whystudymoneybankingandfinancialmarkets-資料下載頁(yè)
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【導(dǎo)讀】Money,Banking,Markets?panies,financepanies,pensionfunds,firms.Recessions(unemployment)andexpansions. Sources:;
【正文】 nks ? World Stock Markets – Help finance federal government also Copyright 169。 2020 Pearson AddisonWesley. All rights reserved. 135 Function of Financial Intermediaries: Indirect Finance ? Lower transaction costs (time and money spent in carrying out financial transactions). – Economies of scale – Liquidity services ? Reduce the exposure of investors to risk – Risk Sharing (Asset Transformation) – Diversification Copyright 169。 2020 Pearson AddisonWesley. All rights reserved. 136 Function of Financial Intermediaries: Indirect Finance ? Deal with asymmetric information problems – (before the transaction) Adverse Selection: try to avoid selecting the risky borrower. ? Gather information about potential borrower. – (after the transaction) Moral Hazard: ensure borrower will not engage in activities that will prevent him/her to repay the loan. ? Sign a contract with restrictive covenants. Copyright 169。 2020 Pearson AddisonWesley. All rights reserved. 137 Function of Financial Intermediaries: Indirect Finance ? Conclusion: – Financial intermediaries allow “small” savers and borrowers to benefit from the existence of financial markets. Copyright 169。 2020 Pearson AddisonWesley. All rights reserved. 138 Table 3 Primary Assets and Liabilities of Financial Intermediaries Copyright 169。 2020 Pearson AddisonWesley. All rights reserved. 139 Table 4 Principal Financial Intermediaries and Value of Their Assets Copyright 169。 2020 Pearson AddisonWesley. All rights reserved. 140 Regulation of the Financial System ? To increase the information available to investors: – Reduce adverse selection and moral hazard problems – Reduce insider trading (SEC). Copyright 169。 2020 Pearson AddisonWesley. All rights reserved. 141 Regulation of the Financial System ? To ensure the soundness of financial intermediaries: – Restrictions on entry (chartering process). – Disclosure of information. – Restrictions on Assets and Activities (control holding of risky assets). – Deposit Insurance (avoid bank runs). – Limits on Competition (mostly in the past): ? Branching ? Restrictions on Interest Rates Copyright 169。 2020 Pearson AddisonWesley. All rights reserved. 142 Table 5 Principal Regulatory Agencies of the . Financial System
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