Macroeconomics and financial economics at Executive MBA

The Executive MBA Essentials of Financial Economics residency session brought participants together at MiLgårdarna in Klippan to delve into macroeconomics and financial economics. “The macroeconomic trend affects and determines the framework conditions for all companies,” says Jens Forssbaeck, team leader of the residency session.

Jens_ForssbaeckWe asked Jens Forssbaeck to answer three questions:

Essentials of Financial Economics – why is this important?

The subject matter of the module is perhaps actually broader than the title implies – the contents relate equally to macroeconomics and financial economics, and the module provides an introduction to these two subject areas. It is important because the macroeconomic trend affects and determines the framework conditions for all companies. Of course, exactly how varies to a great degree from company to company, but that’s why it’s important to have some fundamental analysis tools to understand how the macroeconomy affects us.

How was the session structured?

The residency session was preceded by independent reading by the participants – they used a couple of joint “textbooks” that everyone read, and the participants studied various subjects in groups of 3-4. We then continued to delve into these subjects at the residency session and the teaching method was essentially based on the participants teaching each other. The participants worked on assignments in groups with various subjects and different case countries. For example, on the subject of sovereign risk, this could take the form of using rating agency Moody’s analysis tool to assess the country of Nigeria’s credit risk.

What do you want the participants to take away from the session?

This module takes on a huge subject, and it’s only natural that we need to be selective. We do not intend to turn all the participants into fully fledged macroanalysts either – we just want them to take away some fundamental tools. This is a subject with which most participants do not have much past experience, and there is a certain degree of resistance at first. Nevertheless, I hope that after this module, they will have gotten far enough past that threshold that they can continue on their own.


A few quick questions

What do you have in the pipeline now?
I am currently involved in a couple different research projects, but what has taken nearly all my time the past weeks is an article on the effects of the TARP program, which led to the American government investing over 200 billion dollars in a bailout of the US banking system during the financial crisis. We are particularly interested in what consequences this had for the banks’ creditors and bond pricing.

What is the best thing about your job?
That it gives me the freedom to pursue my curiosity. And that you are in a truly international environment – nearly half the students I teach come from countries other than Sweden.

Best book you would recommend?
For those who are interested in the financial crisis, I recommend Gary Gorton’s Slapped by the Invisible Hand. Another book that provides an interesting parallel to the Swedish debate about household debt is Atif Mian and Amir Sufi’s House of Debt.