Notes: Financial Markets & Institutions Lecture 01: Economics is the study of scarcity Financial System is comprised of: 1. Financial Instruments - What 2. Financial Markets - Where 3. Financial Institutions - Who Trade means to buy and sell Financial Instruments A financial CLAIM is a claim on an entity's assets and future earnings (stock, bonds etc.) Financial Instruments are traded on financial markets Financial Institutions are Financial intermediaries (Intermediation - channeling funds) Intermediation example: Channelling funds from savers (with surplus funds) to users (with a shortage of funds) Financial Institutions ISSUE and INVEST in Financial Instruments. Note: In Finance we use the term FUNDS. Funds could be money but doesn't have to be. Funds = Financial resource Markets - 2 kinds - Primary Markets and Secondary Markets: Primary: Where new funds are RAISED (transferred from savers to users). E.g., A company issues bonds or stocks. Secondary: Where funds are traded. The investor sells to another investor. The function of secondary markets is to provide liquidity - to sell assets quickly and for the full price. Also provides information (price, trends). If an Instrument is not liquid we say it is illiquid Money Markets and Capital Markets: Money Markets: Financial market where money market instruments are traded - money market is a short-term Financial Instrument Capital Markets: Financial market for long-term instruments - maturity of more than one year. Maturity is when the financial instrument dies - (e.g. 5-year bond); Capital markets can be Debt Market and Equity Market. More Terms: Equity is a residual claim on assets - Residual is the claim after all other obligations satisfied (taxes, salaries, and all creditors have been paid) Providers of Debt are called creditors. Creditors buy Debt Financial Instruments. Providers of Equity are called Investors. Investors are buyers of equity. In Finance short-term has a specific definition - means 1 year or less In finance the term 'to Mature' means 'to become payable' - The bond becomes PAYABLE by the ISSUER. Profit is income that results from economic activity. In finance there are no profits - there is only return - the income from Financial Instruments (Buy, Hold, Sell, etc.) An Asset is a resource: Properties of an asset: 1) Must have Value; 2) you can Own it; 3) you can Control it and Use it; 4) and an Asset generates revenue (income)

He explains like I'm 4 and I really needed that. Thank you, professor.

you are a SAVIOR. my professor isn't the best at explaining fundaments of topics when covering them in class. this page has been a god-send. cannot thank you enough!

real appreciate your work sir..videos R like assest for thos who wants but cant afford expensive study classes thank you so much......namaste

Indeed you are a professor we are still benefiting in your lecture even today after 5yrs

He is a good instructor. He was my savior during accounting.

Amazing teacher. He knows how to teach. This is how you teach ❤

this video just gave me a summary of a whole semester course....thanks i stumble into it just before writing my final financial exam

✅✅✅ This Professor is excellent!!! I’d love to see more of his teachings & outputs. 🤓

This video clip is truly an “asset”. Thanks.

This channel is a life saver! Thank you very much!!!!

I watched all the videos of the series..sir you thoroughly explained every topic..gained a lot of knowledge..thankyou very much

I personally think your teaching system gives the best fundament possible to its students.

Excellent way of teaching. You are very articulate and explain slowly. Amazing professor.

Well explained! Thank you Professor, this has helped me soo much in my financial institutions module, my lecturer literally fails to give a clear explanation. God bless!

I adore how you teach your student Sir, It seems you have a long patience towards them❤️ God bless you! Sir keep teaching!!❤️🥰

I am a second-year student in Vietnam and struggling with this subject. I came across your video when searching. I love your teaching style and really appreciate every video you have made. Those will be the precious source for me to handle with other finance-related subjects. God bless you

LOVED this class. Professor you are the BEST

I become more clear in understanding about financial markets from your explanation thanks I will follow you from time to time and write to you for a special request.

You explain way better than our prof does. Thank you so much.

Wonderful job sir...excellent teaching style.Thank you.

One of those most valuable videos have ever seen in KZfaq

Amazing teaching skills ❤️ easy to learn, easy to memories. Thank you so much to make this subject interesting for me Sir.

I've seen many videos, but this is certainly the best one! Thank you!!

After the video, I think I can make presentations to my fellows and teach them how to invest in those markets. Thanks for the explanation. So educative.

Thank you so much! This is the only video that explains everything much clearer.

You saved my life professor ~ Thank you

omg......2019? i need this for my fm assignments and this really help..

I love this professor

This is gold... Thank you sir.

Wooow! You saved a soul with this.

Thanks 🙏 for the good lesson I really appreciate,you know how to explain well and I really enjoyed your lecture.

you are of much help to me, congrats.

Thank you professor, I really need it God bless you.

Thank you so much Prof for your videos God bless you more

I haven't seen like this , thank you very much!!!.

What a great teacher thank you.

Thank you for this insightful lesson.

Thanx Sir For such type of kindness

wow. just wow. he's taking the time to explain every little detail. love it. thank you, sir. Regards from India.

Very good lecture.Bravo.

