Chapter 1 - Functions and roles of the financial system in the global economy. The opening chapter of Money and Capital Markets presents us with an introduction to the global financial system in which the money and capital markets play central roles. It also highlights the principal institutions that shape the character and functioning of the world’s financial marketplace.
Chapter 2 - Financial assets, money, financial transactions, and financial institutions. In this chapter, You will see the most important channels through which funds flow from lenders to borrowers and back again within the global system of money and capital markets, you will discover the nature and characteristics of financial assets how they are created and destroyed by decision makers within the financial system, you will explore the critical roles played by money within the financial system and the linkages between money and inflation in the prices of goods and services.
Chapter 3 - The financial information marketplace. In this chapter you will be able to identify the most important sources of information about the money and capital markets and the financial system, discover why the efficient distribution of information within the financial system is so important and what can happen when relevant financial information is not readily available to all market participants. You will understand how any individual or institution active in the financial marketplace can keep track of the prices of financial assets and interest rates.
Chapter 4 - The future of the financial system and the money and capital markets. After completing this chapter, students will be able to explore the economic, demographic, social, and technological forces reshaping the financial system today; to learn about recent trends in the financial system and how they may affect us in the future; to understand how the problems the financial system faces today may affect its future, leading to a new financial marketplace.
Chapter 18 - Federal, state, and local governments operating in the financial markets. In this chapter, students will be able to examine the many important roles played by the government’s Treasury Department; to identify how the government raises new funds and how it spends the funds raised; to understand how the activities of the Treasury Department impact the money and capital markets and the economy.
Chapter 21 - Consumer lending and borrowing. After completing this unit, you should be able to see the vital role played by consumers in supplying loanable funds through savings to the money and capital markets; to learn about the important role consumers play as major borrowers of funds and the laws that protect their rights; to explore the characteristics of consumer lending institutions.
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Chapter 13 - Leverage and capital structure. In this chapter you will understand the effect of financial leverage on cash flows and cost of equity, understand the impact of taxes and bankruptcy on capital structure choice, understand the basic components of bankruptcy.
Chapter 5 - The determinants of interest rates: Competing ideas. After studying this chapter you will be able to understand the important roles that interest rates play within the economy, to explore the most important ideas about what determines the level of interest rates and asset prices within the financial system; to identify the key forces that economists believe set market interest rates and asset prices into motion.
Chapter 6 - Measuring and calculating interest rates and financial asset prices. In this chapter you will explore the important relationships between the interest rates on bonds and other financial instruments and their market value or price; you will be introduced to the many different ways lending institutions may calculate the interest rates they charge borrowers for loans; you will be able to determine how interest rates or yields on deposits in banks, credit unions, and other depository institutions are figured.
Chapter 7 - Inflation and deflation, Yield curves, and duration: Impact on interest rates and asset prices. After completing this unit, you should be able to learn what inflation is and how it can impact interest rates and the prices of financial assets; to understand the greater concern today over deflation and how it may affect the economy and financial system; to see how yield curves arise and explore the ideas about what determines the shape of the yield curve;...
Chapter 8 - The risk structure of interest rates: Defaults, prepayments, taxes, and other rate-determining factors. In this chapter, students will be able to see the effects of financial assets’ marketability, liquidity, default risk, call privileges, prepayment risk, convertibility and taxability upon their interest rates and prices; to understand why there are so many different interest rates within the global economy; to learn how the “structure of interest rates” is built and why it changes constantly.
Chapter 9 - Interest rate forecasting & hedging: Swaps, financial futures, & options. This chapter is devoted to the forecasting (predicting) and hedging (risk protection activities) associated with changing interest rates and changes in the prices of financial assets.
Chapter 10 - Introduction to the money market and the roles played by governments and security dealers. This chapter has presented, first of all, a broad overview of one of the most important components of any financial system, the money market. The chapter then explores the roles played by governments and security dealers in keeping the money market functioning efficiently.
Chapter 11 - Commercial banks, major corporations, and federal credit agencies in the money market. In this chapter we have examined some of the most important money market institutions, including commercial banks, major corporations, and federal credit agencies.
Chapter 12 - Roles and services of the federal reserve and other central banks around the world. In this chapter, students will be able to explore the many roles and functions of the central banks around the world; to see how and why the Federal Reserve System came to be established as the U.S. central bank; to examine how the Federal Reserve System is organized to carry out the many tasks it must perform.
Chapter 13 - The tools and goals of central bank monetary policy. After completing this unit, you should be able to understand how the policy tools available to central banks work in carrying out a nation’s money and credit policies; to explore the strengths and weaknesses of the various monetary policy tools; to learn how the Federal Reserve System controls U.S. credit and interest rate levels; to see how central bank policy actions affect a nation’s economic goals.
Chapter 14 - The commercial banking industry: Structure, products, and management. In this chapter, you will learn to understand how important commercial banks are to the functioning of a modern economy and financial system; to explore the structure of the united states’ banking industry; to learn about bank financial statements and how to read them; to see how banks create and destroy money and credit, and why this activity is vital.
Chapter 15 - Nonbank thrift institutions: Savings & loans, savings banks, credit unions, and money market funds. In this chapter you will see how significant thrift institutions are in the functioning of a modern economy and financial system, discover what types of services thrift institutions offer to the public and who their principal competitors are, come to understand the principal differences between major types of thrift institutions as well as their principal similarities and why these differences and similarities are important.