Financial Markets

2020 ◽  
pp. 71-88
Author(s):  
Yi-Cheng Zhang
Keyword(s):  
Financial Markets ◽  
Financial Market ◽  
Market Theory ◽  
A Value ◽  
Investment Opportunities ◽  
The Common ◽  
Per Se ◽  
Financial Transactions ◽  
Role Of Information

Chapter 5 extends consumer market theory to finance, to examine the similarities and particularities of both types of market. The common feature is still the role of information, and financial markets are also about how to determine a financial products’ quality. We propose the market symbiosis hypothesis that portrays the role of financial markets in the general economy. We argue that although financial transactions do not create value per se, all players in the financial markets have a value-creation role in selecting outside investment opportunities. A well-functioning financial market can enable more quality investments to be funded and can stimulate their creation.

Modern Financial Market Theory – A Critique Based on the Logic of Human Action

2021 ◽  
Vol 54 (3) ◽  
pp. 447-467
Author(s):  
Thorsten Polleit
Keyword(s):  
Decision Making ◽  
Financial Markets ◽  
Financial Market ◽  
Real World ◽  
Rational Expectation ◽  
Efficient Market Hypothesis ◽  
Human Action ◽  
Market Theory ◽  
Expectation Theory ◽  
Market Economics

The modern financial market theory (MFMT) – based on the efficient market hypothesis, rational expectation theory, and modern portfolio theory – has become the standard approach in financial market economics. In this article, the MFMT will be critically ­reviewed using the logic of human action (or: praxeology) as an epistemological meta­theory. It will be shown that the MFMT exhibits (praxeo-)logical deficiencies so that it cannot provide investors with well-founded decision-making support in real-world financial markets.

Niezależność Narodowego Banku Polskiego a relacje z Parlamentem RP

2021 ◽  
Vol 4(165) ◽  
pp. 105-122
Author(s):  
Rafał Sura
Keyword(s):  
Central Bank ◽  
Financial Markets ◽  
World Economy ◽  
Supply And Demand ◽  
Protective Measures ◽  
Major Significance ◽  
The Common ◽  
The Republic ◽  
Polish Government

The position of the NBP at the time of the common market and progressive Europeanisation of the economy and all areas of community life was particularly important. Currently, in the time of the global crisis caused by the SARS-CoV-2 coronavirus, encompassing both the supply and demand side of the world economy, the role of the central bank is increasing. Without its involvement, there would be no effective protective measures, aimed at mitigating the decline in GDP growth in Poland and protecting jobs. The central bank, together with the Polish Government and Parliament, is of key importance for Poland’s economic development, while the independence of the NBP is of major significance for its credibility in financial markets. That is why it is so important to try to answer the questions what the independence of the NBP is and whether constitutional and statutory regulations of the relations between the Parliament of the Republic of Poland and the central bank do not breach this independence.

The role of Financial Market Infrastructures in Financial Stability

2016 ◽  
pp. 20-40
Author(s):  
Serafin Martinez-Jaramillo ◽  
Jose Luis Molina-Borboa ◽  
Bernardo Bravo-Benitez
Keyword(s):  
Risk Assessment ◽  
Financial Market ◽  
Financial Stability ◽  
Financial System ◽  
General Overview ◽  
Proper Functioning ◽  
Financial Transactions ◽  
Adequate Supervision

Financial Market Infrastructures (FMIs) are essential for the well-functioning of the financial system, as they play a central role in facilitating clearance and settlement of financial transactions such as payments, securities, and derivatives contracts. Nowadays, it is widely acknowledged that the proper functioning of systemically important FMIs is also vital to maintain financial stability; their failure for solvency reasons or operational disruptions could almost certainly lead to systemic instability. As a consequence, the adequate supervision of FMIs is inherent to the function of preserving financial stability. The aim of this chapter is to provide a general overview of the different FMIs; discuss their role in financial stability and to give an overview of the efforts made by some financial authorities towards the supervision, risk assessment and reinforcement of FMIs.

scholarly journals The Role of Political Risk and Financial Development Factors on Sukuk Market Development of Gulf Cooperation Council (GCC) Countries

2018 ◽  
Vol 10 (1) ◽  
pp. 242
Author(s):  
Arafat Mansoor Al-raeai ◽  
Zairy Zainol ◽  
Ahmad Khilmy Abdul Rahim
Keyword(s):  
Financial Markets ◽  
Financial Market ◽  
Financial Management ◽  
Political Risk ◽  
Gulf Cooperation Council ◽  
Market Development ◽  
Model Framework ◽  
Alternative Source ◽  
Gcc Countries

The literature related to the financial management acknowledges the significant role that political risk play to determine the financial market development. Further, financial system development (banking and financial markets) competes to provide long-term financing, and this competition might be positive or negative for each other. The aim of this paper is to propose a conceptual model/framework for investigating the role of political risk and financial market on Sukuk market development in Gulf Cooperation Council (GCC). GCC economies depend heavily on oil revenues which makes them subject to oil prices fluctuations. Therefore, GCC’s governments should diversify their economies by looking for Sukuk as an alternative source of financing, to cover their budget deficit, when the price of oil decreases, and reduce their reliance on oil, because Sukuk has advantages compared to the conventional bond particularly in terms of less information asymmetry. The prior studies have mostly focused on firms' characteristics determinants of Sukuk issuances but gave a little consideration to the role of country' characteristics on Sukuk market development. This paper proposes a framework to explain the political risk and financial markets determinants of Sukuk market development with a focus on the GCC countries that have the largest region in terms of the Islamic financial assets. It is anticipated that the outcome will support policymakers to improve the current state of Sukuk market.

