This Thing of Social Media!

This chapter is about social media and its networking platforms and how they can run or develop a business in the financial sector. As a platform economy, this sector ranges from shadow banks such as mutual funds, leasing companies, brokers, and credit insurance companies to other money market mutual funds. Nevertheless, recent studies in this sector have only focused on the money market, thus creating a vacuum of how social media can run or develop the banking sector through this platform. The social media platform has transformed drastically from being a place for just interaction to buying and selling, forcing many businesses to register on one or two of these media to take advantage of the ever-growing market potentials they offer. However, it also comes with its challenges. This chapter highlights how to manage this medium for a successful business. The study collected data online from bank clients who ever used this platform to transact financial business.

Conventional Versus Sharia Money Market Mutual Funds: Which Performs Better During the Covid-19 Pandemic?

This study aims to determine whether conventional money market mutual funds perform better than sharia money market mutual funds or vice versa during the COVID-19 pandemic in Indonesia. This research method is descriptive with a quantitative comparison approach. This study employed secondary data obtained from IDX, Indonesian Bank, and Pasar Dana website. The research employed the money market mutual funds data, Net Asset Value, BI 7 Days Repo rate during year 2020. Sharpe ratio utilized in this research to determine the money market mutual funds performance. Then, the result compared by using Independent sample T-test on SPSS. The result uncovers that in general the performance of conventional money market mutual funds performance superior the sharia money market mutual funds performance during covid-19 in Indonesia. However, both mutual funds average Sharpe ratio show the negative number during 2020. Moreover, there are no significant difference between conventional and sharia money market mutual funds returns during the period 2020. The high different return on the maximum return due to some conventional mutual fund perform exceptional during 2020.

Changes in the Structure of Financial Intermediation – Eastern-Central European Developments in the Light of Global and European Trends

The article analyses the structural changes of the financial intermediary system of Eastern-Central European (ECE) countries, that joined the EU in 2004, namely the Czech Republic, Hungary, Poland, Slovakia and Slovenia (ECE5) in the light of global and European trends from 2004 to 2016. Its two main focuses are the characteristics of the structural shifts and interconnectedness between banks and financial markets, on the one hand, and the size and specificities of shadow banking systems, on the other. Despite the limited catching up of the region the ECE5 countries has a much less deep and more bank-based financial system than their European counterparts without the emergence of significant market-based banking and shadow banking. However, while in the developed countries the most important shadow banking institutions are the non-money market mutual funds, in ECE5 countries other non-bank financial institutions are those that potentially exposed to shadow banking risk.

Resurgence, Part I

The Glass-Steagall Act created a decentralized financial system composed of three separate and independent financial sectors—commercial banking, securities markets, and insurance. The Bank Holding Company Act of 1956 reinforced Glass-Steagall’s policy of structural separation by prohibiting bank holding companies from engaging in any activities that were not “closely related to banking.” Glass-Steagall’s structural barriers prevented the occurrence of systemic financial crises for more than four decades. During that period, federal regulators could deal with problems arising in one financial sector without need to rescue the entire financial system. Despite Glass-Steagall’s success, federal agencies and courts undermined its prudential buffers during the 1980s and 1990s by opening loopholes. Those loopholes allowed banks to convert their loans into asset-backed securities and to offer derivatives that functioned as synthetic substitutes for securities and insurance products. Regulators and courts also allowed money market mutual funds and other nonbanks to issue short-term financial claims that served as deposit substitutes, despite Glass-Steagall’s prohibition against deposit-taking by nonbanks.

When Brussels meets shadow banking – Technical complexity, regulatory agency and the reconstruction of the shadow banking chain

At the heart of the last financial crisis stood the shadow banking system, a mesh of financial activities and entities that grew outside of bank balance sheets but with the support of the banking sector. These activities were not regulated or supervised like banks, and they were characterized by high maturity mismatches and leverage. Two prime elements were Money Market Mutual Funds and Asset-Backed Commercial Papers, which jointly performed bank-like functions. This paper sheds light on the fate of these entities post-crisis and the regulatory dynamics at play as policymakers shifted their focus from constraining their activities to drafting a European regulatory infrastructure that delivers both stability and growth. Based on expert interviews and document analysis, we show how European policymakers opened up to private experts during this shift to learn about the technical complexity of Money Market Mutual Funds and Asset-Backed Commercial Papers, but in the end were restricted in their efforts to craft such regulation due to competing national factions and the legislative time pressure at the European level. We argue that the process was heavily influenced by, first, nationally held visions about the future role of financial markets that came to the fore at pivotal moments during the negotiations, and, second, the specific European institutional set-up and its electoral cycle.

Investor Information Acquisition and Money Market Fund Risk Rebalancing during the 2011–2012 Eurozone Crisis*

We study investor redemptions and portfolio rebalancing decisions of prime money market mutual funds (MMFs) during the Eurozone crisis. We find that sophisticated investors selectively acquire information about MMFs’ risk exposures to Europe, which leads managers to withdraw funding from information-sensitive European issuers. That is, MMF managers, particularly those serving the most sophisticated investors, selectively adjust their portfolio risk exposures to avoid information-sensitive European risks, while maintaining or increasing risk exposures to other regions. This mechanism helps to explain the occurrence of selective “dry-ups” in debt markets where delegation is common and returns to information production are usually low. (JEL G01, G21, G23) Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.

KINERJA REKSA DANA PASAR UANG DENGAN METODE SHARPE, TREYNOR DAN JENSEN PADA BURSA EFEK INDONESIA (BEI) – PERIODE 2013 – 2017

<em>This study aims to determine the performance of money market mutual funds using the Sharpe, Treynor and Jensen methods for 5 years from 2013 to 2017. This research uses qualitative quantitative design. The selected money market mutual fund products are 5 aggressive money market mutual fund products, where the asset allocation is money assets. Data analysis method uses Sharpe, Treynor and Jensen methods. In general, the performance of money market mutual funds based on the Sharpe, Treynor and Jensen methods has fluctuated. The higher the value of Sharpe, Treynor and Jensen, the better the performance of the Money Market mutual fund, because it can provide actual return that is higher than the expected return so as to minimize the individual risk that it bears. Mutual funds with Sharpe and Jensen approaches, the best performance of money market mutual funds is PT Bahana Dana Likuid. Whereas according to Treynor’s approach the best is Danamas Rupiah Plus because for five years it gives a positive value. This shows that it is useful to provide information to investors who want to invest in Money Market Mutual Funds, because it results in a higher return on risk-free investment</em>