Using Bloomberg as a
Teaching Tool in Economics
Hossein S. Kazemi
Associate Professor of Economics
Stonehill College
8th Annual Economics Teaching Conference
Orlando, Fl.
November 8, 2012
Motivation
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Teaching Economics vs. science
engaging students
reinforcing the material
more in depth understanding of the material
better absorption of material
better retaining of material
improved assignments
improved test results
better real life understanding of economics
better internships and jobs
better skills at work
increased number of majors
happier administrators
happier book publishers
Typical Teaching Approaches
 chalk and talk method
 a good lecturer will capture students' attention
 a good lecturer will attract more students
 a good lecturer will keep students engaged
 publisher supplied power point presentation for the text
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forces the instructors to stay focused
minimizes the possibility of going on a tangent
Shallow
boring to students
boring to the instructor
did I say boring?
Review of the Literature
 Out of 14 of the articles in this paper's literature review,
12 argue that use of technology helps.
 the two that did not were based on the following
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that students’ performance in virtual courses was inferior to that of students who took
live or ‘hybrid’ classes where face-to-face lectures were integrated with a variety of
online material.
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A study of the effectiveness of web-based homework in teaching undergraduate business
statistics" did not find any significant difference between the performance of students
who had been assigned a variety of web-based homework and students who had been
assigned traditional textbook-based homework.
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Summary of the Lit. Review
 study author/s
 title
 technology used
 principal findings
 bottom line
 yes or no
Table 1
Summary of Studies of the Efficacy of Technology in Teaching Economics
Study
Title
Technology
Principal Finding(s)
Does
Technolo
gy
Improve
Learning
Notes
Murray (1999)
Econometrics
Lectures in a
Computer
Classroom
Computer
Simulations:
Monte Carlo
methods
- Discusses the benefits of use of
Monte Carlo in teaching Econometrics.
Concludes that there are caveats but
computer use is beneficial.
Yes
Some Caveats
Mark S. Walbert
and Anthony L.
Ostrosky(1997)
Using Mathcad to
Teach
Undergraduate
Mathematical
Economics
Computer
software for
Engineers:
Mathcad
-Test scores 11% higher than scores
earned by students who did not use
Mathcad, an increase of more than one
letter grade
Yes
The use of
Mathcad in a
one-semester
undergraduate
mathematical
economics
course.
Students in both
groups took
identical tests
and by
controlling for
study time, they
were able to rule
out the
suggestion that
increased time
on tasks raised
the test scores of
the students in
the Mathcad
section.
- Mathcad could also allow the
instructor to cover topics or introduce
techniques that were formerly
considered too advanced.
Table 1 Continued…
Summary of Studies of the Efficacy of Technology in Teaching Economics
Study
Title
Technology
Principal Finding(s)
William E.
Becker and
Michael
Watts(2001)
Teaching Economics at the
Start of the 21st Century: Still
Chalk-and-Talk
Chalk-andTalk
-Economists use passive
teaching techniques and this
may be causing decrease in
enrollment in economics
courses.
- Economists have not
adopted active teaching.
Saunders
(1998)
Learning Theory and
Instructional Objectives
Salemi (2002)
An Illustrated case for active
learning
- New learning (with
technology) is more efficient
if linked to material
students have previously
learned.
- A strong case for active
learning techniques by
outlining numerous benefits
that stem from their
inclusion in the classroom.
He gives an example of
active learning. Active
learning is neither a panacea
nor a free good. In their
experience, it is a strategy
through which students gain
lasting understanding of
important economic
concepts.
Does
Technolo
gy
Improve
Learning
Yes
Yes
Notes
Table 1 Continued…
Summary of Studies of the Efficacy of Technology in Teaching Economics
Study
Title
Technology
Principal Finding(s)
Does
Technology
Improve
Learning
Hawker(1986)
The effects of replacing some
manual skills with computer
algebra manipulations on student
performance in business calculus
Computer
Algebra
Manipulations
Yes
Heid(1988)
Resequencing skills and concepts in
applied calculus using the
computer as a tool
Computer
Found evidence that
students using
computer algebra
systems perform as
well as or better than
students in traditional
business calculus
courses.
