Nobody downloaded yet

International Financial Markets - Article Example

Comments (0) Cite this document
The article "International Financial Markets" discusses the Greek financial crisis with reference to the financial markets. Barrionuevo and his colleagues state that the handling of this crisis by the European Union and all the other organizations involved in helping…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER97.1% of users find it useful
International Financial Markets
Read TextPreview

Extract of sample "International Financial Markets"

Download file to see previous pages Among these is the fact of the assumption that the problem with Greece is based on liquidity instead of solvency. While there might be a problem with liquidity in Greece, the problem that is affecting it most is solvency, something that is not being considered. Instead, the IMF and the European Union are treating the crisis as one of liquidity and they have taken steps to counter it as such. This has not helped Greece recover and may, in fact, have made the problem worse than it already was.
A second issue about how financial markets work that has been ignored is the fact that the Greek debt will be sustainable in the future and that the economy will eventually absorb all the debt that it currently has. What has not been considered is that financial markets do not work well with uncertainties (such as future sustainability) and instead, they only gain confidence if action and their results are seen immediately. The third issue that has come to affect the Greek economy is that its government was given loans way before a plan on how to spend the money given was made. This ensured that there would be a problem with how the money was spent because it ended up being lost because of unplanned spending. The fourth issue discussed in the article is that fact that while Greece has been promised enough financial support to end its crisis effectively, it has become almost impossible to implement its recovery program because most of the money has yet to be received. Instead, most of the money received has been given in bits and this has made it impossible for the economy to recover. This has made the financial markets wary of taking part in the Greek economy as its future has become uncertain.
When one considers the points brought up in the article, one concludes that the Greek financial crisis is something that can be solved if only the people and organizations involved would work faster than they already are to end it. The only way through which this crisis can be solved is if the financial markets can regain the confidence they once had in the Greek economy. The support of these markets would ensure that the flow of money into Greece would become stable and that its liquidity and solvency problems would end. The only way open for the Greek economy to be saved is for all the money that was promised to be made available at once to ensure stability in the financial markets.
International monetary systems
The article by Jack Ewing discusses the international monetary systems, dealing specifically with the Eurozone, which has for the last few years had to deal with various economic crises. Among these is that fact that many of the countries in this zone have are in either recession or are about to enter one. This has seriously threatened the Euro and until recently, many had even questioned if this monetary system was viable. There had been fears that because of the financial crisis encountered by Greece, then this country would withdraw from the Eurozone, thus leading others into abandoning the currency. However, this was not the case, and in fact, the year 2012 saw a recovery in confidence for this monetary system as it continued to perform well. The countries whose economies were expected to collapse such as Spain and Italy did not turn out as expected despite remaining deep in recession. This encouraged the continued confidence in the Euro and the belief that things would be much worse if this money were to be abandoned. ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
(“International Business Essay Example | Topics and Well Written Essays - 1500 words - 1”, n.d.)
International Business Essay Example | Topics and Well Written Essays - 1500 words - 1. Retrieved from
(International Business Essay Example | Topics and Well Written Essays - 1500 Words - 1)
International Business Essay Example | Topics and Well Written Essays - 1500 Words - 1.
“International Business Essay Example | Topics and Well Written Essays - 1500 Words - 1”, n.d.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF International Financial Markets

International Financial Markets

...?International Financial Markets Question a) Issues that have affected the international bond markets since the start of the global financial crisis. Sovereign debt, otherwise known as public debt, is borrowing incurred by governments. This figure has risen significantly and become unsustainable for at least three Eurozone countries, namely Greece, Ireland, and Portugal, which have all turned to the International Monetary Fund (IMF) and other Eurozone member states for financial assistance. Japan has also incurred high public debt for which its credit rating has been downgraded by Standard and Poor’s...
9 Pages(2250 words)Essay

International Financial Markets result in decreasing the capital losses from a decrease in the prices of long-term maturities compared to the increase in the prices of securities having short-term maturities. Task 2 Clean Prices of Bonds Task 3 Estimation of Expected Yields after 1Year E (y1(2)) = 0.23% + 0.1(3.10% - 0.23%) = 0.52% E (y1(5)) = 0.85% + 0.1(3.61% -0.85%) = 1.13% E (y1(10)) = 2.03% + 0.1(3.99% - 2.03%) =2.23% E (y1(20)) = 3.19% + 0.1(4.17% - 3.19%) = 3.29% Estimation of Expected Yields after 2Years E (y2(2)) = 0.52% + 0.1(3.10% - 0.52%) = 0.78% E (y2(5)) = 1.13% + 0.1(3.61% - 1.13%) = 1.37% E (y2(10)) = 2.23% + 0.1(3.99% - 2.23%) =2.40% E (y2(20)) = 3.29% + 0.1(4.17% - 3.29%) = 3.38% Task 4 Impact of the estimated yield changes on the...
6 Pages(1500 words)Essay