This is good for learning financial markets :)

Thanks Professor,

Hello sir,i'm LL.M student and my dissertation is about AML i was searching and came acroos your video its realy helpful,i have corrected a lot of concepts.thanks so much and please( keep go on).

Thanks a lot professor. It's a very informative video. I like your lecture :)

Thank you. You are an exceptional educator.

this guy is awesome thank you sir

How I wish I searched for this when the semester hadn't started , I want to know more about this subject but my Professor is kinda of busy , and I don't fully understand what am I reading

It was a pleasure attending your lecture. Thank you sir :)

You are always excited when you write in red color :D Thanks for the video!

Thanks, professor.

Really helpful 🤗👍

NICE STYLE IF TEACHING AND DEEP AND FOCUSED ON TOPIC.

Amazingggggg Professor!

Very good at explaining and making people learn. Im stealing that skill

omg this is so valuable. i appreciate a lot thanks sir

love it

Our teacher doesn't really explain our lessons well so i count on you

Optimal lecture

nice job sir

Thanks for providing Videos. You are like a god.

Thanks dear!

Incredible lecture thank you so much!!

I appreciate the way you explained the lecture thank you so much go forward...

So wealthy, thank you Sir

I love it thank you so muchhhh

The Best

Sir , Before professor i am a small man although i served 39 years and retired as a senior gazetted officer. I still love to serve as sishya (student disciple) for his extensive imagination inspiration exclusive instructionsl talents. Thanw sir.

Very well explained i understand 100% thank you prof

great u r thank u

Hello Professor your lectures are simply to understand they are great. Education should be encouraging, innovative and provide solutions to problems. I am encouraged to continue with financial engineering course that I am undertaking. I wish you could provide Lecture notes or how do I get the notes

Very well explained. Thanks.

I wish I could give more than one like

Fantastic teaching Prof!! I wanted to learn about the impact of economic development through financial instruments.. while looking through Raguram Rajan papers online, I saw your video.. and it supplements my learning better. By the way I am lecturer in Aerospace in Singapore and find your teaching smooth and steady :)..I hope your students become well learned individuals. Cheers!!

