The Capital and Money markets in the economy - Free Essay Example

Sample details Pages: 4 Words: 1227 Downloads: 4 Date added: 2017/06/26 Category Economics Essay Type Analytical essay Did you like this example? There were two group of markets can be found in financial market. They were the capital market and the money market. Although they both come from financial market but they consist of differences. In capital market, we will found the stocks and bond market but in general it is the market for securities where long term funds can be raised by companies or government. To raise the funds, a person needs to purchase a price-set bond in order to borrow their money to the government or business for period of time and this will gain higher return as promised. The government or company paid the lenders through interest that accrues from the borrowings. Another way for the government or company to raise the fund is through the stock market. By using this method, they will sell shares of their stock which is the ownership of the company to the public or companies. Dividends will be paid to the shareholders as agreed by the company as the return on their investment. There w ere two markets in the capital market: Primary market and secondary market. New issues are distributed to the investor in the primary market and the secondary market is the place where trade securities. In money market, it is about the global financial market. The money market is the place where borrowing and lending in a short-term period. Short-term liquid funding also will be provided to the global financial system. The period of the borrowing of money by the company in a money market has an average of thirteen months. There are few common types of things that being used in the money market such as bankers acceptance, certificates of deposits, commercial paper and repurchase agreements. Normally the money market consists of banks borrowing and lending but money market also will involve by financial companies. A large amounts of asset where issued by the finance companies to fund themselves which is secured by the promise of eligible assets into an asset backed commercial paper conduit. The difference between the two markets is that capital market is for long term investment. They were selling stocks and bonds to borrow money from investors to operate their company. In money markets, it is the short term borrowing or lending market. The banks borrow and lend between themselves and it is usually paid back within thirteen months. The differences can be seen through the ways the two markets used for borrowing or lending transaction. In capital market, primary and secondary markets are interrelated. Securities emerge in primary market while other dealings take place in secondary market. However, there was no sub-division in money market. In efficient money market, secondary market does take place too. In capital market, the financial instrument that being used are debentures, shares, public sector bonds and units of mutual funds. On the other hand, money market uses different financial instruments such as Treasury bill, call money, commercial papers, and c ertificate of deposits. There were several characteristic of the securities in the money market. The rapid maturity, safety, liquidity of the money market funds of securities. Short-term capital requirements of the business and government can be solve by issuing money market securities. The maturity of the securities is between three months and matured within one year. Federal funds and repurchase agreements are the money market instruments that examine the maturity of the securities. The credit ratings that surpass the other investment grade debt instruments make money market securities the safest investments available. (Jim Orrill, 2010) The SEC helps ensure this safety by mandating that at least 95% of a money market funds securities must be ones that have earned the highest rating of at least two of the five major credit rating institutions. Federal Reserve System is often referred as Fed is the central bank of the United States. In Malaysia, Bank Negara Malaysia or BNM is our central bank. Although central bank may differ in terms of structure and modus but they have common responsibility which is to maintain the monetary and financial stability. Sometimes, they are responsible for developing the financial infrastructure and participating in the overall development of nation. Bank Negara Malaysia is responsible to maintain the monetary stability. Preserved the value of the ringgit is the best way to ensure the price stability. This can maintain the inflation of the country low and stable. By maintaining the inflation at low and stable condition will not diminished the purchasing power of ringgit. When the inflation rate is high, people will tend to consider about their purchasing power. When this happened, demand for real assets like properties and houses will be higher because they were thought to be more inflation-proof. Interest of people will be less on investment in the productive capacity of the economy. The interest of holding saving in the financial system will be lesser as they expect that their savings value will be diminished. Fixed income earners will feel their ability to purchase goods and services become less. Bank Negara Malaysia influences the level of interest rates to conduct its monetary policy. Interest rates are the rate that the borrowers of the loan have to pay and the depositors earn on their deposits. To encourage people to save more, interest rate will be given at a high rate. When the economic is weak, funds will be injected into the banking system to reduce the interest rates. Economic activity will be stimulated by the increasing consumption and investment. (Elgilani Eltahir Elshareif, 2010) Short term and long term interest rates of fixed securities is important for the transmission mechanism of monetary policy. Usually the short-term rates will be influence by central bank, while the basis of investors expectations of future real interest rates and inflation affect long-term rates. T he future real interest rates will affect the domestic investment and production. The real sector of the economy will affect by the term structure transmits monetary policy. In the open economy system, the structure will affect international capital flows and hence exchange rate. Required reserve is referring to the amount that the banking institution place with the BNM in compliance with the Statutory Reserve Requirement. Cash in vault of the banking institution and the demand deposits with BNM are considered as excess reserves. Demand and time deposits placed by the financial corporations are deposits of the private sector. Money market securities are extremely liquid can be converted into cash quickly. As the principles of these debts are repaid very rapidly thus the liquidity of the investment was gained. These securities give the optimum way to the public to invest in the money market securities by trading in large denominations. The money market securities are a wholesal e market of short term debt instruments. Orrill, J. (2010, May 21). Characteristics of Money Market Securities Retrieved from December 9, 2010 https://www.ehow.com/list_6536664_characteristics-money-market-securities.html CiteMan.com. (2008-2010). Characteristics of money market Retrieved from December 9, 2010 https://www.citeman.com/4365-characteristics-of-the-money-market/ Elshareif, E. E. Hui Boon Tan (2010). Interpreting term structure of interest rates in the Malaysia Fix-Income Market Andersen. T. M. and Risager, O. (1988) Stabilization policies, credibility, and interest rate determination in a small open economy Bank Negara Malaysia (2003). General information: Bank Negara Malaysia Bank Negara Malaysia (2007). International Monetary Fund: International Financial Statistic. Richard H. Timberlake (2008). The Concise Encyclopedia of economic: Federal Reserve System. Retrieve from December 11, 2010. https://www.econlib.org/libr ary/Enc/FederalReserveSystem.html Don’t waste time! Our writers will create an original "The Capital and Money markets in the economy" essay for you Create order

