The veil of money on the financial market
What is it that makes many people think of the financial market as a gambling
casino? Especially at the present day this analogy does not seem to suggest itself. In the
end, even all casinos in the world taken together could never kick off a longstanding
global economic crisis like the one we are living through since 2008. The reason why
so many people nonetheless assent to this comparison must probably be looked for in
that they have no clear idea of the role the financial market plays within the economy.
In the eyes of a superficial observer, it does not produce anything tangible or “real,” it
even does not provide services that could be consumed by anyone. All one can perceive
with one’s five senses consists in transactions of cash flows against future cash flows,
cash flows against options of cash flows, or even promises of cash flows against
promises of cash flows.
How can yet another book on finance be justified? The field is already well
served with advanced works, many of impressive technical erudition. And,
towards the other end of the academic spectrum, an abundance of mammoth texts
saturates the MBA market. For the general reader, manuals confidently promising
investment success compete with sensational diagnoses of financial upheavals to
attract attention from the gullible, avaricious or unwary.
Alas, no one can expect to make a fortune as a consequence of reading this
book. It has a more modest objective, namely to explore the economics of financial
markets, at an ‘intermediate’ level – roughly that appropriate for advanced undergraduates.
It is a work of exposition, not of original research. It unashamedly
follows Keynes’s immortal characterization of economic theory as ‘an apparatus
of the mind, a technique of thinking’. Principles – rather than assertions of
doctrine, policy pronouncements or institutional description – are the focus of
attention. If the following chapters reveal no get-rich-quick recipes, they should
at least demonstrate why all such nostrums merit unequivocal disbelief.
Whilst many undergraduate finance textbooks are largely descriptive in nature the economic
analysis in most graduate texts is too advanced for final year undergraduates. This book
bridges the gap between these two extremes, offering a textbook that studies economic activity
in financial markets, focusing on how consumers determine future consumption and on
the role of financial securities. Areas covered in the book include:
• An examination of the role of finance in the economy using basic economic principles,
eventually progressing to introductory graduate analysis.
• A microeconomic study of capital asset pricing when there is risk, inflation, taxes and
• An emphasis on economic intuition using geometry to explain formal analysis.
• An extended treatment of corporate finance and the evaluation of public policy.
Written by an experienced teacher of financial economics and microeconomics at both
graduate and postgraduate level, this book is essential reading for students seeking to study
the links between economics and finance and those with a special interest in capital asset
pricing, corporate finance, derivative securities, insurance, policy evaluation and discount
"Damodar Gujarati and new co-author, Dawn Porter, blend the foundations of econometrics with up-to-date research. Basic Econometrics illustrates important concepts through intuitive and informative examples and data." "The Basic Econometrics, 5e website uses periodic updates to provide students and instructors with the most current introduction to econometrics. Students can access econometric web links, data sets from the text, and additional large sample data not included in the book. Instructors will also find the solutions manual, as well as all of the text images for easy download." --Book Jacket.
The targeted readers of this textbook are undergraduate students with no preliminary training in economics, and its purpose is to provide an introduction to the key economic concepts necessary for their further studies. The material is intended for one-semester courses of 14 weeks and 2 contact hours per week. The textbook assumes preliminary knowledge of basic mathematics – approximately at the level of secondary school maths. Nevertheless, most of the simple mathematical analyses applied to economic issues are explained briefly for the less experienced reader. The textbook is structured accordingto the general contents of introductory economic textbooks.
--A highly readable guide to how the economy really works--
Economics is too important to be left to the economists. This brilliantly concise and readable book provides non-specialist readers with all the information they need to understand how capitalism works (and how it doesn't).
Jim Stanford's book is an antidote to the abstract and ideological way that economics is normally taught and reported. Key concepts such as finance, competition and wage labor are explored, and their importance to everyday life is revealed. Stanford answers questions such as "Do workers need capitalists?", "Why does capitalism harm the environment?", and "What really happens on the stock market?" He offers both a realistic assessment of capitalism's strengths, and a robust critique of its many failures.
This book will appeal to those working for a fairer world, and students of social sciences who need to engage with economics. The book is illustrated with humorous and educational cartoons by Tony Biddle, and is supported with a comprehensive set of web-based course materials for popular economics courses.