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Economics of Money, Banking and Financial Markets Global Edition full international summary+notes

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The Economics of Money, Banking and Financial Markets Global Edition, written by Frederic S. Mishkin. All The Economics of Money, Banking and Financial Markets Global Edition notes, flashcards, summaries and study guides are written by your fellow students or tutors. Get yourself a The Economics of...

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  • May 17, 2023
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Frederic S. Mishkin
Columbia University

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Credits to copyrighted material appear on p. C-1, which constitutes a continuation of the copyright page.

Library of Congress Cataloguing-in-Publication Data

Mishkin, Frederic S.
The economics of money, banking, and financial markets / Frederic S. Mishkin.—7th ed.
p. cm. — (The Addison-Wesley series in economics)
Supplemented by a subscription to a companion web site.
Includes bibliographical references and index.
ISBN 0-321-12235-6
1. Finance. 2. Money. 3. Banks and banking. I. Title. II. Series.
HG173.M632 2004
332—dc21
2003041912

Copyright © 2004 by Frederic S. Mishkin. All rights reserved. No part of this publication may be repro-
duced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in
the United States of America.

1 2 3 4 5 6 7 8 9 10—DOW—06050403

,To Sally

, CONTENTS IN BRIEF




PA RT I Introduction 1
1 Why Study Money, Banking, and Financial Markets? . . . . . . . . . . . . . . . . . . . .3
2 An Overview of the Financial System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23
3 What Is Money? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44

PA RT I I Financial Markets 59
4 Understanding Interest Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .61
5 The Behavior of Interest Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .85
6 The Risk and Term Structure of Interest Rates . . . . . . . . . . . . . . . . . . . . . . . .120
7 The Stock Market, the Theory of Rational Expectations,
and the Efficient Market Hypothesis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .141

PA RT I I I Financial Institutions 167
8 An Economic Analysis of Financial Structure . . . . . . . . . . . . . . . . . . . . . . . .169
9 Banking and the Management of Financial Institutions . . . . . . . . . . . . . . . . .201
10 Banking Industry: Structure and Competition . . . . . . . . . . . . . . . . . . . . . . . .229
11 Economic Analysis of Banking Regulation . . . . . . . . . . . . . . . . . . . . . . . . . . .260
12 Nonbank Finance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .287
13 Financial Derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .309

PA RT I V Central Banking and the Conduct of
Monetary Policy 333
14 Structure of Central Banks and the Federal Reserve System . . . . . . . . . . . . .335
15 Multiple Deposit Creation and the Money Supply Process . . . . . . . . . . . . . .357
16 Determinants of the Money Supply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .374
17 Tools of Monetary Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .393
18 Conduct of Monetary Policy: Goals and Targets . . . . . . . . . . . . . . . . . . . . . .411

PA RT V International Finance and Monetary Policy 433
19 The Foreign Exchange Market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .435
20 The International Financial System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .462
21 Monetary Policy Strategy: The International Experience . . . . . . . . . . . . . . . .487




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