Chapter 2 Outline

Chapter 2 Outline - Chapter 2 An Overview of the Financial...

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Department of Economics So Chapter 2: An Overview of the Financial System Econ 330: Money and Banking Fall 2007 Prof. Joseph Santos This outline draws from Frederic Mishkin’s Money, Banking and Financial Markets (2007) and, as such, contains copy written material. Please do not quote without proper citation.
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Department of Economics So [1] Structure of the Financial System [1] Structure of the Financial System [2] Functions of Financial Markets [3] Structure of Financial Markets [4.1] Financial Market Instruments [4.2] Financial Market Instruments [5] Internationalization of Financial Markets [6] Functions of Financial Intermediaries [7.1] Types of Financial Intermediaries [7.2] Types of Financial Intermediaries This outline draws from Frederic Mishkin’s Money, Banking and Financial Markets (2007) and, as such, contains copy written material. Please do not quote without proper citation.
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Department of Economics So [2] Functions of Financial Markets Financial markets are real or virtual locations where people who have an excess of funds transfer (directly) these funds to people who have a shortage of funds. In direct finance, spenders obtain funds directly from savers in financial markets by selling the latter securities. In indirect finance a financial intermediary stands between spenders and savers and, as such, helps transfer funds from one to the other. Why is channeling funds from savers to spenders to important? Financial markets transfer funds from those with no investment opportunities to those with investment opportunities. Financial markets improve the wellbeing of consumers by allowing them to time (or, smooth) their purchases. [1] Structure of the Financial System [2] Functions of Financial Markets [3] Structure of Financial Markets [4.1] Financial Market Instruments [4.2] Financial Market Instruments [5] Internationalization of Financial Markets [6] Functions of Financial Intermediaries [7.1] Types of Financial Intermediaries [7.2] Types of Financial Intermediaries This outline draws from Frederic Mishkin’s Money, Banking and Financial Markets (2007) and, as such, contains copy written material. Please do not quote without proper citation.
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Department of Economics So [3] Structure of Financial Markets Some important terminology:
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This note was uploaded on 04/09/2008 for the course ECON 330 taught by Professor Santos during the Spring '08 term at SD State.

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Chapter 2 Outline - Chapter 2 An Overview of the Financial...

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