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Unformatted text preview: The determining factor is time. Money Market of investment or instrument of 1 year or less maturity Capital market is a market of investment or instrument of anything greater than 1 year. Bonds > 1 year Capital Market Stock > 1 year Capital Market Risk => Systematic/Systemic Risk, Non-Systematic/Non-Systemic Systemic Risk: Impacts whole economy, with no means of preparation S.A. War, Weather, Recession/Depression “Big Risk,” “System Wide Risk,” Collapse financial Institutions Non-Systemic: Individual Risk, Specified Risk Locust Invasion in Corn Crops: Hurts farmers, drives the price of corn up, but not much else Price Oil Rises: Pay more, but can prepare for it, and find alternate means of energy....
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- Spring '10
- Finance, Collapse financial Institutions, Bonds Banks, Repay Suppliers Demands