INTERNATIONAL FINANCIAL MARKETS

International Financial Markets



International Financial Markets

Introduction

Speaking about the international financial market, we must first define the basic terminology features, concepts and beliefs associated with its formation and development. What is the financial market? It's a market for the exchange of capital and credit, including monetary and foreign exchange markets.

Money Market - a market of short-term debt securities, such as bankers' acceptances, commercial paper, repos accounted for certificates of deposit, treasury bills with maturities up to one year. Usually it is safe, highly liquid investments. Capital is impossible to characterize in two ways. Firstly, under capital refers to assets or commodities used to generate revenue. Secondly, under the capital can be understood as the net value of the business, ie amount representing the difference exceeded assets over liabilities. (Obstfeld, 2004)

Exchange, the sphere of exchange, currency. Here, the interpretations even more. First of all, it is an organization, association or group that provides and maintains a market in which to trade securities, options, futures or commodities. In addition, it can be immediately and the market itself. The second definition involves the provision of goods and services in exchange for other goods and services roughly equivalent value. Exchange in this case is called barter. And finally, thirdly, it may be the currency markets.

The jurisdiction of nations in the world's wealth

The enormous importance of the exchange rates of foreign currency can be seen in the mere fact of seeing that are evaluated and published daily. The reaction to this economic data are not yet so unequivocal: some notes from him without flinching, some controversially discussed the advantages and disadvantages of its recent amendments, give feedback or excited, in which it comes out causes and effects, perpetrators and victims, promising trends and huge risks. The degree of competition, the authority of the comment depends precisely the point of view with which such comments are identified. In the case of the speaker of merchandise exports, a falling currency will be judged in a different way which makes it, as the importer that says how much he affected this fall. For banks involved in foreign trade, changes in exchange rates present another aspect: whether they favored currency is one that has suffered a loss, or if that, which came off on time and which they bet, has suffered a fall. Their fate will be different and will take comments of disapproval of the "markets" or praise about their "forces" beneficent. The range of masters in the art of problematization acquire it, yes, those who interfere in behalf of the Nation. No need to try to chiefs of staff or the central bank - enough that the national currency is chosen as the object of their concerns and their parities are considered from the point of view of national balance. Such consideration of the vagaries of the types deserves much attention, because it means money in the nation are not as mere means of private commercial interests, but are viewed with the same eyes of the guardian and guarantor of money, which ...