Book description
Praise for Financial Markets, Banking, and Monetary Policy
"A lucid treatment that takes on board shadow-banking, Dodd-Frank, the zero lower bound, and forward guidance. In short, all the key post-crisis issues."
—Anil Kashyap, Edward Eagle Brown Professor of Economics and Finance, University of Chicago
"The financial sector is a vital component of the US economic machinery. The Federal Reserve works within this sector to promote its congressional mandates of maximum employment and low inflation. Unfortunately, the contribution of the financial system to the economy's performance is not well understood. Students of standard college courses on money, banking, and monetary policy often find that the textbooks have not kept pace with the evolution of the financial sector, including the rise of securitized finance and the Federal Reserve's evolving monetary operations. Tom Simpson's book represents a huge step forward in this regard. His comprehensive exposition of the essential parts of the financial system and modern explanation of how the Federal Reserve supports the economy gives readers a much better understanding of the US financial system and the Federal Reserve."
—James Glassman, Managing Director and Head Economist for the Commercial Bank, JPMorgan Chase & Co.
"Financial Markets, Banking, and Monetary Policy by Tom Simpson provides a comprehensive introduction to the financial system, including the markets, institutions, and mechanisms of finance, as well as the role of the Federal Reserve and monetary policy. The economic principles underlying finance are woven through the chapters, and the book includes an insightful introduction into the causes of and responses to the recent financial crisis. Tom Simpson has had a front-row seat on financial developments in recent decades and has written a book that provides an ideal introduction to the financial system and monetary policy."
—Dan Sichel, Professor of Economics, Wellesley College
Table of contents
- Preface
- CHAPTER 1: Introduction
- CHAPTER 2: Overview of the Financial System
- CHAPTER 3: The Special Role of Commercial Banks
-
CHAPTER 4: The Pricing of Financial Assets
- What You Will Learn in This Chapter
- Background
- Present Value
- Maturity and Price Sensitivity
- Holding Periods versus Maturities
- Return versus Yield
- Duration
- Nominal versus Real Yields
- Summary
- Questions
- Appendix A: Variations of the Valuation Relationship
- Appendix B: Solutions Using a Financial Calculator
- Notes
- CHAPTER 5: Factors Affecting Yields
- CHAPTER 6: Principles of Portfolio Selection and Efficient Markets
- CHAPTER 7: The Money Market
- CHAPTER 8: The Bond Market
-
CHAPTER 9: Securitization
- What You Will Learn in This Chapter
- Background
- Obstacles to Overcome
- Beginnings of Securitization—MBSs
- Other Securitized Loans—Consumer ABSs
- ABSs Involving Business Credit—CDOs and Structured Securities
- Securitization and the Integration of Credit Markets
- Monetary Policy and Securitization
- Summary
- Questions
- Notes
- CHAPTER 10: The Mortgage Market
-
CHAPTER 11: The Equity Market
- What You Will Learn in This Chapter
- Background
- Equities as a Source of Corporate Finance
- Preferred versus Common Shares
- Primary and Secondary Markets
- Valuation of Individual Shares
- Price-Earnings
- Extending These Principles to the Stock Market
- Monetary Policy and the Stock Market
- Indexes of Stock Prices
- Summary
- Questions
- Notes
-
CHAPTER 12: Central Banking and the Federal Reserve
- What You Will Learn in This Chapter
- Background
- Origins of Central Banks
- Constitutional Foundations
- The Century and a Quarter without a Central Bank
- Creation of the Federal Reserve
- Early Years of the Federal Reserve
- Reforms of the 1930s
- Fed Independence
- Central Bank Accountability and Transparency
- Central Bank Responsibilities
- Monetary Operations
- Summary
- Questions
- Notes
-
CHAPTER 13: Monetary Policy: The Basics
- What You Will Learn in This Chapter
- Background
- Effects of Monetary Policy on Output and Prices
- The Operational Counterparts to Maximum Employment and Price Stability
- Aggregate Demand and Aggregate Supply
- The Model
- Addressing Inflation
- Addressing a Shortfall in Output
- Okun’s Law
- Summary
- Questions
- Notes
- CHAPTER 14: Monetary Policy: Challenges Faced by Policymakers
- CHAPTER 15: Financial Crises
-
CHAPTER 16: The Foreign Exchange Market and Exchange Rate Regimes
- What You Will Learn in This Chapter
- Background
- Features of the Market
- The Relation Between Spot and Forward Exchange Rates
- Long-Run Exchange Rate Relationships
- The Real Exchange Rate
- Exchange Rate Determination in the Shorter Run
- Floating Exchange Rate Regime
- Fixed Exchange Rate Regime
- Summary
- Questions
- Notes
-
CHAPTER 17: Depository Institutions
- What You Will Learn in This Chapter
- Background
- Organization of Commercial Banks and Other Depository Institutions
- Economic Functions of Depository Institutions
- The Balance Sheet of the Commercial Banking System
- The Balance Sheet of Savings Institutions
- The Balance Sheet of Credit Unions
- Deposit Insurance
- Regulation and Supervision of Depository Institutions
- Depository Institutions and Monetary Policy
- Summary
- Questions
- Notes
- CHAPTER 18: Mutual Funds
- CHAPTER 19: Hedge, Venture Capital, and Private Equity Funds
- CHAPTER 20: Large Institutional Investors
- About the Author
- Index
- End User License Agreement
Product information
- Title: Financial Markets, Banking, and Monetary Policy
- Author(s):
- Release date: August 2014
- Publisher(s): Wiley
- ISBN: 9781118872239
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