very late to talk about your own work along these lines in fact I like so much this idea of recent that that's in the title of the paper that seems like an I wrote recently and it's really a much more traditional macro mode but with this perspective so we call it a recent models for aggregate demand recessions and there too macro potential policy will play a very important complementary role and the basic idea is very simple I have no idea how much time so I will tell you the story three times five minutes words and so on five minutes okay well so let me tell you once the story and probably I will give you to daily twice so what happens here is occasionally risk rises dramatically risk perception rises risk premium rises it could be because of problems in balance sheets intermediaries or something else and that if it is sufficiently high then the central bank will try to relax monetary policy lower interest rate but at some point is not enough we hit the zero lower bound and that triggers a traditional recession now one of the points of this work is that that feed that is a feedback in fact and we were talking about causality with Royer but really what happens is they feed into each other because the risk premium you know leads to a decline in interest rate when that's not enough to balance the risk markets then asset prices collapse but when asset prices collapse demand collapse demand collapse the dividends collapse and profits collapse and therefore asset prices collapse and there's a downward spiral that develops and how deep that downward spiral is well the only thing that can balance that is some hope that you're gonna get out of this situation and then when asset prices decline well that gives you a big expected capital gain but for that you need to hope that you get out of the stuff very soon because if not there's no capital gain to be had and so the degree of pessimism you have is very important in stabilizing an economy and in that context speculation during the good time is particularly damaging because speculation by its very natural makes the economy extrapolative in good times the optimists do very well in bad times the pessimists do very poorly so to the extent that you have a speculation you're gonna have the wrong selection of individuals dominating the asset pricing at the time in which you fall into a deep crisis and the anticipation of this even can produce even larger and larger effects okay so the reason for macro-prudential regulation here is different from the one that Marcos highlighted but it's related it's not a model of moral hazard and so on but it's a matter it could be complemented by moral hazard it's a matter of an aggregate demand externality is the fact that you will need optimists when things go wrong you need people that can value high-lead assets banks because they can leverage and so on are those type of agents okay it's not about believing that they're not necessarily but it's about agents that can value things highly and you need somebody that supports asset markets when things go very wrong because of an aggregate demand externality it's not a model of a pecuniary externality it's a model in which there's an aggregate demand externality which you need to offset with if you don't have monetary policy to dilute that's what triggers the aggregate demand externality macro-prudential regulation helps you because it protects the wealth of those agents that you need very much in our session am I pointing at the right place or oh okay so I have very little time clearly but let me explain the equations I think where Roger was trying to say and John as well so the model really is two equations the first equation is really good market equilibrium and there's lots of shocks going around everything is normalized so all that they have there in the left-hand side is capacity utilization and the right-hand side is consumption as a function of asset values Q and Q theory investment as a function of Q and what you see from that equation is that you need high asset prices in order to support aggregate demand so you can have full capacity utilization but that means that asset prices are really locked into this goal into this role you need an asset prices are sufficiently high at Q star in order to have full employment and the question then becomes well how do I ensure they have enough wealth price house house prices stock markets and so on how do I ensure that I can support that wealth that this economy needs in order to have full employment well for that I need to look at the risk market condition what is happening in the risk market in the red box that they had at the bottom that's what the second equation does on the left-hand side you have the supply of risk that the economy has the volatility of the economy the perceived volatility and on the right-hand side is a complicated way of writing the sharp ratio what is a proxy for the demand for risk in the economy so the issue is well suppose that the risk premium rises dramatically the perception of volatility rises well that immediately shift the am I pointing at well anyways it shift the left-hand side up immediately and it also shift the right-hand side down because for any expected return given more risk there is a demand for that risk and so the role of monetary policy said earlier on is really to I'm having a ball here with this stuff there's a lag talking about PLLs and so on in evidence so so interest rate policy will try to offset that but is the jump in volatility sufficiently high is not enough and then asset prices will drop but when asset prices drop there in order to generate an excess return no I expected capital gain but when that happens that brings an aggregate demand and you get excess capacity so here you had two scenarios one in which there's a low risk premium environment in which interest rates are positive and that's enough to ensure that asset prices the amount of wealth that you need to support full employment interest rates are positive another one is a high risk premium estate in which the interest rate becomes binding and then asset prices collapse that generates a recession and so on so the only one thing I want to say is that now pessimism matters a lot both for good times and bad times to be a pessimist in good times mean that you think that it's very likely that you may go into this high volatility high risk premium environment and it does the case it's easy to see in the formula which is there at the bottom at the top that the equilibrium interest rate starts declining in the good estate not necessarily because now you're afraid that when things go wrong you're not going to have the interest rate to deal with that asset prices will have to collapse and therefore you have to you need a lower interest rate to compensate for the expected capital gain that now takes place when you go into high vol regime I'm almost done and then in the bad estate well then pessimism matters a lot because as I said before when asset prices falls if you keep dividends constant asset prices fall that immediately makes an excess return an increase in excess return but if dividends come along or expected profits come down because the demand is coming down then that doesn't work and in fact in our mall what happens is the economy implodes the more asset prices drop the more profits demand drops the more profits drop the more asset prices drop and there's no end to that the economy implodes the only thing that saves you is optimism and what is optimism optimism is is say okay look this stuff is gonna end in the near future and if it ends in the near future then a sufficiently large drop in the in asset prices gives you an after for capital gain that that stabilizes the economy okay I'm done it's a good conclusion anyway huh? yeah I'm almost done it's a fantastic conclusion anyway I'm almost done Timism will save us well you need enough optimism that's an economy you know that they say you can see how as economy becomes more and more pessimistic the whole feedback sort of starts going worse and worse and I'm not gonna be able to say anything about speculation but the blue line shows for the same level of wealth of distribution of level of wealth for the same level of pessimism collective pessimism when you have more speculation more heterogeneity in beliefs the drop in asset prices the feedback is more negative and that's the reason you need to do macro-prudential regulation here and you do wonderful things with macro-prudential policy but in any event so let me let me conclude here so these are both views that I call recentric they have differences but they have something in common and that's what I want to finish with it's a very recent perspective of macro that highlights wealth effects and I think everyone in the panel has done that and the key question is how does the economy absorb the risk being generated by the productive extractory and how to integrate monetary and macro-prudential policies to make that absorption process a smoother so it doesn't contaminate the real side of the economy this is a variety of models now new models that really think about the world about macro in these terms so let me end here thank you very much Ricardo so for the audience there will be a quiz on Ricardo's model