Please help me fix my problems

Dear Prof.Johannes Pfeifer
Please help me fix my problems with dynare code.
Firstly, I constructed my model and It works.
In order to make it better, I continue to consider another member society (banking sector) and introduce the money growth rule in my model. And then the error appears like
Warning: Matrix is singular to working precision.

In evaluate_steady_state at 85
In resol at 104
In check at 73
In ha_r4 at 655
In dynare at 180
Error using print_info (line 80)
The steady state contains NaN or Inf

Error in check (line 76)
print_info(info, 0, options);

Error in ha_r4 (line 655)
oo_.dr.eigval = check(M_,options_,oo_);

Error in dynare (line 180)
evalin(‘base’,fname) ;

Please tell me how to fix this problem.
Thank Professor so much
Best Regard
Ha
newdata_taylor.m (8.45 KB)

Put

resid(1);
steady(solve_algo=0);

before

check; model_diagnostics;
to see that

[quote]Residuals of the static equations:

Equation number 48 : 0.005[/quote]

This means your model is not correctly linearized. In particular, equation 48 is

mcspread=r_b - R_b;
with mcspread being a parameter equal to 0.005. This equation cannot be correct.

A few other things:

  1. If you want to estimate your model, you need to fix the parameter dependence. You are not taking parameter dependence into account. That’s why you should use model-local variables (the ones with the pound operator) or a steady state file. See Remark 4 (Parameter dependence and the use of model-local variables) in Pfeifer(2013): “A Guide to Specifying Observation Equations for the Estimation of DSGE Models” sites.google.com/site/pfeiferecon/Pfeifer_2013_Observation_Equations.pdf.

  2. Your observation equation is wrong. You are trying to match trending data to stationary model variables. See again the referenced guide on how to correct this.

  3. sigma_r is not set in your file, but used later.