Unformatted text preview: to mutual funds and pension
funds being called “transparent” intermediaries. By contrast, the lower correlation between the performance of
the assets and liabilities of banks, thrifts, and insurance companies has led to their being called “opaque” intermediaries. See Steven A. Ross, “Institutional Markets, Financial Marketing, and Financial Innovation,” Journal
of Finance, July 1989, pp. 541–56.
R. Merton, “A Functional Perspective of Financial Intermediation,” Financial Management, Summer 1995,
The number of banks in the United States dropped from 12,230 in 1990 to 8,315 at the end of 2000, a decline of
32 percent. This decline is even more dramatic when it is realized that 1,496 new bank charters were granted in
the 1990–2000 period. sau86198_ch01.qxd 18 Part One 4/21/02 8:52 PM Page 18 Introduction etrade
Buying and selling
shares on the Internet. www.sec.gov late 1990s and early 2000s has been considerably better than in the early 1990s (despite the effects of a recession and terrorist attacks on the World Trade Center and the
Pentagon in September 2001) (s...
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