The Problem Of Low Back Pain - 1591 Words

Low back pain is one of the major causes for not only days lost at work, but also the early exit from the field of nursing. This can potentially be a major concern to address as policymakers and healthcare experts look to solve the nursing shortage problem. Project Back to Back is one initiative aimed at addressing this issue. It seeks to reduce the prevalence of low back pain experienced by nurses by introducing continual training in proper patient handling and Dru yoga classes to nurses working in the hospital facilities that are a part of the Mount Sinai Hospital System. In the United States, low back pain is singled out as the most common reason for time lost at work after the common cold, the third most common condition leading to surgical procedures, and the fifth most common reason for hospital visits (United States Department of Health and Human Services (HHS), Healthy People 2020, n.d.). 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Adaptive Radiation - Darwins Finches free essay sample

When Charles Darwin stepped ashore on the Galapagos Islands in September 1835, it was the start of five weeks that would change the world of science, although he did not know it at the time. Among other finds, he observed and collected the variety of small birds that inhabited the islands, but he did not realize their significance, and failed to keep good records of his specimens and where they were collected. It was not until he was back in London, puzzling over the birds, that the realization that they were all different, but closely related, species of finch led him toward formulating the principle of natural selection. In his memoir, The Voyage of the Beagle, Darwin noted, almost as if in awe, One might really fancy that, from an original paucity of birds in this archipelago, one species had been taken and modified for different ends. Indeed, the Galapagos have been called a living laboratory where speciation can be seen at work. We will write a custom essay sample on Adaptive Radiation Darwins Finches or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page A few million years ago, one species of finch migrated to the rocky Galapagos from the mainland of Central or South America. From this one migrant species would come many at least 13 species of finch evolving from the single ancestor. This process in which one species gives rise to multiple species that exploit different niches is called adaptive radiation. The ecological niches exert the selection pressures that push the populations in various directions. On various islands, finch species have become adapted for different diets: seeds, insects, flowers, the blood of seabirds, and leaves. The ancestral finch was a ground-dwelling, seed-eating finch. After the burst of speciation in the Galapagos, a total of 14 species would exist: three species of ground-dwelling seed-eaters; three others living on cactuses and eating seeds; one living in trees and eating seeds; and 7 species of tree-dwelling insect-eaters. Scientists long after Darwin spent years trying to understand the process that had created so many types of finches that differed mainly in the size and shape of their beaks. Most recently, Peter and Rosemary Grant have spent many years in the Galapagos, seeing changing climatic conditions from year to year dramatically altering the food supply. As a result, certain of the finches have lived or died depending on which species beak structure was best adapted for the most abundant food just as Darwin would have predicted.

