The aim of this paper is to explore the reasons of gold price volatility. It analyses the information function of the gold future market by open interest contracts as speculation effect, and further fundamental factors including inflation, Chinese yuan per dollar, Japanese yen per dollar, dollar per euro, interest rate, oil price, and stock price, in the short-run. The study proceeds to build a Dynamic OLS model for long-run equilibrium to produce reliable gold price forecasts using the following variables: gold demand, gold supply, inflation, USD/SDR exchange rate, speculation, interest rate, oil price, and stock prices. Findings prove that in the short-run, changes in gold price does granger cause changes in open interest, and changes in Japanese yen per dollar does granger cause changes in gold price. However, in the long-run, the results prove that gold demand, gold supply, USD/SDR exchange rate, inflation, speculation, interest rate, and oil price are associated in a long-run relationship.

The aim of this paper is to analyze how aggregate activity in Lebanon fluctuates with regard to recurrent shocks. The research starts by identifying the Lebanese economic business cycle from the first quarter of 1998 to the fourth quarter of 2015 adopting a statistical method. Furthermore, this research studies the relationship between the capacity utilization rate and the inflation rate to explore theoretically and empirically how monetary and real shocks account for the disturbances that affect the economic activity. Findings prove that, over the studied period, the Lebanese economy performs largely under its full capacity and that the capacity utilization rate is related to inflation in the short run, but not in the long run. In other terms, findings prove that monetary factors account for business cycle disturbances of the Lebanese economy in short run, but not in the long run.

The investment decision Process varies from one individual to another and from one country to another respectively. These decisions are usually taken based on either a Conventional basis or linked to the sentimental side of investors and reflected through behavioral finance gateway, where biases and psychological side of investors control their way of thinking and affect their investment decisions endlessly. Furthermore, based on previous literature the majority of investors tend to incorporate both gateways during their investment process as they don’t depend solely on Conventional gate, but their psychological part appears to play a big role while deciding and similarly for Lebanon. However, the main aim of this paper lies in investigating the main factors from both gates triggering Lebanese individual investors’ decision-making during their investment process. Moreover, the empirical part lies on focusing on a bunch of samples from individual Lebanese investors distributed along with most Lebanese districts; where 211 complete responses are interpreted within the SPSS program, undergoing factor analyses and Regression models. Results obtained indicates that Lebanese individual investors tend to incorporate both gateways in their investments decision, where the main goal stays utility and profit maximization; that to say tending to seek profits regardless of the investment field and approach. Nevertheless, during seeking profits Lebanese investor is being exposed to certain behavioral errors and biases that appear to impact and control his decisions significantly during investment making the process so far, and theses biases are affecting the Lebanese individual investors clearly more than that of conventional ones.

This paper estimates the output Gap for Lebanon to analyze the economic policy and to judge the stance of the economy. Therefore, a Cobb-Douglas production function is estimated for the period Q11998 to Q42015 and potential output calculated by substituting for potential levels of the factors in the estimated production function. The calculation of potential labor required the calculation of the NAIRU. This paper calculates therefore three types of NAIRU. The results of output gap calculations show that the Lebanese economy is working over its capacity and that it hits his limits. Furthermore, findings show that the labor market is characterized by high levels of NAIRU which restricted potential output growth. Therefore, any policy aiming to increase economic growth, while neglecting structural reforms will prove to be unsustainable.

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