Financial Systems-Economist

pay: trick or treat? Oct 21st 1999 From The economical expert print edition During the past two decades, monetary transactions pass water grown much faster than global output. This article, the first in a series of schools briefs about the world of finance, looks at the role that the financial corpse plays in a new-fashioned economy THEODORE ROOSEVELT, an American president, once claimed that there was no moral departure between shimmer on cards or horses and gambling on the stockmarket. Jacques Chirac, the current president of France, has denounced currency speculators as the assist of the world economy. Bankers argon widely condemned either as greedy usurers or as incompetent fools. At best, the financial system is seen as a wasteful sideshow that relies on roiled money earned in real businesses and adds no economic value. At worst, it is portrayed as an irrational casino, in which 22-year-old traders are able to bankrupt economies. Might we be better pip without all the financiers? A stockmarket crash or a rank of bank failures can clearly do serious economic harm. The worst recessions in history, including the Great Depression in the mid-thirties and, more recently, Japans stagnation during the 1990s and eastbound Asias slump in 1997-98, all followed financial crises.

to that degree this brief will explain that, for all its failings, the financial system provides services that are vital for long-term economic growth. Finance has existed in nigh form since the dawn of recorded history. confidence was used in agriculture in Mesopotamia in 3000BC. Banks existed in Egypt in 200BC. Even derivatives are not new: futures contracts were traded on the Amsterdam exchange in the 17th century. There is zipper inherently new about borrowing, lending and investing. Even so, in Hamlet, Polonius advised his son neither a borrower nor a lender be. If everybody followed that advice the financial system would not exist. intimately people, however, need to borrow or save at some time in their lifeâ€"from... If you want to get a full essay, order it on our website: Orderessay

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