Philanthropy have left her utterly unconcerned abo Essay Example For Students

Philanthropy have left her utterly unconcerned abo Essay hiut her family and Harold Skimpole who is a lazy and selfish man looked after by others’ generosity and his mimicry of childish irresponsibility. In its time the novel was seen as poorly constructed despite its host of interesting characters although later critics have generally seen it as one of his very finest works despite its occasional verbosity. Variously a parish helper to the London poor and a successful New Zealand sheep farmer, Samuel Butler did not treasure the attitudes of his time (the second half of the 19th century). His books were iconoclastic in their attitudes towards Victorian ideals and The Way of All Flesh is foremost among them. It is appropriate, then, that it was published after his death and Queen Victorias, in 1903. It was completed in its original version in 1885 though the second half was never revised. It depicts the lives of four generations and is narrated by family friend Overton although it focuses on Ernest Pontifex and his respect for his great-grandfather John. His father Theo is the books initial concern, though,and he grows after ordination into cruel and disciplinarian attitudes to parenthood which affect young Ernest. As the story progresses we see the latter give his money to a pregnant maid, become a priest and imprisoned for mistaking a respectable lady for a whore. Ernest is released onl y to begin an unwise relationship with the maid, Ellen. The tale and its conclusion question the values of Victorian society and offer the solace of the individual mind when convention fails. Many regard The Way of All Flesh, published in 1903, the year after Butlers death, as his masterpiece. It certainly contains much of the quintessence of Butlerism. This largely autobiographical novel tells, with ruthless wit, realism, and lack of sentiment, the story of Butlers escape from the suffocating moral atmosphere of his home circle. In it, the character Ernest Pontifex stands for Butlers early self and Overton for his mature self; Theobald and Christina are his parents; Towneley and Alethea represent â€Å"nice† people who â€Å"love God† in Butlers special sense of having â€Å"good health, good looks, good sense, experience, and a fair balance of cash in hand.† The book was influential at the beginning of the anti-Victorian reaction and helped turn the tide against excessive parental dominance and religious rigidity. Ernest Pontifex, protagonist in The Way of All Flesh, battles his fathers iron will in a personal struggle to fully realize the potential of the self. While taking the position of an intellectual gadfly determined to attack the shams of society, Pontifex also assumes the de facto role of spokesman for the authors unique anti-Victorian beliefs. Bibliography:philanthropy have left her utterly unconcerned about her family and Harold Skimpole who is a lazy and selfish man looked after by others’ generosity and his mimicry of childish irresponsibility. In its time the novel was seen as poorly constructed despite its host of interesting characters although later critics have generally seen it as one of his very finest works despite its occasional verbosity. Way of all fleshSummary Variously a parish helper to the London poor and a successful New Zealand sheep farmer, Samuel Butler did not treasure the attitudes of his time (the second half of the 19th century). His books were iconoclastic in their attitudes towards Victorian ideals and The Way of All Flesh is foremost among them. It is appropriate, then, that it was published after his death and Queen Victorias, in 1903. It was completed in its original version in 1885 though the second half was never revised. It depicts the lives of four generations and is narrated by family friend Overton although it focuses on Ernest Pontifex and his respect for his great-grandfather John. His father Theo is the books initial concern, though,and he grows after ordination into cruel and disciplinarian attitudes to parenthood which affect young Ernest. As the story progresses we see the latter give his money to a pregnant maid, become a priest and imprisoned for mistaking a respectable lady for a whore . Ernest is released only to begin an unwise relationship with the maid, Ellen. The tale and its conclusion question the values of Victorian society and offer