International Financial Markets

...? International Financial Markets Contents Contents 2 Introduction 2 Discussion 3 Financial System Structure 3 Financial markets and their economic importance 4 Importance of Bond Market 6 Importance of Equity Market 8 Importance of Foreign Exchange Market 10 Importance of Derivatives Market 11 Conclusion 12 References 13 Introduction Financial markets are vital for any economy. They channel the funds from firms, households and the governments which they have surplus funds to those who have shortage of funds as they spend more than their...
10 Pages(2500 words)Essay

International Financial Markets

...International Financial Markets Introduction02 International Financial Markets.02 Foreign Exchange..03 Growth of foreign exchange..04 International capital...05 Growth and flow of International Capital.05 International stock markets...06 Impact on the economy.06 Growth of international stock markets in the last three decades..07 Factors hindering the growth rate of international financial markets...09 Conclusion10 Reference & Appendices..11 Introduction Foreign...
7 Pages(1750 words)Essay

International financial markets

...:// Eatwell. J. & Taylor, L. (1999) Towards an Effective Regulation of International Capital Markets Retrieved February 27, 2007, from Ferderer, P. (2002) The Evolution of the international Financial System: 1879-1971. Saint Paul: Macalester College. Flandreau, M, Holtfrerich, C., James, H. (2003). International Financial History in the Twentieth Century. London: Cambridge University Press. Germain, R.D. (n.d.) Reforming the International Financial Architecture: The New Political Agenda. PhD...
8 Pages(2000 words)Essay

International financial markets

... Financial Management, Harcourt Brace College Publishers, Orlando, FL Ehrhardt, M C & Brigham, E F 2009 Corporate Finance: A Focused Approach, Third Edition. South-Western Cengage Learning Gitman, L. (1995), Basic Managerial Finance, Harper and Row, New York. Jensen M. (1972), “Capital Markets: Theory and Evidence,” Bell Journal of Economics and Management Science. Maxim, M 2008 T-Bonds start trading. International Financial Law Review, Oct, Vol. 27 Issue 10, p33-33 Ritter, J R 1998 Initial Public Offerings, Contemporary Finance Digest, vol. 2 no. 1, pp. 5-30 Wood, D 2007 Revving Up the Bond. Treasury & Risk, Mar, p15-16... 55 Administaff, Inc. 0 100 Allied Waste 64 46 Utilities 63 37 Reliant Energy, Inc. 43 57 CMS...
8 Pages(2000 words)Essay


...International Financial Markets The many strengths provided by being part of the European Union, those related to finance, infrastructure for distribution of product, and the current currency value compared to the rest of the globe, makes JEL Industries the best option. Developing countries within the European Union, such as the Czech Republic, currently provides considerable incentives for companies that wish to offer foreign direct investment or simply establish a new base of operations and production. As one example, Hyundai Auto was given incentives that equaled 18 percent of its total investment plus an additional $8,000 each and every time a new job was created in the country by foreign business leaders (Weidenbaum, 2006... the EU...
1 Pages(250 words)Assignment

International Financial Markets

...participants (Alexander, 2008, 281; Alexander, 2010, 137). Main markets works together with the LSE and the financial authorities in regulation of trades with big corporations. These are companies who are not only looking for ways of raising capital but also in having a reputation in their liquidity shares profile and international position. It has a combined market capitalisation of £3.7 trillion. This market serves over 1400 companies. It opens avenues for different sectors and geographical dimensions. Moreover, this market facilitates exchange of funds by creating ways for capital growth (Great Britain: Competition Commission, 2005,...
8 Pages(2000 words)Essay

International financial markets

...Lecturer: Using examples, explain the relevance of arbitrage (or “no arbitrage in the following contexts; (a) The Arbitrage Pricing Theory(APT); Arbitrage involves acquisition of positive estimated returns from overpriced or underpriced items in the inefficient market devoid of any incremental risk and any extra investments (KHAN and JAIN, 2004) . In APT context, arbitrage involves trading of two items where at least one of the items has been mispriced. The arbitrageur sells the comparatively more costly item and uses the amount earned, to buy the comparatively cheaper item. The arbitrager creates a portfolio, which they use to make a risk free profit. For instance, when the current price is too low, it means that by the...
1 Pages(250 words)Essay

International Financial Markets

..., but common market risks affect each and every stock, consequently it is significant to diversify in different divisions of assets. The main key is to find a medium amongst returns and risks. This will insure your fiscal goals are accomplished efficiently and effectively. Reference Berger, D., Pukthuanthong, K. & Jimmy Yang, J., 2011. International diversification with frontier markets. Journal of Financial Economics, 101, pp.227–242. Denis, D.J., Denis, D.K. & Yost, K., 2002. Global Diversification, Industrial Diversification, and Firm Value. The Journal of Finance, 57, pp.1951–1979. Available at:...
5 Pages(1250 words)Assignment
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Article on topic International Financial Markets for FREE!

Contact Us