Judson(1988)
Effects of modified sequencing of
skills and applications in
introductory calculus
Palmiter
(1991)
Effects of computer algebra
systems on concept and skill
acquisition in calculus
Empirical results
indicated that students
who used the
computer algebra
system scored higher
on tests covering both
their conceptual
knowledge as well as
their ability to do
computations.
Yes
Computer
Algebra
Systems
Notes
- In a broader study, the performance of
university students taught engineering calculus
using a computer algebra system was compared to
the performance of students using paper-andpencil computations. Both groups received lecture
as a primary means of instruction throughout the
semester. However, after five weeks, the
computer algebra system group also spent time
engaged in active learning with computer-oriented
labs.
Table 1 Continued…
Summary of Studies of the Efficacy of Technology in Teaching Economics
Study
Title
Technology
Principal Finding(s)
Does
Technolog
y Improve
Learning
Galbraith and
Pemberton (2001)
Digging Beneath
the Surface:
When
Manipulators,
Mathematics,
and Students Mix
On the use of
symbolic
computation in
undergraduate
microeconomics
instruction
Computer Software
Yes
Miles Cahill and
George Kosicki (2000)
Exploring
Economic Models
Using Excel
Excel Software
- Found a strong correlation
between confidence and
motivation after integrating
Maple into undergraduate
mathematics courses in
Australia.
-Eight of the 10 questionnaires
characterized the experience
with Maple as helpful or positive.
A number of students
commented that Maple allowed
them to focus more on
economics and less on
mathematics.
They don't have evidence for
efficacy but suggest that their
methods may lead to
improvements.
Owen, A. (2007)
Integrating
Computer
Applications Into
Economics
Electives
Computer
Applications
Some evidence has been
presented that suggests that
students enjoy economics
courses more when they are
taught in this way and are more
actively engaged in the material.
Yes
Boyd, D.W. (1998)
Computer Software
Yes
Notes
Table 1 Continued…
Summary of Studies of the Efficacy of Technology in Teaching Economics
Study
Title
Paul G. King and
Ross M. LaRoe
(1991)
The Laboratory-Based
Economics Curriculum
Kendrick,
Mercado and
Amman (2006)
Computational
Economics: Help for
the Underestimated
Undergraduate
Technology
Principal Finding(s)
The revised TUCE test results
showed significant increases in
student understanding of
macroeconomics in all sections.
Provide examples from a number of
fields of economics and discuss how
they can be used to develop
opportunities for students to learn
about and then modify these
computational models.
Does
Technology
Improve
Learning
Notes
Yes
An analysis of
variance test
indicates that
students in the lab
sections learned
more than students
in the non-lab
section. The F
statistic shows a
significant
difference between
the lab and non-lab
sections at the
recognition level,
but not at the
explicit level.
Table 1 continued…
Summary of Studies of the Efficacy of Technology in Teaching Economics
Study
Title
Elliott (2003)
Using a personal response
system in economics teaching
Brown and
Liedholm (2002)
Can web courses replace the
classroom in principles of
microeconomics?
Palocsay and
Stevens (2008)
Technology
Principal Finding(s)
Does
Technology
Improve
Learning
- reported improvement in students’ performance
and in their enjoyment of lectures after introducing
a Personal Response System.
Yes
Web
Technology
found, however, that students’ performance in
virtual courses was inferior to that of students who
took live or ‘hybrid’ classes where face-to-face
lectures were integrated with a variety of online
material.
No
Computational Economics: Help
for the Underestimated
Undergraduate
Web
Technology
A study of the effectiveness of web-based homework
in teaching undergraduate business statistics" did
not find any significant difference between the
performance of students who had been assigned a
variety of web-based homework and students who
had been assigned traditional textbook-based
homework.
No
Dufresne et al.
(2002)
Using a personal response
system in economics teaching
Web
Technology
- The effect of web-based homework on test
performance in large enrollment introductory
physics courses
Yes
Lass et al. (2007)
Teaching with technology to
engage students and enhance
learning
found that online homework did lead to higher exam
performance.