scholarly journals Rethinking the Effects of Financial Globalization *

2016 ◽  
Vol 131 (3) ◽  
pp. 1497-1542 ◽  
Author(s):  
Fernando Broner ◽  
Jaume Ventura
Keyword(s):  
Financial Markets ◽  
Capital Flows ◽  
Capital Inflows ◽  
Financial Globalization ◽  
The Past ◽  
Domestic Capital ◽  
Domestic Savings ◽  
Financial Transactions

Abstract During the past three decades, many countries have lifted restrictions on cross-border financial transactions. We present a simple model that can account for the observed effects of financial globalization. The model emphasizes the role of imperfect enforcement of domestic debts and the interactions between domestic and foreign debts. Financial globalization can lead to a variety of outcomes: (i) domestic capital flight and ambiguous effects on net capital flows, investment, and growth; (ii) capital inflows and higher investment and growth; or (iii) volatile capital flows and unstable domestic financial markets. The model shows how the effects of financial globalization depend on the level of development, productivity, domestic savings, and the quality of institutions.

scholarly journals Main lessons for finance of the 2007-2009 crisis

2010 ◽  
Vol 7 (4) ◽  
pp. 62-65
Author(s):  
Tom Berglund
Keyword(s):  
Financial Crisis ◽  
Economic Analysis ◽  
Financial Markets ◽  
Information Asymmetry ◽  
Asset Values ◽  
The Future ◽  
Role Of Information

This paper discusses issues that should receive an increased weight in how finance is being taught in the future, based on the experiences of the financial crisis of 2007-2009. The three specific lessons are: the role of basic economic analysis in understanding the foundations of asset values, the shortcomings of diversification as a method to reduce risks, and the increased role of information asymmetry in crisis stricken financial markets.

The Role of Information Technology in Managing the Conflicts of Long-Distance Partners

2019 ◽  
Author(s):  
Gremil Alessandro Naz
Keyword(s):  
Information Technology ◽  
Personal Characteristics ◽  
Text Messages ◽  
Self Control ◽  
Long Distance ◽  
The Common ◽  
Communication Practices ◽  
Study Participants ◽  
Role Of Information

This study sought to understand the role of information technology (IT) in managing the conflicts of Filipinos in long-distance relationships (LDRs). Specifically, it aimed to know the conflicts Filipinos in LDRs usually experience, how these conflicts are managed with the help of IT, their conflict communication practices, and the values necessary for LDR maintenance. Ten Filipinos in LDRs were interviewed in depth. Results showed that the common conflicts identified by the study participants were on childrearing, failure to communicate on the appointed date and time, delayed and unsent text messages, the husband’s drinking, and gossips related to the husband’s alleged infidelity. IT was a big help in managing these conflicts because it allowed effective communication, with video telephony as the most preferred technology. According to the study participants, the personal characteristics that contribute to LDR maintenance are cool-headedness, self-control, patience, and humility.

The Role of Information Technology in Managing the Conflicts of Long-Distance Partners

2021 ◽  
Vol 13 (1) ◽  
pp. 65-78
Author(s):  
Gremil Alessandro Alcazar Naz
Keyword(s):  
Information Technology ◽  
Personal Characteristics ◽  
Text Messages ◽  
Self Control ◽  
Long Distance ◽  
The Common ◽  
Communication Practices ◽  
Study Participants ◽  
Role Of Information

This study sought to understand the role of information technology (IT) in managing the conflicts of Filipinos in long-distance relationships (LDRs). Specifically, it aimed to know the conflicts Filipinos in LDRs usually experience, how these conflicts are managed with the help of IT, their conflict communication practices, and the values necessary for LDR maintenance. Ten Filipinos in LDRs were interviewed in depth. Results showed that the common conflicts identified by the study participants were on childrearing, failure to communicate on the appointed date and time, delayed and unsent text messages, the husband's drinking, and gossips related to the husband's alleged infidelity. IT was a big help in managing these conflicts because it allowed effective communication, with video telephony as the most preferred technology. According to the study participants, the personal characteristics that contribute to LDR maintenance are cool-headedness, self-control, patience, and humility.

ROLE OF INFORMATION IN PRICING DEFAULT-SENSITIVE CONTINGENT CLAIMS

2015 ◽  
Vol 18 (01) ◽  
pp. 1550007 ◽  
Author(s):  
MONIQUE JEANBLANC ◽  
MARTA LENIEC
Keyword(s):  
Financial Market ◽  
Stock Price ◽  
Stopping Time ◽  
Contingent Claims ◽  
Contingent Claim ◽  
Martingale Measures ◽  
Equivalent Martingale Measures ◽  
Equivalent Martingale ◽  
Role Of Information

We consider a financial market with a savings account and a stock S that follows a general diffusion. The default of the company, which issues the stock S, is modeled as a stopping time with respect to the filtration generated by the value of the firm that is not observable by regular investors. We assume that the stock price and the value of the firm are correlated. We study three investors with different information levels trading in the market who aim to price a general default-sensitive contingent claim. We use the density approach and Yor's method to solve the pricing problem. Specifically, we find the sets of equivalent martingale measures in three cases and, when needed, we choose one of them using f-divergence approach.

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