瀸敢瑡-Chapter3-MarketStructures.pptVIP

Chapter 3 - Market Structures * This Lecture Financial Systems Markets Intermediaries This Lecture options of financial demand and supply regional differences in financial structures how people save and invest criteria of financial market classifications the trade-off between risk and return the international dimension the interconnectedness of markets Options Which options has a private household in western Europe looking to finance the purchase of a new car, a house, or other consumer durables? looking for an opportunity to save? Options a private household in western Europe looking to finance the purchase of consumer durables can take a bank loan look for special finance (mortgage, consumer loan offered by a car producer ...) use a credit card spend own savings ... in most cases a financial intermediary is needed Options a private household in western Europe looking for an opportunity to save can open a savings account buy bonds or shares speculate in foreign exchange invest in derivatives buy insurance keep the money under the mattress in most cases a financial intermediary is needed Financial intermediaries take the money from one party and give it to another in exchange for a small fee or other form of compensation, or arrange for capital demand and supply to meet in organised markets. Providers of financial services include banks investment funds insurance companies credit card companies non-bank financial firms (GE Capital, Ford Motor Credit Company) ... Options Which options has a business firm in western Europe looking to finance an investment or its daily expenses or actively manage financial risks? Options A business firm can take a bank loan issue securities buy and sell short-term papers, bonds and shares engage in money market and foreign exchange transactions engage in derivatives trading Options Firms’ fina