Secondary Market

1962 words 8 pages
Essay Questions:

Lecture 1:
1. Discuss the purpose of the primary and secondary markets, and how each functions. Explain how the secondary market supports the function of the primary market, and how financial market turmoil (e.g. 2008-09) impedes this.

2. Discuss the differences between the Money and Capital Markets, and the types of securities trade in those markets. Give examples.

3. Discuss what market whether you would go to the Money or Capital Markets to raise funds for construction of a factory. Explain why. Discuss which market and the sort of instruments you should use to manage corporate treasury funds.

Lecture 2:
4. Explain in words why a dollar has different values dependent on point in time received, and how
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Does either control Moral Hazard? Can either reduce Adverse Selection? Explain.

26. Discuss the benefits and risks stemming from off-balance sheet income sources; give examples that are commonly used by banks. Discuss why the specific sources are risky. Also, discuss indicators of bank health, and signs to look for in a failing bank.

27. Discuss the Federal Reserve Act of 1913; what exactly the act did, what the FED was supposed to do, and why it was passed. Did the FED act as anticipated in the stock market crash of 1929. If not, what did it not do that it should have?

28. What was the fundamental mission of the Glass-Steagall Act, and when and why was it passed? What act repealed it and why was it repealed? Are there any dangers to its repeal?

29. Discuss deposit insurance, and why it was put in place in 1934. What risks are created by having deposit insurance, and to whom? How should we control these risks?

30. What was FIRREA, and how did it resolve the S&L crisis? What were the costs?

31. Discuss Sarbanes-Oxley and Dodd-Frank, what each act supposed to do, why it was passed, and the problems it has created. Discuss criticisms of each.

32. Discuss how banks are currently regulated, and identify the regulatory authorities. If different banks are regulated by different authorities, summarize who regulates what.

33. What is Universal Banking? What is the

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