Great sir

HI MISTER YOUR LEARN VERY IMPORTANT

Thank u soo much sir it helps alot to me

thank you sir ....😊😊😊

Thank you soo much sir,

👍👍

thnz for the great work

Thank you very much sir

Thank youu so much

thank you

Thank you

Economics suffers badly from the fact that it is a science that lacks the protection from the prestige gained from aging, as is the case with physics which results from repeating experimentation every time which emphises the foundations of that science in different, varied, and surprising ways. And all reinforce that science. The author Walid Ahmed Kamal Al-Hababi, in his book "The Economic Risk Theory" (the Islamic Macroeconomic System), deals with achieving maximum benefit, detailing the new economic system, which is called the "risk" system in which wealth is distributed to everyone, as it is a stable and more efficient system than the system of free market. In his book "The Theory of Economic Risk" (The Islamic Macroeconomic System), the author believes that the basic idea of ​​this book is to clarify the idea of ​​how to use the principle of time preference in imposing taxes, in order to motivate everyone to invest and raise productivity through tax. He also touched on the state's duties regarding its implementation and the extent of its participation in the market accurately. The author spoke of the zakat banks as the state budget, while the state budget remains the most controversial point among policy makers in countries. At the same time, the writer believes that while economic writings are scarce from a total point of view, there is no writer who spoke about a holistic Islamic economy as a previous system; So this is the only writing, up to the moment. You cannot change a system by fighting the existing truth, as Muslim economists always do, but to change something, you must create a model that makes the current system an outdated system. furthermore If we know that this system achieves the highest rate of spending in a country without need for other economic resources - without taxes or anything else - thus we can see that we are facing unique writings. Whereas, it lays out clear features for the Islamic economy that distinguish it completely from the socialist and capitalist economies, and not a fabrication to be similar to either of them. And he affirms that with this system, other systems will not be able to catch up with our economic progress, no matter what efforts are made, except to implement it. On the other hand, he believes that we will not be able to catch up with the West economically with the current systems, no matter what we try. Finally, the author asserts, that economics is the only thing that clarifies the purpose of Islamic customs and rituals apart from their devotional meaning in human life. So that it can be proven without doubt that it is indispensable for a person to perform it such as Hajj, Zakat, prayer ... etc. He also confirms that all of this is found in the book (The Theory of Economic Risk) in this book issued by the House of “Yemeni Books” for printing, publishing and distribution within 305 pages and distributed in three main chapters, that this Islamic macroeconomic system is; He is the one who will bring us the maximum benefit يعاني علمُ الاقتصادِ بشدةٍ من أنه العلمُ الذي يفتقدُ إلى الحمايةِ التي تُؤمنها الهَيبة المكتسبة من تقادم العمر، كما هو الحال مع علمِ الفيزياءِ الناتج عن ترسيخ التجربة المتكررة في كلِ مرة للأسس بطرقٍ مختلفةٍ، ومتنوعةٍ، و مدهشةٍ. وجميعها تعززُ مكانة ذلك العلمِ. وتناول المؤلف وليد أحمد كمال الحبابي، في كتابه" نظرية المخاطرة الاقتصادية" (النظام الاقتصادي الكلي الإسلامي) تحقيق المنفعة القصوى، إيراد تفاصيل النظام الاقتصادي الجديد ، والذي يسمى نظام "المخاطرة" والذي تتوزع فيه الثروة على الجميع ، باعتباره نظاماً مستقراً أكثر كفاءة من نظام السوق الحر. ويرى المؤلف في كتابه" نظرية المخاطرة الاقتصادية" (النظام الاقتصادي الكلي الإسلامي) تحقيق المنفعة القصوى، أن الفكرة الأساسية لهذا الكتاب تكمنْ في توضيح فكرة كيفية استخدام مبدأ التفضيل الزمني في فرض الضريبة، وذلك لتحفيز الجميع على الاستثمار ورفع الانتاجية من خلال الضريبة. كما تطرق الى واجبات الدولة بخصوص تطبيقه ومدى اشتراكها في الأسواق بدقه . وتحدث المؤلف عن أن مصارف الزكاة تعتبر هي موازنة الدولة، فيما تظل موازنة الدولة هي النقطة الاكثر جدلا بين صانعي السياسات في البلدان. وفي الوقت نفسه يرى الكاتب أنه فيما تندر الكتاباتُ الاقتصاديةِ من ناحيةٍ كلية، ولا يوجد كاتبٌ تحدث عن اقتصادٍ إسلامي كلي كنظام سابقًا؛ وبالتالي فهذه هي الكتابة الوحيدة، حتى اللحظة. ويضيف لا يمكنك تغيير نظام بمحاربة الحقيقة القائمة، كما يفعل ذلك الاقتصاديون المسلمون دوما ، ولكن لتغيير شيءٍ، يجب عليك وضع نموذج يجعل النظام الحالي نظام عفا عليه الزمان؛ فإذا علمنا أن هذا النظام يحقق أعلا معدل إنفاق في دولة بلا موارد اقتصادية_ دون اللجوء إلى ضرائبٍ، أو غيرها_ فحينها يمكن أن نرى أننا أمام كتاباتٍ فريدةٍ من نوعها؛ حيثُ أنها تضع للاقتصاد الإسلامي ملامحًا واضحةً تميزهُ تمامًا عن الاقتصادين الاشتراكين و الرأسمالين، وليس تلفيقًا ليشابه أحدهما. ويؤكد أنه بهذا النظام لنْ تتمكن الأنظمةُ الأخرى من اللحاقِ بتقدمنا الاقتصادي مهما بذلت من جهود سوى تطبيقه. وعلى الجانب الآخر يرى أننا لن نتمكن نحنُ من اللحاق بركب الغرب اقتصاديًا بالنظم الحالية مهما حاولنا. وأخيرًا يجزم المؤلف، إن الاقتصاد هو الشيء الوحيد الذي يوضح الغرض من العاداتِ والعباداتِ الإسلامية بعيدًا عن معناها التعبدي في حياة الإنسان؛ بحيث يثبت بما لا يدع للشكِ أنه لاغنى للإنسان عن القيام بها من حج، وزكاة، وصلاة... الخ. كما يؤكد أن كل ذلك نجدهُ في كتاب ( نظريةُ المخاطرةِ الاقتصاديةِ) في هذا الكتاب الصادر عن دار "الكتب اليمنية" للطباعة والنشر والتوزيع ضمن 305 صفحة وموزع على ثلاثة أبواب رئيسية ، أن هذا النظام الاقتصادي الكلي الإسلامي؛ هو الذي سيحققُ لنا المنفعة القصوى.. .. ,,لتنزيل نسخة مجانية من الكتاب www.mediafire.com/file/tvpyra7ojgvocbc/الاقتصاد+الكلي+الاسلامي.pdf/file لمشاهدة لقاء مع المؤلف حول موضوع الكتاب يرجى زيارة الرابط التالي kzfaq.info/get/bejne/fdR2isp10eC7pGQ.html ارجوا ان يتم وضعه كمادة تدرس في المنهج الدراسي لطلبة الاقتصاد في الفصل القادم وشكرا.. . . .. . .. And thanks alot ......

great lecture

Hats off sir.......

The prof is a teacher

Thanks

Thankyou sir

Hello, Professor, first of all i want to say thanks for making such a useful videos and secondly i want to request that please upload a link of book here so we may have book while listening your lectures, it would be very helpful for all.

I am from India, Thank you so much sir, for your clear explanation

very lucid i mean the presentation is very easily understandable. thank u sir

Dear Professor Components of the Financial system can Also be Included the Financial Services- Which will answer the Question How?

Using diagram, illustrate how a financial system works

Try it at 1.5×

How i wish my prof teaches the way you do huhuhu

Just understood 300 pages in 40 minutes

if the financial institution is weak, what to do?