Financial Markets

An introduction to Financial Markets and Institutions.

By the end of this module the student should be able to:

1. Understand current issues affecting financial markets and institutions and their customers;
2. Understand the workings of financial markets and institutions and the flow of funds between global markets.

1 Money and the Financial System

The Six Parts of the Financial System; What is Money and How Can We Measure It?; The Payment System.

2 Bond Markets and Interests Rates

The Bond Market and the Determination of Interests Rates; Ratings and the Risk Structure of Interests Rates; The Yield Curve; Theories of the Term Structure of Interests Rates.

3 Stock Markets and Derivatives

The Essential Characteristics of Common Stock; Measuring the Level of the Stock Market; Investing in Stocks for the Long Run; What are Derivatives?; Forwards and Futures; Options; Swaps.

4 Financial Institutions

The Role of Financial Intermediaries; Information Asymmetries and Information Costs; Bank Management; Bank Risk: Where it comes from and what to do about it?

5 Central Banking and Monetary Policy

Understanding the Central Bank's Balance Sheet; Monetary Base; the Money Multiplier and Money Supply; Monetary Policy; Unconventional Monetary Policy Tools.

6 Regulation and Financial Crises

The Need for Regulating the Financial System; The Government Safety Net; Regulation and Supervision of the Financial System; Financial Crises.

7 Foreign Exchange

Exchange Rates Determination and Foreign Exchange Markets.

8 Current Topics on Financial Markets and Institutions

The Euro Debate; Socially Responsible Investment; Islamic Finance; Microcredit.