Module1 - Module Module 1 Introduction to Financial Systems...

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odule 1 Module 1 Introduction to Financial Systems
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odule 1 Module 1 ± earning goals: Learning goals: To know the definitions relating to the financial ystem system To understand the basic concepts relating to struments (assets) Instruments (assets) To understand the basic concepts of markets. To understand the basic concepts relating to intermediaries (banks, savings banks, brokers, etc.) To understand the basic concepts relating to regulatory bodies (Bank of Spain, CNMV, DGSFP) 2
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odule 1 ± ontext Module 1 Context Students should imagine that they have joined an intermediary or regulatory body of their choice. They should see this as a conceptual immersion which allows them to carry out the main responsibilities assigned them at work. 3
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odule 1 ± verview Module 1 Overview Introduction and structure Definition of: • Instruments •Ma rke ts • Intermediaries • Regulatory bodies 4
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troduction and Structure Introduction and Structure
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troduction Introduction ± inancial system definition Financial system definition. The financial system comprises markets, stitutions and instruments whose primordial institutions and instruments, whose primordial aim is to put spending units with a surplus into ontact with spending units with a deficit thus contact with spending units with a deficit, thus channelling the savings of the former towards e latter the latter. ± The financial system is more efficient: The more savings are channelled he more it contributes to economic growth The more it contributes to economic growth. 6
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troducción Introducción ± he financial system comprises markets The financial system comprises markets, institutions and instruments, whose rimordial aim is to put spending units with a primordial aim is to put spending units with a surplus into contact with spending units with a deficit, thus channelling the savings of the former towards the latter. 7
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Instruments
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struments Instruments ± hat? What? They are instruments that transfer funds between economic agents. They generate a liability = a payment obligation. The buyers are other economic units to obtain a return They are instruments for transferring risk. The issuer transfers a part of the risk in their activity to the buyers.
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This note was uploaded on 02/03/2011 for the course ECON 101 taught by Professor Flora during the Spring '11 term at Universidad Carlos III de Madrid.

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Module1 - Module Module 1 Introduction to Financial Systems...

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