Notes
Five Step Approach
 Show students the tools in the discipline
 Use Bloomberg to crunch the numbers and see how things
work at the technical level
 Use Bloomberg to show the interaction between economic
news and financial markets
 Have them follow up the lecture and Bloomberg presentation
with CNBC, WSJ, the Barron’s and the Economist
 Have them produce a report that highlights what they have
learned and its connection with what they have seen and read
in the media
Courses where Bloomberg used:
 Bloomberg is used by the author in a series of Economics
and Finance classes over the course of the past 15 years
at four of the major Boston area colleges in business,
economics and school of management. Courses such as
Money & Banking, Macro Theory, Investments, Monetary
Policy, International Finance, Impact of News on
Financial Markets, Capital Markets and Investments,
Investments & Portfolio Analysis, Money & Financial
Markets, Fixed Income Analysis, and Portfolio
Management.
Examples of How to Use Bloomberg
 Effect of QE on Equity Markets
 Equity Analysis
 Treasury Securities
 Yield Curve
 Fixed Income Analysis
 Market Indexes and Volatility
 Fed Funds Rate and Taylor Rule
Dow Industrial’s Response to QE1
Dow Industrial’s Response to QE2
Dow Industrial’s Response to Operation Twist
Figure 1. Bloomberg Quote for Apple Computers Inc.
Source: Bloomberg Professional
November 7, 2012
Figure 3. Bloomberg Earnings Estimate for Apple Computers Inc.
Source: Bloomberg Professional
November 7, 2012
Figure 4. Beta for Apple Computers Inc.
Source: Bloomberg Professional
November 2, 2012
Figure 5. Bloomberg Earnings Estimate V.S. Price for Apple Computers Inc.
Source: Bloomberg Professional
May 26, 2012
Figure 6. Bloomberg Bollinger Bands for Apple Computers Inc.
Source: Bloomberg Professional
November 7, 2012
Figure 7. Price Ratios for Apple Computers Inc.
Source: Bloomberg Professional
May 26, 2012
Figure 8. Price and Volume Movements for Apple Computers Inc.
Source: Bloomberg Professional
November 7, 2011- November 7, 2012
Apple’s 20% decline since it’s September 19th peak
Figure 9. 10-Day Intraday Price for Apple : Face Book Phenomenon
Source: Bloomberg Professional
May 14 - May 25, 2012
Figure 10. Trade/Quote Recap for Apple Computers Inc.
Source: Bloomberg Professional
November 7, 2012
Figure 11. Relative Value Comparison for Apple Computers Inc.
Source: Bloomberg Professional
November 7, 2012
Using Bloomberg to Present Treasury Actives
and Derive Yield Curve
 Treasury Bills
 Treasury Notes
 Treasury Bond
 Treasury Inflation Protected Securities (TIPs)
 Derivation of Yield Curve
Figure 12. Treasury Actives (PX1)
Source: Bloomberg Professional
November 7, 2012
Figure 13. US Yield Curve
Source: Bloomberg Professional
November 7, 2012
Figure 14. International Yield Curve
Source: Bloomberg Professional
November 7, 2012
Bonds: Pricing/Yield
 bid/ask price
 yield to maturity
 accrued interest
 reinvestment interest
 street convention
 duration
 convexity
Figure 15. Treasury Actives
Source: Bloomberg Professional
November 7, 2012
Figure 16. Yield Analysis
Source: Bloomberg Professional
November 7, 2012
Figure 17.
Impact of News on Financial Markets
November 7, 2012
Figure 18.
Taylor Rule: Inflation/Unemployment Gap Model
Figure 19.
Taylor Rule: Stone & McCarthy Model
Figure 20.
Taylor Rule: Deutsche Bank Model
Challenges
 Administrators
 lack of support
 poor understanding of Bloomberg capabilities
 budgetary limitations
 IT
 lack of timely response when help is needed
 slow bandwidth
 rare internet connection interruption
 Students
 addiction to using ctrl+c and ctrl+v
 unwillingness to sub Bloomberg for the internet
Challenges
continued...
 Instructor
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teaching with a new technology is not easier
time consuming
requires revamping the entire course
have to be ready to do chalk-and-talk if any glitches
be prepared to hit the curve balls from technology suppliers
 Faculty Peers
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the biggest hurdle
unwillingness to sign on
unwillingness to learn new tricks
unwillingness to have their students trained
see it as too big of an investment