Financial Markets And The Global Economy

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Financial markets reference a platform that allows the exchange of monetary assets with securities or other entities solely, in corporate groups and also through government based groups. The financial markets mainly facilitate the transfer at low prices for the buyer but at a sufficient level for the seller, if the requests and source match (Jones 2002). Stocks are a core market in the United States and have been highly recognized for an extensive period based on the revenue they generate for the economy. The global economy caters for the buying, selling and holding of stocks by the investor and also allows for the placement of a monitoring and party capable of performing the stated transactions on behalf of the investor (Darškuvienė…show more content…
This type of trading was exclusive to banks and large corporations in the past, but now it is becoming a more widely available platform for average investors. This market is supported by international transactions, 24 hours a day, five days a week. The principle of supply and demand is the basic cause for price fluctuations with currency pairs. As the worth of one currency goes up against another, money is being mad or lost depending on the rapid sale or purchase of the currencies. Caporale and Pittis (2000) highlight that policies on financial investments in one nation can impact the interest levels in a lateral area, but this is coupled with the local budget deficits in the country in question. The rate at which an economy expands is a local influence to the interest rates as well as the changes of wages laid out for the employees. The quota of funds borrowed by the civil authority to sustain the economy and the constant shifts in wealth accumulation for citizens, through unemployment rate changes impact interest rate levels. In 2008, the federal interest rate was at an astounding 6.5%, very high in comparison to the 0.5% rate enforced a few years later. Janda & Zetek (2013) add that the prices of entities and the living standards play a primary role in the swaying of interest rates. Awareness on investment openings available can be tagged as a factor affecting interest rates as it influences the level
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