The economics of money, banking, and financial markets

FYI  The AIG Blowup  5

FYI  The Global Financial Crisis and the Monoline Insurers  6

APPLICATION

  Insurance Management ....................................................................... 6

Screening ..............................................................................................................................  6

Risk-Based Premiums ............................................................................................................  7

Restrictive Provisions .............................................................................................................  7

Prevention of Fraud ...............................................................................................................  8

Cancellation of Insurance ......................................................................................................  8

Deductibles ...........................................................................................................................  8

Coinsurance ..........................................................................................................................  8

Limits on the Amount of Insurance .......................................................................................  8

Summary ...............................................................................................................................  9

Pension Funds .................................................................................................................................. 9

Private Pension Plans ...........................................................................................................  10

Public Pension Plans ............................................................................................................  10

FYI  Should Social Security Be Privatized?  11

Finance Companies .....................................................................................................................  12

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Contents in Detail 

xxxiii

Securities Market Operations ...................................................................................................  13

Investment Banking .............................................................................................................  13

Securities Brokers and Dealers .............................................................................................  14

Organized Exchanges ..........................................................................................................  14

Mutual Funds ................................................................................................................................  15

FYI  Sovereign Wealth Funds: Are They a Danger?  16

Money Market Mutual Funds ..............................................................................................  17

Hedge Funds .................................................................................................................................  17

Private Equity and Venture Capital Funds .............................................................................  18

Government Financial Intermediation ..................................................................................  19

Federal Credit Agencies .......................................................................................................  19

FYI  The Global Financial Crisis and the Bailout of Fannie Mae  

and Freddie Mac  20

Summary  21   •   Key Terms  22   •   Questions  22   •   Applied Problems  23   •    

Data Analysis Problems  23   •   Web Exercises  24   •   Web References  24