金融市場英文教學課件：ch1 Why Study Financial Markets and Institutions

1、Part OneIntroductionChapter 1Why Study Financial Markets and Institutions?Copyright 2009 Pearson Prentice Hall. All rights reserved.1-3Chapter PreviewTo start, we preview subjects of interest to anyone who is a part of a productive society. We motivate how financial markets and institutions have sig

2、nificant impact on important questions about our financial well-being. Topics include:Why Study Financial Markets?Why Study Financial Institutions?Applied Managerial PerspectiveHow Will We Study Financial Markets and InstitutionsCopyright 2009 Pearson Prentice Hall. All rights reserved.1-4Why Study

3、Financial Markets?Financial markets, such as bond and stock markets, are crucial in our economy.These markets channel funds from savers to investors, thereby promoting economic efficiency.Market activity affects personal wealth, the behavior of business firms, and economy as a wholeCopyright 2009 Pe

4、arson Prentice Hall. All rights reserved.1-5Why Study Financial Markets?Well functioning financial markets, such as the bond market, stock market, and foreign exchange market, are key factors in producing high economic growth.We will briefly examine each of these markets, key statistics, and how we

5、will examine them throughout this course.Copyright 2009 Pearson Prentice Hall. All rights reserved.1-6Why Study Financial Markets? Debt Markets & Interest RatesDebt markets, or bond markets, allow governments, corporations, and individuals to borrow to finance activities.In this market, borrowers is

6、sue a security, called a bond, that promises the timely payment of interest and principal over some specific time horizon.The interest rate is the cost of borrowing.Copyright 2009 Pearson Prentice Hall. All rights reserved.1-7Why Study Financial Markets? Debt Markets & Interest RatesThere are many d

7、ifferent types of market interest rates, including mortgage rates, car loan rates, credit card rates, etc.The level of these rates are important. For example, mortgage rates in the early part of 1983 exceeded 13%. Financing a house was quite expensive at this time.Copyright 2009 Pearson Prentice Hal

8、l. All rights reserved.1-8Why Study Financial Markets? Debt Markets & Interest RatesBecause interest rates are important to individuals and business, understanding the history of interest rates is beneficial.The next slide shows historical interest rates in various sectors of the bond market: Long-T

9、erm U.S. Government rates, Short-Term U.S. Government rates, and corporate rates.We will study these further in several chapters, examining the types and characteristics of bonds, as well as theories on how rates are determined.Copyright 2009 Pearson Prentice Hall. All rights reserved.1-9Bond Market

10、 and Interest RatesComplete list of interest rates/releasesCopyright 2009 Pearson Prentice Hall. All rights reserved.1-10Why Study Financial Markets? The Stock MarketThe stock market is the market where common stock (or just stock), representing ownership in a company, are traded.Companies initially

11、 sell stock (in the primary market) to raise money. But after that, the stock is traded among investors (secondary market).Of all the active markets, the stock market receives the most attention from the media, probably because it is the place where people get rich (and poor) quickly.Copyright 2009

12、Pearson Prentice Hall. All rights reserved.1-11Why Study Financial Markets? The Stock MarketThe next slide shows the level of the Dow Jones Industrial Average over the last 55 years. Note how volatile stock prices have been, especially over the last five years.In future chapters, we will examine the

13、 role of the stock market, as well as how prices react to information in the marketplace.Stock MarketCopyright 2009 Pearson Prentice Hall. All rights reserved.1-13Why Study Financial Markets? The Stock MarketCompanies, not just individuals, also watch the market. They often seek additional funding i

14、n equity markets after going public. The success of these seasoned-equity offerings (SEOs) is very dependent on the current price of the companys stock.Copyright 2009 Pearson Prentice Hall. All rights reserved.1-14Why Study Financial Markets? The Foreign Exchange MarketThe foreign exchange market is

15、 where international currencies trade and exchange rates are set.Although most people know little about this market, it has a daily volume around $1 trillion!View historical financial data and forecasts at/data/index.htmCopyright 2009 Pearson Prentice Hall. All rights reserved.1-15Why Study Financia

16、l Institutions?We will also spend considerable time discussing financial institutionsthe corporations, organizations, and networks that operate the so-called “marketplaces.” These institutions play a crucial role in improving the efficiency of the economy. We will look at:Central Banks and the Condu

17、ct of Monetary PolicyThe role of the Fed and foreign counterpartsStructure of the Financial SystemHelps get funds from savers to othersCopyright 2009 Pearson Prentice Hall. All rights reserved.1-16Why Study Financial Institutions?Banks and Other Financial InstitutionsIncludes the role of insurance c

18、ompanies, mutual funds, pension funds, etc.Financial InnovationFocusing on the improvements in technology and its impact on how financial products are deliveredManaging Risk in Financial InstitutionsFocusing on risk management in the financial institution.Copyright 2009 Pearson Prentice Hall. All rights reserved.1-17Applied Managerial PerspectiveFinancial institutions are among the largest employers in the U.S. and often pay high salaries.Knowing how financial institutions are managed may help you better deal with them.Copyright 2009 Pearson Prentice Hall. All right